Chandigarh

StateCommission

CC/62/2019

Dr. Alka Khera - Complainant(s)

Versus

m/s Omaxe Chandigarh Extension Developers Pvt. Ltd. - Opp.Party(s)

Rohit Goswani Adv.

10 Sep 2019

ORDER

 STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	62 of 2019
Date of Institution	:	18.03.2019
Date of Decision	:	10.09.2019

 

1. Dr.Alka Khera wife of Dr Dheeraj Dumir, resident of H.No.484, Sector 16, Panchkula.
2. Dr Dheeraj Dumir, resident of H.No.484, Sector 16, Panchkula.

……Complainants

V e r s u s

1. M/s Omaxe Chandigarh Extension Developers Private Limited, Regional Office SCO 139-140, Sector 8C, Chandigarh, through its Authorized Signatory or Regional Head.
2. M/s Omaxe Chandigarh Extension Developers Private Limited, 10, LSC, Kalka ji, New Delhi-110019, through its Director.

….Opposite parties

Complaint under Section 17 of the Consumer Protection Act, 1986.

 

BEFORE:    JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT.

                   MRS. PADMA PANDEY, MEMBER.

                   MR. RAJESH K. ARYA, MEMBER.

 

Argued by: Sh.Rohit Goswami, Advocate for the complainants.

Sh.Ashim Aggarwal, Advocate for the opposite parties.

 

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                The complainants have filed this complaint, seeking refund of amount of Rs.48,62,807/- paid by them, to the opposite parties (which fact is not disputed), towards purchase of plot bearing No.OCE/II/4/790A, measuring 199.13 square yards, in the project named ‘Omaxe Chandigarh Extension’, New Chandigarh, Mullanpur, District SAS Nagar, Punjab. Total price of the said plot was fixed at Rs.56,27,778.70ps. It is specific case of the complainants that despite making payment of Rs.48,62,807/-, against total sale consideration of Rs.56,27,778.70ps., the opposite parties failed to offer and deliver possession of the plot, on or before 12.10.2017 i.e. within a total period of 30 months (24 months plus (+) 6 months grace period), as envisaged under Clause 35(a) of the Allotment Letter/Agreement. Visits to the project site revealed that the opposite parties will not be able to deliver possession of the plot, even in the next two to three years, for want of development works. Number of requests were made to the opposite parties, to complete development at the project site and deliver possession of the plot, in question, but no positive steps have been taken by them. Emails written to the opposite parties, in the matter, for the period from 21.07.2014 to 07.07.2018 Annexure C-9 colly., also did not yield any result. It was pleaded that on account of act and conduct of the opposite parties, in not completing development works at the project site, the complainants could not start construction on the plot, in question, as a result whereof, they were charged penal interest by the State Bank of India, from which they had obtained loan for making part payment thereof, under Tripartite Agreement dated 13.04.2015 Annexure C-6.

                By stating that the aforesaid act of the opposite parties amounted to deficiency in providing service and adoption of unfair trade practice, the present complaint has been filed by the complainants, seeking refund of amount paid alongwith interest, compensation etc.

2.         In the reply filed by the opposite parties, many preliminary objections were raised by them. It was averred that the complainants did not fall within the definition of “consumer” as defined under Section 2(1)(d) of the Act. They are the owners of a house at Sector 16 Panchkula, as such, they being investors had purchased the plot, in question, for commercial purpose i.e. for selling the same, as and when there was escalation in the prices of real estate, to gain huge profits. Territorial and pecuniary jurisdiction of this Commission was challenged.
3.         It was stated that development works in the area, where the plot, in question, is located have been completed. Partial completion has also been applied for, with the Competent Authorities vide letter dated 24.04.2019 and  on receipt thereof, possession will be delivered to the complainants.  It was pleaded that that since period to offer possession of the plot was to be computed excluding Saturdays, Sundays and Bank Holidays; no definite period was committed to hand over possession of the plot; and also the plot, in question, falls under the category of immovable property, as such, time was not to be considered as essence of the contract. However, in the same breath, it was pleaded that the complaint filed is time barred. It was stated that the complainants defaulted in making payments, towards price of the said plot, as a result whereof, reminders were sent to them, by the opposite parties. Obtaining loan from the State Bank of India, for making payment towards price of the said plot, was prerogative of the complainants, and the opposite parties cannot be made responsible, if the said bank has levied penal interest upon them (complainants). It was pleaded that, in case, still the complainants want refund of the amount paid, forfeiture clause would be applicable. Remaining averments were denied being wrong. Prayer was made to dismiss the complaint with cost.
4.         In the rejoinder filed, the complainants reiterated all the averments contained in the complaint and controverted those, contained in written version of the opposite parties.
5.         The parties led evidence in support of their case.
6.         The contesting parties raised arguments, in tune of the facts narrated above.
7.         We have heard the contesting parties and have gone through the evidence and record of the case, very carefully.
8.         First, we will like to decide the objection raised by the opposite parties that for want of pecuniary jurisdiction, it is not open to this Commission to entertain and adjudicate this complaint. It may be stated here that as per Section 17 (1) (a) (i) of the Act, the State Consumer Disputes Redressal Commission shall have pecuniary jurisdiction to entertain any complaint,  where the value of the goods or services and compensation, if any, claimed exceeds rupees twenty lakhs but does not exceed rupees one crore. It was also so elucidated elaborately by a Large Bench of the National Commission in the case titled as Ambrish Kumar Shukla and 21 ors. Vs. Ferrous Infrastructure Pvt. Ltd., Consumer Case No.97 of 2016, decided on 07.10.2016. As such, in the present case, if total value of the plot, in question, i.e. Rs.56,27,778.70ps., plus compensation claimed by way of interest @12% p.a. on the deposited amount of Rs.48,62,807/- and other reliefs claimed, are clubbed together, it exceeds Rs.20 lacs and fell below Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction, to entertain and decide this complaint. Objection taken by the opposite parties, that this Commission lacks pecuniary Jurisdiction, being devoid of merit, must fail and the same stands rejected.
9.         The next question that falls for consideration, is, as to whether, this Commission has territorial jurisdiction to entertain and decide this complaint or not.

                According to Section 17 (2) of the Act, a consumer complaint can be filed, by the complainants, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to them. Section 17 (2) (a) and (c) of the Act, reads thus:-

“Section 17 in the Consumer Protection Act, 1986

17.  [(2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction,—

(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or

(b) …………………..

(c) the cause of action, wholly or in part, arises.]”

 

                It is specifically stated that a consumer can file a complaint in the State Commission, within the limits of whose jurisdiction, the opposite party(s) actually and voluntarily resides or carries on business. As such, this Commission has to find out two factors, first whether the opposite parties have any branch office at Chandigarh and secondly, whether, any part of cause of action accrued to the complainants at the said Branch Office at Chandigarh or not. Perusal of record reveals that as per Clause 58 (e) of the Agreement, the communication address of the Company has been mentioned as SCO 139-140, 1^st Floor, Madhya Marg, Sector 8-C, Chandigarh. As such, it is proved that the opposite parties were actually and voluntarily carrying out their business at their Chandigarh Office, also.

                Now coming to the question, as to whether, any cause of action arose to the complainants at the said Chandigarh Office of the opposite parties, it may be stated here that we have gone through the record and it is evident that almost all the payments receipts i.e. Annexure C-1 dated 18.04.2013, C-2 dated 17.07.2013, C-3 dated 30.06.2014 and C-7 dated 15.04.2015, have been issued by Regional Office of the opposite parties at Chandigarh i.e. SCO 139-140, Sector 8-C, Madhya Marg, Chandigarh-160008. In view of above, it can safely be said that the Company is running its business from the said place at Chandigarh and also the fact that cause of action accrued to the complainants at Chandigarh, as such, this Commission has got territorial jurisdiction to entertain the present complaint, in view of the provisions of Section 17 (2) (a) and (c) of the Act. Objection taken by the opposite parties, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected. 

10.         The next question, that falls for consideration, is, as to whether, the complainants fall within the definition of a consumer, as defined by Section 2 (1) (d) of the Act, or not. It may be stated here that mere bald objection of the opposite parties that the complainants had purchased the plot, by way of investment, to gain huge profits, by selling the same, as and when there was escalation in prices, does not carry any weight and is liable to be rejected. There is nothing, on the record, that the complainants are property dealers and deal in the sale and purchase of property, on regular basis. A person cannot be said to have purchased a house for a commercial purpose only by proving that he/she has purchased more than one houses or plots.  Separate plots may be purchased by a person for the individual use of his family members.  A person may buy two or three houses, if the requirement of his family cannot be met in one house. Thus, in the absence of any cogent evidence, in support of the objection raised by the opposite parties, mere bald assertion to that effect, cannot be taken into consideration. Since the opposite parties have levelled allegations against the complainants, the onus lay upon them, to place on record, documentary evidence in that regard, which they failed to do so. Otherwise also, in a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, decided by the National Consumer Disputes Redressal Commission, New Delhi, it was held that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs Nirmala Devi Gupta,  2016 (2) CPJ 316. Not only as above, under similar circumstances, in a case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016, the National Commission, while rejecting similar plea raised by the builder, observed as under:-

 “ In the case of the purchase of the houses which a builder undertakes to construct for the buyer, the purchase can be said to be for a commercial purpose where it is shown, by producing evidence, that the buyer is engaged in the business of a buying and selling of houses and or plots as a trading activity, with a view to make profits by sale of such houses or plots.  A person cannot be said to have purchased a house for a commercial purpose only by proving that he owns or had purchased more than one houses or plots.  In a given case, separate houses may be purchased by a person for the individual use of his family members.  A person owning a house in a city A may also purchase a house in city B for the purpose of staying in that house during short visits to that city.  A person may buy two or three houses if the requirement of his family cannot be met in one house.  Therefore, it would not be correct to say that in every case where a person owns more than one house, the acquisition of the house is for a commercial purpose.  In fact, this was also the view taken by this Commission in Rajesh Malhotra & Ors. Vs. Acron Developers Pvt. Ltd. & Ors. First Appeal No. 1287 of 2014 decided on 05.11.2015.”

 

                The principle of law, laid down, in the aforesaid cases, is fully applicable to the present case. The complainants, thus, fall within the definition of a ‘consumer’, as defined under Section 2(1)(d) of the Act. Such an objection, taken by the opposite parties, therefore, being devoid of merit, is rejected. 

11.         It is not in dispute that the complainants had purchased the plot in question, in the said project, for total sale consideration of Rs.56,27,778.70ps., inclusive of all charges, against which, they had already paid an amount of Rs.48,62,807/-.  It is also not disputed that by the stipulated date or even by the date of filing this complaint, possession of the plot, in question, has not been offered and delivered to the complainants, despite the fact that it was promised to be delivered latest by 12.10.2017, as per Clause 35 (a) of the allotment letter, referred to above. At the same time, not even a single document has been produced on record, to prove as to at what stage, development at the project site has reached, which has been carried out, by spending the amount received from the complainants and other similar located allottees. It is settled law that onus to prove the stage and status of development at the project, is on the builder/developer. It was so said by the National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. It is very strange that in the present case, not even an iota of evidence has been placed on record, by the opposite parties, to prove that as to at what stage, development work has reached, in respect of the project, wherein, the plot, in question, is located. Only a bald statement has been given that the development works are complete at the site. In case, the development/construction activities, are being undertaken and in progress, or the same have been completed, then it was for the opposite parties, which could be said to be in possession of the best evidence, to produce cogent and convincing documentary evidence, in the shape of the reports and affidavits of the Engineers/Architects, as they could be said to be the best persons, to testify, as to whether, all these development/construction activities, had been undertaken and completed at the site or not, but they failed to do so. At the time of arguments, when a specific question was put to Counsel for the opposite parties, as to by which date, possession could be offered to the complainants, he only said that partial completion certificate has been applied for, by the Company, and as soon as the same will be received, possession of the plot, will be offered and delivered to the complainants. Possession was to be delivered by October 2017 and now it is September 2019, still the complainants are empty handed. It is well settled law that non-delivery of possession of plot(s)/unit(s) in a developed project, by the stipulated date, is a material violation on the part of a builder and in those circumstances, the allottee is well within his/her right to seek refund of the amount paid. It was so said by the National Commission, in a case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016, wherein, it was held  as under:-

“I am in agreement with the learned senior counsel for the complainants that considering the default on the part of opposite parties no.1 and 2 in performing its contractual obligation, the complainants cannot be compelled to accept the offer of possession at this belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest.”

 

The above view taken by the National Commission, has been reiterated by it, in the case titled as Sujay Bharatiya & Anr. Vs. Unitech Reliable Projects Pvt. Ltd., Consumer Case No.1814 of 2017 decided on 05.07.2018. Relevant part of the said order reads thus:-

“This Commission in Emaar MGF Land Ltd. & Anr. V. Amit Puri (First Appeal No.250 of 2014), decided on 30.03.2015, has held that if the Developer fails to deliver possession of the allotted plot/flat within the stipulated time, the allottee is under no obligation to accept an alternative plot. At the cost of repetition, we may reiterate that in the event of Developer failing to deliver possession of the property within the stipulated period, for any reason, save and except a force majeure condition, agreed to between the contracting parties, an allottee cannot be compelled to accept an alternate site/plot and he would be within his rights to seek refund of the amount deposited with the Developer against allotment”.

The above view taken is further supported by the principle of law laid down by the Supreme Court of India in the case titled as Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, Civil Appeal No.12238 of 2018, decided on 02.04.2019. In that case, possession of the unit had been offered during pendency of the complaint after obtaining occupation certificate, though after a delay of 2 years of the stipulated date. The Supreme Court upheld the order of refund of amount paid alongwith interest, passed by the National Commission, while holding as under:-

      “In the present case, admittedly the Appellant – Builder obtained the Occupancy Certificate almost 2 years after the date stipulated in the Apartment Buyer’s Agreement. As a consequence, there was a failure to hand over possession of the flat to the Respondent – Flat Purchaser within a reasonable period. The Occupancy Certificate was obtained after a delay of more than 2 years on 28.08.2018 during the pendency of the proceedings before the National Commission.

       In Lucknow Development Authority v. M.K. Gupta,  this Court held that when a person hires the services of a builder, or a contractor, for the construction of a house or a flat, and the same is for a consideration, it is a “service” as defined by Section 2 (o) of the Consumer Protection Act, 1986. The inordinate delay in handing over possession of the flat clearly amounts to deficiency of service.

      In Fortune Infrastructure & Anr. v. Trevor D’Lima & Ors.,  this Court held that a person cannot be made to wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.

      The Respondent – Flat Purchaser has made out a clear case of deficiency of service on the part of the Appellant –

Builder. The Respondent – Flat Purchaser was justified in terminating the Apartment Buyer’s Agreement by filing the Consumer Complaint, and cannot be compelled to accept the possession whenever it is offered by the Builder. The Respondent – Purchaser was legally entitled to seek refund of the money deposited by him along with appropriate compensation.”

 

In the present case also, there has been an inordinate delay in the matter, as such, the complainants cannot be made to wait for an indefinite period for delivery of possession of the plot, at the whims and fancies of the opposite parties. They are at liberty to seek refund of the amount deposited.

12.         It is to be further seen, as to whether, interest, on the amount refunded, can be granted, in favour of the complainants. It is not in dispute that an amount of Rs.48,62,807/- was paid by the complainants towards price of the said plot. The said amount has been used by the opposite parties, for their own benefit. It is well settled law that whenever money has been received by a party and when its refund is ordered, the right to get interest follows, as a matter of course. The obligation to refund money received and retained without right implies and carries with it, the said right. It was so said by the Hon`ble Supreme Court of India, in UOI vs. Tata Chemicals Ltd (Supreme Court), (2014) 6 SCC 335. The complainants are, thus, entitled to refund of the amount paid, alongwith interest, from the respective dates of deposits, till realization.
13.         The question, as to what rate of interest should be granted while ordering refund of the deposited amount, in case, the builder fails to deliver possession of residential units, by the stipulated date, fell for determination before the Supreme Court of India in H.U.D.A. Vs. Neelam Sharma, Civil Appeal no.3417 of 2003 decided on 18.08.2004. In the said case, Supreme Court held that in case of refund of amount, the Interest Act would apply and 12% interest is to be granted from the date of amounts deposited till repayment. Relevant part of the said order is reproduced hereunder:-

 “We have in our Judgment in the case of Ghaziabad Development Authority vs. Balbir Singh reported in (2004) 5 SCC 65 held that in case the amounts have to be refunded, the Interest Act would apply.  In our view, in these matters as it is not possible for us to ascertain what was the prevailing rate of interest,  we have been directing payment of interest @ 12% from the date the amounts were deposited till repayment.”

Similar view was taken by the Supreme Court of India in H.P. Housing Board Vs. Janak Gupta, (2009) INSC 627, while holding as under:-

 “We may note that in Haryana Urban Development Auhority vs. Darsh Kumar (2005) 9 SCC 449, this Court has said that in future the Forum/Commission will follow the principles laid down by it in the case of Balbir Singh-I(supra).In the light of the aforenoted decisions, the order of the Commission, awarding interest at the rate of 18% per annum cannot be sustained. We are of the view that having regard to the facts and the circumstances of the instant  case, award of interest @ 12% per annum would meet the ends of justice. …………………….”.

There is another reason, as to why, this Commission can grant interest @12% p.a., on the amount ordered to be refunded to the complainants. Undisputedly, the project in question falls within the State of Punjab and the provisions of The Punjab Apartment and Property Regulation Act, 1995, (in short the PAPRA) and also The Punjab Apartment and Property Regulation Rules, 1995 (in short the PAPRR) are applicable. Rule 17 of the PAPRR provides that upon cancellation of the agreement, the promoter shall refund full amount collected from the prospective buyers with interest thereon at the rate of 12% p.a. from the date of receipt of amount so collected till the date of re-payment. Relevant part of the said Rule reads as under:-

“17. Rate of interest on refund of advance money upon cancellation of agreement.- The promoter shall refund full amount collected from the prospective buyers under sub-section (1) of section 6 together with interest thereon at the rate of twelve per cent per annum payable from the date of receipt of amount so collected till the date of re-payment.”

Thus, the statutory requirement of refund of full amount collected from the prospective buyers under Rule 17 of the PAPRR, alongwith interest @12% p.a. is a mandatory one.

                In view of principle of law laid down by the Supreme Court of India, in the cases, referred to in this paragraph and also Rule 17 of the PAPRR, if interest @12% p.a. is awarded to the complainants, from the respective dates of deposits, till realization, that will meet the ends of justice. At the same time, the complainants are also held entitled for compensation towards mental agony and physical harassment, caused to them, by the opposite parties.  

14.         Counsel for the opposite parties has contended that since it was mentioned in the Allotment Letter that the Company shall try to complete development works within a period of 24 months, with further grace period of six months, from the date of signing thereof, as such, time was not the essence of contract. The contention raised is devoid of merit. It may be stated here that once a specific period of 24 months, with extended period of 6 months was mentioned in Clause 35 (a) of the Allotment Letter/Agreement with commitment to complete the development/construction work, now at this stage, the  opposite parties  cannot wriggle out of the same. Other than this Clause contained in the allotment letter, there is no Clause, which speaks about the period/date for delivery of possession of the plot, to the complainants. A clear-cut promise was made to deliver possession of the plot, within a maximum period of 30 months. It is not the case of the  opposite parties, that they encountered any force majeure circumstances, as a result whereof, they were legally entitled for extension of time for delivering possession of the plots to the allottees, including the complainants.

                It was also argued by Counsel for the  opposite parties  that, as per terms and conditions of the said Allotment Letter/Agreement, when computing the above said period, Sundays, Saturdays, Bank Holidays, etc. are to be ignored. We feel that the contention raised is liable to be rejected. As stated above, in Clause 35(a) of the allotment letter, it is stated that possession will be delivered within 24 months, from the date of signing of allotment letter, with six months’ extension. It is further stated that when computing the said period all Saturdays, Sundays and Bank Holidays will be excluded. A similar issue came up for consideration before this Commission qua another project of the opposite parties, in the case of Dr.Divya Dahiya Vs. M/s Omaxe Chandigarh Extension Developers Private Limited and another, Consumer Complaint No.57 of 2016, decided on 15.07.2016, wherein, it was observed as under:-

“The first question, which falls for consideration, is, as to whether there was delay in offering possession of the plot, in question, and if so, to what extent. The allotment letter for independent floor in Row-Housing Project “Silver Birch” in the project of the Opposite Parties (Annexure C-4) was issued to the complainant on 30.08.2011. As per Clause 31(a) of the allotment letter, the Opposite Parties were to complete the development of the unit within 24 months or within an extended period of six months from the date of start of construction, subject to force majeure conditions. Since allotment letter is dated 30.08.2011, by computing 24 months plus 6 months’ period, the Opposite Parties were bound to deliver possession of the plot, in question, by 01.03.2014. The Opposite Parties have stated that period was to be computed by excluding Sundays, Bank Holidays, enforced Govt. holidays and the days of cessation of work at site in compliance of order of any Judicial/concerned State Legislative Body. Apparently, for seeking six months extension beyond 24 months or beyond six months extended period, the Opposite Parties owe an explanation, if the delay was on account of force majure conditions but nothing by way of cogent evidence to this effect has been placed on record. Thus, when no explanation for extension of six months period has been furnished, the Opposite Parties at the most could be allowed one out of the two benefits i.e. either six months extension beyond 24 months or period on account of Sundays/Holidays etc. This Commission in Consumer Complaint No.153 of 2015 titled ‘Mr. Madan Lal Taneja and another Vs. M/s Omaxe Chandigarh Extension Developers P. Ltd.’ decided on 03.11.2015, facts of which were almost identical, held that Opposite Parties were to hand over possession within 30 months from the date of start of construction. Thus, the possession of the unit, in question, was to be delivered by 01.03.2014.”

 

                Similar view was reiterated by this Commission, in a case titled as Sudesh Rani Vs. Omaxe Chandigarh Extension Developers Pvt. Ltd. and another, Consumer Case No.178 of 2016, decided on 16.08.2016 and many other cases, thereafter. It was specifically held that when there is no explanation of getting extension of 6 months’ period to deliver possession beyond the stipulated date, the benefit of exclusion of Saturdays, Sundays, Bank Holidays etc. cannot be given. Thus, in the present case also, since as per Clause 35 (a) of the Allotment Letter, the  opposite parties were bound to deliver possession of the developed plot, within a maximum period of 30 months from the date of execution of the same (allotment letter), as such, time was unequivocally made the essence of contract. In view of above, plea of the opposite parties in this regard stands rejected.

                At the same time, it is also submitted that the  opposite parties cannot evade their liability, merely by saying that since there was no definite period mentioned in the allotment letter, for delivery of possession of the plot, and only the words “try to complete the development” was mentioned, as such, time is not to be considered as essence of the contract. The act of non-mentioning of exact date in the allotment letter/Agreement is violation of CHAPTER II Regulation of Promotion of Construction, Sale, Transfer and Management of Apartments, Plots and Properties, Condition no. 3(2) (g) of the Punjab Apartment and Property Regulation Act, 1995 (PAPRA), which says that the project proponent is duty bound to specify, in writing, the date by which possession of the plot or apartment is to be handed over and it shall hand over such possession accordingly. Relevant contents of condition no.3(2) (g) of PAPRA are reproduced below:-

“(g) specify, in writing, the date by which possession of the plot or apartment is to be handed over and he shall hand over such possession accordingly”;

As such, plea raised in this regard, being devoid of merit, is rejected.

15.          Another objection taken by the  opposite parties  that since the plot, in question, falls under the category of immovable property, as such, in that event also, time is not to be considered as essence of the contract, is also bereft of merit, in view of ratio of judgment titled as Saradamani Kandappan Vs S. Rajalakshmi & Ors., Civil Appeal Nos. 7254-7256  of 2002 &                                      and   Contempt Petition (C) No. 28-29 of 2009, decided on 4^th  July, 2011, wherein the Hon`ble Supreme Court held as under:-

“A correct perspective relating to the question whether time is not of the essence of the contract in contracts relating to immovable property, is given by this court in K.S. Vidyanadam and Others vs. Vairavan - (1997) 3 SCC 1 (by Jeevan Reddy J. who incidentally was a member of the Constitution Bench in Chand Rani). This Court observed:

"It has been consistently held by the courts in India, following certain early English decisions, that in the case of agreement of sale relating to immovable property, time is not of the essence of the contract unless specifically provided to that effect.

In the case of urban properties in India, it is well-known that their prices have been going up sharply over the last few decades - particularly after 1973. .........We cannot be oblivious to the reality and the reality is constant and continuous rise in the values of urban properties - fuelled by large scale migration of people from rural areas to urban centres and by inflation.

Indeed, we are inclined to think that the rigor of the rule evolved by courts that time is not of the essence of the contract in the case of immovable properties - evolved in times when prices and values were stable and inflation was unknown - requires to be relaxed, if not modified, particularly in the case of urban immovable properties. It is high time, we do so."

(emphasis supplied) Therefore there is an urgent need to revisit the principle that time is not of the essence in contracts relating to immovable properties and also explain the current position of law with regard to contracts relating to immovable property made after 1975, in view of the changed circumstances arising from inflation and steep increase in prices. We do not propose to undertake that exercise in this case, nor referring the matter to larger bench as we have held on facts in this case that time is the essence of the contract, even with reference to the principles in Chand Rani and other cases. Be that as it may.”

 

16.         Now coming to the objection raised by the  opposite parties, to the effect that this complaint  is time barred, it may be stated here that since it is an admitted fact, that possession of the plot, in question, has not been offered to the complainants, even by the date when arguments were heard in this complaint,  as such, there was a continuing cause of action in their favour, in view of principle of law down, in  Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal   Shah  and Anr., II 2000 (1) CPC 269=AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC),  wherein it was held that when possession of the residential units is not offered, there is a continuing cause of action, in favour of the allottee/buyer. Objection raised in this regard, as such, is rejected.
17.         In the present case, since the opposite parties themselves were deficient in providing service and negligent, in not developing the project and delivering possession of the plot, by the stipulated date, as promised vide the allotment letter, the complainants were right in not making further payment demanded by them (opposite parties). It is settled law that the allottees of flats/plots could not be expected to go on making payments to the builder as per the payment plan, when they could discover that it is not in a position to hand over possession of the property in time, for want of construction and development at the project site.  It was so said by the National Commission in Rakesh Anand & Anr. Vs M/S. Royal Empires (Royal Minaar), First Appeal No. 1378 of 2016, decided on 09 Apr 2018. Relevant part of the said order reads thus:-

“………..It is clear from these facts that the complainants could not be expected to go on making payments to the OP builder as per the payment plan, when they could discover that the OP builder was not in a position to hand over the possession of the property in time.”

 

Furthermore, the Supreme Court of India in Haryana Urban Development Authority Vs. Mrs. Raj Mehta, Appeal (Civil) 5882 of 2002, decided on 24.09.2004, held that if the builder is at fault in not delivering possession of the unit by the stipulated date, it cannot expect the allottee(s) to go on paying instalments to it. Similar view had also been taken by the National Commission, in Prasad Homes Private Limited Vs. E.Mahender Reddy and Ors., 1 (2009) CPJ 136 (NC), wherein it was held that when development work was not carried out at the site, the payment of further installments was rightly stopped by the purchaser. Under these circumstances, in no way, the complainants can be termed as defaulters, in case, they had stopped making payments, on few occasions, as alleged by the opposite parties. Objection taken in this regard, stands rejected.  

18.         Since, it has been held above that there was delay on the part of the opposite parties, in offering possession of the plot, in question, and even by the time this complaint has been filed and arguments were heard therein, as a result whereof, the complainants were empty handed, as such, the plea taken by them (opposite parties) that forfeiture clause will be applicable being devoid of merit, stands rejected. Had possession of the plot, in question, been offered by the stipulated date and had the complainants refused to take over the same, on account of some personal/financial reasons, only in those circumstances, order with regard to forfeiture of amount out of the deposited amount, would have been passed by this Commission, as per the prevailing law. The opposite parties are not entitled to forfeit any amount, out of the deposited one, as far as the present case is concerned.  
19.         Since, this Commission has awarded interest @12% p.a. to the complainants, on the amount so deposited by them, from the respective dates of deposits, as such, it will take care of financial loss, if any, suffered by them, on account of increase in rate of interest by the bank concerned, for not starting construction on the plot, in question. Plea taken by the complainants that they be awarded the difference of amount paid by them to the SBI towards increase in rate of interest, referred to above, stands rejected.
20.         No other point, was urged, by the contesting parties.
21.         For the reasons recorded above, this complaint is partly accepted with costs and the opposite parties, jointly and severally, are directed as under:-

1. To refund the amount Rs.48,62,807/- to the complainants, alongwith interest @12% p.a., from the respective dates of deposit onwards, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount of Rs.48,62,807/- shall further carry 3% penal interest i.e. total 15% p.a. (12% p.a. plus (+) 3% p.a.) from the date of passing of this order till realization.
2. To pay compensation, in the sum of Rs.2,00,000/- for causing mental agony and physical harassment, and also deficiency in providing service and adoption of unfair trade practice and also cost of litigation, to the tune of Rs.35,000/- to the complainants, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, the said amount of Rs.2,00,000/- and  Rs.35,000/- shall carry interest @12% p.a. from the date of passing of this order till realization.

 

22.                 However, it is made clear that since in the present case, the complainants have availed loan facility from the SBI, for making payment towards part price of the said plot, it (SBI) will have the first charge of the amount payable, to the extent, the same is due to be paid by them (complainants).
23.         Certified Copies of this order be sent to the parties, free of charge.
24.         The file be consigned to Record Room, after completion.

Pronounced.

10.09.2019

Sd/-

 [JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

Sd/-

(PADMA PANDEY)

        MEMBER

 

 

Sd/-

(RAJESH K. ARYA)

MEMBER

 Rg