Chandigarh

StateCommission

CC/110/2019

Gagandeep - Complainant(s)

Versus

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

Amit Sharma Adv.

14 Feb 2020

ORDER

  STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Complaint case No.	:	110 of 2019
Date of Institution	:	09.05.2019
Date of Decision	:	14.02.2020

 

Gagandeep aged about 46 years son of Sh.Subhash Chandra, resident of H.No.43, Railway Colony No.1, Type 5, DMW, Patiala, Punjab.

…..Complainant

V e r s u s

1. M/s Omaxe Chandigarh Extension Developers Pvt. Ltd.,  a Company registered under the provisions of the Companies Act, 1956, having its Regional Office at SCO 139-140, First Floor, Sector 8-C, Madhya Marg, Chandigarh-160008 now shifted to India Trade Tower, 1^st Floor, Madhya Marg Extension Road, New Chandigarh Mullanpur, District SAS Nagar-140901, Punjab, through its Authorized Representative.
2. Rohtas Goel, Managing Director and Chairman, having its Corporate Office at 10 L.S.C., Kalkaji, New Delhi-110019.

…..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.Amit Sharma, Advocate for the complainant.

       Sh.Gazi Mohd., Advocate for the opposite parties.

 

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                   The complainant has filed this complaint seeking directions to the opposite parties to deliver possession of plot bearing no.OCE/659, measuring 209.79 square yards, purchased by him, in their project named ‘Omaxe Chandigarh Extension”, Mullanpur, SAS Nagar, Punjab, total price whereof was fixed at Rs.32,37,339.50ps. By placing reliance on statement of account dated 26.08.2016 (Annexure C-1), it has been stated by the complainant in his complaint, that despite making payment of Rs.30,97,473/- against total sale consideration of Rs.32,37,339.50ps., the opposite parties failed to deliver possession of plot no.OCE/659 by 16.12.2012 i.e. within a period of 18 months plus 6 months totaling 24 months, as committed vide Clause 29 (a) of the allotment letter dated 17.12.2010 (Annexure C-2), for want of development work and basic amenities at the project site. When possession of plot no.OCE/659 was not offered by the stipulated date or even thereafter, the complainant wrote letter dated 10.03.2015 (Annexure C-3), with a request to either deliver possession of plot no.OCE/659 or if not possible to relocate him in the same sector/phase, to a habitable plot but to no avail. On the other hand, the opposite parties, unilaterally and arbitrarily, sent letter dated 16.12.2015 (Annexure C-4), intimating the complainant that he has been relocated to plot no.OCE/558R5, measuring 198.27 square yards, which is located in some other project i.e. a project in  Phase II, which was never accepted by him. However, thereafter, the opposite parties issued letter dated 23.03.2019 (Annexure C-5) alongwith which statement of account was also attached, wherein another amount of Rs.3,19,362.89 ps. was demanded from him, so that possession of plot no.OCE/558R5 which was never opted by him, can be delivered.

                   It has been stated that the aforesaid act of the opposite parties amounted to deficiency in providing service and adoption of unfair trade practice. Hence this complaint has been filed by the complainant seeking directions to the opposite parties to deliver possession of the OCE/659, measuring 209.79 square yards; to pay compensation by way of interest @18% p.a. on the deposited amount for the period of delay in offering possession; to pay Rs.5 lacs as compensation for mental agony and physical harassment and Rs.1 lac as cost of litigation.  

2.           His claim has been contested by the opposite parties, on numerous grounds, inter alia, that in the face of existence of provision to settle disputes between the parties through Arbitration, this Commission has no jurisdiction to entertain this consumer complaint; that the complainant has concealed the fact that plot no.OCE/659  was purchased by him in resale from one Mrs.Priti Chander vide endorsement dated 10.11.2010 (Annexure OP-2 colly.); that the complainant being investor, did not fall within the definition of “consumer” as defined under Section 2(1)(d) of the Act; that this Commission did not vest with pecuniary and territorial jurisdiction; that no definite period was committed to hand over possession of the plot and also it was an immovable property, therefore, time was not to be considered as essence of the contract; that the period of possession was to be computed after excluding Saturdays, Sundays and Bank Holidays; that the complaint filed is barred by limitation; and that the complainant is not entitled to any compensation for the period of delay in offering possession.
3.           On merits, purchase of plot no.OCE/659 in resale by the complainant; payments made by him towards it, as mentioned in the complaint has not been disputed. It has been stated that vide letter dated 16.12.2015 (Annexure C-4), he was relocated to plot no.OCE/558R5, measuring 198.27 square yards, to which he never objected; that possession of the relocated plot was offered to him, vide letter dated 23.03.2019 (Annexure C-5) after completing development works at the project site; that he was requested to make remaining payment of Rs.3,19,362.89ps. but despite sending reminder in the matter, he neither made the said payment nor took possession of the relocated plot and on the other hand filed this complaint. Remaining averments have been denied being wrong. Prayer has been made to dismiss the complaint with cost.
4.           The parties have been afforded adequate opportunities to adduce evidence, which has been led, in support of their respective cases, by way of affidavit and also produced numerous documents.
5.           We have heard the contesting parties and have gone through the evidence and record of the case, very carefully.
6.           In this case, following points have been emerged for consideration:-
   1. Whether the arbitration clause contained in the allotment letter/agreement bars the jurisdiction of this Commission?
   2. Whether this Commission has territorial and pecuniary jurisdiction to entertain and decide this complaint?
   3. Whether the complainant falls under the definition of ‘consumer’?
   4. Whether time was essence of the contract?
   5. Whether the complaint filed is barred by limitation?
   6. Whether unilateral and suo motto relocation to plot no.OCE/558R5, by the Company will amount to novation of contract, especially when no consent has been taken from the complainant and whether he is obliged to take possession of the relocated plot?
   7. Whether the complainant is entitled to be compensated for the period of delay in offering possession of plot no.OCE/659 and, if yes, to what extent?

 

7.           First, we would like to deal with the objection raised by the opposite parties, to the effect that in the face of existence of provision in the agreement, to settle disputes between the parties through Arbitration, this Commission has no jurisdiction to entertain the consumer complaint. It may be stated here that this issue has already been dealt with by the larger Bench of the National Commission in a case titled as Aftab Singh  Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, vide order dated 13.07.2017, has held that an Arbitration Clause in the Agreements between the complainant and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, notwithstanding the amendments made to Section 8 of the Arbitration Act. Feeling aggrieved against the said findings, the builder filed Civil Appeal bearing No.23512-23513 of 2017 before the Hon’ble Supreme Court of India, which was dismissed vide order dated 13.02.2018. Even the Review Petition (C) Nos. 2629-2630 of 2018 filed by the builder in Civil Appeal Nos.23512-23513 of 2017 against order dated 13.02.2018, was dismissed by the Hon’ble Supreme Court of India, vide order dated 10.12.2018.In this view of the matter, objection raised by the opposite parties, in this regard, stands rejected.
8.           Now coming to the objection raised with regard to territorial jurisdiction of this Commission, it may be stated here that according to Section 17 of the Act, a consumer complaint can be filed by the complainant, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to him. In the instant case, it is evident that the endorsement form dated 10.11.2010 (Annexure OP/2 colly.) and permission to transfer plot no.OCE/659 in respect of the complainant, was addressed to and accepted by Chandigarh Office of the opposite parties. Not only as above, even the letter dated 16.12.2015 (Annexure C-4) was also written by the opposite parties to the complainant, from their Chandigarh Regional Office, as it bears address thereon as SCO No.139-140, Sector 8-C, Chandigarh. Under these circumstances, it can safely be said that since a part of cause of action arose to the complainant, at Chandigarh, as such, this Commission has got territorial Jurisdiction to entertain and decide this complaint.  Objection taken in this regard therefore stands rejected. 
9.           Now coming to the objection raised with regard to pecuniary jurisdiction of this Commission, it may be stated here that in the present case, if total value of the plot, in question i.e. Rs.32,37,339.50ps.; plus compensation claimed by way of interest @18% p.a. on the deposited amount of Rs.30,97,473/-/-, for the period of delay, in offering possession of plot no.OCE/659; and also Rs.5 lacs, claimed as compensation for mental harassment etc., is 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, thus, stands rejected.
10.           As far as objection taken to the effect that the complainant did not fall within the definition of ‘consumer’, it may be stated here that the objection raised is not supported by any documentary evidence and as such the onus shifts to the opposite parties to establish that the complainant has purchased the plot in question to indulge in ‘purchase and sale of plots’ as was held by the Hon’ble National Commission in Kavit Ahuja vs. Shipra Estates I (2016) CPJ 31 but since they failed to discharge that onus, hence we hold that the complainant is a consumer as defined under Section 2(1)(d) of the Act. Mere fact that the complainant is residing or owning some house in Kapurthala or any other place is not a sufficient ground to shove him out of the purview of consumer.       
11.           From the documents placed on record, it has been proved that the complainant purchased plot bearing no.OCE/659, measuring 209.79 square yards, in the said project, against which,  he had already paid amount of  Rs.30,97,473/- against the demand of Rs.29,37,178.69ps. It is also evident from the record that as per Clause 29 (a) of the agreement dated 17.12.2010 (Annexure C-2), possession was to be delivered within a period of 18 months plus 6 months totaling 24 months from the date of execution of the said agreement i.e. latest by 16.12.2012. However, it is also not disputed by the opposite parties that possession of plot no.OCE/659 was never offered to the complainant by the stipulated date or even thereafter, as a result whereof,  after waiting for quite a long time, the complainant wrote letter dated 10.03.2015, with a request to either deliver possession of plot no.OCE/659 or to relocate  him in the same sector/phase to a habitable plot but to no avail.

                   However, it is coming out from the record, that instead of relocating the complainant in the same sector/phase, the opposite parties, unilaterally and arbitrarily, sent letter dated 16.12.2015 (Annexure C-4) to the complainant  intimating him that he is relocated to plot no.OCE/558R5, measuring 198.27 square yards, i.e. in another project in Phase II and thereafter issued letter dated 23.03.2019 (Annexure C-5) alongwith which statement of account was also attached, wherein the complainant was asked to make payment of Rs.3,19,362.89 ps. so that possession of relocated plot no.OCE/558R5, can be offered to him. However, there is nothing on record to prove that the complainant even accepted the said relocation.

12.           During arguments, while placing reliance on Clauses 3 and 4 of the allotment letter/agreement which say that the area/location of the plot is subject to change, Counsel for the opposite parties has taken the plea of novation of the contract. We have considered the plea taken in this regard but it carries no weight. It may be stated here that novation means extinguishment of the terms of an earlier contract and the creation of another between new persons at least one of whom was a stranger to the original contract and it is essential for the principle of novation to apply that there must be the mutual consent of all parties concerned. However, in the present case, there is no novation of contract in the eyes of law. Section 62 of the Act, 1872 provides that if the parties to the contract, agreed to substitute the new contract, or to rescind or alter it, only then, the original contract need not to be performed. The said section provides that the original contract need not be performed in the following cases:-

1. where the parties to the contract agree to substitute a new contract for it, technically  called “novation”.
2. where the parties to a contract agree to rescind it;
3. where the parties to a contact agree to alter it.

 

After going through the material available on record, this Commission has found that in the present case, the complainant has never given his consent for novation or substitution or alteration of the terms and conditions of the allotment letter/agreement (Annexure C-2). Whereas, on the other hand, when possession of the original plot no.OCE/659 was not offered by the stipulated date i.e. 16.12.2012, the complainant, after waiting for more than two and half years, requested the opposite parties that, in case, still they are not in a position to deliver possession of the said plot, he may be relocated in the same phase only i.e. Phase 1 of the project but to the contrary, the opposite parties in a very arbitrary and unilateral manner, relocated him to plot no.OCE/558R5 in other project in Phase-II, to which he never accepted.  Thus, there has been no novation of the contract dated 17.12.2010, as the said relocation was never accepted by the complainant and has also been challenged by way of filing this complaint. Only the executable contract (Annexure C-2), whereby plot no.OCE/659 in Phase I of the project was allotted to the complainant, as referred to above, is to be considered. It is therefore held that in the absence of novation of the contract, the complainant was not obliged to accept relocation of plot no.OCE/558R5 in other project in Phase-II. Therefore, the plea taken by the opposite parties in this regard is devoid of merit.

                   Under above circumstances, once it is held that the complainant was  not obliged to accept relocation of plot no.OCE/558R5 in other project in Phase-II, as such, letter dated 23.03.2019 vide which he was offered possession thereof, and also the statement of account attached therewith, whereby demand was raised to the tune of Rs.3,19,362.89ps., followed by reminder dated 31.05.2019 has no significant value in the eyes of law and is accordingly quashed.

13.           As stated above, possession of the plot bearing no.OCE/659, measuring 209.79 square yards, against which the complainant had already paid amount of  Rs.30,97,473/- against the demand of Rs.29,37,178.69ps., was not offered by the committed date i.e. 16.12.2012. Neither in the entire written statement nor during the course of arguments, has the opposite parties explained the reasons, as to why development and construction activities were not carried out in the area, where the said plot is located. Why they kept mum for five years from the date of allotment and three years from the committed date of delivery of possession, which expired on 16.12.2012 and it was only on 16.12.2015 that they offered relocation to the complainant, has also not been clarified.
14.           At the time of arguments, vide order dated 17.10.2019, the opposite parties were asked to submit an affidavit, as to whether plot no.659 has been allotted to someone else or not. In response thereto, Sh.Deepanjit Singh, Authorized Representative of the opposite parties filed an affidavit stating therein that since there is no development in the area where plot no.OCE/659 is located  and also it is not known as to when the same will be completed, therefore, the same has not been allotted to anyone at this stage.

                   We are of the considered view that once the opposite parties have received more than 95% of the total sale consideration in respect of plot no.OCE/659 possession whereof was committed to be delivered latest by 16.12.2012 and also at the same time there is no convincing evidence placed on record to prove that they ever faced any force majeure circumstances as a result whereof development could not be completed, as such, now at this stage i.e. after more than nine years of booking thereof,  the opposite parties cannot wriggle out of the said deal, at their whims and fancies. Once, the opposite parties have confirmed the booking; received more than 95% of the total sale consideration; and also have executed the agreement thereby committing the date of delivery of possession of plot no.OCE/659, later on, after nine years, they cannot take a somersault in the matter by saying that development at the project site where the said plot (plot no.OCE/659) is located is not complete. The opposite parties have failed to produce on record any evidence, which has forced them to change the area or location of  plots in the area, so that this Commission is convinced to give immunity to them under clauses 3 and 4 of the allotment letter.  In the absence of any cogent and convincing evidence, the opposite parties cannot invoke the provisions of clauses 3 and 4 of the allotment letter. It is therefore held that the opposite parties were deficient in providing service, negligent and guilty of adoption of unfair trade practice, on this score.

15.           Furthermore, it is a settled law that a builder cannot force allottee/buyer to accept relocation against his wish and that too in the absence of novation of the contract.  Similar view was expressed by the Hon’ble National Commission in M/s. Taneja Developers & Infrastructure Ltd. Vs. Deepak Kumar & Anr., First Appeal No. 509 of 2016, decided on 03 Jun 2016. Relevant part of the said order is reproduced hereunder:-

“….In case,  the complainant had  refused to accept the allotment of alternative plot offered by the OPs, he cannot be forced to accept the alternative plot,  as per the desire of the appellant/OP…..”

 

Under above circumstances, the complainant is not obliged to accept relocation of plot, referred to above. It is therefore held that the opposite parties are liable to complete development work at the project site, wherein the originally allotted plot bearing no.OCE/659, measuring 209.79 square yards, is located and deliver possession thereof to the complainant, complete in all respects, after obtaining completion certificate from the competent Authorities. By not doing so and on the other hand, relocating the complainant to the plot referred to above, unilaterally and arbitrarily, in the absence of novation of the contract, the opposite parties indulged themselves into unfair trade practice and are also negligent and deficient in providing service to him.  

16.           Counsel for the opposite parties contended that since it was mentioned in the Allotment Letter/Agreement that the Company shall make its best efforts to deliver possession of the plot within a period of 18 months, with further grace period of six months, 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 18 months, with extended period of 6 months was mentioned in Clause 29 (a) of the Allotment Letter/Agreement with commitment of best efforts, 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 plot no.OCE/659 to the complainant. 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 plot no.OCE/659 to the complainant. As far as the plea taken by Counsel for the opposite parties, that while computing period of possession, Sundays, Saturdays, Bank Holidays, etc. are to be ignored, it may be stated here that the said 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, which was rejected by holding that when no explanation for extension of six months period has been furnished, the builder 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. In this view of the matter, plea taken in this regard also, stands rejected.
17.           It has been proved on record that the opposite parties have been utilizing the amount paid by the complainant for purchase of plot no.OCE/659, for number of years, without providing him anything, as a result whereof, financial loss was caused to him. Still he is interested in taking over possession of plot no.OCE/659, referred to above. Under these circumstances, this Commission is of the considered opinion that the complainant needs to be compensated for the period of delay in offering possession of plot no.OCE/659, by the opposite parties, till possession thereof is actually delivered to him, complete in all respects.
18.           What relief can be granted to a consumer, for delay in offering possession of the residential units/plots, fell for determination before the Hon’ble Supreme Court of India in DLF Homes Panchkula (P) Ltd. vs Sushila Devi, 2019 (Civil Appeal Nos. 2285-2330 of 2019 (@ SLP(C) NOS.928-930, 932-938, 940-967 and 969-976 of 2019), decided on 26 February, wherein, under similar circumstances, interest @9% p.a. on the deposited amount, already granted by the National Commission, for the period of delay in offering possession was confirmed.  The principle of law laid down in the aforesaid case, is fully applicable to the present case. It is therefore held that the complainant is entitled to get interest @9% p.a., on the deposited amount, towards price of the plot no.OCE/659, for the period of delay i.e. from 16.12.2012 (committed date) onwards.

                   Besides as above, the opposite parties are also liable to pay compensation to the complainant, for providing deficient service and guilty of adoption of unfair trade practice, thereby causing him mental agony and physical harassment.

19.           As far as objection taken to the effect that the complaint filed is time barred, it may be stated here that since possession of the plot no.OCE/659  has not been delivered to the complainant till date, for want of development and construction activities, which fact has been candidly admitted by the opposite parties in their written reply and also by their Counsel, during pendency of this complaint, as such, there is a continuing cause of action in favour of the complainant to file this complaint, in view of principle of law laid 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 units/plots is not offered, there is a continuing cause of action, in favour of the allottee/buyer. In this view of the matter, objection taken stands rejected.
20.           For the reasons recorded above, this complaint is partly accepted, with costs. The opposite parties, jointly and severally, are directed as under: -
    1. To hand over actual physical possession of the plot bearing no.OCE/659, measuring 209.79 square yards, as committed vide allotment letter dated 17.12.2010, to the complainant, within a period of six months from the date of receipt of a certified copy of this order, after completing the development work and obtaining completion certificate from the competent Authorities, on receipt of balance amount legally due from the complainant, strictly as per terms and conditions of the said allotment letter dated 17.12.2010.
    2. To execute and register the sale deed in respect of plot bearing no.OCE/659, measuring 209.79 square yards,  in favour of the complainant, within a period of one month, from the date of handing over possession, as ordered in Clause (i) above, on payment of stamp duty/registration charges by the complainant.
    3. To pay compensation by way of interest @9% p.a., on the entire deposited amount to the complainant from 16.12.2012 (due date of possession) till 29.02.2020, within a period of one month, from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount shall carry penal interest @12% p.a. instead of 9% p.a., till the payment is made.
    4. To pay compensation by way of interest @9% p.a., on the entire deposited amount to the complainant w.e.f. 01.03.2020 onwards (per month), till actual delivery of physical possession of plot no.OCE/659, by the 10^th of the following month, failing which, the same shall carry penal interest @12% p.a., from the date of default, till payment is made.
    5. To pay compensation for causing mental agony and physical harassment; deficiency in providing service and adoption of unfair trade practice and also cost of litigation, in lumpsum, to the tune of Rs.50,000/-, to the complainant, 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.50,000/-, shall carry interest @9% p.a. from the date of passing of this order, till realization.
21.           Certified Copies of this order be sent to the parties, free of charge.
22.           The file be consigned to Record Room, after completion.

Pronounced

14.02.2020

Sd/-

 [JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

Sd/-

 (PADMA PANDEY)

          MEMBER

 

 

Sd/-

 (RAJESH K. ARYA)

MEMBER

Rg