Chandigarh

StateCommission

CC/3/2023

J.C. MEHTA & ANOTHER - Complainant(s)

Versus

M/S OMAXE CHANDIGARH EXTENSION DEVELOPERS PVT. LTD - Opp.Party(s)

ATUL AGGARWAL

29 Dec 2023

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Complaint No.	:	3 of 2023
Date of Institution	:	10.01.2023
Date of Decision	:	29.12.2023

 

1]      J. C. Mehta, aged 84 years, son of Late Sh. K. R. Mehta resident of H.No.108, Sector 23-A, Chandigarh.

2]      Shashi Kiran Mehta, aged 79 years, wife of Sh. J. C. Mehta resident of H.No.108, Sector 23-A, Chandigarh.

….Complainants.

Versus

1]      M/s Omaxe Chandigarh Extension Developers Private Limited, through its Managing Director, 10 Local Shopping Centre, Kalkaji, New Delhi, South Delhi DL-110019 IN.

          IInd Address:

M/s Omaxe Chandigarh Extension Developers Private Limited, through its Managing Director/Directors, India Trade Tower (Omaxe Building), 1^st Floor, Madhya Marg Extension Road, New Chandigarh (Near Mullanpur), SAS Nagar, Punjab.

2]      Shalini Barathi, Director, M/s Omaxe Chandigarh Extension Developers Private Limited, 10 Local Shopping Centre, Kalkaji, New Delhi, South Delhi DL-110019 IN.

3]      Bhupendra Singh, Director, M/s Omaxe Chandigarh Extension Developers Private Limited, 10 Local Shopping Centre, Kalkaji, New Delhi, South Delhi DL-110019 IN.

4]      Jitendar Garg, Authorized Representative, M/s Omaxe Chandigarh Extension Developers Private Limited, India Trade Tower (Omaxe Building), 1^st Floor, Madhya Marg Extension Road, New Delhi (Near Mullanpur), SAS Nagar, Punjab.

5]      Tarun Nayyar, Authorized Representative, M/s Omaxe Chandigarh Extension Developers Private Limited, India Trade Tower (Omaxe Building), 1^st Floor, Madhya Marg Extension Road, New Delhi (Near Mullanpur), SAS Nagar, Punjab.

…..Opposite Parties.

 

BEFORE:

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT MR.RAJESH K. ARYA, MEMBER

Argued by :-­

 

Sh. Atul Aggarwal, Advocate for the complainants alongwith Sh. J. C. Mehta, complainant no.1 in person.  

Sh. Satyam Tandon, Advocate for the opposite parties.

 

PER  RAJESH  K. ARYA, MEMBER

 

Brief facts:-

                   The complainants were allotted property No.CRC/396H3/UGF/1 in June 2016 and an agreement was entered into between the complainants and the opposite parties. The possession of the said unit was to be delivered within the promised period of 18 months but the opposite parties showed their inability to give possession of the said unit due to certain litigation. Thereafter, in July 2018, on request of opposite parties and having no other option, the complainant accepted alternative property No.CRC/466ZI15/UGF/1 having super/carpet area of 2300/1589 sq. ft. on UGF Floor (Category: Celestia Royal Chandigarh) in exchange at a new price vide letter dated 16.07.2018, Annexure C-1. Agreement dated 14.08.2018, Annexure C-3, was executed between the parties confirming allotment of aforesaid independent floor No.CRC/466ZI15/UGF/1, total sale consideration whereof was Rs.92,74,487/- excluding GST as per payment schedule C of the said agreement. As per Clause 7.1 of the agreement, the possession of the unit in question was assured to be handed over in April 2021 but despite receiving a substantial amount of Rs.95,01,911.40 and that too without any default on the part of the complainants in making the payments, the opposite parties failed to offer/deliver possession of the said unit. Alleging above acts of the opposite parties as deficiency in rendering service and unfair trade practice on their part, this complaint has been filed seeking directions to the opposite parties to handover physical possession of the unit in question, complete in all respects, execute and register conveyance/sale deed, pay interest @12% p.a. for the delay period as per Clause 7.4 & 9.2 of the agreement; pay Rs.10,00,000/- as compensation and Rs.1,10,000/- as litigation expenses.

Reply of the opposite parties:-

1.                 The opposite parties in their written reply, while admitting factual matrix of the case with regard to sale and allotment of the unit in question to the complainants in the project in question; payments made by them as mentioned in the complaint etc. took various objections/pleas as under:-
   1. that the complainants being investor did not fall within the definition of consumer;
   2. that the complaint is not maintainable before this Commission as the dispute relates to real estate, which can be raised before Real Estate Regulatory Authority (RERA) under Section 31 of Real Estate (Regulation and Development) Act, 2016;
   3. that the complaint is liable to be dismissed on the ground of mis-joinder and non-joinder of necessary parties because there is no position of Managing
      Director in the company and the Managing Director/ Directors being the agents of the Company in their fiduciary duty cannot be personally held liable in the matter;
   4. that the earlier unit bearing No.CRC/396H3/UGF was purchased by the complainant’s daughter i.e. Priyanka Kukkal and was later assigned to the complainants, which was later exchanged with Unit NoCRC/466Z15/UGF/1, which fact has not been mentioned in the complaint. 
   5. that although as per Clause 7.1 of the agreement, the possession was to be given by the opposite parties by April 2021 yet it could have been delayed if a force majeure event occurred;
   6. that delay in offering possession of the unit took place because of the force majeure circumstances having been faced by the opposite parties due to COVID-19 and due to Covid-19, the extension of 6 months was granted to the opposite parties up-to 31.10.2021; second extension was granted as per revised registration certificate dated 12.11.2021 up-to 30.10.2022 and another extension has already been applied for.
   7. that further as per Clause 7.2 of the agreement, it is only after obtaining the occupancy certificate from the competent authority, the possession can be given.
   8. that the parties are bound by terms and conditions of the allotment letter/agreement and the Courts have no power to amend the same;

While denying the rest of the averments made in the complaint, the opposite parties have prayed for dismissal of the complaint.

•  
•                 In the rejoinder filed, the complainants reiterated all the averments contained in the complaint and controverted those contained in written reply of the opposite parties.  

 

 

1.                 The parties led evidence, in support of their case and also filed written arguments.
2.                 We have heard the Counsel for the parties and have gone through the evidence and record of this case, including the written arguments, very carefully.
3.                 It may be stated here that opposite parties have filed a Miscellaneous Application No.206 of 2023 seeking correction of Annexure R-9 on the ground that due to inadvertent human error, another document has been mistakenly annexed and seeks permission of this Commission to place on record amended Annexure R-9. Perusal of record transpires that Annexure R-9 annexed by the opposite parties alongwith the written reply does not pertain to this case and has been wrongly annexed by the opposite parties. Therefore, miscellaneous application No.206 of 2023 is allowed and the document, Exhibit R-9, which is statement dated 20.02.2023 pertaining to the subsequent unit No.CRC/466Z15/UGF/1 allotted to the complainants, is taken on record as Exhibit R-9 (Amended).
4.                 First of all we deal with the preliminary objections raised by the opposite parties as under:-

 

Whether the complainants are consumer or not?

 

1.                 First coming to the objection taken by the opposite parties to the effect that the complainants do not fall within the definition of ‘consumer’, it is significant to mention here that the opposite parties have failed to place on record any cogent and convincing evidence in support of this objection. To prove the objection that the unit in question has been purchased by the complainants to indulge in ‘purchase and sale of units’ i.e. for earning profits, the onus lays upon the opposite parties but they failed to do so. Thus, because in the present case, the opposite parties failed to discharge their onus, especially, when still the complainants are seeking possession of their unit, hence, we hold that they fall under the definition of consumer as defined under the Act. Our this view is supported by the observations made by the Hon’ble National  Commission in Kavit Ahuja vs. Shipra Estates, I (2016) CPJ 31. As such, objection taken in this regard stands rejected.

 

 

Whether the complaint is maintainable before this Commission as the dispute relates to real estate?

 

9]                As regards this objection, it may be stated here that the same does not merit acceptance, in view of the ratio of law laid down by the Hon’ble Supreme Court of India in Civil Appeal No. 3581-3590 of 2020, M/s Imperia Structures Ltd. Vs. Anil Patni and another, decided on 02.11.2020, wherein it was held that the provisions of RERA Act does not in any way bar the Commission or Forum under the provisions of the CP Act to entertain any consumer complaint. This view has been reiterated by the Hon’ble Supreme Court of India in Civil Appeal No. 5785 of 2019, Ireo Grace Realtech Pvt. Ltd. Versus Abhishek Khanna & Others, decided on 11.01.2021. As such, this objection also stands rejected.

 

Whether complaint is liable to be dismissed for non-joinder & mis-joinder of necessary parties?

 

10]              As far as objection taken to the effect that the complaint is bad for non-joinder and mis-joinder of necessary parties because there is no position of Managing Director in the Company and the Managing Director/Directors being the agents of the Company in their fiduciary duty cannot be personally held liable in the matter, it may be stated here that the Officers like CEO, Managing Director and Directors are holding such important positions in the Company (a juristic person), where they are directly involved with the decision-making process and will be jointly and severally liable alongwith the Company, for all its  acts done. Similar view was taken by the Hon’ble National Commission, in a case titled as M/s. India Bulls Real Estate & Wholesale Services Ltd. & Ors, Vs. Vemparala Srikant & Anr., First Appeal No. 797 of 2017, decided on 16 Aug 2017. As such, objection taken in this regard stands rejected.

 

Observations/findings of this Commission.

1.               It is not in dispute that the alternative independent unit No.CRC/466ZI15/UGF/1 in lieu of earlier unit No.CRC/396H3/UGF/1 was allotted to the complainants by the opposite parties vide letter dated 16.07.2018 and against the sale consideration of Rs.92,74,487/- excluding GST, as per annexure R-9, the opposite parties received a substantial amount of, the amount of ₹95,01,911.40 i.e. (₹88,54,802.89 + ₹6,47,108.51 as ST/GST). As per Clause 7.1 of the agreement dated 14.08.2018, possession of the unit in question was to be handed over in April 2021, which has been delivered to the complainants only on 08.09.2023. Perusal of order dated 07.08.2023 passed by this Commission transpires that on the said date, Counsel for the opposite parties submitted that the flat in question is ready and offer of possession has already been given vide letter dated 25.07.2023 and amount of Rs.8,43,100.47 remained due to be paid by the complainants. Accordingly, as agreed, the complainants were asked to visit the spot to verify the present status of the construction of the unit and submit the report.  On the next date of hearing i.e. 22.08.2023, direction was given to the opposite parties to remove the discrepancies & shortcomings in the flat as pointed out by the complainants and in the meanwhile, the complainants were also directed to deposit the due amount of Rs.8,43,100.47 with this Commission subject to final verification of accounts of both the parties. Accordingly, on 04.09.2023, the complainants deposited the said amount with this Commission by way of demand draft on 04.09.2023 and direction was issued to the opposite parties to deliver actual physical possession of the flat in question to the complainants, which was finally delivered on 08.09.2023, as stated above. Perusal of offer of possession letter dated 25.07.2023 reveals that the possession has been delivered after receiving the requisite part completion certificate pertaining to the unit in question.
2.               To justify the delay in delivery of possession of the unit in question, the opposite parties have taken shelter under one list, Annexure R-6 stating that the extension of 6 months was granted to the them on account of COVID-19 as per Circular dated 28.10.2020. It may be stated here that we have gone through this list very minutely and found that this extension has been given only for the registration of the projects meaning thereby that the validity of the registration of the projects which fell due during the Covid period were given immunity of six months for the said registration. It may be stated here that extension of registration of project is always provided under the provisions of Section 6 of The Real Estate (Regulation and Development Act), 2016 and rules made thereunder and this registration of projects has no concern insofar as delivery of possession of the unit in question is concerned. However, still this Commission is not oblivious of the fact that during the year 2020, due to Covid-19, lockdown in the country was announced on 25.03.2020, which was lifted in April 2020. This Commission has already dealt with this issue in various judgments while relying on one office memorandum dated 13.05.2020 issued by the Government of India, Ministry of Housing and Urban Affairs, Housing Section, whereby the registration and completion date or revised completion date or extended completion dates were extended by 6 months due to outbreak of COVID-19, which was extendable up-to further 3 months i.e. total 9 months. Thus, in our considered opinion, the opposite parties are entitled to get immunity of these 9 months from the actual due date of offering possession of the unit to the complainant i.e.  possession should have been delivered to the complainants latest by 1^st January 2022 (09 months from 1^st April 2021). Thus, in our considered opinion, by not offering and delivering possession of the unit in question by the promised date or even with the extended period of 9 months due to COVID-19, referred to above, the opposite parties are deficient in providing service and guilty of adoption of unfair trade practice. Thus, in our considered view, the complainants are entitled to get delayed compensation for the period of delay in delivery of possession.

 

What amount of compensation should be granted to the complainants, for the period of delay in delivery of possession of their unit?

 

1.               Now, we will like to decide as to what amount of compensation should be granted to the complainants, for the period of delay in delivery of possession of their unit. On account of delay in actual delivery of possession of the unit to the complainants, they have suffered mental agony, hardships and financial loss. In the case titled as Lucknow Development Authority v. M K Gupta (1994) 1 SCC 243, the Hon’ble Supreme Court discussed about the extent of the jurisdiction of the Consumer Fora to award just and reasonable compensation for the harassment and agony suffered by a consumer. In Nagesh Maruti Utekar Vs. Sunstone Developers Joint Venture, Consumer Case No. 12 of 2017, decided on 04 May 2022, the Hon’ble National Commission awarded interest @9% p.a. from the committed date of delivery till possession is delivered. Relevant part of the said order is reproduced hereunder:-

“……Consequently, the Opposite Party Developer is directed to pay interest @9% w.e.f. 31.03.2014, i.e., the expected date of delivery of the possession, on the amount deposited by the respective Complainant till 02.09.2017, i.e., the date on which the possession of the Flat was offered by the Opposite Party Developer, within two months from today.…..”

 

In Shreya Kumar & 11 Ors. Vs. M/s. Ansal Housing & Construction Ltd. & 3 Ors., Consumer Case No. 1021 of 2017, decided on 05 May 2022, the Larger Bench of the Hon’ble National Commission has awarded interest @9% p.a. from the committed date of delivery till possession is delivered. In the present case, the complainants are still empty handed and have to approach this Commission for redressal of their grievance by way of filing this complaint. Under above circumstances, in our considered opinion, if we grant interest @9% p.a. to the complainants on the entire amount deposited by them, from the due date of possession of their unit i.e. 01.01.2022, as held above, till 07.09.2023 (one day before delivery of possession), that will meet the ends of justice.

14]              Now the final question which falls for determination is as to whether the complainants are liable to make any further payment qua the unit in question or are entitled for any refund of the amount or not? Perusal of payment plan – Schedule C attachment with the allotment letter reveals that total sale consideration of the unit in question was fixed as ₹92,94,487/-, which includes basic sale price, PLC, IFMS, Maintenance, EDC, Club membership, covered parking and power backup. As per statement Annexure R-9, the amount of ₹95,01,911.40 i.e. (₹8854802.89 + ₹647108.51 as ST/GST) stood received by the opposite parties yet vide statement of account attached with the possession letter dated 25.07.2023, the opposite parties have raised a demand of ₹8,43,100.47, which stood deposited by the complainants with this Commission.

15]              First coming to the demand of differential amount of ₹2,94,712.50 and ₹8,265.00 raised by the opposite parties towards enhanced area and increased EDC on account of the said increase in area, it may be stated here that it is clearly coming out from Clause 1.6 of Agreement for Sale dated 14.08.2018, Annexure C-3, that the complainants have agreed with regard to the payment of differential amount only up-to the extent of 5 percent on account of any additions/alternations in the sanctioned plans, layout plans and specifications and in the nature of fixtures, fittings and amenities described therein in respect of the apartment, plot or buildings, as the case may be, without their previous written consent. In the present case, the increase in the area is below 5% i.e. only 87 sq. ft. and as such, the demand of the opposite parties on this account is justified and the complainants are liable to pay the said differential amount, which includes enhanced EDC also. Therefore, the demand raised by the opposite parties to the extent of ₹8,43,100.47 is justified. We further opinion that the opposite parties should be given liberty to appropriate/ adjust this amount of ₹8,43,100.47, payable by the complainants, from the amount of compensation to be paid by the opposite parties @9% p.a. for the period from 01.01.2022 till 07.09.2023, without levying any penalty or future interest thereupon.

16]              In view of above, the amount of ₹8,43,100.47 lying deposited with this Commission, alongwith interest if any accrued thereupon in the FDR is ordered to be  released in favour of the complainants, in equal share, through RTGS on their furnishing Bank Account details and proper identification.  

 

Relief granted by this Commission as under:-

17]              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 pay to the complainants, compensation by way of interest @9% p.a. starting from 01.01.2022 till 07.09.2023 (one day before the delivery of possession), on the amount deposited by them, within a period of 30 days from the date of receipt of a certified copy of this order, failing which the entire accumulated amount (01.01.2022 till 07.09.2023) shall carry interest @12% p.a. from the date of default till this entire accumulated amount is paid to the complainants.

          However, the opposite parties are at liberty to appropriate/adjust the amount of ₹8,43,100.47, payable by the complainants, without levying any future interest or penalty thereupon, at the time of  calculating delayed interest 9% p.a. starting from 01.01.2022 till 07.09.2023, as directed above. 

2. To pay to the complainants, compensation to the tune of Rs.1,00,000/- for causing them mental agony and harassment and also for deficiency in providing service and adoption of unfair trade practice and cost of litigation to the tune of Rs.35,000/- within a period of 30 days, from the date of receipt of a certified copy of this order, failing which the said amounts shall carry interest @9% p.a. from the date of default till realization.

18]              Certified copies of this order be sent to the parties, free of charge.

19]              The file be consigned to Record Room after completion.

Pronounced.

 29.12.2023

 

[RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

 

 (RAJESH K. ARYA)

MEMBER

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