Chandigarh

StateCommission

CC/154/2015

Bhupender Kumar Sharma - Complainant(s)

Versus

M/s Puma Realtors Pvt. ltd. - Opp.Party(s)

Neeraj Sobti, Adv.

29 Sep 2015

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Consumer Complaint No.	:	154 of 2015
Date of Institution	:	28.07.2015
Date of Decision	:	29.09.2015

 

Bhupender Kumar Sharma, resident of House No.173, Sector 12-A, Panchkula.

 

……Complainant.

 

Versus

 

1. M/s Puma Realtors Pvt. Ltd., An IREO Group Company through its Managing Director/Chairman, Corporate Office at SCO No.6-8, First and Second Floors, Sector 9-D, Madhaya Marg, Chandigarh – 160009.

 

2. M/s Puma Realtors Pvt. Ltd. An IREO Group Company through its Managing Director/Chairman, Registered Office at No.5, Dhanraj Chambers, 1st floor, Satbari, New Delhi – 110074.

              ....Opposite Parties.

 

BEFORE:  JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

               SH. DEV RAJ, MEMBER.

               MRS. PADMA PANDEY, MEMBER.

               

Argued by:

 

Sh.Neeraj Sobti,  Advocate  for  the complainant.

Sh. Ramnik Gupta, Advocate for the Opposite Parties.

 

PER PADMA PANDEY, MEMBER

                The facts, in brief, are that, lured by the Opposite Parties who made a number of assurances through various newspapers, marketing emails and telemarketing with regard to launching of their integrated residential project under the name and style of “IREO HAMLET in Sector 98,  SAS Nagar, Mohali, the complainant met the representative of the Opposite Parties for the purchase of a residential plot in their project. It was assured by the Opposite Parties that since the development activity at the site had started in full swing, possession of the plot, complete in all respects would be handed over within the maximum period of 30 months, from the date of execution of the Plot Buyer‘s Agreement. On such assurance, the complainant applied for the allotment of a residential plot in the project of the Opposite Parties vide application dated 24.05.2011 (Annexure C-1) and paid a sum of Rs.6,50,000/- vide cheque dated 24.05.2011,  as booking amount. Subsequently, the complainant was allotted plot No.291 in the residential project “IREO Hamlet” measuring 250.59 square yards approx., in Sector 98, S.A.S. Nagar, Mohali, Punjab, vide provisional allotment letter dated 26.05.2011 (Annexure C-2). On 25.06.2011, the complainant paid another amount of Rs.2,89,713/-, towards part price of the said plot vide receipt dated 14.07.2011 (Annexure C-3). Thereafter, the Plot Buyer’s Agreement was executed between the parties, at Chandigarh, on 11.08.2011 (Annexure C-4) and as per Clause 3, basic sale price of the plot was Rs.62,64,750/-. It was further stated that the allottee was also required to pay External Development Charges (EDC) @Rs.1275.10 per sq. yard of the plot area and also costs, charges, fees, which in all constituted the sale consideration. It was stated that the complainant opted for Time Linked Payment Plan, according to which, he was required to pay 95% of the total sale consideration within 18 months, from the date of booking and the remaining 5% was to be paid on delivery of possession.

2. It was averred that according to Clause 21.2 of General Clauses of the Agreement, the Opposite Parties were to develop the said project and further, as per Clause 11.1 of “Possession and Handing Over Charges”, the Opposite Parties were liable to handover physical possession of the plot to the allottee within a period of 24 months, with a grace period of 6 months i.e. not later than 30 months from the date of execution of the Agreement i.e. latest by 11.02.2014. Further, as per Clause 11.2, if the Opposite Parties failed to offer possession of the said plot to the allottee by the end of grace period, they should be liable to pay compensation calculated @Rs.50/-per sq. yd. of the area of the said plot (Delay Compensation) for every month of delay until the actual date fixed by them for handing over of possession of the same to the allottee. Thereafter, as per the demand raised by the Opposite Parties, the complainant made another payment of Rs.10,19,594/- vide receipt (Annexure C-5). The Opposite Parties changed the payment plan from “Time Linked” to “Development Linked” vide letter dated 26.09.2011 (Annexure C-6). Then, the complainant paid a sum of Rs.10,19,594/- vide cheque (Annexure C-7) to the Opposite Parties as per their Development Linked Plan and upto 30.06.2013 he had paid the total amount of Rs.29,78,901/-. It was further averred that the complainant received a letter dated 30.10.2014 (Annexure C-8) from the Opposite Parties, vide which, they changed the original plot No.291 (measuring 250.59 sq. yd.) to plot No.245 (measuring 259.36 sq. yd.), without the consent of the complainant,  due to certain planning requirements of IREO Hamlet Project, wherein, the development of the entire block, where the original plot was situated, was decided to be dropped/absolutely deleted by the Opposite Parties and they also demanded a sum of Rs.11,59,531.45 from him.  Unilaterally, the complainant vide letter dated 10.12.2014 sought refund of the deposited amount alongwith interest and compensation but despite repeated reminders dated 06.01.2015 and 20.01.2015 (Annexure C-9 to C-11), the Opposite Parties failed to refund the same. Ultimately, the complainant sent a legal notice dated 14.02.2015 (Annexure C-12) to the Opposite Parties but to no avail. After receipt of the legal notice, the Opposite Parties tried to impose the said relocated plot No.245 to the complainant by issuing the notice of possession dated 23.06.2015 (Annexure C-13), which was illegal, as they failed to obtain completion certificate from the competent authority. Thus, the Opposite Parties were deficient, in rendering service, as also indulged into unfair trade practice.  When the grievance of the complainant was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the “Act” only), was filed.

3.         In their written statement, the Opposite Parties, took-up certain preliminary objections, to the effect, that the complaint was liable to be dismissed, due to existence of arbitration clause No.33 in the Plot Buyer’s Agreement dated 11.08.2011; that the complainant was not consumer as the present complaint related to the enforcement of agreement to sell/purchase of a residential plot i.e. an immoveable property and hence was not covered under the Act; that the complainant did not hire any services of the Opposite Parties, as the parties did not enter into any contract for hiring the services; that the complainant did not book the plot for his personal use but for investment/commercial purposes; that the allegations in the complaint being of contractual nature, were only triable by the Civil Court; and that this Commission had no jurisdiction to entertain and try the complaint.

4.           On merits, it was denied that it was ever assured by the Opposite Parties that the development activity at site had started in full swing and possession of the plot would be handed over to the complainant within a period of 30 months from the date of execution of the said Agreement. After having satisfied in all aspects, the complainant applied for booking of the plot vide application dated 24.05.2011 by making payment of Rs.6,50,000/- towards booking amount. It was admitted by the complainant that he opted for Time Linked Payment Plan, however, for the benefit of the allottees including him (complainant), the payment plan from “Time Linked” was changed to “Development Linked” vide letter dated 26.09.2011 (Annexure OP-4), which was duly accepted by him. It was stated that as per Clause 21.2 of the Agreement, it was specifically represented and agreed between the parties that the development of the sector roads/access roads were to be provided by the State Government and the Opposite Parties should carry out internal development works within the project only. It was pleaded that the complainant on the basis of the selective reading of part of Clause 11 of the Agreement wrongly alleged that possession of the plot was to be delivered within 30 months (24 months from the date of Agreement + 6 months grace period) from the date of said Agreement dated 11.08.2011 and possession of the plot was required to be given latest by 11.02.2014, in as much as, the co-joint reading of Clauses 11.1 to 11.3 of the said Agreement would reveal that the period of offering of possession travels beyond the said alleged period of 30 months as per Clause 11.2 of the said Agreement. As per Clause 11.3 of the Agreement, the complainant was given an option to terminate the said Agreement and seek refund after expiry of 42 months from the said Agreement if the Opposite Parties fail to offer possession for 42 months by serving a notice upon the Opposite Parties. In this regard, he failed to exercise the said option and possession of the plot had already been offered vide Notice of Possession dated 23.06.2015 (Annexure C-13). It was further denied that the complainant kept on making the payment of the installment as per demands raised by the Opposite Parties vide demand notes/reminders dated 26.05.2011, 29.06.2011, 29.07.2011, 29.08.2011, 30.04.2013, 31.05.2013, 30.10.2014 and 26.11.2014 (Annexure OP-5 to OP-12). It was stated that the development work started at the site on 01.05.2013 and according to the agreed Development Linked Payment Plan, the Opposite Parties raised demand note dated 30.04.2013 but he did not make the payment of the said installment, as such, reminder dated 31.05.2013 was issued and after receipt of the said reminder, he made the payment vide cheque dated 03.06.2013 (Annexure C-7).

5.             Further, as per Clause 10.3 of the Agreement, it was clearly agreed by the complainant that the Opposite Parties were in process of developing the project and that the size and location of the plot could be changed by them and that no claim, whatsoever, monetary or otherwise should lie against the Opposite Parties, nor should be raised by the complainant, in any manner, whatsoever. Thereafter, on account of certain planning requirements for proper and beneficial development of the IREO Hamlet project, it became imperative to relocate certain plots from their existing locations and accordingly, the Opposite Parties vide letter dated 30.10.2014 (Annexure C-10) duly informed the complainant that the plot allotted to him has been relocated due to certain planning requirements and consequently plot No.291 was changed to plot No.245 and the area was also slightly changed. It was specifically agreed that the size and location of the plot were tentative only and the same might be changed during the process of development of the project. It was stated that the location of plot No.245 would reveal that it is better because the relocated plot is now situated on a  15 meter wide ROW (right of way) than originally allotted plot on 12 meter wide ROW. Even, there are no terms and conditions in the said Agreement, vide which, the Opposite Parties were under any obligation to obtain prior consent of the complainant for re-located the plot. The Opposite Parties strictly acted in accordance with the agreed terms and conditions of the said Agreement and the demand of the installment vide letter dated 30.10.2014 and, thereafter, reminder dated 01.12.2014 was rightly raised upon the complainant but he did not make the payment of the same and instead demanded refund of the deposited amount vide letter dated 10.12.2014 (Annexure C-9) in total contravention of the agreed terms and conditions of the said Agreement. As per the Opposite Parties, the clauses 10.4 and 11.3 of the Agreement are totally independent, separate and distinct from each other as both the clauses deal with the separate and distinct eventualities. It was admitted that the complainant sent emails on 11.12.2014, 20.12.2014 and 23.12.2014 (Annexure OP-14 Colly.) and reminders dated 06.01.2015 and 20.01.2015 (Annexure C-10 and C-11) to the Opposite Parties for refund of the amount but it was duly made clear to him that no refund is liable to be made to him, as it is simply a case of relocation and not absolute deletion of the plot. It was further averred that the Opposite Parties being in the process of developing a mega project has already been granted exemption from the provisions of the Punjab Apartment and Property Regulation Act, 1995 (PAPRA) by the state of Punjab vide notification dated 14.08.2008 (Annexure OP-16) and that being so, the Opposite Party was not required to obtain the completion certificate under Section 14 of the PAPRA. Therefore, there was no deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice. The remaining averments, were denied, being wrong.

6.             The complainant filed replication, wherein, he reiterated all the averments, contained in the complaint, and refuted those, contained in the written version of the Opposite Parties.

7.             We have heard the Counsel for the parties, and have gone through the evidence, and record of the case, carefully. 

8.             Admittedly, the complainant applied for the allotment of a residential plot, in the project of the Opposite Parties, and he was allotted Plot No.291 in the residential project “IREO Hamlet” in Sector 98, S.A.S. Nagar, Mohali, Punjab vide provisional allotment letter dated 26.05.2011 (Annexure C-2). It is also the admitted fact that Plot Buyer’s Agreement dated 11.8.2011 (Annexure C-4) was executed between the parties. It is evident from the record that the complainant opted for Time Linked Payment Plan, and subsequently the Opposite Parties offered change of payment plan to its allottees including him (complainant) from “Time Linked Payment Plan” to “Development Linked Payment Plan” vide letter dated 26.09.2011 (Annexure C-6) and he did not raise any objection, to the same. It is also the admitted fact that the complainant paid an amount of Rs.29,78,901/- as is evident from the letter dated 30.10.2014 (Annexure C-8). It is also evident from the documents that the Opposite Parties changed plot from Plot No.291 to Plot No.245 and area of the plot also stands changed from 250.59 sq. yds to 259.36 sq. yds. approximately

9.             The first objection, raised by the Opposite Parties, is as regards the existence of arbitration clause 33 in the Plot Buyer’s Agreement dated 11.08.2011. In this context, the Counsel placed reliance on Auro Developers Vs. Mala Mukherjee, C.O. No.2828 of 2010, decided by Hon’ble Calcutta High Court on 23.12.2011, wherein the Calcultta High Court while relying upon the judgment of Hon’ble Supreme Court passed by seven Judges Bench in SBP and Co. Vs. M/s Patel Engineering Ltd. & Anr., AIR 2006 SC 450, held, interalia, that “……..It would certainly include the Court as defined in section 2(e) of the Act and would also, in our opinion, include other courts and may even include a special tribunal like the Consumer Forum [See Fair Air Engineers (P) Ltd. & Anr. Vs. N. K. Modi, MANU/SC/0141/1997: 1996 (6) SCC 385]….” The Opposite Parties further placed reliance on judgments of Hon’ble Calcutta High Court in Indusind Bank Vs. Gadadhar Banerjee, C.O. No.223 of 2009 decided on 01.04.2010 and Sudarshan Vyapar Pvt. Ltd. & Anr. Vs. Madhusudan Guha & Anr., C.O. No.2648 of 2012 decided on 06.12.2012, wherein in Para 15, it was held that “….once the parties had agreed to resolve their disputes by the arbitration, the jurisdiction of a Civil Court is clearly ousted by reason of Section 5 of the Arbitration and Conciliation Act. In view of the aforesaid and having regard to the law laid down in SBP (supra), this Court is of the view that the consumer forum has no jurisdiction to entertain the said complaint….” The Counsel submitted that the judgment of Hon’ble Supreme Court of India in Fair Air Engg. Pvt. Ltd. & another Vs. N.K.Modi (1996) 6 SCC 385, is not applicable as the Hon’ble Apex Court had discussed the applicability of Section 34 of the old Arbitration Act, 1940 and there was no occasion of discussing  the  scope  and  applicability of Sections 5 and 8 of the Arbitration and Conciliation Act 1996. He further submitted that under Section 34, there was no bar of jurisdiction of the Judicial Authority but the discretion was vested with the Judicial Authority either to proceed with the matter before it, or to stay the matter and refer the dispute to be adjudicated    by the arbitrator. He further submitted that in Para 11, it was held by the Hon’ble Apex Court that the Consumer Foras fall within the definition of Judicial Authorities. He further submitted that in National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr., I (2012) CPJ 1 (SC), since the Hon’ble Apex Court did not discuss the scope and applicability of Sections 5 and 8 of the Arbitration and Conciliation Act, 1996, the same was not applicable in the instant case. He further submitted that under Section 5 of Arbitration and Conciliation Act, 1996, there is an absolute bar and Section 3 of the Consumer Protection Act, 1986 cannot be made applicable, in view of the fact that Arbitration and Conciliation Act came into force in the year 1996 when the Consumer Protection Act, 1986 was already in existence. Therefore, the provisions of the Act, enacted later on would prevail.

10.           With a view to appreciate the controversy, in   its proper perspective, reference to Section 3 of the Act is made, which reads as under;

“3. Act not in derogation of any other law.—

The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.”

Section 3 of the Act, is worded in widest terms, and leaves no manner of doubt, that the provisions of the Act, shall be, in addition to, and not in derogation of any other law, for the time being, in force. The mere existence of an arbitration clause, in the document, aforesaid, would not oust the jurisdiction of the Consumer Fora, in view of the provisions of Section 3 of the Act. In Fair Air Engg. Pvt. Ltd. & another Vs. N.K.Modi’s case (supra), the Hon’ble supreme Court of India held that the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. The Hon’ble Apex Court also held that Section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. The Hon’ble Apex court further held that the Legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the CPC. The Hon’ble Supreme Court in Para 17 held that dispute need not be referred to arbitration under clause 12 of the Agreement and the matter could be decided on merits by the State Commission itself.

11.           It may be stated here that the Hon’ble Supreme Court of India in its judgment in National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr.’s case (supra), in Paras 27 to 31 held as under:-

“27. The next question which needs consideration is whether the growers of seeds were not entitled to file complaint under the Consumer Act and the only remedy available to them for the alleged breach of the terms of agreement was to apply for arbitration. According to the learned Counsel for the appellant, if the growers had applied for arbitration then in terms of Section 8 of the Arbitration and Conciliation Act the dispute arising out of the arbitration clause had to be referred to an appropriate arbitrator and the District Consumer Forums were not entitled to entertain their complaint. This contention represents an extension of the main objection of the appellant that the only remedy available to the farmers and growers who claim to have suffered loss on account of use of defective seeds sold/supplied by the appellant was to file complaints with the concerned Seed Inspectors for taking action under Section(s) 19 and/or 21 of the Seeds Act.

28. The consideration of this issue needs to be prefaced with an observation that the grievance of a farmer/grower who has suffered financially due to loss or failure of crop on account of use of defective seeds sold/supplied by the appellant or by an authorised person is not remedied by prosecuting the seller/supplier of the seeds. Even if such person is found guilty and sentenced to imprisonment, the aggrieved farmer/grower does not get anything. Therefore, the so-called remedy available to an aggrieved farmer/grower to lodge a complaint with the concerned Seed Inspector for prosecution of the seller/supplier of the seed cannot but be treated as illusory and he cannot be denied relief under the Consumer Act on the ground of availability of an alternative remedy.

29. The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996. Moreover, the plain language of Section 3 of the Consumer Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force. In Fair Air Engineers (P) Ltd. v. N.K. Modi (supra), the 2-Judge Bench interpreted that section and held as under:

the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that Section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. It is true, as rightly contended by Mr. Suri, that the words ‘in derogation of the provisions of any other law for the time being in force’ would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act. Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well founded. Parliament is aware of the provisions of the Arbitration Act and the Contract Act, 1872 and the consequential remedy available under Section 9 of the Code of Civil Procedure, i.e., to avail of right of civil action in a competent Court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.

It would, therefore, be clear that the Legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the Code of Civil Procedure. Thereby, as seen, Section 34 of the Act does not confer an automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act. It is a matter of discretion. Considered from this perspective, we hold that though the District Forum, State Commission and National Commission are judicial authorities, for the purpose of Section 34 of the Arbitration Act, in view of the object of the Act and by operation of Section 3 thereof, we are of the considered view that it would be appropriate that these forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that the Act intends to relieve the consumers of the cumbersome arbitration proceedings or civil action unless the forums on their own and on the peculiar facts and circumstances of a particular case, come to the conclusion that the appropriate forum for adjudication of the disputes would be otherwise those given in the Act.”

(Emphasis supplied)

30. In Skypak Couriers Limited v. Tata Chemicals Limited (supra), this Court observed:

“Even if there exists an arbitration clause in an agreement and a complaint is made by the consumer, in relation to a certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal Agency, constituted under the Consumer Protection Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force.

31. In Trans Mediterranean Airways v. Universal Exports (supra), it was observed:

“In our view, the protection provided under the CP Act to consumers is in addition to the remedies available under any other statute. It does not extinguish the remedies under another statute but provides an additional or alternative remedy.”

In view of the law settled by the Hon’ble Supreme Court of India in National Seeds Corporation Ltd. Vs. M. Madhusudhan Reddy & Anr.’s case (supra), wherein the Hon’ble Apex Court, while discussing a number of judgments thread-bare, clearly held that “..The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996.” In DLF Limited Vs. Mridul Estate (Pvt.) Ltd., Revision Petition No.412 of 2011 decided on 13.05.2013 by a three Member Bench of the National Consumer Disputes Redressal Commission, New Delhi, after discussing a number of cases decided by the Hon’ble Supreme Court, it was held that mere existence of an arbitration clause in the Agreement did not oust the jurisdiction of the Consumer Fora from entertaining and deciding the consumer complaint. The National Commission took cognizance of the decision of the Apex Court in SBP and Co. Vs. M/s Patel Engineering Ltd. & Anr., AIR 2006 SC 450, as is evident from Para 33 of its judgment, which reads as under:-

“33.    Faced with this, Ld. Counsel appearing for the Opposite Parties contended that in this case, the Hon’ble Supreme Court did not take into consideration the decision of the Seven Judges Bench in the S.B.P & Co.’s case. We do not find substance in this submission as well.  In Madhusudhan Reddy’s case (Supra) , Supreme Court after taking into consideration the background, objectives and reasons behind the enactment of C.P. Act, juxtapositioning the provisions of the C.P. Act and the Arbitration Act of 1996 (Section 3 of the C.P. Act and Section 8 of the Arbitration Act of 1996) held that the complaint filed by a consumer under the C.P. Act would be maintainable and the relief cannot be denied by invoking the jurisdiction of section 8 of the Arbitration Act of 1996.  We are bound to follow the law laid down by the Supreme Court.  The judgment is binding precedent.

By establishing the Consumer Disputes Redressal Forums, the Legislature has provided special remedy for the redressal of the grievances of “small consumers” who buy the goods or avail of services for their personal purpose. Persons who have bought the goods or availed of services for commercial purposes have been specifically excluded from the definition of ‘consumer’ except where the goods have been bought or services availed of by a small consumer for earning his livelihood by way of self- employment.  Remedy provided under the C.P. Act is a special remedy with the objective of redressal of the grievances of the affected consumers in an expeditious and non-expensive manner. If the small consumers are relegated to the Alternative Dispute Resolution (ADR) mechanism of arbitration, the remedy provided under the C.P. Act would become illusionary.  It would be neither expeditious nor in-expensive. It would defeat the very purpose of enactment of the C.P. Act.” 

In the instant case, the complainant has specifically averred in his replication that he has chosen to file consumer complaint first and, as such, he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996. As regards, the contention of the Opposite Parties, that since there is an absolute bar under Section 5 of Arbitration and Conciliation Act, 1996, the provisions of Section 3 of Act cannot be made applicable, it may be stated here that the Consumer Protection Act, 1986 is a beneficial legislation and in view of the law laid down by the National Commission in DLF Limited Vs. Mridul Estates (P) Ltd.’s case (supra) and Hon’ble Supreme Court in National Seeds Corporation Ltd. Vs. M. Madhusudhan Reddy & Anr.’s case (supra), the objection of the Opposite Parties, in our considered opinion, is not tenable. As such, this Commission has the jurisdiction to entertain and try the complaint. In this view of the matter, this objection of the Opposite Parties, being devoid of merit, must fail, and the same stands rejected.

12.           As regards the next objection of the Opposite Parties that since the complainant, did not book the plot for his personal use but for investment/commercial purpose, and, as such, he was not consumer, it may be stated here that the complainant specifically stated in his replication that he did not purchase the said plot for an investment/commercial purpose, as alleged, but he purchased the said plot for his married daughter, who and her husband did not possess any residential property in their name and presently they are living in rental accommodation and to this effect, he also placed on record his affidavit and the affidavit of his daughter (Annexure C-15 and C-16). So, it is proved that in the absence of any cogent documentary evidence, brought, on record, by the Opposite Parties, to the effect, that the complainant purchased the property for investment/commercial purpose, the objection of the Opposite Parties, is not sustainable in the eyes of law. The same, therefore, stands rejected.

13.           The contention of the Opposite Parties that an Agreement for sale/purchase of a plot, cannot be treated as service and, therefore, the complainant is not consumers, is also not on sound footing. It may be stated here, that it is not the case of the Opposite Parties that the complainant purchased the plot, in an open auction, on “as is where is basis”, without any further promise of the Opposite Parties, of providing amenities/facilities, and developing the area, where the unit, in question, is situated.  In Narne Construction P. Ltd., etc. etc. Vs.  Union Of India and  Ors. Etc., II (2012) CPJ 4 (SC),  it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor the nature of transaction is covered by the expression ‘service’ of any description. Housing construction or building activity carried on by a private or statutory body constitutes ‘service’ within the ambit of Section 2(1)(o) of the Act. Similar principle of law, was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable. Not only this, Section 3 of the Act, provides an alternative remedy. Even if, it is assumed that the complainant has a remedy to file a suit, for specific performance, in the Civil Court, the alternative remedy provided under  Section 3 of the Act, can be availed of by him, as he falls within the definition of  consumer, as stated above. In this view of the matter, the submission of the Counsel for the Opposite Parties, being devoid of merit, must fail, and the same stands rejected.

14.           The next question, which falls for consideration, is, as to whether the remedy of the complainant to seek refund after offer of possession of relocated plot No.245, vide letter dated 23.06.2015 (Annexure C-13) was barred. The Counsel for the Opposite Parties submitted that once the notice of possession (Annexure C-13) was sent, the complainant could not seek refund. He relied upon Clause 11.3 of the Plot Buyer’s Agreement dated 11.08.2011 (Annexure C-4), which is extracted hereunder:-

“11.3

Subject to Clause 11.1, in the event of delay by the Company in handing over the possession of the said Plot beyond a period of 12 months from the end of the Grace Period (such 12 month period hereinafter referred to as the “Extended Delay Period”), then the Allottee shall become entitled to opt for termination of the Allotment/Agreement and refund of the actual paid up installment(s) made against the said Plot after adjusting the interest/penalty on delayed payments along with Delay Compensation for 12 months. Such refund shall be made by the Company within 90 days of receipt of intimation of this effect from the Allottee, without any interest thereon. For removal of doubt, it is clarified that Delay Compensation payable to the Allottee who is validly opting for termination, shall be limited to and calculated for the fixed period of 12 months only irrespective of the date on which the Allottee actually exercised the option for termination. This option of termination may be exercised by the Allottee only up till dispatch of the Notice of Possession by the Company to the Allottee whereupon the said option shall be deemed to have irrevocably lapsed. No other claim, whatsoever, monetary or otherwise shall lie against the company nor be raised otherwise or in any other manner by the Allottee.

 

The Counsel for the Opposite Parties submitted that the complainant could exercise option of termination only up-till dispatch of the Notice of Possession of relocated plot by the Opposite Parties to him, whereupon, the said option was deemed to have irrevocably lapsed. No doubt, in the instant case, the possession of the relocated plot had been offered to the complainant vide letter dated 23.06.2015 (Annexure C-13), but he (complainant) has challenged the same by way of filing the instant complaint on account of the fact that the Opposite Parties could not relocate the originally allotted plot, without obtaining any written consent from him and further the Opposite Parties did not take necessary approvals from the Competent Authorities and that there was no development and basic amenities at the site. It is apparent from the record that vide letter dated 30.10.2014 (Annexure C-8), the Opposite Parties relocated the plot allotted to the complainant to Plot No.245 and further the area of the plot also stands changed from 250.59 sq. yds to 259.36 sq. yds approximately and further no PLC was applicable on the relocated plot. Vide this very letter, the amount payable by the complainant, in terms of arrears/excess, if any, is shown as Rs.104253.97 and the net payable amount was Rs.1159531.45. It is also seen from the said letter that the complainant paid an amount of Rs.29,78,901/-. The Opposite Parties firstly relied upon Clause 10.1 of the Agreement, to contend that there could be changes, alterations, modification in the layout plans, site plan, dimensions etc. of the plot, in question. The Opposite Parties further relied upon Clause 10.3 of the Agreement, according to which, the allottee gave his concurrence and agreed that the site plan could be revised during the ongoing course of completion. On the other hand, the complainant relied upon Clause 10.4 of the Agreement, as per which, in case of absolute deletion of the said plot on account of reduction in the overall number of plots in the IREO Hamlet project or modification in its layout plans or due to any other reason whatsoever, the paid up sale consideration received against the said plot by the Company shall be refunded to the allottee alongwith simple interest thereon at the rate of 7.5% per annum. It may be stated here that when the Opposite Parties, without obtaining consent from the complainant, relocated the originally allotted plot to Plot No.245, they cannot take shelter under the garb of Clauses 10.1, 10.2 and 10.3 of the Agreement.

15.           A bare perusal of the Map (Annexure OP-15) clearly shows that the originally allotted plot No.291 was on 12 MT wide road. However, the said Map does not show the positioning of the relocated plot No.245 measuring 259.36 Sq. yd. approximately. Thus, in view of above, the complainant could not be forced to have the possession of the relocated plot in the absence of his consent and further when the Opposite Parties in letter (Annexure C-8) did not give any specific reason as to why they relocated the originally allotted plot. The Opposite Parties cannot take the complainant by surprise by relocating the originally allotted plot, for which, he has deposited his hard earned money with them. The Opposite Parties rather admitted in their reply that the development activity started at the site on 01.05.2013. Thus, the Opposite Parties offered the possession of the relocated plot vide letter dated 23.06.2015 (Annexure C-13) without development, basic amenities and approvals from the Competent Authorities, and that too without obtaining consent of the complainant, which certainly give rise to cause of action for seeking refund by the complainant.

16.           The next question, which falls for consideration, is, as to whether the development and the basic amenities were complete at the site before offering possession of the relocated plot vide letter dated 23.06.2015 (Annexure C-13) or not. It may be stated here that there is nothing, on the record, that complete development, in respect of the plot, in question, and amenities at the site as promised, as per the Plot Buyer’s Agreement dated 11.08.2011 (Annexure C-4), were available at the site. Had the amenities been completed at the site, then certainly the Opposite Parties, being in possession of the best evidence, having engaged a number of engineers/architects, would have placed, on record, their reports, to prove that factum. Though the Counsel for the Opposite Parties pleaded that the basic amenities such as water lines, sewer lines, etc., were required to be provided underground and nothing was visible on the surface, but they failed to produce any cogent and convincing evidence to this effect, and that the site where the plot, in question, was located was fully developed. Even the complainant stated in para No.8 of his replication that vide letter dated 29.06.2015 (Annexure C-14) regarding admission of the Opposite Parties i.e. upto the month of June, 2015 i.e. almost four months after the expiry of a period of 42 months the project was not complete in all respects, as per the Agreement.    Thus, from the aforesaid discussion, it is evidently clear that neither the Opposite Parties have completed the development and basic amenities nor they were having all the necessary sanctions/approvals from the Competent Authorities up-till June, 2015.

17.           So far as the contention of the Opposite Parties that they were exempted under Section 44 of the Punjab Apartment and Property Regulation Act, 1995  vide Notification dated 14.8.2008 (Annexure OP-16), is concerned, it may be stated here that the said exemption was granted subject to number of conditions to be fulfilled by the Opposite parties viz. the development work shall be carried out in accordance with the layout plan sanction, the Promoters of the Housing Project shall strictly abide by the legal agreement dated 3.4.2006 as well as various notifications issued by Department of Housing and Urban Development; the promoter shall deposit the entire amount in respect of the contribution to the Punjab Urban Development found created under Section 32 of the PAPRA; the promoter shall be responsible for obtaining Final NOC from Punjab Pollution Control Board and also obtain environmental clearance from the Ministry of Environmental and Forest Government of India. However, nothing has been placed on record by the Opposite Parties to prove that they fulfilled the aforesaid conditions. Thus, in the absence of any cogent and convincing evidence to the effect that the basic amenities and other allied facilities, at the site, were available and when there is clear admission by the Opposite Parties that the construction activity started at the site on 01.05.2013, the possession offered was clearly a paper possession and not legal. Thus, it cannot be said that the Opposite Parties were not required to obtain complete and occupation certificate from the Competent Authorities. It is, therefore, held that the Opposite Parties were not only deficient, in rendering service but also indulged into unfair trade practice, by offering a paper possession to the complainant, before completing the basic amenities as also without obtaining the necessary sanctions/approvals.

18.           The next question, which falls for consideration, is, as to whether, in the circumstances, referred to above, the complainant is entitled to refund of the amount deposited by him with interest, if yes, to what extent. Moreover, when the Opposite Parties, without the written consent of the complainant, changed his original plot No.291 to plot No.245 and demanded more money, the complainant sought refund of his deposited amount alongwith interest etc., however, the Opposite Parties after receipt of the letters/reminders from the complainant dated 10.12.2014, 06.01.2015, 20.01.2015 and lastly the legal notice dated 14.02.2015 (Annexure C-9 to C-12), did not give any response and failed to refund the same. Since it has been held above that the possession offered vide letter dated 23.6.2015 (Annexure C-13) was merely a paper possession and not a legal physical possession with all basic amenities as provided under the terms and conditions of the Plot Buyer’s Agreement dated 11.8.2011, and furthermore, when there was no development at the site and the Opposite Parties did not give any specific date for providing the same, the complainant is definitely entitled to the refund of amount of Rs.29,78,901/-deposited by him with the Opposite Parties, alongwith interest @12% p.a.

19.           The next question, which falls for consideration, is, as to whether, the complainant is entitled to any compensation or not. The complainant deposited his hard earned money, in the hope that he will have a house to live in. On account of non-delivery of legal physical possession of the plot, in question, complete in all respects, by the Opposite Parties, to the complainant, and, on the other hand, by offering only a paper possession and that too of the relocated plot, without obtaining his consent for doing so, and not refunding the amount deposited, he (complainant) had certainly suffered physical harassment and mental agony at the hands of the Opposite Parties, for which, he need to be suitably compensated. In our considered opinion, compensation in the sum of Rs.1,00,000/- would be just and adequate, to meet the ends of justice.          

20.           No other point, was urged, by the Counsel for the parties.

21.            For the reasons, recorded above, the complaint is partly accepted, with costs, and the Opposite Parties are jointly and severally, held liable and directed in the following manner:-

(i)     To refund the amount of Rs.29,78,901/-, alongwith interest @12% per annum, from the respective dates of deposits, within three months, from the date of receipt of a certified copy of this order.

(ii)    To pay an amount of Rs.1,00,000/-  (Rupees One Lac only), to the complainant, as compensation for mental agony and physical harassment, within a period of three months from the date of receipt of a certified copy of the order.

(iii)   To pay cost of litigation, to the tune of Rs.20,000/-, to the complainant.

 (iv)  In case, the payment of amounts, mentioned in Clauses (i) and (ii), is not made, within the stipulated period, then the Opposite Parties, shall be liable to pay the amount mentioned in Clause (i) above, with interest @15% per annum, instead of @12% per annum, from the respective dates of deposits, till realization and amount mentioned in Clause (ii) above, with interest @15% per annum from the date of default till realization, besides costs of litigation.

22.           Certified Copies of this order be sent to the parties, free of charge.

23.           The file be consigned to Record Room, after completion.

Pronounced

29.09.2015

Sd/-

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

Sd/-

[DEV RAJ]

MEMBER

 

 

Sd/-

[PADMA PANDEY]

 MEMBER

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