APPEARED AT THE TIME OF ARGUMENTS

PRONOUNCED ON    5^th July  2019

ORDER

          This consumer complaint has been filed by Sidharth Ghosh and Poulami Roy, the complainants against M/s. Supertech Ltd., the opposite parties.  The complainants have alleged that they booked a ready to move in apartment under the project of the opposite party namely “Ready to move In, Spacious Luxury Apartments” unit no. 1102 in Aster 2 tower, Supertech Emrald Court, Plot No. 4, Sector 93-A, Expressway Noida, U.P. – 201304.  They paid Rs. 17 lakh in advance in the last week of February 2012.  The possession of the flat was to be given on 30.04.2012.  However, the possession was not given and then the complainants inspected the site and found that the construction was not completed and that the flat was not in a position to be handed over.  It has further been alleged that the complainants were trying to get the home loan sanctioned as after the booking within 30 days, 85% of the consideration was to be paid.  As the arrangements of loan took some time, the opposite party sent final demand cum cancellation notice dated 28.05.2012.  Though the complainant wrote many letters to the opposite party, informing that the construction was not completed and that was likely to take some more time and in the meanwhile, the money will be arranged and paid to the opposite parties.  However, the opposite party vide its letter dated 08.10.2012, sent the final demand cum cancellation notice in which it was informed to the complainant that if the outstanding amount is not paid within ten days, the allotment shall be cancelled.  No further amount was paid by the complainants.  As neither possession was given to the complainants nor the amount was refunded to the complainants, being aggrieved the complainants have filed this consumer complaint.

2.      The complaint has been resisted by the opposite party by filing the written statement wherein it has been stated that as per the payment plan, 10% of the total consideration was to be paid as the booking amount and 85% of the total consideration was to be paid within 30 days.  The remaining 5% was to be given only at the time of offer of possession.  As the complainants paid only the booking amount and never paid the due 85% of the total consideration, there was no question of handing over the possession of the flat to the complainants.  The opposite party had sent several demand notices to the complainants, however, the complainants failed to deposit 85% amount of the total consideration.  Then the opposite party was compelled to cancel the allotment.  It was stated as per the provision of the agreement/allotment letter, 15% of the total amount was to be forfeited if the allottee cancels the allotment or does not pay the remaining instalments.  Consequently total booking amount paid by the complainants stands forfeited and the complainants are not entitled to any refund.  On account of these reasons, it was requested that the complaint be dismissed.

3.      Both the parties filed their evidence by way of affidavits, which were taken on record.

4.      Heard the learned counsel for both the parties and perused the record.

5.      The learned counsel for the complainants reiterated the facts of the complaint and requested that the amount paid by the complainants to the opposite party be refunded to the complainants alongwith interest and in respect of his arguments referred to the following judgments passed by this Commission: (1) Consumer Case No. 232 of 2014, Puneet Malhotra vs. M/s. Parsvnath Developers Ltd. and (2) Consumer Case No. 510 of 2015, Jitendra Balani vs. M/s. Unitech Ltd. connected with other similar matters.

6.      The learned counsel for the opposite party also reiterated the grounds mentioned in the written statement on which the complaint was resisted.  It was stated that the essence of the scheme was the timely payment of the total consideration as the property was a “ready to move in” flat.  It was very clear to the complainants that huge sum would be required to be paid in one go and if they did not have this arrangement, they should not have booked the flat under this scheme. The learned counsel for the opposite party in respect of his arguments referred to the following judgments passed by Hon’ble Supreme Court: (1) (2000) 4 SCC 120, Prashant Kumar Shahi vs. Ghaziabad Development Authority and (2) (2013) 1 SCC 345, Satish Batra vs. Sudhir Rawal.

 7.     I have carefully considered the arguments of both sides. The main question in the present complaint is that whether the complainants are entitled to refund of any amount and if they are entitled to refund then what amount should be refunded and with what interest.  Both the parties agreed that Rs. 17 lakh was paid by way of booking amount in the last week of February, 2012.  Clearly as per the agreement, remaining 85% of the consideration amount was to be paid within 30 days.  The complainants have clearly failed in paying this amount of 85% of the total consideration, though it has been claimed by the complainants that this was due to the time taken in the sanctioning of the loan amount from the bank. 

8.      As the complainants did not pay the remaining instalments as per the payment plan even after several notices given by the opposite party, the opposite party was constrained to cancel the allotment.  This flat was booked by the complainants as “ready to move in” flat and that is why the importance of timely payment of instalment was there so that the construction could be completed within the agreed time frame.  As the further instalments were not paid by the complainants, the opposite party was justified in cancelling the allotment.

9.      The complainants paid Rs. 17 lakh as the booking amount and the complainants want refund of this amount along with the interest whereas the claim of the opposite party is that as per the following clause of the agreement, the booking amount of Rs. 17 lakh stands forfeited in favour of the opposite party:-

1.     That the timely payment of Installments as indicated in the Payment Plan is the essence of the scheme.  Installment due towards payment of the unit will be paid at intervals in accordance with the mode of payment spelt out above.  If payment is not received within the stipulated period or in the event of breach of any of the terms and conditions of this agreement by the buyer, the allotment will be cancelled and balance payment will be refunded without any interest, after deduction of 15% of the total cost of the unit.

10.    From the above clause, one thing is clear that the timely payment of instalments is the essence of the scheme.  The complainants have failed in timely payment of instalments and as per the above clause, the opposite party can claim forfeiture of the booking amount. Though under the agreement, it is mentioned that the opposite party is entitled to forfeiture of 15 % of the consideration amount, this Commission vide its judgment dated 06.01.2015 in R.P. No. 3860 of 2014, DLF Ltd. vs. Bhagwanti Narula, has observed that forfeiture of more than 10% of the amount is illegal and cannot be forfeited. It reads as under:-

“13.  For the reasons stated herein above, we hold that (i) an amount exceeding 10% of the total price cannot be forfeited by the seller, since forfeiture beyond 10% of the sale price would be unreasonable and (ii) only the amount, which is paid at the time of concluding the contract can be said to be the earnest money.  The Petitioner Company, therefore, was entitled to forfeit only the sum of Rs.63,469/-, which the complainant had deposited with them at the time of booking of the  apartment. - - -”

11.    The flat was booked as “ready to move in” flat.  This means that the flat was more or less ready when the booking was made and clearly the flat must have been constructed with the own funds of the opposite party.  Clearly the amount paid by the complainants may not have been utilised in the construction.  Moreover, the Hon’ble Supreme Court in Civil Appeal No. 193/2015, M/s. Kailash Nath Associates vs. Delhi Development Authority & Anr. has held that the opposite party is entitled to forfeiture of the earnest money only when the opposite party has suffered loss and proof has been placed for such loss. The Hon’ble Supreme Court has observed as follows:

“29.   Based on the facts of this case, it would be arbitrary for the DDA to forfeit the earnest money on two fundamental grounds. First, there is no breach of contract on the part of the appellant as has been held above. And second, DDA not having been put to any loss, even if DDA could insist on a contractual stipulation in its favour, it would be arbitrary to allow DDA as a public authority to appropriate Rs.78,00,000/- (Rupees Seventy Eight Lakhs) without any loss being caused. It is clear, therefore, that Article 14 would apply in the field of contract in this case and the finding of the Division Bench on this aspect is hereby reversed.”

12.    In the present case, if only the booking amount was paid and further instalments were not paid, the opposite party may not have suffered any loss as the flat was ready to move in flat and definitely could have been sold to any other buyer.  The opposite party has not filed any proof of loss suffered by the opposite party in the matter and therefore relying upon the judgment of the Hon’ble Supreme Court in M/s. Kailash Nath Associates vs. Delhi Development Authority & Anr. (supra), I am of the view that the booking amount has to be refunded to the complainants in the facts and circumstances of the case. 

13.    In respect of the interest demanded by the complainants on the refund amount, it is seen that the complainants themselves have defaulted in payment of further instalments as per the payment plan for which the opposite party cannot be held responsible.  Though, as per the agreement, the opposite party is also entitled to forfeit the booking amount, however, in the light of the judgment of the Hon’ble Supreme Court in M/s. Kailash Nath Associates vs. Delhi Development Authority & Anr. (supra), this Commission is allowing the refund of the booking amount.  In these circumstances, in my view, an interest @ 5% p.a. would be reasonable and sufficient in the facts and circumstances of the case from the date of filing of the present complaint.

14.     Consequently, the complaint is partly allowed and the opposite party is directed to refund Rs. 17 lakh paid by the complainants as booking amount to the complainants, alongwith interest @ 5% p.a. on this amount from 08.07.2013 i.e. date of filing of the complaint till actual payment within a period of 45 days from the date of receipt/service of this order.       No order as to costs.