Chandigarh

StateCommission

CC/190/2014

Jaswinder Kumar & anr. - Complainant(s)

Versus

M/s Unitech Limited, - Opp.Party(s)

Rakesh Sharma

19 Feb 2015

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

                UNION TERRITORY, CHANDIGARH

 

                               

Consumer Complaint No.	190 of 2014
Date of Institution	23/12/2014
Date of Decision	19/02/2015

 

1.     Jaswinder Kumar son of Shri Mehar Chand;

 

2.     Mrs.Urmila Rani wife of Mr.Jaswinder Kumar ;

 

Both residents of flat No.1531, Progressive Enclave, Sector 50-B, Chandigarh.  

….…Complainants

 

V E R S U S

 

1. M/s UNITECH Limited, SCO No.189-190-191, Sector 17-C, Chandigarh – 160017 U.T., through its Managing Director;

2nd Address : 6, Community Centre, Saket, New Delhi – 110017.

 

1. Shri R.K.Chhabra, Senior Manager/General Manager – Marketing, UNITEC Limited, SCO No.189-190-191, Sector 17-C, Chandigarh-160017 U.T.

 

1. Housing Development Finance Corporation Limited, SCO 153-155, Sector 8-C, Madhya Marg, Chandigarh-160008, through Shri Bhupinder Singh, Manager.  

                                                .….. Opposite Parties

 

 

BEFORE: JUSTICE SHAM SUNDER (RETD.), PRESIDENT

                SH.DEV RAJ, MEMBER

                SMT.PADMA PANDEY, MEMBER      

                                                                       

Argued by:   

 

Sh.Rakesh Sharma, Advocate for the complainants.

Ms.Vertika H.Singh, Advocate for Opposite Parties No.1 and 2.

Ms.Rupali, Advocate for Opposite Party No.3.

 

PER PADMA PANDEY, MEMBER

 

              In brief, the facts of the case, are that the complainants were desirous and looking forward to buy a residential house for themselves to satisfy their need and came across an advertisement in the newspaper. Thereafter, the complainants came in contact with Opposite Party No.2, who convinced them to buy a residential unit in the upcoming project of Opposite Parties No.1 and 2. It was further stated that the complainants were jointly allotted residential unit in executive floors on ground floor of plot No.59, measuring 1796 sq. feet, Block ‘D’ in Mega Township known as UNIWORLD CITY, Sector 97, S.A.S.Nagar (Mohali), vide allotment letter dated 20.03.2010 (Annexure C-1). The total consideration of the unit was fixed at Rs.50,99,300/-. The complainants paid the booking amount of Rs.4,85,000/- to Opposite Parties No.1 & 2 and after receipt of the aforesaid amount, Unitech Limited entered into Buyer’s Agreement dated 17.05.2010 (Annexure C-2) with the complainants.  It was stated that Tripartite Agreement dated 10.08.2010 (Annexure C-3) was also executed between the complainants and Opposite Parties No.1 to 3, at Chandigarh, for housing loan. It was further stated that as per Article 4, para 4.a(i) of the Buyer’s Agreement, Opposite Parties No.1 and 2 were required to hand over possession of the unit within 21 months (i.e. on or before 16.02.2012) from the date of signing of the same (Agreement). The complainants had paid an amount of Rs.31,74,000/- to Opposite Parties No.1 and 2 till date from their own source and with the help of housing loan from Opposite Party No.3, with a hope that their dream house would be handed over to them, as per commitment. One of the receipts issued by the Chandigarh Office of the Company is Annexure C-5.

2.             It was further stated that Opposite Party No.1 is demanding installment and charging interest without progress on site, as committed and described in Annexure’A’ attached with the Buyer’s Agreement. Even the HDFC Limited (Opposite Party No.3) refused to release the installment for the reason that there was not enough progress at the site, entitling Opposite Party No.1 to raise the demand of the same (installment), which was communicated to the Opposite Parties by the complainants vide email dated 31.12.2011, Annexure C-6 (Colly.) and gave chance to it (Opposite Party No.1) to justify the delay, in progress at the site and explain reasons to them as well as Opposite Party No.3. The complainants through the abovesaid email also requested Opposite Party No.1 to clarify the details of interest levied by it, but Opposite Parties No.1 and 2 failed to provide the details knowingly.  It was further stated that the complainants called Opposite Party No.2 on phone, a number of times, to confirm the progress at site. However, there was no clear update on progress at site and the committed date of handing over the project was 16.02.2012.  Thereafter, the complainants visited the site on 24.07.2013 and found that the project was running behind schedule and even the basic facilities and infrastructure, as promised, did not exist there. It was further stated that the complainants were duped of their hard earned money by wrongful representations by Opposite Parties No.1 and 2 and their representatives with false sugar-coated promises of providing infrastructures and facilities like  clubhouse with lounge area, restaurant, indoor games room, state-of-art gym, swimming pool, jogging tracks, kids play areas, café and shopping arcades, tennis and squash courts, school etc., which is still being advertised on the website of Opposite Party No.1. Copy of snapshot of the website luring the customer with such promises is Annexure C-7. It was further stated that Opposite Parties No.1 and 2 failed to provide/ensure even the basic facilities in the project and the complete project was totally uninhabited. It was further stated that on asking of the complainants vide email dated 01.11.2014, Opposite Parties No.1 and 2 supplied their statement of account, vide their email dated 07.11.2014, wherein, they wrongly debited huge interest and installments to their account on various dates, without any justification, which also did not match with payment plan (Annexure A) of the said Buyer’s Agreement. Copies of the said emails dated 01.11.2014 and 07.11.2014 are Annexure C-8 (Colly). The complainants approached Opposite Parties No.1 and 2 on various occasions to refund the amount paid alongwith interest, but they failed to do so. Ultimately, the complainants sent a legal notice dated 25.11.2014 through Regd. Post as well as scanned copy through email dated 26.11.2014 (Annexure C-9 & C-10) to Opposite Parties No.1 and 2 but to no avail. It was further stated that the Opposite Parties were deficient, in rendering service, as also, indulged into unfair trade practice.  When the grievance of the complainants was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (hereinafter to be called as the “Act” only), was filed.

1.         In their written statement, Opposite Parties No.1 and 2 stated that this Commission has no territorial Jurisdiction to adjudicate upon the present complaint because the property is in Mohali, Buyer Agreement was executed between the parties at New Delhi and moreover, the demand for the payment was raised by the replying Opposite Parties, from their Gurgaon Office. It was further stated that the complaint was barred by limitation because the last payment was made by the complainants on 13.06.2011 and, as such, cause of action accrued to them on 13.06.2011 and, thereafter, they chose not to make any further payment against the sale price of the flat. Even the complainants concealed the fact that they were defaulters and they were served with repeated demand notices, reminders and notice prior to cancellation.  It was further stated that the complainants are not covered within the definition of “consumer” as per Section 2(d) of the Consumer Protection Act, because they are investors, who were looking only for making easy money in the resale of the property but could not do the same due to over all slump in the real estate sector. 

4.             It was further stated that the complainants themselves chose to buy the residential unit in the project of the replying Opposite Parties without any compulsion from them. It was further stated that the Agreement had been executed at New Delhi and the Chandigarh office is only the marketing office, as had been mentioned in the Agreement itself. It was denied that the Agreement was executed at Chandigarh. The replying Opposite Parties had entered into Tri-partite Agreement dated 10.08.2010 with the complainants for his housing loan from HDFC and even the said Agreement showed the execution on behalf of the replying Opposite Parties being carried out from their head office. It was further stated that as per Clause 4.a(i) of the Buyer Agreement,  possession of the floor was admittedly to be delivered within 21 months of signing the Agreement but it was subject to force majeure circumstances and the buyer making the timely payments of the installments, as had been agreed. In the present case, the Company could not hand over possession of the unit due to the reasons of Global meltdown of the economy world wide, wherein, the foreign investors, as anticipated by them (Opposite Parties No.1 and 2), had refrained from any kind of investment, in India, and there was a cash crunch throughout. The replying Opposite Parties are facing extreme financial hardship due to the recession in the reality market and all these circumstances were beyond the control of the replying Opposite Parties. It was further stated that the replying Opposite Parties time and again issued notices to the complainants regarding the outstanding payment. The complainants were even issued notice prior to cancellation dated 3.12.2011 (Annexure R-1), wherein, it was specifically mentioned that despite repeated reminders and notices, they failed to clear their overdue payment within the stipulated time frame and they were advised to clear their dues by 20.12.2011. It was further stated that the complainants made the payment of Rs.31,74,000/-, after issuance of several reminders and, thereafter, they stopped to make the payment unilaterally against the due installments, due to which, the replying Opposite Parties could not complete the work at site. It was further stated that both the parties are bound by the terms and conditions of the Buyer Agreement and, as such, as per Clause 4.C of the Buyer Agreement, the replying Opposite Parties should be liable to pay compensation @Rs.5/- per sq. ft. per month of the salable area of the floor for the period of delay in offering possession of the said apartment beyond the period of 21 months from the date of signing of the Agreement, save and except for the reason beyond the reasonable control of the developer. It was also stipulated in the aforesaid clause of the Buyer Agreement that such charges should be adjusted at the time of notice of possession.

5.             It was further stated that Opposite Parties No.1 and 2 time and again issued notices to the complainants for making payments vide Annexure R-2(Colly.). It was further stated that as per Clause 2.c of the Buyer Agreement, if the purchaser failed to pay the balance consideration or in the event of any delay in payments of any installment and/or other charges, in accordance with the payment plan, the purchaser should be liable to pay interest calculated from due date of outstanding amount @18% p.a. compounded quarterly. It was further stated that the demand of payments was raised by the replying Opposite Parties in consonance with the construction at the site and no vague demand was raised by them. It was further stated that the refund sought by the complainants amounts to breach of the Buyer Agreement because Article 11 of the said Agreement clearly stipulated that in case the purchaser failed to perform or observe all or any of the stipulation contained herein, the developer should have the right to terminate the Agreement and forfeit the earnest money alongwith interest paid on delayed payment till the time of such breach, if any, and the same should be retained by the developer. It was denied that cause of action, as alleged by the complainants, accrued to them on 7.11.2014 when the replying Opposite Parties provided the statement of accounts and also when the replying Opposite Parties did not respond to the legal notice dated 25.11.2014 sent by them. It was further stated that neither there was any deficiency, in rendering service, on the part of Opposite Parties No.1 and 2, nor they indulged into unfair trade practice.

6.             In its written statement, Opposite Party No.3 stated that the grievance of the complainants was only against Opposite Parties No.1 and 2 and no claim was made against the replying Opposite Party. It was further stated that the property, in question, was duly mortgaged with HDFC Ltd. and complete documentation in this regard is Annexure R-3/1 (Colly.). It was further stated that on the request of the complainants, replying Opposite Party disbursed the loan amount of Rs.20 lacs, out of the sanctioned loan amount of Rs.25 lacs. It was further prayed for dismissal of the complaint, qua it.

7.             The complainants, filed rejoinder to the written statement of Opposite Parties No.1 and 2, wherein they reiterated all the averments, contained in the complaint, and refuted those, contained in the written version of Opposite Parties No.1 and 2. 

8.             The Parties led evidence, in support of their case.

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

10.           Admittedly, the complainants applied to the Company vide application dated 20.03.2010 for booking of the unit in the project of Opposite Parties No.1 and 2 and, as such, Flat No.D-00-0059 (3 bedroom) Executive Floors (Sector – 97), Uniworld City, Mohali was allotted by them, vide allotment letter dated 20.03.2010 (Annexure C-1). It is also the admitted fact that Buyer’s Agreement dated 17.05.2010 (Annexure C-2) was executed between the complainants and Unitech Limited. It is also evident from Clause 2.a. of the Buyer’s Agreement that the total consideration of the said floor was Rs.50,99,300/-, which included basic price & External Development Charges, as per present rates, Preferential Location Charges, if any. Opposite Parties No.1 and 2 also issued ‘Annexure A’ Payment Plans (at page No.44) with the Buyer’s Agreement, which is extracted hereunder:-

S.No.	Payment Description	Due Date	Amount
1.	At the time of Regn.	20/03/2010	489000.00
2.	Within 75 days of Regn.	03/06/2010	489000.00
3.	Within 150 days of Regn.	17/08/2010	785825.00
4.	* On casting of Ground Floor Roof	17/09/2010	785825.00
5.	On casting of First Floor Roof	18/10/2010	541325.00
6.	On casting of Second Floor Roof	-	541325.00+ 50% CMRC
7.	On compl. Of Brick work & Int. plast.	-	244500.00
8.	On completion of flooring	-	244500.00
9.	On compl. Of int. Electrification	-	244500.00
10.	On compl. Of Int. Plumbing	-	244500.00
11.	On compl. Of Ext. Plastering	-	244500.00
12.	On Final Notice of Possession	-	244500.00 + 50% CMRC + SDC & Other charges
	Total Amount :-		5099300.00

 

11.           A perusal of the aforesaid chart shows that total price of the unit was Rs.50,99,300/-, which was to be paid by the complainants. It is abundantly clear from Customer Ledger (Marketing), Annexure C-8 (Colly.) (at page No.65) that Unitech Limited received an amount of Rs.31,74,000/- from the complainants.  Opposite Parties No.1 and 2 also admitted in para No.9 (page No.78) of their written statement that the complainants had made the payment of Rs.31,74,000/-.

12.           The first question, that falls for consideration, is, as to whether, this Commission has got territorial Jurisdiction, to entertain and decide the complaint or not. According to Section 17 of the Act, a Consumer Complaint, could be filed, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to them. No doubt, the Buyer’s Agreement dated 17.05.2010, Annexure C-2, was executed between the complainants and Unitech Limited at New Delhi, in respect of the unit, in question. The perusal of Tripartite Agreement dated 10.08.2010, Annexure C-3, reveals that the same was executed at Chandigarh, between the complainants, and the Opposite Parties. It is evident, that the amount of Rs.7,00,000/-, towards the part price, in respect of the said unit, was paid to Opposite Parties No.1 and 2, at Chandigarh, vide cheque (Annexure C-5), as this document bears the stamp, in photo-impression of Unitech Limited, Regional Office, SCO 189-191, Sector 17-C, Chandigarh – 160017. Even it is evident from copy of the Customer Ledger (Marketing), Annexure C-8 (at page No.65), that the same was issued by the Chandigarh Office of Unitech Limited. Since, as per the documents, referred to above, a part of cause of action, arose to the complainants, at Chandigarh, this Commission has got territorial Jurisdiction, to entertain and decide the complaint. The objection, taken by Opposite Parties No.1 and 2, in their written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.

13.           The next question, that falls for consideration, is, as to whether, the complaint was barred by time or not. The possession, as per the Agreement, was to be delivered on or before 16.02.2012. Neither the possession was offered by the stipulated date, nor upto the date of filing the complaint. There was, thus, continuing cause of action, in favour of the complainants, to file the complaint. In Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal  Shah And Anr., II 2000 (1) CPC 269=AIR 1999 SC 380, wherein, the facts and circumstances were similar to the one, involved, in the instant case, it was held that there was a continuing cause of action, and the complaint was not barred by time. In Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC),  the complainant applied for a plot, in the year 1992, on the basis of inducement made in the advertisements of the petitioner, knowing fully well that the land, in question, was under litigation. Consumer Complaint was filed, in the year 2009, claiming relief of execution of the sale deed, which was granted to him. An objection was taken that the complaint was barred by time. The Hon’ble Supreme Court held that there was a continuing cause of action, and, as such, the complaint was not barred by time. The principle of law, laid down, in the aforesaid cases, is fully applicable to the facts of the instant case. Under these circumstances, it is held that the complaint was not at all barred by time. The submission of the Counsel for Opposite Parties No.1 and 2, in this regard, being devoid of merit, must fail, and the same stands rejected.

14.           The next question, that falls for consideration is, as to whether, the complainants fall within the definition of consumers or not? The Counsel for Opposite Parties No.1 and 2 submitted that the complainants are investors, who were looking only for making easy money in the resale of the property but could not do the same due to over all slump in the real estate sector and, as such, they are not covered under the definition of ‘consumer’ as per Section 2(d) of the Consumer Protection Act, 1986.   The unit, which was allotted, in favour of the complainants, is a residential one and Opposite Parties No.1 and 2 did not allot the booth, where the complainants were to run commercial activity.  No evidence was produced by Opposite Parties No.1 and 2, that the complainants are property dealers, who deal in the sale and purchase of the property, and, as such, they purchased the unit, in question, for the purpose of investment, with a view to resell the same, as and when, there is escalation, in the prices of real estate. Under these circumstances, it is held that the complainants availed of the services of Opposite Parties No.1 and 2, for consideration, for the purpose of allotment of the unit, in question, and therefore, they fall within the definition of consumer. The submission of the Counsel for Opposite Parties No.1 and 2, therefore, being without merit must fail and the same stands rejected.

15.           The next question, that falls for consideration, is, as to whether, the complainants are entitled to the refund of amount, deposited by them, in the circumstances, referred to above. The Opposite Parties No.1 and 2, failed to deliver possession of the unit, in question, to the complainants, on account of pending development works and basic amenities.  Moreover, the complainants have already paid the huge amount of Rs.31,74,000/- i.e. more than 50% of the total amount of Rs.50,99,300/- to Opposite Parties No.1 and 2. The complainants also took the loan from Opposite Party No.3 and it also refused to release the installments to Opposite Parties No.1 and 2 for the reason that there was not enough progress at the site. The complainants sent the legal notice dated 25.11.2014 (Annexure C-9) to Opposite Parties No.1 and 2 and requested to refund the amount paid by them alongwith interest but they never bothered to reply the same. The complainants specifically stated, in their rejoinder, that Opposite Parties No.1 and 2 failed to show any progress at the site and used the money deposited by them to further their other business objectives and now making a vague averment of global slowdown. They, therefore, had no right, to retain the hard earned money of the complainants, in the sum of Rs.31,74,000/-, deposited by them, towards the part price of unit, in question, without rendering them, any service. Since, the unit, in question, had not been constructed, even by the time, the complaint was filed, no alternative was left with the complainants, than to ask for the refund of amount, deposited by them. Even till date, Opposite Parties No.1 and 2 are unable to hand over the legal physical possession of the unit, in question. In our considered opinion, the complainants are entitled to the refund of amount of Rs.31,74,000/-, deposited by them. By not refunding the amount, deposited by the complainants, with interest, Opposite Parties No.1 and 2 were deficient, in rendering service.

16.           The next question, that falls for consideration, is, as to whether, the complainants are entitled to interest, on the amount deposited by them, if so, at what rate. The amount of Rs.31,74,000/-, towards more than 50% of the price of the unit, in question, was deposited by the complainants, which fact is not disputed.  The hard earned money of the complainants was utilized by Opposite Parties No.1 and 2, for a sufficient longer period but they failed to give physical possession of the unit, in question. Had this amount been deposited by the complainants, in some bank, or had they invested the same, in some business, they would have earned handsome returns thereon. In case of delay, in deposit of installment(s), Opposite Parties No.1 and 2 were charging interest @18% P.A. (compounded quarterly), as is evident from Article 2.c. of the Buyer’s Agreement (Annexure C-1). Under these circumstances, in our considered opinion, if  interest  @9% P.A., on the amount deposited by the complainants, from the respective dates of deposits, is granted, that will serve the ends of justice.

17.           The next question, that falls for consideration, is, as to whether, the complainants are entitled to compensation, under Section 14(1)(d) of the Act, on account  of mental agony and physical harassment and injury caused to them,  by not delivering physical possession of the unit, to them or by not refunding the amount deposited. The complainants,  underwent a lot of mental agony and physical harassment, on account of the acts of omission and commission of Opposite Parties No.1 and 2. Compensation,  to the tune of Rs.1.00 lac, on account of mental agony and physical harassment, caused to the complainants, due to the acts of omission and commission of Opposite Parties No.1 and 2, if granted, shall be reasonable, adequate and fair. The complainants, are, thus, held entitled to compensation, in the sum of Rs.1.00 lac, as indicated above.

18.           No relief was sought, against Opposite Party no.3. Accordingly, complaint against it is liable to be dismissed.

19.           No other point, was urged by the Counsel for the Parties.

20.           For the reasons recorded above, the complaint is partly accepted with costs, against Opposite Parties No.1 and 2, in the following manner:-

(i)             Opposite   Parties No.1 and 2 are jointly and severally directed to refund the deposited amount of   Rs.31,74,000/-, to the complainants, alongwith interest @9% per annum, from the respective dates of deposits, within 45 days, from the date of receipt of a certified copy of this order.

(ii)            Opposite Parties No.1 and 2 are jointly and severally further directed to pay compensation, in the sum of Rs.1.00 lac, for causing mental agony and physical harassment, to the complainants, within 45 days, from the date of receipt of a certified copy of this order.

(iii)           Housing Development Finance Corporation Limited (HDFC) shall have the first charge, on the amount to be refunded, to the complainants, by Opposite Parties No.1 and 2, to the extent, the amount is due to it, against the complainants as it (HDFC) advanced loan in their (complainants) favour for part payment of the price of unit, in question, under the Tripartite Agreement dated 10.08.2010 (Annexure C-3).

(iv)           Opposite Parties No.1 and 2 are further directed to pay cost of litigation, to the tune of Rs.10,000/-, to the complainants.

(v)            In case the payment of amounts, mentioned in Clauses (i) and (ii), is not made, within the stipulated period, then Opposite Parties No.1 and 2 jointly and severally shall be liable to pay the amount mentioned in Clause (i) with interest @12 % P.A., instead of 9% P.A., from the respective dates of deposits, till realization, and interest @12% p.a., on the amount of compensation, mentioned in Clause (ii), from the date of filing the complaint, till realization,  besides payment of litigation costs, to the tune of Rs.10,000/-.

21.           Complaint against Opposite Party No.3 is dismissed with no order as to costs.

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.                                                                                    

19/02/2015                                                                       Sd/-

[JUSTICE SHAM SUNDER [RETD.]

                                                                                 PRESIDENT

 

                                                                                                            Sd/-                                  [DEV RAJ]

                                                                                                MEMBER

 

Sd/-

 [PADMA PANDEY]

MEMBER

rb