Chandigarh

StateCommission

CC/192/2019

Gurbax Singh Cheema - Complainant(s)

Versus

M/s Yellow Stone Builders Pvt. Ltd. - Opp.Party(s)

Devinder Kumar Adv.

07 Jan 2021

ORDER

 

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Complaint case No.	:	192 of 2019
Date of Institution	:	30.08.2019
Date of Decision	:	07.01.2021

 

1. Gurbax Singh Cheema son of Sh.Jagir Singh, aged about 60 years.
2. Narinder Kaur wife of Sh.Gurbax Singh Cheema, aged about 60 years.

Both resident of Flat No.108, 6^th Floor, Acme Gulmohar Apartment, New Sunny Enclave, Sector 125, Kharar, District Mohali.

…… Complainants

V e r s u s

1. M/s Yellow Stone Builders Pvt. Ltd., A unit of M/s Sukhm Infrastructure Pvt. Ltd., SCO No.123-124, Third Floor, Sector 17-C, Chandigarh through its Director Sh.Tejinder Singh.

2^nd Address:- Site Office, Aeropolis City, Near Railway Station, Sector 66-A, Mohali.

2. Sh.Tejinder Singh, Director of M/s Yellows Stone Builders Pvt. Ltd., A unit of M/s Sukhm Infrastructure Pvt. Ltd., Site Office: Near Railway Station, Sector 66-A, District S.A.S. Nagar, Mohali (Punjab) 140103.
3. Sh.Jaspal Singh Sodhi, Manager Sales, M/s Yellowstone Builders Pvt. Ltd., office at Yellow Stone Landmark Infocity, Sector 66-A, District S.A.S. Nagar, Mohali (Punjab) 140103.

…..Opposite parties.

 

BEFORE:              JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT.

                             MRS. PADMA PANDEY, MEMBER.

                             MR. RAJESH K. ARYA, MEMBER.

 

Present through Video Conferencing:-

                             Sh.Devinder Kumar, Advocate for the complainants.

                             Sh.Rahish A. Nagrath, Advocate for the opposite parties.

 

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT 

                   It is the case of the complainants that they had booked two flats, in the project of the opposite parties launched by them under the name and style ‘Yellow Stone Garden’, Sector 66-A, SAS Nagar, Mohali, Punjab, for which they made payment of Rs.41,38,340/- on 19.05.2012 vide cheque no.419305 of the even date. It has been stated that though, at the time of booking of the said flats, it was assured by the opposite parties that possession thereof will be delivered latest by January 2014, yet, thereafter vide letter dt. Nil, Annexure C-4, it was intimated that possession will be delivered by April 2015. However, possession was never delivered for want of development and construction activities. Number of emails were written to the opposite parties, in the matter, starting from 31.10.2015 to 04.10.2017, Annexures C-5 to C-14 requesting them to hand over possession of the flats in question but to no avail, which forced the complainants to seek refund of amount paid by way of sending emails dated 27.01.2018, 19.03.2018, 01.06.2018 and 07.09.2018, Annexures C-15 and C-18. On receipt of the said emails, the opposite parties approached the complainants for  amicable settlement in the matter, as  a result whereof compromise was arrived at between the parties vide compromise deed dated 29.09.2018, Annexure C-19, whereby the opposite parties agreed to pay a sum of Rs.75 lacs to  the complainants in three monthly installments of Rs.25 lacs each. As such, for the first installment two cheques amounting of Rs.5 lacs and Rs.20 lacs dated 07.10.2018 and 30.10.2018 respectively were handed over to the complainants out of which only the cheque in the sum of Rs.5 lacs was encashed and another cheque in the sum of Rs.20 lacs, when presented before the bank concerned was dishonoured for  insufficient funds. When matter was brought to the notice of the opposite parties, they paid an amount of Rs.5 lacs vide demand draft no.500078 dated 29.01.2019. Thereafter, number of requests were made by the complainants to the opposite parties to pay the remaining amount as agreed to vide the compromise deed aforesaid but to no avail.  Thus, in this manner, only an amount of Rs.10 lacs stood paid by the opposite parties and the remaining amount of Rs.65 lacs has not yet been paid to the complainants despite making number of requests by the complainants. Hence this complaint has been filed by the complainants seeking directions to the opposite parties to pay the remaining amount of Rs.65 lacs alongwith interest; compensation and litigation expenses.

2.           The claim of the complainants has been contested by the opposite parties on numerous grounds, inter alia, that they have concealed material facts from this Commission and have come with unclean hands; that no cause of action accrued to them to file this complaint; that this complaint is not maintainable before this Commission, proceedings before which are summary in nature; that since compromise deed has been executed between the parties and there is a dispute with regard to payment of Rs.65 lacs, as such, only the civil court is competent to adjudicate this issue, as proper evidence needs to be recorded in the matter;  that the parties are bound by terms and conditions of the said compromise deed; and that cheque in the sum of Rs.20 lacs was handed over to the complainants only as a security amount. Prayer has been made to dismiss the complaint. 
3.           In the rejoinder filed, the complainants reiterated all the averments contained in the complaint and controverted those of the written reply filed by the opposite parties.
4.           The parties led evidence in support of their case.
5.           We have heard the contesting parties and have gone through the evidence and record of the case, including the written arguments filed by the party concerned, very carefully.
6.           The moot question, which arises for consideration is, as to whether this complaint is maintainable before this Commission or not? It may be stated here that admittedly, it is a case wherein, the opposite parties  have received huge sale consideration of Rs.41,38,340/- from the complainants on 19.05.2012 vide cheque no.419305 towards booking of two flats, in the said project. As per commitment made by the opposite parties, vide letter Annexure C-4, they were legally bound to deliver possession of the said flats by April 2015. However, there is nothing on record to prove that construction of the said flats was even started and completed by April 2015. It is also coming out from the record that when the period for delivery of possession expired, the complainants pursued the matter consistently with the opposite parties, by way of sending emails for the period from 31.10.2015 to 04.10.2017, Annexures C-5 to C-14 requesting them to hand over possession of the flats in question. In the reply filed by the opposite parties or at the time of arguments, no reason has been given, as to why, construction and development activities could not be completed at the project site and possession of the flats were not delivered to the complainants. Not even single evidence has been produced on record by the opposite parties to prove that construction of the flats were even started at the project site, what to speak of delay in delivery of possession thereof. .
7.           During pendency of this complaint also, this Commission vide order dated 03.09.2019, directed the opposite parties to produce on record the following documents, duly authenticated, to apprise us, as to whether, the Company was competent to launch the project and sell units/plots therein to the general public including the complainants or not:-

 

1. “Registration Certificate of the project with the competent authority.
2. Copy of requisite Licence issued by the Competent Authority under Punjab Apartment and Property Regulation Act 1995.
3. Change of Land Use (CLU) pertaining to the project in question.
4. Letter of Intent (LOI).
5. Copy of approved site plan of the project.
6. Completion Certificate of the project.
7. Latest photographs of the site/unit in dispute.
8. Current list of Managing Director/Director(s) of the Company.
9. Detail of Bank Accounts of the Company.
10. List of properties both moveable and immoveable of the company and its Managing Director/Director(s) which can be attached in execution of the decree. ”

 

However,  it is significant to mention here that even thereafter also during pendency of this complaint, despite the fact that number of opportunities were available with the opposite parties to place on record the aforesaid documents, yet, they failed to furnish the same for the reasons best known to them. Under these circumstances, we are of the considered view that by not placing on record the aforesaid documents, the opposite parties have attracted an adverse inference that the project in question had been launched by them in contravention of the relevant Rules and  Regulations and also Punjab Apartment and Property Regulation Act, 1995 i.e. they have failed to obtain necessary approvals/sanctions for launching the said project and selling the units therein to the prospective buyers.

8.           Furthermore, it is settled law that onus to prove the stage and status of construction and development work at the project site and that all the permissions/approvals have been obtained in respect thereof, is on the builder/developer. It was so observed by the Hon’ble National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. As stated above, it is very strange that in the present case not even an iota of evidence has been placed on record by the opposite parties to prove as to at what stage, construction and development work had reached at the project site by 2015; or that as to whether approvals/ sanctions have been obtained by them from the competent Authorities to launch the said project or not. Even this much has not been proved that construction of the flats at the project site was started or not. In case, the development/construction activities were undertaken and were about to complete at the project site by the committed dated or even thereafter, then it was for the opposite parties, which could be said to be in possession of the best evidence, to produce cogent and convincing documentary evidence, in the shape of the reports and affidavits of the Engineers/Architects, as they could be said to be the best persons, to testify, as to whether, all these development/construction activities, are being undertaken and about to complete at the site or not but they failed to do so.
9.           Furthermore, there is nothing on record to show that the opposite parties suffered any force majeure circumstances, on account of which, construction and development work at the project site could not be completed and possession of the flats could not be delivered to the complainants by the committed date, referred to above or even thereafter. Since, the opposite parties had received huge sale consideration from the complainants towards the said flats and  they were to provide service by way of allotment of the said flats and possession thereof to the complainants by April 2015 as committed by them in the letter Annexure C-4, the nature of such transaction is covered by the expression ‘service’. Our this view is supported by the principle of law laid down in Narne Construction P. Ltd., etc. etc. Vs.  Union of India and Ors. Etc., II (2012) CPJ 4 (SC), wherein 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), while holding as under:-

“…….We would reiterate that the statutory Boards and Development Authorities which are allotting sites with the promise of development, are amenable to the jurisdiction of consumer forum in case of deficiency of services as has already been decided in U.T. Chandigarh Administration & Anr. v. Amarjeet Singh & Ors.[1]; Karnataka Industrial Areas and Development Board v. Nandi Cold Storage Pvt. Ltd.[2]. This Court in Narne Construction (P) Ltd. v. Union of India [3] referred to its earlier decision in Lucknow Development Authority v. M.K. Gupta [4] and duly discussed the wide connotation of the terms “consumer” and “service” under the consumer protection laws and reiterated the observation of this Court in Lucknow Development Authority v. M.K. Gupta (supra) which is provided hereunder :

“5. In the context of the housing construction and building activities carried on by a private or statutory body and whether such activity tantamounts to service within the meaning of clause (o) of Section 2(1) of the Act, the Court observed: (LDA case, SCC pp. 256- 57, para 6):

“…when a statutory authority develops land or allots a site or constructs a house for the benefit of common man it is as much service as by a builder or contractor. The one is contractual service and the other statutory service. If the service is defective or it is not what was represented then it would be unfair trade practice as defined in the Act….”

 

10.           Furthermore, because it is an undisputed fact that the opposite parties did not deliver possession of the flats purchased by the complainants by the promised date i.e. April 2015 or even thereafter and no reason has been given for the same, as such, it can very well be said that there is a denial  of service to the complainants on the part of the opposite parties. Our this view is supported by the principle of law laid down in Lucknow Development Authority Vs. M.K.Gupta, Civil Appeal No.6237 of 1990, decided on 5.11.1993,  wherein the Hon’ble Supreme Court held that where the developer is at fault in not delivering possession of an immovable property, the act so amounts to denial of service, and consumer complaint is maintainable before the Consumer Fora.
11.           However, deficiency in providing service and adoption of unfair trade practice on the part of the opposite parties is writ large because even after making commitment in the compromise deed, referred to above, to the effect that  they will pay an amount of Rs.75 lacs, in lumpsum, to the complainants which includes the amount of Rs41,38,340/- paid by them towards sale consideration of the said flats and also interest thereon, yet, it is clearly coming out of record that out of the said amount of Rs.75 lacs, only an amount of Rs.10 lacs stood received by the complainants. Even this amount was also paid to the complainants on making lot of efforts, as the cheque in the sum of Rs.20 lacs handed over by the opposite parties in line with the compromise deed aforesaid was dishonoured, when presented before the bank concerned for insufficient funds and thereafter out of the said amount of Rs.20 lacs, only an amount of Rs.5 lacs was paid to the complainants vide demand draft dated 29.01.2019. However, there is nothing on record that except this amount of Rs.10 lacs out of Rs.75 lacs, any further amount was paid by the opposite parties to the complainants. It appears that the compromise deed was executed by the opposite parties, just with a view to wriggle out of the situation, and can withheld the complainants for seeking remedy available to them under the law for refund of the amount paid by them. Under these circumstances, it can very well be said that once the opposite parties have violated the terms and conditions of the said settlement deed, later on, they cannot take any advantage out of it, by saying that the complainants are debarred from filing this consumer complaint. It is also not the case of the opposite parties that the amount in dispute was borrowed by the complainants from them for their personal use and as such only recovery suit is required to be filed for recovery thereof. It is also not the case of the opposite parties that they have complied with the commitments made vide the compromise deed (which infact was subject matter of non-delivery of possession of the flats to the complainants due to delay in construction of flats) but even then the complainants have filed this complaint seeking refund of the amount paid. The opposite parties in the present case want to have the cake and eat it too. It clearly shows the high-handedness of the opposite parties towards the poor consumers like the complainants. Once, it has been clearly agreed to between the parties vide condition no.3 of the said compromise deed dated 29.09.2018 that if the company fails to pay the amount on time, the complainants have the right for legal proceedings and now on failure to comply with the terms and conditions of the said compromise deed by the opposite parties, if the complainants have filed this complaint, they (opposite parties) cannot take such a bald objection that the present complaint is not maintainable before this Commission.
12.           From the peculiar circumstances of this case, it has been proved that the opposite parties made false representations, which were materially incorrect and were made in such a way that the complainants, to whom it was made, were entitled to rely upon it and they may act in reliance on it. The complainants are thereby involved in a disadvantageous contract with the opposite parties and suffered financial loss, mental agony and physical harassment. Representations/ statements made at that time were believed to be true. All the facts established that from the very inception there was intent to induce the complainants to enter into the transaction for sale of flats and then a compromise deed, referred to above and also intent to deceive them by not honouring the commitments made, which act amounts to grave deficiency in providing service, negligence and adoption of unfair trade practice on the part of the opposite parties.
13.           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 the remaining amount of Rs.65 lacs alongwith interest @12% p.a. from 01.01.2019 (three months from the date of execution of compromise deed dated 29.09.2018), within a period of 30 days from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount of Rs.65 lacs, shall carry 3% penal interest i.e. 15% p.a. (12% p.a. plus (+) 3% p.a.), from the date of passing of this order, till realization.

 

2. To pay compensation for causing mental agony and physical harassment; deficiency in providing service and adoption of unfair trade practice and also cost of litigation, in lumpsum, to the tune of Rs.50,000/-, to the complainants, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, the said amount of Rs.50,000/-, shall carry interest @12% p.a. from the date of passing of this order, till realization.

 

14.           However, it is made clear that, in case, the complainants have received any amount out of the aforesaid remaining amount of Rs.65 lacs from the opposite parties, the amount to that extent shall automatically be deducted therefrom accordingly.
15.           Certified Copies of this order be sent to the parties, free of charge.
16.           The file be consigned to Record Room, after completion.

07.01.2021

 

Sd/-

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

          Sd/-

(PADMA PANDEY)

          MEMBER

 

 

          Sd/-

(RAJESH K. ARYA)

MEMBER

 Rg