DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)

Consumer Complaint No. 26 of 2017

                                                 Date of institution:  10.01.2017                                                     Date of decision   :  21.03.2018

Amarjeet Singh Kairon son of Shri Milan Singh Kairon, resident of M-201, Konork, Indrayu Enclave-2, NIB Road, Pune.

…….Complainant

Vs

1.     M/s. Bajwa Developers Limited through its Managing Director, office at Sunny Enclave, Desu Majra, Tehsil Kharar, SAS Nagar, Mohali.  

2.     Mr. Jarnail Singh Bajwa son of Shri Bishan Singh, Managing Director M/s. Bajwa Developers Limited office at Sunny Enclave, Desu Majra, Tehsil Kharar, SAS Nagar, Mohali. 

……..Opposite Parties

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:    Shri G.K. Dhir, President,

                Shri Amrinder Singh Sidhu, Member

                Mrs. Natasha Chopra, Member.

Present:     Shri Jasminder Pal Singh, counsel for complainant.

                Ms. Kulwinder Kaur, counsel for the OPs.

Order by :-  Shri G.K. Dhir, President.

Order

               Complainant entered into an agreement for sale with OPs on 26.07.2011 for purchase of one BHK BR (309) flat bearing No.F-21 in Sector 74-A, 117, Mohali for total sale consideration amount of Rs.12,00,000/-. Complainant made payment as per schedule. Till date an amount of Rs.3,12,500/- has been paid including the charges and taxes. However, despite that possession of the flat has not been delivered to complainant and nor any notice of possession has been served by OPs on complainant. As OPs delayed delivery of possession and as such complainant suffered lot because he stands divested of hard earned money deposited by him with OPs. Complainant claims to have never defaulted in payment of installments in time as per demands of OPs. However, OPs have not taken any action for start of development of the unit for further handing over possession of the unit to complainant. Amount of Rs.2.00 lakhs was paid by complainant on 20.04.2011, but Rs.1,12,500/- on 14.07.2011 and in this way total amount of Rs.3,12,500/- has been paid. Complainant believed assertions of the OPs as if OPs are builder and developer of repute and as such complainant need not worry. OPs kept on procrastinating the matter in respect of development of project and delivery of possession, despite the fact that considerable period has lapsed. Though assurance for delivery of possession within 36 months from the date of agreement/sale deed was given, but nothing has been done till date and as such by claiming that OPs have adopted unfair trade practice, this complaint filed after serving legal notice on OPs. Prayer made for directing OPs to handover possession of the site after receipt of balance sale consideration amount within three months or in the alternative prayer made for refund  of the paid amount with interest @ 18% per annum. Compensation for mental harassment and agony of Rs.10.00 lakhs and litigation expenses of Rs.55,000/- more claimed.

2.             In reply submitted by OPs, it is pleaded inter alia as if pecuniary jurisdiction of this Forum is barred because the price amount of flat was Rs.12,00,150/-,  but compensation of Rs.7,50,000/- is claimed alongwith alternative relief of refund of Rs.5,00,000/- alongwith compensation and litigation expenses of Rs.10,55,000/-. In this way it is claimed that relief claimed is for amount of Rs.35,57,000/- excluding interest. Besides complaint alleged to be barred by limitation because agreement was arrived at on 26.07.2011 and last payment made on 14.07.2011, but this complaint filed on 10.01.2017 i.e. after more than six years from the date of accrual of cause of action. Even it is claimed that complainant is not consumer within meaning of Section 2 (1) (d) of the Consumer Protection Act because the flats were meant for EWS category and complainant concealed his identity of being affluent member of the society. OPs were kept in dark in this respect. Construction and possession of the flat was limited to payment plan. Reference to Section 27 of Indian Limitation Act and Section 24-A of Consumer Protection Act made for claiming the complaint to be barred by limitation. Moreover, it is claimed that in view of Clause-3 of agreement, earnest amount paid by complainant liable to be forfeited because he failed to abide by terms and conditions of the contract for making payment of installments as per scheduled time. Moreover, it is claimed that in view of Clause-7 of agreement, complainant did not furnish documents in support of his claim of belonging to economically weaker section as prescribed by Punjab Govt. and as such OPs were kept in dark. Fraud also alleged to have been committed by complainant with OPs. Agreement is scribed on under stamped papers and consent of OPs was obtained by fraud regarding economically weaker section status of complainant. After deposit of Rs.3,12,500/-, complainant failed to deposit the balance amount. OPs claim to have obtained the permissions from GMADA, but complainant failed to submit the requisite documents regarding his entitlement to EWS category flat allotment. Complainant was informed that approvals yet to be received and in case the authorities failed to approve the plan, then complainant will be entitled for refund of the earnest amount only. Booking of the flat was done by complainant for speculative purposes and as such he is not a consumer. Other averments of the complaint except that of entering into agreement denied one by one each.

3.             Counsel for complainant tendered in evidence affidavit Ex.CW-1/1 of complainant alongwith documents Ex.C-1 to Ex.C-4 and thereafter closed evidence.  On the other hand, counsel for OPs tendered in evidence affidavit Ex.OP-1/1 of Shri Jarnail Singh Bajwa, MD of the OPs and thereafter closed evidence.

4.             Written arguments submitted by complainant, but not by OPs. Oral arguments heard and records gone through.

5.             After going through pleadings of the parties and the submitted evidence of both the parties and agreement of sale Ex.C-1, it is made out that one BHK BR 309 having area of 450 sq. ft. approximately was contracted to be purchased by complainant from OPs for consideration of Rs.12.00 lakhs. Receipt of amounts of Rs.3,12,500/- not denied by OPs in their written reply or in the affidavit and as such certainly complainant able to establish as if he paid amount of Rs.3,12,500/-,  split of which with specific dates of 20.04.2011 and 14.07.2011 is given in acknowledgement receipt signed by OPs.

6.             From perusal of schedule of payments worked out in Clause-2 of agreement Ex.C-1, it is made out that amount of Rs.3.00 lakhs as earnest amount was to be deposited by 26.07.2011; balance 5 installments of Rs.1,80,000/- each payable by complainant to OPs on or before 26.11.2011; 26.03.2012; 26.07.2012; 26.11.2012 and 26.01.2013. However, complainant himself committed default in payment of these installments because he paid Rs.2.00 lakhs on 20.04.2011 and Rs.1,12,500/- on 14.07.2011. After this payment on 14.07.2011, complainant has not paid any amount and as such virtually breach of terms and conditions of the contract agreement Ex.C-1 committed by complainant himself by not sticking to the payment schedule. Moreover, complainant has not specified in the complaint or in the affidavit as to on which date he got knowledge that OPs unable to complete the project. Even the date of knowledge of non start of construction by OPs on the spot is not specified in the complaint and as such it is obvious that complainant himself deliberately committed breach of terms and conditions of agreement of sale Ex.C-1 by not sticking to payment schedule. However, present is also a case in which OPs also remained at fault in not starting the construction after getting all due approvals/sanctions from competent authorities and as such it is a case in which both the parties to agreement Ex.C-1 committed default by not abiding by terms and conditions of the agreement. In such circumstances, even if default may have been committed by complainant in not abiding by terms of schedule of payment of installments, despite that OPs not entitled to forfeit the paid earnest amount by invoking Clause-3 of agreement Ex.C-1. This clause-3 of Ex.C-1 specifically provides that in case the payment of installments not made as per schedule or within 15 days of the stipulated period, then the earnest amount will stand forfeited. That forfeiture of the paid amount is not proper in this case, particularly when OPs themselves claiming the agreement to be in question as voidable because of the fraud committed by complainant with OPs in not disclosing correct financial status for claiming benefit of allotment of EWS category flat. As and when the agreement is void or voidable and sought to be declared as such, then the party seeking such declaration bound to reimburse the benefits received under the agreement to the party, from whom those benefits got by it. In view of this legal position laid in Section 64 and 65 of Indian Contract Act and in view of plea of fraud taken by OPs, they cannot retain the received amounts from complainant, but are bound to return back the same to complainant, from whom same received.

7.             After going through Clause-6 of Ex.C-1 it is made out that in case due to any technical defects, approvals from the authorities concerned could not be obtained, then the purchaser will be entitled for refund of the paid earnest amount, but not to  compensation amount at all. Completion of the project has not been done by OPs themselves and nor OPs able to establish that they got requisite sanctions/approvals from GMADA or Pollution Control Board or other authorities, enabling them to start and complete the project in question and as such fault also lays with OPs in not abiding by terms and conditions of agreement regarding delivery of possession. So it is a case in which both the parties committed breach of terms and conditions of agreement in question, due to which entitlement of complainant for refund of paid amount will be there, but without interest till the date the demand for refund put forth for the first time. That demand for refund put forth for the first time on issue of notice Ex.C-2 dated 03.09.2016 through counsel. Said notice was sent through registered post is a fact borne from contents of postal receipts Ex.C-3 and Ex.C-4 produced on record. In case OPs allowed to retain the paid amount by complainant, then it will entitle them to have unjust enrichment, which is not legally permissible. However, as fault of complainant led to scarcity of funds with OPs in not completing the project and as such complainant should not be allowed interest because he is also is a wrong doer in not paying the installments in time as envisaged by agreement Ex.C-1 arrived at by him with OPs.

8.             As per law laid down in Vasant Mahadero Kate Vs. Shastri Gruha Nirman Sahkari Sanstha Ltd. II (2015) CPJ 4 (NC),  purchaser of plot has continuous cause of action available to him unless and until possession of plot handed over to him. So in view of this legal position, certainly complainant continued to have recurring cause of action available in his favour until he after getting knowledge qua inability of OPs to start and complete the construction, issued notice Ex.C-2 for seeking refund of the paid amounts with interest. In view of this recurring cause of action available with complainant, certainly complaint is not barred by limitation either under Section 24-A of Consumer Protection Act or under Section 27 of Limitation Act because complaint is filed within two years from the date, when complainant got knowledge that OPs will not be able to stick to their commitment of delivering the possession.

9.             As per case of Kushal K. Rana Vs. M/s. DLF Commercial Complex Ltd., 2015(1) CLT 134 (NC),  terms and conditions of agreement of purchase of flat/plot are binding on both the parties because agreement is not a one way traffic. If that be the position, then certainly both the parties bound by terms and conditions of agreement Ex.C-1 in question. However, in this case both the parties remained at fault in not sticking to terms and conditions of agreement Ex.C-1 and as such equitable considerations demand that complainant be allowed interest with effect from the date of issue of first notice qua seeking refund as referred above. Had OPs not taken plea regarding commission of fraud by complainant, then certainly they would have refunded the paid amount back to complainant, but they chose not to do so and as such act of OPs led the complainant to be dragged in this litigation. So certainly complainant is entitled for compensation for mental harassment and agony and also to litigation expenses to reasonable extent.

10.            Even if Clause-7 in agreement Ex.C-1 may be there that the persons to whom flats in EWS category to be allotted are bound to follow the terms and conditions of such allotment, but despite that it was the duty of OPs to get the compliance of those terms and conditions done from complainant before accepting any amount from complainant. As agreement of sale Ex.C-1 was mutually arrived at between parties and complainant was not supposed to know as to what were the terms and conditions on which flat in EWS category, can be allotted and as such it was for the OPs to get the terms and conditions of such allotment complied with. OPs not shown to have supplied those terms and conditions to complainant and as such fault in this respect also remains with OPs, due to which they cannot be given benefit of their own wrong.

11.            Submissions advanced by counsel for complainant has force that demand of EWS category certificate never put forth by OPs from complainant because no date specified in the written statement or in the affidavit Ex.OP-1/1 as to when this demand was put forth. So long as said demand not put forth, complainant would not have information of requirement of submission of such certificate for availing benefit of EWS category. OPs have not brought any material on record to establish that complainant belongs to affluent category of persons of the society. Being so plea taken regarding complainant, being an affluent, is unsubstantiated.

12.            Pecuniary jurisdiction of this Forum certainly is there because total sale consideration of the flat in question is Rs.12.00 lakhs and complainant has not denied about this fact while seeking relief for delivery of possession alongwith claim for compensation for mental harassment and agony of Rs.7,50,000/-. So if the contents of main relief taken into consideration then the valuation will not be beyond Rs.20.00 lakhs, but it will be below Rs.20.00 lakhs. If in the alternative relief complainant has taken plea for refund of the paid amount of Rs.3,12,500/- with interest @ 18% per annum pendentelite till realisation alongwith compensation for mental harassment and agony of Rs.10.00 lakhs and litigation expenses of Rs.55,000/-, even then the valuation of the claimed reliefs is not to go beyond limit of Rs.20.00 lakhs. As and when principal relief alongwith alternative relief claimed then the total worth of two categories of reliefs not to be clubbed for finding pecuniary jurisdiction of the Forum, but worth of the reliefs to be taken distinctively for finding as to whether the Forum has pecuniary jurisdiction or not. When so considered, then certainly this Forum has pecuniary jurisdiction, as discussed above.

13.            No other point argued.

14.            As a sequel of above discussion, complaint allowed with direction to OPs to refund the received amount of Rs.3,12,500/- with interest @ 12% per annum with effect from the date of issue of legal notice dated 03.09.2016 till payment. Compensation for mental harassment and agony of Rs.20,000/- and litigation expenses of Rs.5,000/-  more allowed in favour of complainant and against the OPs. Payment of these amounts of compensation and litigation expenses be made within 30 days from the date of receipt of certified copy of order.  Certified copies be supplied to the parties as per rules.          File be indexed and consigned to record room.

Announced

March 21, 2018.

                                                                (G.K. Dhir)

                                                                President

                                                                   (Amrinder Singh Sidhu)                                                                 Member

(Mrs. Natasha Chopra)

Member