Date of filing: 01.03.2021
Date of Disposal: 16.05.2023
BEFORE THE III ADDITIONAL BANGALORE URBAN
DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, BENGALURU – 560 027.
DATED THIS THE 16TH DAY OF MAY, 2023
CONSUMER COMPLAINT NO.243/2021
PRESENT:
-
SRI.RAJU K.S,
SMT.REKHA SAYANNAVAR,:MEMBER
Mr. Krishnachandran,
S/o. Damodara Menon,
Aged About 37 Years,
R/at Chundiriyil House,
Ponnuveettil Lane,
Patturaikal P.O. Thrissur,
Thiruvambady TSR, Kerala-680022.
Also at Flat No.503, Building No.6,
Behind Al Hilal Bank,
Al Mahatah Park, Al Qasimia, Sharjah,
United Aram Emirates,
Represented by his SPA holder
Mr. Puruyatha Kalam Krishnanunni,
S/o. ABS Nair, Aged About 57 Years,
R/at: No.4, 2nd Cross, 2nd Main,
Behind Ittina RRV Apts BSV reddy Layout,
Ramamurthynagar, Bangalore North-560016.
(Rep by Sri. Ram Bhat & Sreepada, Advocate)
- V/s -
M/s. Hoskote Neo Homes Limited,
A fully owned subsidiary of
Artha Real Estate Corporation Limited,
A Company incorporated and registered
Under the Companies Act, 1956,
Having registered office at No.110/37,
Solitaire Building, Service Road,
Outer Ring Road, Marathahalli,
Rep. by its Managing Director.
(Rep. by Sri.Sandeep S. Shahapur, Advocate)
//JUDGEMENT//
BY SRI. SHIVARAMA K, PRESIDENT
01. The complainant has filed this complaint under section 35 of the Consumer Protection Act, 2019 seeking for a direction to the opposite party to refund the principal amount and with interest amounting to Rs.61,04,605/- and such other relief as this Commission deems fit in the circumstances of the case.
02. It is not in dispute that, opposite party is the developer and the complainant opted to purchase 02 apartment units bearing number A-310 and 1409 under Subvention scheme. Further it is not in dispute that, out of the sale consideration of Rs.29,64,203/- for flat No.A-310 the complainant had paid a sum of Rs.2,87,840/- as part consideration and in respect of flat No.1409 out of the sale consideration of Rs.27,40,203/- the complainant has paid a sum of Rs.2,65,440/-. Further it is not in dispute that, the complainant had entered in to Tripartite agreement with the opposite party and the Bank i.e., India Bulls housing Financial Limited.
03. Further it is not in dispute that, the complainant had availed credit facility of Rs.21,45,000/- for flat No.A-310 and the Bank had disbursed part of the loan amount of Rs.20,14,880/- on 05.05.2018 and in respect of flat No. 1409 the complainant had availed loan of Rs.21,00,000/- out of which Rs.19,95,000/- was disbursed by the Bank to the complainant on 23.03.2018. Further it is not in dispute that, period of 24 months and additional grace period of 06 months for completion of the project was fixed at the launch of the project. Further it is not in dispute that, the RERA granted extension for completion of subject project.
04. It is the further case of the complainant that, by looking the amenities/facilities provided in the brochure/advertisement the complainant approached opposite party to book a flat in the opposite party’s project in the pre-launch phase/plan. Further it is not in dispute that, the complainant availed loan from Bank in 10:90 ratio and the builder/developer will pay the premium from the date of first disbursement of the loan up to the completion of the construction of the flat. Further opposite party had failed to build and allot the flat as assured. Further the complainant has terminated the agreement and sought for refund of the amount paid. Further opposite party had stopped the pre-EMI to the bank from February-2020 and recently complainant learnt on enquiry that, opposite party has stopped the construction half way and there is no sign of the project being completed in the near future and opposite party had stopped sending the construction progress reports to the complainant and the Bank. Further the complainant had decided to terminate the agreement of sale and got issued legal notice dated: 11.01.2021 to the opposite party seeking for refund of the amount paid including the amount disbursed from the Bank and the interest paid to the Bank. In-spite of that, opposite party did not refund the amount. Hence the complaint came to be filed.
05. It is the further case of the opposite party that, due to various subsequent events, opposite party was not able to complete the project on the fixed time given at the launch of the project. Further opposite party did not receive legal notice dated: 11.01.2021 and the fact that, the complainant has decided to terminate the agreement indicates that, he is not ready and willing to purchase the property. Hence, it is sought to dismiss the complaint.
06. To prove the case, the SPA holder of the complainant (PW.1) has filed affidavit in the form of his evidence in chief and got marked EX.P.1 to EX.P.17 documents.
07. Counsel for complainant has filed written arguments with the citations.
08. Heard the counsel for complainant.
09. The points that would arise for consideration are as under:-
(1) Whether there is deficiency of service on the part of the opposite party?
(2) Whether the complainant is entitle for the
relief sought ?
(3) What order ?
10. Our findings on the aforesaid points are as follows:-
POINT NO.1:- In affirmative
POINT NO.2:- Partly affirmative
POINT NO.3:- As per the final order
for the following:
REASONS
11. POINT NO.1:- The SPA holder of the complainant (PW.1) has reiterated the fact stated in the complaint, in the affidavit filed in the form of his evidence in chief.
12. It is the contention of the learned counsel for the complainant that, opposite party has not at all completed the construction within the time schedule. In support of the contention counsel relies EX.P.4 & EX.P.5 copy of the agreement of sale and construction dated: 15.03.2018. In its clause 7.1 it is stated that, “the Developer shall convey and deliver the schedule ‘C’ residential apartment within 02 years with the grace period of 06 months from the date of first disbursement of loan amount from Bank/non-banking financial company”. The agreements were entered in to on 15.03.2018 as stated in EX.P.4 and EX.P.5 in respect of two flats. It is the contention of the learned counsel for the complainant that, the project ought to have been completed on or before 23.03.2019 and by adding the grace period the project were to be completed by 23.09.2019.
13. It is the contention of the learned counsel for the opposite party as stated in the version that, due to demonetisation which paralysed the industry for substantial period, introduction of GST resulting in escalation of cost and implementation issue, supply disruption of materials, pandemic of COVID-19, land owners dispute and dispute regarding violation of 79A & B caused delay for the reasons unforeseen and beyond control. To prove the said fact opposite party did not enter the witness box and given any evidence and produced any documents.
14. It is the further contention of the learned counsel for the complainant that, the reason stated above by the opposite party is not sustainable as no documents been produced to prove the same. In support of the contention counsel relied the judgement rendered by Hon’ble National Consumer Disputes Redressal Commission, New Delhi, in Anuj Biswas & Another Vs. Kapstone Constructions Private Limited, decided on 13.04.2022. It is held in the judgment that, “the complainants are entitled to give notice to the Developer for termination of the agreement and refund of the amount and the Developer is under an obligation to refund the amount within 03 weeks from the date of receipt of the notice along with interest at the rate of 9% per annum from the respective dates of deposit till payment and liquidate damages. Further after the promised date of delivery, it is the discretion of the complainant whether he wants to accept the offer of possession, if any, or seek refund of the amounts paid with reasonable interest. It is well within the complainant’s right to seek for refund of the principal amount with interest and compensation”. Hence we feel the opposite party has failed to prove the defence taken as stated above.
15. The other contention taken in the version filed by the opposite party is that, during the tenure of 24 months subvention scheme was rendered void, thereby opposite party is not supposed to pay the EMI for the loan disbursed to the complainant. Further the complainant cannot allege that, as per NHB guidelines, developers cannot offer subvention schemes and seek to enforce it. Hence the complainant had entered in to a void contract and based on void contract he has no locus standi to make claim as made in the proceedings. It is the contention of the learned counsel for the complainant that, as per clause 7.2 of agreement of sale and construction it is agreed that, as per the subvention scheme the opposite party shall pay the Pre-EMI from the date of the first disbursement of loan till the completion of the construction and handover of the schedule ‘B’ property. The opposite party stopped paying the Pre-EMI as per subvention scheme. The opposite party did not produce any document to substantiate that, the said agreement is a void contract and the complainant has no locus standi to make a claim as made in the present proceedings. In clause-7.2 of agreement of sale and construction vide EX.P.4 & EX.P.5 it is stated that, “the Purchaser/s who have availed loan under the purview of 10:90 subvention scheme from Bank/non-banking financial company need not pay interest from the date of the 1st disbursement up to the completion of construction of the schedule C flat/apartment”. Hence we feel there is no merit in the contention of the learned counsel for the opposite party that, the complainant had entered in to a void contract and based on void contract he has no locus standi to make a claim.
16. It is the further contention of the learned counsel for the complainant that, the project ought to be completed on or before 23.03.2019 and along with grace period the project ought to be completed by 23.09.2019 and the builder has failed to complete and handover the flat till date. It is not the case of the opposite party that, the project has been completed. Hence, not completing the project in the given time without any sound reason, amounts to deficiency of service on the part of the developer.
17. It is the further contention of the learned counsel for the complainant that, as per the NHB guidelines the developers are not permitted to offer subvention scheme to customers and that any Pre EMI paid by the complainant to the bank till the handover/possession will be adjusted/discounted towards the balance receivable against the complainant’s own contribution towards the total consideration. It is the contention of the learned counsel for the complainant that, the said scheme holds good to future transactions between a new customer and developer only, i.e., it does not have a retrospective effect. In the case on hand the complainant has taken the scheme in the year 2016 and the part loan was disbursed in the year 2018. Therefore the opposite party shall continue to pay the pre-EMI until the completion of the project as per Clause 7.2 of the Agreement of sale and construction. The opposite party did not produce the said NHB guidelines. Even if guidelines had been issued as contended by the opposite party it has no retrospective effect unless it is stated as such. Hence we feel there is no merit in the contention of the learned counsel for the opposite party in that aspect.
18. It is the further contention of the opposite party that, the complainant is not a Consumer. We feel since the opposite party is a Developer is a service provider as contemplated under section 2(37)(ii) of the Consumer Protection Act, 2019. Since the complainant had availed the service of opposite party, the complainant shall be a Consumer as contemplated under section 2(7)(ii) of the Consumer Protection Act.
19. It is the further contention of the learned counsel for the complainant that the opposite party did not complete the project in the assured time. As per agreement the project ought to be completed on or before 23.03.2019 and after the grace period, the project shall be completed by 23.09.2019 i.e., much before COVID-19 pandemic begun in India. Hence opposite party has given frivolous and baseless reasons to cover up their lacuna. Further according to opposite party they were scheduled to complete the project by December-2020 and had received further extension till June-2021 by Hon’ble RERA. It is the contention of the counsel for complainant that, still there were no signs of the completion of the project and opposite party did not produce any document with regard to the extension of time post June-2021. The complainant had issued a legal notice dated: 06.07.2020 demanding to complete the project by the end of December-2020 or else reimburse the Pre-EMI amount. Since the same has not been complied complainant had issued the notice dated: 11.01.2021 calling upon the opposite party to refund the amount paid including the amount disbursed by the Bank. It is not the case of the opposite party that, the project has been completed. The opposite party did not give any evidence contrary to the evidence of the complainant. Hence the oral evidence and the documents produced by the complainant remained unchallenged. Since the opposite party did not complete the project as assured and not refunded the amount paid as sought in the legal notice dated: 11.01.2021, we feel there is deficiency of service on the part of opposite party as contemplated under section 2(11) of the Consumer Protection Act, 2019. Accordingly we answer this point in affirmative.
20. POINT NO.2:- The complainant claimed refund of the principal amount which includes booking amount, loan amount disbursed by the Bank towards sale consideration, the Pre EMI paid by the complainant to the Bank along with interest amounting to Rs.61,04,605/-. According to PW-1 the complainant has paid the booking amount (inclusive of 02 apartments) of Rs.5,53,280/- and amount disbursed by bank (inclusive of 02 apartments) was of Rs.40,09,880/- and interest paid as Pre-EMI to the Bank for both the apartments of Rs.3,59,909/- and interest at the rate of 18% per annum from 23.09.2019 till 31.01.2021 of Rs.11,81,536/-. The opposite party did not dispute the said figures. We feel the complainant is entitled for the advance booking amount, amount disbursed by the bank and interest paid as Pre-EMI to the Bank. We feel the rate of interest is highly exorbitant one. The complainant is entitle for the interest at the rate of 9% per annum from the date of advance been paid till realization. Further for the amount disbursed by the Bank in favour of opposite party the complainant is entitle for the interest at the rate of 9% per annum from the date of the amount been disbursed by the Bank and from the date the interest paid as per EMI to the bank till realization. Further the complainant claimed compensation of Rs.10,00,000/- as damages. Admittedly the complainant has paid the amount in the year 2017 and the project ought to have completed on or before the 23.09.2019. Since the project has not been completed the complainant had sustained mental agony. Therefore the opposite party to pay a sum of Rs.1,00,000/- towards mental agony and damages. Further the act of opposite party made the complainant to get issued the legal notice vide EX.P.11 dated: 06.07.2020 seeking to complete the project by the end of December-2020 or else to reimburse the Pre-EMI paid or to adjust the same towards outstanding. Further the complainant got issued notice dated: 11.01.2021 vide EX.P.12 seeking for refund of the amount paid and the amount disbursed from the Bank with interest. Since opposite party did not comply the demand made in the EX.P.12 the complainant has approached this Commission for the relief in question. Hence the complainant is entitle for a sum of Rs.10,000/- towards litigation cost. Accordingly we answer this point party in affirmative.
21. POINT NO.3:- In view of the discussion made above, we proceed to pass the following:-
ORDER
The complaint is allowed in part.
The opposite party is directed to pay a sum of Rs.49,23,069/- with interest at the rate of 9% per annum on the booking amount paid from the date of payment made, on the loan been disbursed from the date of disbursement of the loan by the Bank and on the interest paid of Rs.3,59,909/- from the date of interest paid as Pre-EMI to the Bank till realization and a sum of Rs.1,00,000/- towards mental agony and damages and a sum of Rs.10,000/- towards litigation cost.
The opposite party shall comply the order within 30 days. In case, the opposite party fails to comply the order within the said period, the above said amount of Rs.1,10,000/- carries interest at the rate of 9% p.a. from the date of order till realization.
Supply free copy of this order to both the parties and return extra copies of the pleading and evidence to the parties.
Applications pending, if any, stands disposed-off in terms of the aforesaid judgment.
(Dictated to the Stenographer, typed by him, the transcript corrected, revised and then pronounced in the open Commission on 16th Day of MAY 2023)
- REKHA SAYANNAVAR) (RAJU K.S) (SHIVARAMA. K)
MEMBER MEMBER PRESIDENT
//ANNEXURE//
Witness examined for the complainant side:
Sri. Puruyatha Kalam Krishnanunni, SPA Holder of the complainant has filed affidavit in the form of his evidence in chief.
Documents got marked for complainant side:
- Original Special Power of Attorney dt.08.01.2021 –EX.P.1.
- Original list of documents issued by the Bank – EX.P.2(a) & EX.P.2(b).
- Original old brochure (2 in Nos.) – EX.P.3.
- True copy/Notarized copy of the agreement of sale & Construction dt: 15.03.2018 for Flat No.l-409 – EX.P.4.
- True copy/Notarized copy of the agreement of sale & Construction dt: 15.03.2018 for Flat No.A-310 – EX.P.5.
- True copy/notarized copy of the Tripartite Agreement dt:23.03.2018 for Flat No.l-409 - EX.P.6.
- True copy/notarized copy of the Tripartite Agreement dt:23.03.2018 for Flat No.A-310 – EX.P.7.
- True copy/Notarized Copy of the Loan Agreement dt: 23.03.2018 for Flat No.l-409 – EX.P.8.
- True copy/Notarized copy of the Loan Agreement dt: 23.03.2018 for Flat No.A-310 – Ex.P.9.
- Copy of the latest statement of bank account (2 in numbers) - EX.P.10(a) & EX.P.10(b).
11. Office copy of the legal notice sent by the complainant to the Ops dt: 06.07.2020 with acknowledgment – Ex.P.11 & EX.P.11(a).
12. Office copy of the legal notice sent by the complainant to the Ops dt: 11.01.2021 – Ex.P.12
13. Postal receipt & postal acknowledgment - EX.P.13(a) & EX.P.13(b).
14. Copy of the new brochure – EX.P.14
15. Copy of the latest statement of bank account – EX.P.15 & EX.P.15(a)
16. Copy of the photograph of the project – EX.P.16
17. Copy of the email dt. 18.03.2020 – EX.P.17.
Witness examined for the opposite party side:
- NIL -
Documents got marked for the Opposite Party side:
- NIL -
- REKHA SAYANNAVAR) (RAJU K.S) (SHIVARAMA. K)
MEMBER MEMBER PRESIDENT
