1.      Heard Ms. Neha Garg, Advocate, for the complainants and Ms. Shriya Takkar, Advocate, for the opposite party.

2.      Jayant Singhal and Smt. Prabha Singhal have filed above complaint for directing the opposite party (i) to refund the amount of Rs.8106434/- with interest @18% per annum from the date of respective deposit till the date of actual payment, (ii) to pay Rs.5/- lacs as the compensation including cost of litigation with interest @18% per annum and (iii) any other relief, which is deemed fit and proper in the facts and circumstances of case.

3.      The complainants stated that M/s. M3M India Limited (opposite party) (hereinafter referred to as the builder) was a company, registered under the Companies Act, 1956 and engaged in the business of development and construction of residential and commercial building and selling its unit to the prospective buyers. The builder launched a project of group housing in the name of “M3M Woodshire”, at village Dharampur, Sector-107, Gurgaon, Haryana, in the year 2012 and made its wide publicity and that possession would be delivered within three years. Allured with attractive representations of the builder, complainant-1 booked a flat and deposited booking amount of Rs.500000/- on 14.05.2012. As per demand, the complainant deposited Rs.223176/- on 07.07.2012, Rs.689905/- on 03.01.2013 and Rs.706541 on 29.05.2013. The builder provisionally allotted Apartment No. MW TW-B03/1201, super area approximately 1536 sq.ft, total sale price of Rs.8346048/- on 25.01.2013. Apartment Buyer’s Agreement was executed on 29.05.2013. Vide Clause-16.1 of the agreement, possession had to be given within 36 months of commencement of construction with grace period of 180 days. Annexure-A of the agreement, provided Payment Plan as “Construction Linked Payment Plan”. The complainant paid Rs.1000000/- on 09.05.2014, Rs.375000/- on 12.05.2014, Rs.625000/- on 17.05.2014, Rs.480000/- on 01.05.2015, Rs.460000/- on 02.05.2015, Rs.440000/- on 04.05.2015, Rs.480000/- on 08.06.2015, Rs.470000/- on 09.06.2015, Rs.410000/- on 12.06.2015, Rs.400000/- on 08.07.2015, Rs.250000/- on 08.07.2015, Rs.150000/- on 09.07.2015, Rs.388840/- on 13.07.2015 and Rs.57972 on 13.07.2015 (Total Rs.8106434/-). The builder arbitrarily realized money without completing the construction according to “Construction Linked Payment Plan”. Complainant-2 is the mother of complainant-1. Her name was added in allotment register of the builder on 05.08.2015. Period of 42 months completed in December, 2015, from the date of booking. The builder realized entire money (except payable at the time of possession) but failed to deliver possession on due date. The builder, vide letter dated 28.04.2017, offered possession. Along with letter of possession, the builder supplied Statement of account of the complainants showing Rs.1471227/- as due. The complainants then inspected the flat on 18.05.2017 and found that the construction was not completed as per specification and also that the construction was not raised according to sanctioned layout plan. In the brochure and in the agreement, 40 meter wide road on the periphery and 24 meter wide internal road was provided but on the spot, very narrow road was provided. The complainants therefore, vide email dated 24.05.2017, demanded for refund of his money. But the builder did not give any reply. Then this complaint was filed on 18.09.2017.

4.      The builder filed their written reply on 31.01.2018, in which, the material facts have not been denied. The builder stated that under Apartment Buyer’s Agreement dated 29.05.2013, timely payment of instalments was an essence of the contract. The complainant was a chronic defaulter in payment of instalments in spite of demand notices given to him. 20% of sale price (including booking amount) was payable till 03.01.2013. The builder issued a demand notice dated 04.12.2012 in this respect. Excavation commenced in March, 2013. Second instalment was payable till 05.04.2013. The builder issued demand notice in this respect on 15.03.2013. The builder gave reminders dated 12.04.2013, 30.04.2013, 08.11.2013, 09.12.2013, 19.02.2014, 26.08.2014, 10.12.2014, 18.03.2015 and 24.06.2015 and pre-cancelation notices dated 07.03.2014, 13.11.2014, 13.02.2015 and 29.09.2017. Apartment Buyer’s Agreement was sent to the complainant on 21.03.2013. The complainant took time and signed it on 29.05.2013. The period of possession as given under clause-16.1 of the agreement was subject to timely payment of instalments. In the matter of civil construction work, time cannot be essence of contract. From the date of agreement, construction period of 36 months and grace period of 6 months, expired in December, 2016. The builder completed construction within promised period and applied for issue of “occupation certificate” on 12.09.2016. The competent authority took time and issued “occupation certificate” on 20.04.2017. The builder issued letter for possession to the complainants on 28.04.2017. In the matter of civil construction work, time cannot be essence of contract. There was no unreasonable delay. Clause-48 of the agreement contained an arbitration clause. The complaint is not maintainable and is liable to be dismissed.

5.      The complainants filed Rejoinder Reply, on 09.07.2018, in which, the facts stated in the complaint have been reiterated. The complainants filed various documentary evidence and Affidavit of Evidence of Jayant Singhal. The builder filed various documents and Affidavit of Evidence of Deepak Kapoor. The builder filed some documents, through IA/3021/2022, which is allowed and the papers are taken on record. Both the parties filed their short synopsis.

6.      We have considered the arguments of the counsel for the parties and examined the record. Vide Clause-16.1 of Apartment Buyer’s Agreement dated 29.05.2013, possession had to be given within 36 months of commencement of construction with grace period of 180 days, subject to timely payment of instalments. Excavation work commenced in March, 2013. The period of 42 months completed in September, 2016. The builder completed construction and applied for issue of “occupation certificate” on 12.09.2016. The competent authority took time and issued “occupation certificate” on 20.04.2017. The builder issued letter for possession to the complainants on 28.04.2017. There was no unreasonable delay in offer of possession. The complainants cannot terminate the contract on the ground of delay in offer of possession. Supreme Court in Bangalore Development Authority Vs. Syndicate Bank, (2007) 6 SCC 711, held that in civil construction works, time cannot be an essence of contract. In Ireo Grace Realteck Pvt. Ltd. Vs. Abhishek Khanna, 2021 SCC OnLine SC 277, due date of possession was 27.11.2018 and possession was offered on 28.06.2019. Supreme Court held that there was no unreasonable delay in offer of possession and the buyers were obligated to take possession.

7.      If the complainants terminate the contract, the earnest money and brokerage if any are liable to be forfeited under Clause-8.2 of Apartment Buyer’s Agreement dated 29.05.2013. Supreme Court, in Maula Bux Vs. Union of India, (1970) 1 SCR 928 and Sirdar K.B. Ram Chandra Raj Urs Vs. Sarah C. Urs, (2015) 4 SCC 136, held that forfeiture of the amount in case of breach of contract must be reasonable and if forfeiture is in the nature of penalty, then provisions of Section-74 of Contract Act, 1872 are attracted and the party so forfeiting must prove actual damage. After cancellation of allotment, the flat remains with the builder as such there is hardly any actual damage. This Commission in CC/438/2019, Ramesh Malhotra Vs. EMAAR MGF Land Ltd. (decided on 29.06.2020) and Mr. Saurav Sanyal Vs. M/s. Ireo Pvt. Ltd. (decided on 12.04.2022) held that 10% of basic sale price is reasonable amount to be forfeited in the name of “earnest money”.

O R D E R

In view of aforesaid discussions the complaint is partly allowed. The opposite party is directed to refund the entire amount deposited by the complainants forfeiting 10% of basic sale price along with interest @9% per annum, from the date of each deposit till its actual payment, within a period of 90 days from the date of this judgment.