RA no.101 of 2021

1.     This review application has been filed seeking review of the order dated 21.10.2021 in AE 41 of 2014. Vide this order, relying on the Arbitral Award dated 09.01.2015 between Parsvnath Developers Pvt., Ltd., vs Chandigarh Housing Board which had decided that compensation shall be paid in the ratio of 70:30 between the Developer and the Housing Board, this Commission had directed the Judgment Debtor to pay compensation in terms of the order dated 05.03.2013, with effect from 05.02.2011 in the ratio of 70:30 between the developer - Parsvnath Developers Pvt., Ltd. and Chandigarh Housing Board. The Counsel appearing on behalf of the Chandigarh Housing Board argued that the share of 30% allocated to Chandigarh Housing Board was incorrect and that the entire liability of payment of compensation should lie with the developer – M/s Parsvnath Developers Pvt., Ltd. The reasons stated for the same are that the Hon’ble Supreme Court in Chandigarh Housing Board vs M/s Parasvnath Developers Ltd., and Anr.  (2020) 14 SCC 559 in Civil Appeal no.10748 of 2016 had directed as under:

“10.    When the facts of the instant case are examined in light of these observations, it become clear that clause 9 (c) is not attracted in the present case at all. First, there has been no fulfilment of the condition under clause 9 (a) for clause 9 (c) to come into operation. This is because the developer never even began construction at the project site due to the dispute with CHB about the encumbrances on the allotted land. Thus, the question of finishing such construction within the period mentioned under clause 9 (a) does not even arise. Consequently, clause 9 (c) which is concerned with the nonfulfillment of this obligation, is also not attracted”.

2.     It was argued that since the developer did not even commence the construction of the project at the site due to a dispute with the Chandigarh Housing Board in view of the encumbrances on the allotted land, there was no question that execution of the project had commenced and therefore, in view of this, there was no fulfilment of any obligation requiring 30% liability. Accordingly, it was argued that there was no question of inter se allocation of liability with regard to payment of compensation. It was also argued that the entire liability on payment of compensation should be raised on the developer M/s Parsvnath Developers Pvt. Ltd. The counsel appearing on behalf of M/s Parsvnath Developers Pvt. Ltd. did not contest the fact that the project had not commenced in view of the issues pertaining to the legal title of the land.

3.     For the aforesaid reasons, there is merit in the contention of the counsel for the Chandigarh Housing Board. The liability for payment of compensation should not have been fastened on the Board in the impugned order in terms of the order of the Hon’ble Supreme Court in Chandigarh Housing Board vs M/s Parasvnath Developers Ltd., and Anr.  (supra).

4.     In view of the discussion above, the Review Application is allowed and the order dated 21.10.2021 in paragraph 15 is amended to read as below:

15.     In view of the foregoing discussion, the opposite parties/ judgment debtors are directed to pay the compensation in terms of the order dated 05.03.2013 passed by this Commission, with effect from 05.02.2009 along with interest @ 12% per annum till the date of payment to the appellant/ decree holder the Parsvnath Developers Ltd., shall make the payment of compensation in the ratio of 100% within four weeks from today failing which proceedings under section 27 of the Consumer Protection Act, 1986 will be initiated against them. There shall be no order as to costs.