The present Appeal Execution has been filed by Mr. Rajiv Malhotra (hereinafter referred to as Appellant/Complainant) under Section 19 read with Section 21 and 22 of the Consumer Protection Act, 1986 against the Order dated 12.09.2014 passed by the Chandigarh UT Consumer Disputes Redressal Commission (hereinafter referred to as State Commission), whereby the Execution Application No. 38 / 2014 filed by the Appellant had been partly allowed.
Brief facts of the case are that the Appellant/Complainant booked a Penthouse with Parsvnath Developer Ltd. and a tripartite Agreement was entered between Appellant/Complainant, Parsvnath Developer Ltd. (hereinafter referred to as the Developer) and Chandigarh Housing Board (hereinafter referred to as CHB).The Appellant deposited ₹12,85,000/- and ₹12,86,500/- on 27.09.2007 and 04.02.2008 respectively.As the Developer failed to deliver the possession of the Penthouse within stipulated period, the Appellant filed a Consumer Complaint before the State Commission.Vide Order dated 11.08.2011, the State Commission allowed the Complaint in following terms:-
“(i) Parsvnath Developers Limited and the Chandigarh Housing Board are held liable jointly and severally to refund the amount deposited by the complainants, alongwith interest at the SBI Term Deposit rate as applicable on the date of refund, with effect from the respective dates of deposits, till actual payment to complainants, as provided by Clause 9(d) of the Flat Buyer Agreement ;
(ii) Parsvnath Developers Limited shall also pay compensation, (for not offering the built up flat within 36 months) @ Rs.107.60 per sq. mtr (Rs.10/- per sq.ft) of the super area of the unit, per month, from 5.10.2009, the last date of completion of the project, till actual payment to the complainants is made, as provided by Clause 9(c) of the Flat Buyer Agreement.
(iii) The aforesaid directions shall be complied with, by the OPs, within 30 days, from the date of receipt of a copy of the order, failing which they shall be liable to pay penal interest @ 12% p.a, on the aforesaid payable amounts.
(iv) The OPs shall jointly and severally pay to the complainants Rs.5,000/- as costs of litigation.”
Feeling aggrieved, Parsvnath Developers Ltd. filed Appeal, i.e., FA No.371/2011 before this Commission.Vide Order dated 05.03.2013, this Commission modified the Order dated 11.08.2011 passed by the State Commission in following terms:-
“The District Forum as well as the State Commission in most of the cases while allowing the complaint have directed the Developer and the CHB jointly and severally to pay interest at the rate of SBI term deposit prevalent at the relevant time, i.e. 7.75% p.a. in terms of clause 9 (d) of the Flat Buyer Agreements. However, in some cases it varies from 9% to 12% p.a.
To avoid the contradiction in the directions given by the District Forum and the State Commission regarding the payment of interest to the Complainants, we modify the orders passed by the fora below and direct the Developer and the CHB to pay interest at the uniform rate of 9% p.a (payable to the senior citizen on Bank fixed deposit at the relevant time) to the Complaints in the ratio of 70:30 from the respective dates of deposit till the date of deposit of the amount by the Appellants/Petitioners in the Escrow Account.
Adverting to the point of compensation, Ld. Counsel for the Developer has tried to shift the burden on the CHB by stating that the CHB has failed to hand over the possession of the unencumbered land to the Developer to raise the construction. That had the CHB handed over the possession of the unencumbered land to the Developer, the construction of the residential units would have been completed within the stipulated time. As against this, Ld. Counsel appearing for the CHB states that an area of 123.79 acres of land was handed over to the Developer for construction of the residential units. That there was no dispute with regard to the said land and the dispute was regarding the remaining project land which was earmarked for commercial activities. For a dispute between the Developer and the CHB, Complainants cannot be deprived of their legitimate dues which have become payable in terms of clause 9 (c) of the tripartite agreement. The Developer and the CHB cannot be allowed to have the benefit of their own/mutual wrongs. The dispute arising between the Developer and the CHB already stands referred to the Sole Arbitrator appointed by the Hon’ble Supreme Court (Hon’ble Mr. Justice R.V. Raveendran, Retd. Judge of the Supreme Court of India).
In terms of clause 9 (c) of the Flat Buyer Agreement, the Developer is liable to pay the compensation @ Rs.107.60 per Sq. Mt. (Rs.10 per sq. ft.) of the super area of the unit per month in case the possession of the built up area was not offered to the Buyer within a period of 36 months as stipulated in the tripartite agreement. Clause 9 (c) reads as under:-
“9(c) In case of possession of the built up area is not offered to the buyer within a period of 36 months or extended period as stipulated in sub clause (a) above the Buyer shall be entitled to receive from the Developer compensation @ Rs.107.60 per sq. mtr. (Rs.10/- per sf. Ft) of the super area of the unit per month and to no other compensation of any kind. In case the Buyer fails to clear his account and take possession of the unit within 30 days of offer, the Buyer shall be liable to pay to the developer holding charges @ 107.60 per sq. mtrs. (Rs.10 per sq. ft) of the super area of the unit per month in addition to the liability to pay interest to the sellers and other consequences of default in payment.”
Admittedly, the Developer has failed to construct the residential units and hand over the possession of the same to the Complainants. In terms of clause 9 (c) of the Agreement, Developer is liable to compensate the buyers @ Rs.107.60 per sqr. mtrs. (Rs.10 per Sq.ft) of the super area of the unit per month. By way of interim measure, we direct the Developer to pay the compensation to the Complainants in terms of clause 9 (c) of the agreement @ Rs.107.60 per sqr. mtrs. (Rs.10 per Sq.ft) of the super area of the unit per month which would be subject to the final outcome of the arbitration proceedings.
The orders passed by the State Commission in the original complaints and in the First Appeals arising of the complaint filed before the District Forum stand modified in terms of the directions given above. Any direction either contrary or at variance to these directions stands modified.
The amount of interest and compensation shall be paid by the Developer and the CHB as directed above within a period of three months from today failing which the amount shall carry interest @ 12% p.a.”
The Appellant filed Execution Application No. 38 / 2014 before the State Commission for compliance of the Order dated 11.08.2011 passed by the State Commission in Consumer Complaint No. 75 / 2010 which was modified vide Order dated 05.03.2013 passed by this Commission.Vide Order dated 12.09.2014, the State Commission partly allowed the Execution Application in following terms:-
“....... we are of the considered view that the definition of interest as contained in Section 2(28-A) of the Income Tax Act and the provisions of Section 194-A were not applicable and Judgment Debtors No.1 to 4 wrongly deducted the TDS of Rs.48,055/- from the interest amount payable/paid to the complainants / Decree Holders. Opposite parties/Judgment Debtors No.1 to 4 are directed to pay the amount of Rs.48,055/- which has already been deducted by them on account of TDS from the interest amount, to the Decree Holders and also not to deduct any TDS, from the future payment of interest, if any, payable to the Decree Holders.
11. It will not be out of place to mention here that the compensation, which was awarded by this Commission and upheld by the National Commission has been stayed by the Hon’ble Supreme Court of India in one of the appeals filed by Parasvnath Developers Ltd. Similarly, in two other execution applications in which this Commission ordered the payment of interest @ 12% p.a., the appeals/revision petitions were filed by M/s Parasvnath Developers Ltd. in which that direction was also stayed.
12. In view of the above, the execution application is partly accepted, with on order as to costs holding that Judgment Debtors No.1 to 4 are liable to refund the TDS deducted from the interest amount payable /paid to the Decree Holders as the interest accrued is actually compensation as mentioned in the preceding para of this order.
13. The said TDS amount be refunded to the Decree Holders by Judgment Debtors No. 1 to 4 by 22.09.2014.
14. However, the Decree Holders shall be at liberty to file a fresh Execution Application as and when the question with regard to the payment or non-payment of interest @ 12% p.a. and compensation is decided by the National Commission and the Hon’ble Supreme Court of India in the appeals, referred to above.”
Feeling aggrieved by the Order dated 12.09.2014 passed by the State Commission, the Appellant has filed the present Execution Appeal before this Commission seeking following reliefs:-
“a) Pass order as per Section 27 of the Consumer Protection Act, 1986 and issue arrest warrants against the Respondent No. 3-4;
b) Pass Orders for cost of litigation of ₹35,000/- in favour of Appellants against the Respondents;
c) Pass orders for cost of harassment to the tune of ₹50,000/- in favour of the Appellants against the Respondents.
d) Pass any other or further Orders / Reliefs / Directions which this Hon’ble Commission may deem fit and proper after considering the facts and circumstances of the case and in the interest of justice.”
We have heard Mr. Tushar Thareja, learned Counsel for the Appellant, Mr. Vineet Sinha, learned Counsel for the Respondent Developer, Ms. Rachna Joshi Issar, learned Counsel for Chandigarh Housing Board and perused the averments made in the Appeal Execution.
Mr. Tushar Thareja, learned Counsel for the Appellant submitted that vide Arbitral Award dated 09.01.2015, the learned Arbitrator decided that the amount of Compensation shall be paid in the ratio 70:30 between the Developer and Housing Board and extended the date of completion from 05.10.2009 to 05.02.2011.It was submitted that the Developer neither raised the issue of completion of the Project before State Commission nor before this Commission and, therefore, the Developer cannot raise this issue at this belated stage.He further submitted that as the Opposite Parties / Judgment Debtors failed to comply the Order dated 05.03.2013 by not paying the awarded amount within 3 months, therefore, they are liable to pay interest @12% p.a. instead of 9% p.a. on the deposited amount.
Per contra, Mr. Vineet Sinha, learned Counsel for the Developer and Ms. Rachna Joshi Issar, learned Counsel for Chandigarh Housing Board submitted that the Hon’ble Supreme Court vide Order dated 21.04.2015 in SLP No. 17133 – 17134 of 2013 ‘Parsvnath Developers Ltd. & Anr. Vs. Harsohin Kaur & Anr.’ and connected matters, held that ……If, for any reason, the respondent(s)/buyer(s) file any execution petition for execution of the judgment(s) and order(s) passed by the Commission, the Developer is at liberty to take such objections based on award passed by the Arbitrator. If such objections are raised, it is for the executing Court to consider the same and pass appropriate orders in accordance with law.” They further submitted that the learned Arbitrator vide Award dated 09.01.2015, decided the amount of compensation shall be paid in the ratio 70:30 between the Developer and Housing Board and extended the date of completion from 05.10.2009 to 05.02.2011. Accordingly, they have made the payment of compensation w.e.f. 05.02.2011.
We have given thoughtful consideration to the various pleas raised by the Parties andfound that the main issue involved in this Execution Appeal are:-
(a) Period of compensation – from 05.10.2009 or 05.02.2011?
(b) Rate of interest - 12% p.a. or 9% p.a., as the Developer had failed to pay the Compensation in terms of the Order dated 05.03.2013 passed by this Commission;
The First issue is regarding the period of Compensation whether it should be commenced from 05.10.2009, i.e., the agreed date of Completion of Project or 05.02.2011, the date decided by the learned Arbitrator for Completion of Project.The learned Arbitrator vide its Award dated 09.01.2015 extended the date of completion of the Project from 05.10.2009 to 05.02.2011 and decided the ratio of payment by Parsvanath Developers Ltd. and Chandigarh Housing Board as 70:30 by observing as under:-
“99. In view of the foregoing, the actual date of delivery of the project land (CHB’s assets), as per the Development Agreement is therefore, 05.02.2008 and not 06.10.2006. Consequently, the development period of thirty six months will have to be calculated from 5.02.2008 instead of 6.10.2006.
……..
The claimant and respondent are directed to bear the liability towards residential unit buyers, for refund of advances (payment of sale price or part thereof), interest and compensation as awarded by any consumer fora or any court, in the ratio of 70:30 respectively. For this purpose, the parties may take note of the payments, if any, already made by them and pay the balance so that the ratio of liability is maintained at 70:30.”
The Compensation was awarded by this Commission subject to the final outcome of the arbitration proceedings.The finding of this Commission was upheld by the Hon’ble Supreme Court vide Order dated 21.04.2015 in SLP No. 17133 – 17134 of 2013 ‘Parsvnath Developers Ltd. & Anr. Vs. Harsohin Kaur & Anr.’ by observing as under:-
“5. ………we are of the considered opinion that the Commission has not committed any mistake.
6. Further, it would be pertinent to note that the Commission has observed that its order would be subject to the pending arbitration proceedings between the Developers and the Chandigarh Housing Board.
7. In this context, Shri Rakesh Dwivedi, learned senior counsel would state that in view of the award passed by the Arbitrator the period that is stipulated in the Agreement has been extended from 06.10.2006 to 05.02.2008. We are not inclined to enter into this controversy. If, for any reason, the respondent(s)/buyer(s) file any execution petition for execution of the judgment(s) and order(s) passed by the Commission, the Developer is at liberty to take such objections based on award passed by the Arbitrator. If such objections are raised, it is for the executing Court to consider the same and pass appropriate orders in accordance with law.”
As the Compensation was awarded subject to the final outcome of the arbitration proceedings and the learned Arbitrator has decided the date of Completion of Project as 05.02.2011, the Compensation is directed to be paid w.e.f. 05.02.2011.
Now, coming to the second issue regarding rate of interest – 12% p.a. or 9% p.a. Vide order dated 05.03.2013, following directions were given:-
“…The amount of interest and compensation shall be paid by the Developer and the CHB as directed above within a period of three months from today failing which the amount shall carry interest @ 12% p.a.”
Undisputedly, the Judgment Debtors failed to pay the Compensation to Appellant/Complainant within three months from the date of the Order, failing which the amount should carry interest @12% p.a.As the Judgment Debtors/Opposite Parties failed to comply with the Order, they are liable to pay interest @12% p.a. on the Compensation amount w.e.f. 05.02.2011.
In view of the foregoing discussions, 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 05.02.2011 alongwith interest @12% p.a. till the date of payment to the Appellant/Decree Holder.The Parsvnath Developers Ltd. and the Chandigarh Housing Board shall make the payment of Compensation in the ratio of 70:30 within four weeks from today failing which proceedings u/s 27 of the Consumer Protection Act, 1986 will be initiated against them.There shall be no order as to costs.
The Execution Appeal stands disposed off in above terms.
