JUSTICE V.K.JAIN, (ORAL)

The complainants, who are husband and wife, booked a residential villa with the opposite party in a project which the opposite party is developing in Sector 17A of Yamuna Expressway Industrial Development Authority. Villa No.62 came to be allotted to them for an agreed sale consideration of Rs.7464450/-. The possession was agreed to be delivered to the complainants by May 2014, though the opposite party was entitled to a further grace period of six months for this purpose. As per clause 19 of the allotment letter, the opposite party was to pay penalty to the allottees @ Rs.75/- per sq.ft of the super area of the unit per month, in the event of the possession not being delivered within the agreed period or the extended period. Since the possession was not offered to the complainants even on expiry of the grace period, they are before this Commission, seeking the following reliefs:-

“i) Direct the OP to pay an amount of Rs.32,70,150/- on account of delay in possession beyond the given date and delivery i.e. May, 2014 as calculated in para 19 of the complaint or to adjust an amount of Rs.32,70,150/- (on account of delay in possession beyond the given date and delivery i.e. May, 2014) into the balance fourth installment of Rs.18,66,112/- + Service Tax = Rs.19,32,494/- and to refund the balance of Rs.13,37,656/- to the complainants alongwith interest thereon at the rate of 24 percent per annum from the date the said amount became due and payable till the date of actual payment of such amount to the complainants and also to pay the increased service tax;

ii) Direct the OP to carry out the necessary changes and completion in the complainant’s Villa as mentioned in para 15 above;

iii) Direct the OP to execute sale deed and handover the possession of Unit/Villa No.62 (R023 S100062/Villa62) in Sector/Block S-1 which was booked by the complainants in the OP’s residential project situated at TS-1, Sector-17A, Yamuna Expressway Industrial Development Authority (YEIDA)-201303;

iv) Direct the OP to pay an amount of Rs.1,50,000/- for removing the kitchen (consists of complete modular kitchen with Hob & Chimney, R.O. System, C.P. fitting, Stainless Steel sink double bowl) from 1^st floor as defined in sales brochure without any approval/intimation to the complainants;

v) Pass restrain orders against the arbitrary and illegal demands raised by the OP and also restraining the OP from allotting the Unit/Villa No.62 (R023 S100062/Villa62) in Sector/Block S-1 which was booked by the complainants in the OP’s residential project situated at TS-1, Sector-17A, Yamuna Expressway Industrial Development Authority (YEIDA)-201303 to any other party;

vi) Direct the OP to pay an amount of Rs.10,00,000/- towards compensation for loss and injury suffered by the complainants on account of deprivation, harassment and mental agony caused by the negligence and dereliction of duty by all of the OP and for loss of reputation of the complainants;

vii) Direct the OP to pay an amount of Rs.55,000/- towards the cost of litigation.”

2.      The complaint has been resisted by the opposite party which has taken a preliminary objection that this Commission lacks the pecuniary jurisdiction to entertain the complaint since the complainants have paid only a sum of Rs.5768086/- as against the total villa cost of Rs.74644450/-, exclusive of taxes and other charges. As regards payment of penalty, it is stated in the written version filed by the opposite party that there was a typographical error in the allotment letter since the word ‘square feet’ was printed in place of the word ‘square yard’. The aforesaid mistake was brought by the opposite party to the notice of the complainants vide letter dated 11.1.2016, though it was disputed by the complainant vide his letter dated 25.1.2016. It is also alleged that the complainants had defaulted in payment of the demand raised vide final demand notice dated 18.3.2016.

          It has further been alleged in the written version filed by the opposite party that there is an arbitration clause in the agreement between the parties.

3.      During the course of hearing, the learned counsel for the opposite party stated that the construction of the villa allotted to the complainants is complete in all respects and they have already applied for the occupancy certificate which they expect to receive shortly. The learned counsel further states that they expect the occupancy certificate to be granted in about 3-4 months. The learned counsel for the complainants states on instructions that the complainants are ready to wait for the delivery of possession of the villa booked by them but press for payment of compensation, penalty etc. in terms of the prayers made in the complaint.

4.      As far as pecuniary jurisdiction of this Commission is concerned, as provided in section 21 of the Consumer Protection Act, this Commission possesses the pecuniary jurisdiction to entertain a consumer complaint where the aggregate of the value of the goods or services as the case may be and the compensation, if any, claimed exceeds Rs.1 crore. The value of the goods or services has been interpreted by a three-Members Bench of this Commission in CC No.97 of 2016 -  Ambrish Kumar Shukla & Ors. Vs. Ferrous infrastructure Pvt. Ltd. dated 7.10.2016 to mean the agreed sale consideration. Admittedly, the agreed sale consideration was more than Rs.74 lakhs. If the compensation claimed by the complainants is added to the aforesaid amount, the aggregate comes to much more than Rs.1 crore. Even if the compensation calculated at the rate of Rs.75/- per sq. yard of the super area per month in terms of clause 1 and 19 of the allotment letter is added to the agreed sale consideration, the aggregate would come to more than Rs.1 crore. Therefore, it can hardly be disputed that this Commission does possess the requisite pecuniary jurisdiction.

5.      As regards the alleged default on the part of the complainants in making payment in terms of the demand notice dated 18.3.2016, a sum of Rs.1932494/- inclusive of service tax was demanded from the complainant. Yet another demand notice titled as “Possession Payment Demand Notice” dated 18.3.2016 was sent to the complainant, demanding a sum of Rs.2498935/-. The complainant responded to the aforesaid demand notice on 25.3.2016 by way of an email, disputing the alleged delay and claiming penalty amounting to Rs.3270150/- from the opposite party. The opposite party was requested to issue an amended possession letter.

6.      The payment plan agreed by the complainant with the opposite party reads as under:-

“Payment Plans: Flexi Payment Plan

(The full payment has to be made as per following schedule)

Since the booking admittedly was made on 27.5.2013, the 2^nd  instalment became payable on 27.11.2013, the 3^rd instalment became payable on on 27.5.2014 whereas the last instalment would become payable only on offer of possession. The learned counsel for the complainants states that they have made payment within 30 days from the date on which the demand letters were issued from the opposite party. In my view, considering the payment plan agreed between the parties, they are under a contractual obligation to make payment in a time bound manner even without receipt of any demand notice from the opposite party, as far as the second and third instalments are concerned. Therefore, the complainants are required to pay interest at the agreed rate, for the delay in payment of the second and the third instalment. As far as the payment of 4^th instalment is concerned, the opposite party, in my opinion, could not have offered possession without completing the construction in all respects and obtaining the requisite occupancy certificate. Therefore, no payment of interest on the last instalment is required, unless the possession is offered after obtaining the requisite occupancy certificate and complete the construction of the villa allotted to the complainants in all respects.

7.      It is an admitted position that the complainants opted for 2 kv power and made payment for load to the aforesaid extent at the time of booking. Later on, the opposite party presumably provided power backup to the extent of 4 kv. However, the learned counsel for the opposite party has not been able to show any term in the allotment letter which entitles the opposite party to unilaterally increase the power back up at the cost of the allottees. Therefore, the opposite party, in my opinion, is not entitled to any additional payment on account of the alleged additional power back up though it will be open to it to restrict the power back up to the complainants to 2kv.

8.      The next demand raised by the opposite party towards maintenance charges. Clause 10 of the allotment letter which refers to the maintenance expenses, to the extent it is relevant, reads as under:-

“THAT an Interest Free Maintenance Security (IFMS) towards the maintenance and upkeep of the complex shall be payable by the Allottee/s to the Company as mentioned in the payment plan on page no.2/3.  The date of commencement of maintenance and upkeep of the complex for which monthly maintenance charges to be paid by the allottee based on super area of the unit, shall be reckoned from the date of issue of “Letter of Offer of Possession.”

It would thus be seen that maintenance charges are required to be paid by the allottee from the date of issue of letter of offer of possession. As stated earlier, the possession in my view could not have been offered to the allottee without completing the construction of the villa in all respects and obtaining the requisite occupancy certificate. Offering possession without obtaining the occupancy certificate is meaningless since the allottee is not permitted in law to occupy the house which does not have the requisite occupancy certificate. Therefore, the maintenance charges, in my opinion, would be payable only from the date on which the possession is offered to the complainants, after obtaining the requisite occupancy certificate and provided the construction of the villa complete in all respects at that time.

9.      The next demand raised by the opposite party was for providing water connection to the villa allotted to the complainants. The learned counsel for the OP has drawn my attention to clause 40 of the allotment letter in this regard which reads as under:-

“40.        THAT all the charges payable to various departments for obtaining service connections to the unit like electricity, telephone, water etc., including security deposit for sanction and release of such connections as well as informal charges pertaining thereto will be payable by the Allottee/s.”

It would be seen from a perusal of the aforesaid clause that only the charges actually paid by the opposite party to the concerned department for obtaining water connection, including the security deposit for obtaining for such connection, can be recovered from the allottee. The learned counsel for the OP states that instead of paying individually for each villa, the OP has made composite payment to the concerned department in respect of water connection provided to all the villas. If this is so, the OP will be entitled to recover the actual charges paid to the concerned department from the complainants on pro-rata basis, i.e., depending upon the area of the villa allotted to the complainant vis-à-vis the area of all the villas in this particular project. The complainants will also be entitled to proof of  such a payment to the concerned department along with a computation proportionate to their villa, before making payment under the aforesaid head.

10.    The next demand pertains to the cess paid by the OP under Buildings and Other Welfare  Cess Act 1996. A perusal of the order dated 10.12.2015 would show that the Dy. Legal Commissioner Noida and Cess Assessment Commissioner, Gautam Budh Nagar directed the OP to pay cess upto 31.3.2014 quantified at Rs.2675385/- in respect of the construction on Sector 17A of Yamuna Expressway.  Clause 16 of the allotment letter reads as under:-

“16. THAT all taxes, present or future, on land or on building levied by any authority from the date of booking shall be borne and paid by the Allottee/s. However, so long as each unit of the said complex is not assessed separately for the taxes, all the Allottee/s shall pay proportionate share of taxes assessed on the whole complex.”

In view of the aforesaid clause of the allotment letter, the aforesaid charges are payable by the complainants on proportionate basis. The OP will be entitled to recover the said cess from the complainants on propionate basis after providing the requisite computation to them. If any further cess in respect of the aforesaid project is paid by the OP for the period subsequent to 31.3.2014, that also can be recovered from the complainants on proportionate basis after providing the requisite computation.  The payment of interest, if any, on the cess will not be the liability of the allottees and, therefore, the complainants will not be obliged to pay interest, if any, paid by the OP on the said cess, except interest at the rate of 9% per annum, from the date of demand letter or the date of payment of cess, whichever be later.  

11.    The last demand raised by the OP is on account of additional compensation which Yamuna Expressway has demanded from the OP for payment to farmers whose land was acquired and allotted to the OP. Clause 15 of the allotment letter is relevant in this regard and reads as under:-

“D. TERMS OF DEVELOPMENT AUTHORITY

15. That the project is being executed by the company on land acquired from farmers/allotted by Yamuna Expressway Industrial Development Authority for development of the group housing project/commercial projects on the said land.  The Sub-lease Deed as the case may be, of the unit will be executed in favour of the Alottee/s by the company.  That upon the execution of the deed in favour of the Allottee/s, the Allottee/s will be bound by the terms of the development authority/given in Sub-lease Deed or Sale Deed.

It is evident from a bare perusal of the aforesaid clause that if the terms of the lease deed executed by the Yamuna Expressway Authority in favour of the OP obligate it to pay additional compensation for farmers to the Authority, the said amount can be recovered from the allotees on proportionate basis, after paying the same to Yamuna Expressway Authority.  In that case, the OP will also be entitled to interest @ 9% per annum on the said amount, from the date of payment or date of demand letter, whichever be later.  Though the demand letter issued to the OP by Yamuna Expressway Authority is on record, it is not known from the said letter as to whether it was issued in exercise of a contractual  obligation contained in the lease deed or otherwise. The lease deed executed by Yamuna Expressway Authority in favour of the OP is not available on record. In these circumstances, I hold that the OP shall be entitled to recover the said additional compensation from the complainants on proportionate basis provided it was under a contractual obligation in terms of the lease deed executed by Yamuna Expressway Authority in its favour to pay the said additional compensation for the farmers and has actually paid the same.  In that case, the OP shall also provide a copy of the lease deed executed in its favour along with the requisite computation to the complainants before enforcing the said demand.

12.    The demand notice dated 18.3.2016 contains a demand of Rs.168171/- towards escalation charges and service tax. Clause 42 of the allotment made which provides for escalation in the prices of construction material and labour cost reads as under:-

“THAT the price of the allotted unit subject to escalation in the prices of construction material and labour cost and the same shall be paid by the Allottee/s to the company over and above the allotted unit price as mentioned in this Allotment Letter and earlier in the price list and booking form. The period for which the escalation charges shall be calculated will be from the date of booking and upto the date of possession as given in the Allotment Letter. The escalation charges shall be calculated as per the company policy on the basis of RBI Index and the same shall be paid at the time of the possession of the allotted unit.”

          The computation of the escalation charges is available on page 105 of the paper-book and it purports to be based upon the RBI Index. The demand appears to be inconsonance with Clause 42 of the buyers agreement though it is required to be paid at the time of the allotted villa is offered after obtaining the occupancy certificate and completing the construction as per the contractual obligations of the parties in all respects. Therefore, the OP shall be entitled to recover the said amount accordingly.

13.    The last issue is with respect to the compensation to which the complainant is entitled on account of the delay in offering possession of the villa to the complainants. The case of the OP, as noted earlier, is that the construction of the villa is complete in all respects and they have already applied for grant of the requisite occupancy certificate though the same has not been issued as yet. Clauses 1 and 19 of the allotment letter read as under:-

“1. The company hereby agrees to pay penalty to the allottee/s @ 75.00 per sq.ft. of super area of unit per month for any delay in possession beyond the given date plus grace period of 6 months till the offer of possession/handing over of unit whichever is earlier. The compensation amount will be calculated after the lapse of the grace period and shall be paid/adjusted at the time of final account settlement before possession of the unit. The penalty clause will be applicable to only those allottee/s who honour their agreed payment schedule and make/s the payment of all his/her due instalments and additional charges/PLC as per the payment plan agreed upon in the allotment letter.

19. The possession of the unit shall be given by May, 2014 or extended period as permitted by the agreement. However, the company hereby agrees to pay penalty to the allottee/s @ Rs.75.00 per sq.ft. of super area of unit per month for any delay in possession beyond the given date plus grace period of 6 months till the offer of possession/handing over of unit whichever is earlier. The compensation amount will be calculated after the lapse of the grace period and shall be paid/adjusted at the time of final account settlement before possession of the unit. However, the payment of compensation is subject to the condition that the Allottee/s makes the payment of all his/her due instalment and additional charges/PLC as per the payment plan agreed upon.”

          On the face of it, the aforesaid clauses provide for payment of the compensation @ Rs.75 per sq.ft of super area of the villa per month for delay in possession beyond the agreed date plus the grace period of six months. The case of the OP as noted earlier is that there was a printing error in the aforesaid two clauses as ‘per square feet’ was typed in place of ‘per square yard’ in the aforesaid clauses. The case of the complainant, on the other hand, is that the agreed compensation was only Rs.75 per sq.ft. of the super area per month. The price of the villa sold to the complainant comes to less than Rs.2700/- per sq.ft. of the super area. It is inconceivable that a builder would agree to pay compensation @ about 3% per month to the builder, in such a transaction, when the prevailing rate of interest in the market at the time of the allotment should be about 12% p.a. Therefore, I am satisfied that there was a genuine mistake committed by the OP in incorporating the quantum of compensation payable in case of delay in offering possession. The compensation @ Rs.75/- per sq.yd. of the super area comes to about 4% p.a. However, considering the fact that the OP is utilising the money of the complainant beyond the date by which the possession was to be delivered to the complainant and taking into account the rate of interest prevailing during the period after the date by which the possession was to be delivered, the OP, in my view, should pay compensation to the complainant @ 9% p.a. for the period the possession is delayed. The learned counsel for the complainants states that since the OP has utilised the money belonging to the complainant for a commercial purpose, they should pay the rate of  interest applicable for taking commercial loan from the banks.  I, however, find myself unable to accept the contention considering the fact that the financial loss to the complainants would not be more than what I am awarding and in a consumer forum a person is entitled to compensation commensurate with the loss suffered by him.

14.    For the reasons stated hereinabove, the complaint is disposed of with the following directions:-

(i)      The opposite  party shall offer possession of villa in question to the complainants after completing its construction in all respects as per the contractual obligation of the parties and obtaining the requisite occupancy certificate, within six months from today;

(ii)      The OP shall pay compensation calculated @ 9% per annum of the amount paid by the complainant, w.e.f. 1.12.2014 till the date on which the possession in terms of this order is offered;

(iii)     The OP while offering possession shall be entitled to recover charges in terms of the view taken in this order;

(iv)    The compensation shall be paid or adjusted while issuing the offer of possession to the complainant in terms of this order;

(v)     The OP shall also pay a sum of Rs.10,000/- as cost of litigation to the complainants.