For the Appellant : Mr. Naresh Thanai, Advocate For the Respondent : Mr. S.K. Pattjoshi, Senior Advocate Nos. 1 & 2 and Mr. Sunil Mund, Advocate with him. For the Respondent No.3 : Mr. Paras Chaudhry, Advocate 01.04.2013 O R D E R Complainant/Appellant was allotted a plot admeasuring 502.32 sq. yards bearing No. C-0131 in Gardens (Sector 97) Uniworld City, Mohali by the Respondent builder vide allotment letter dated 22.04.08 for a total consideration of Rs.71,58,060/-, out of which he paid Rs.18,75,000/- upto March 2008. As per time linked payment plan, first installment was to be paid within 3 months of allotment. Vide allotment letter dated 22.04.08, Respondents asked the Appellant to deposit the amount of first installment on or before 2.06.08. According to the Appellant, since the allotment letter dated 22.04.08 was received by him on 2.05.08, therefore, the first installment was to be paid upto 1.8.08. Further, as per Clause 10 of the General Terms and Conditions of the Registration, the allottee was to be handed over the possession of the allotted plot within 36 months from the signing of the agreement by the Appellant. Respondents sent two agreement forms vide letter dated 22.4.08 which Appellant refused to sign as certain clauses of the agreement were not acceptable to him. Thereafter, on visiting the site, it was found by the Appellant that the allotted plot was situated amongst the block of 300 square meters size plots in Block-C and no allotment was made in Block B by the Respondents. Appellant also learnt that in default of payment of installment, the Respondent was charging interest @ 18% p.a. compounded quarterly which was higher than the rate being charged by the Bank on housing loan. Appellant sent a letter to the Respondents stating that he was prepared to pay the entire amount with reasonable interest. Respondents rejecting the request of the Appellant sent a notice to him demanding a sum of Rs.73,13,804/- which included interest amount of Rs.22,84,694/- upto 21.05.11. It was also mentioned in the said notice that in case of default of payment the allotment made in favour of the Appellant shall stand cancelled and the amount deposited by him shall stand forfeited. Complainant, being aggrieved, filed the complaint before the State Commission seeking a direction to the Respondents to either allot a residential plot measuring 502.32 sq. yards in block B of the proposed sector 97 Mohali in lieu of plot No. C-131 or refund the entire amount of Rs.18,75,000/- deposited by him along with interest @ 18% p.a., Rs.2,00,000/- as compensation and Rs.22,000/- a costs. Respondent builder, on being served, entered appearance and filed its written statement resisting the complaint on the grounds; that the complaint filed in the year 2011 was barred by limitation as the cause of action arose in the year 2008; that the plot was booked by the Appellant for commercial purposes which does not fall within the purview of the Consumer Protection Act, 1986; that the Respondent No.3 was the original allottee and the initial payment was made by them; that at the time of transfer of plot in his favour, Appellant for the first time made the payment; that despite repeated reminders, Appellant failed to pay the remaining sale consideration; that the Respondent was entitled to cancel the plot in case of default in payment; that in case of refund of deposited amount, Respondent was entitled to deduct booking/registration amount. State Commission after considering the pleadings available on record held that the complaint was within time; that the complainant was a ‘consumer’ within the Act and that in case of refund of the deposited amount, Respondent builder was entitled to deduct 20% of the Basic Sale Price in terms of Condition No.6 & 7 of the General Terms and Conditions of the Registration. State Commission partly allowed the complaint and directed the Respondent Nos. 1 & 2 to refund the amount of Rs.4,43,388/- to the Appellant with interest @ 10% p.a. with effect from the date of filing the complaint till realization within a period 30 days failing which the amount shall carry interest @ 12% p.a. State Commission in its order held as under:- “ However, according to Condition No.6 of the General Terms and Conditions for registration of provisional allotment of a plot at page 60 of the file, duly signed by the complainant, in case, at any stage, the intending allottee seeks cancellation of allotment and/or refund of the amount deposited by him, the Company may, at its discretion, forfeit the booking/registration amount or the Earnest Money, as the case may be, and the intending allottee shall be left with no right or lien on the said Plot. The amount paid, if any, over and above the Earnest Money, shall be refunded by the Company without interest. In the instant case, as stated above, the Complainant sought one of the reliefs, as refund of money. As stated above, it was the complainant, who failed to pay the remaining installments, qua the price of plot. According to condition No.7 of the general terms and conditions at page 60 of the file, earnest money shall be deemed to be 20% of the Basic Sale Price. These terms and conditions were duly signed by the complainant voluntarily. Since the Complainant asked for the refund of amount deposited, for the first time, in the instant complaint, the amount after deduction of 20% earnest money of the basic sale price is to be refunded. The basic sale price of the plot, as admitted by the complainant was Rs.71,58,060/-. The complainant deposited Rs.18,75,000/- in all . 20% of the basic sale price of the plot, comes to Rs.14,31,612/-. The complainant is, thus, entitled to the refund of Rs.4,43,388/- (Rs.18,75,000/- minus Rs.14,31,612).” Appellant, being aggrieved, has filed the present Appeal. Heard the Ld. Counsel for the parties at length. Ld. Counsel appearing for the Appellant contends that the plan of payment/demand itself was not in accordance with the terms and conditions of the registration; that the allotment letter was dated 22.04.08 and, therefore, the first installment after three months of the allotment was due on 1.08.08; that the terms and conditions were subject to the allotment and the Respondent builder was not entitled to deduct 20% of the deposited amount towards the earnest money; that the basic sale price of plot was Rs.62,79,000/- and not Rs.71,58,060/- which included some other charges and, therefore, at best 20% of Rs.62,79,000/- ought to have been deducted. As against this, Ld. Counsel appearing for the Respondent builder supports the order passed by the State Commission. The facts are not in dispute before us. Plot bearing No.C-0131 in Gardens (Sector 97) Uniworld City, Mohali was initially allotted to the Respondent No.3, Manohar Singh and Company and the initial payment was made by them. The said plot was transferred in the name of the Appellant in 2008 and for the first time, Appellant paid the amount to the Respondent. Thereafter, Appellant defaulted in making the payment of the installments of the balance sale consideration to the Respondent builder despite the repeated reminders. Respondent served a notice upon the Appellant demanding a sum of Rs. 73,13,804/- which included interest amount of Rs.22,84,694/- upto 21.5.11. Appellant filed the complaint before the State Commission seeking allotment of alternative plot in lieu of originally allotted plot or refund of the deposited amount along with interest, compensation and costs. State Commission allowed the complaint and directed the Respondent builder to refund the deposited amount after deduction of 20% of the Basic Sale Price towards earnest money. As per condition No.7 of the General Terms and Conditions of the Registration, the earnest money was deemed to be 20% of the basic sale price. In terms of condition No.6 of the General Terms and Conditions for registration of provisional allotment of a plot duly signed by the Appellant, Respondent Builder was at its discretion to forfeit the booking/registration amount or the earnest money in case of the Allottee seeking cancellation of the allotment or refund of the amount deposited by him. Admittedly, Appellant was a defaulter in making the payment of the installments of the balance sale consideration. Appellant prayed for refund of the deposited amount in the complaint. Under the circumstances, State Commission directed the Respondent builder to refund the deposited amount after deduction of 20% of the Basic Sale Price towards earnest money. The question as to “whether the seller is entitled to forfeit the earnest money deposit where the sale of an immoveable property falls through by reason of the fault or failure of the purchaser” came up for consideration before the Hon’ble Supreme Court in the case of Satish Batra Vs. Sudhir Rawal – (2013) 1 SCC 345. The Hon’ble Supreme Court after taking into consideration the entire case law answered the question as under:- “19. We are, therefore, of the view that the seller was justified in forfeiting the amount of Rs.7,00,000/- as per the relevant clause, since the earnest money was primarily a security for the due performance of the agreement and, consequently, the seller is entitled to forfeit the entire deposit. The High Court has, therefore, committed an error in reversing the judgment of the trial court.” Since, in the present case, the Appellant was a defaulter, State Commission rightly concluded that the Developer was entitled to forfeit the earnest money @ 20% of the Basic Sale Price. We do not find any infirmity in the order passed by the State Commission. For the reasons stated above, we do not find any merit in this appeal and dismiss the same leaving the parties to bear their own costs. |
