BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM,

ERNAKULAM.

Date of filing : 24/07/2013

Date of Order : 28/11/2014

Present :-

Shri. A. Rajesh, President.

Shri. Sheen Jose, Member.

Smt. V.K. Beena Kumari, Member.

C.C. No. 529/2013

Between

And

O R D E R

A. Rajesh, President.

1. Briefly stated, the case of the complainant is as follows :-

Lured by the assurances of the opposite parties, on 30-12-2008 the complainant entered into an agreement with the opposite parties to purchase a residential apartment bearing No. K083 located on the 8^th floor of the project of the opposite parties by name “New Town heights DLF” having super built up area of 1236 sq.ft. and proportionate undivided share in the land with a covered car parking at a total consideration of Rs. 32,41,120/-. As per the agreement, the opposite parties agreed to deliver the completed apartment within 36 months from the date of agreement. The complainant paid Rs. 4,00,000/- on 30-09-2008 the date of booking of the apartment, and thereafter, paid Rs. 2,48,224/-. The opposite parties have signed the original agreement and deliver the same to the complainant only on 04-03-2008. At the instance of the opposite parties, the complainant approached the State Bank of India, but they could not sanction the loan due to legal issues of the project. The complainant managed to avail loan from L.I.C. Housing Finance in June 2008. The opposite parties have waived the alleged default of payment by accepting the dues with interest. A supplementary agreement dated 06-07-2009 was entered into between the complainant and the opposite parties agreeing that if the completion of project is delayed beyond December 2011, the opposite parties would pay Rs. 10/- per sq.ft. per month as compensation for the period of delay. The complainant has paid a total sum of Rs. 31,22,702/- to the opposite parties. The opposite parties failed to complete the construction of the apartment as agreed. The complainant is entitled to get possession of the apartment and also entitled to get the penalty of Rs. 10/-per sq.ft. per month for delayed delivery of the apartment from 30-12-2011, till the actual date of delivery of the apartment together with a compensation of Rs. 5 lakhs and costs of the proceedings. This complaint hence.

2. The version of the opposite parties is as follows :-

The complainant is not a consumer within the purview of the Consumer Protection Act. The disputes if any, between the parties arising out of the agreement shall be referred for arbitration. There is no inordinate delay on the part of the opposite parties in providing the agreements to the complainant. The availing of loan from the bank is matter of discretion by the complainant and the opposite parties cannot be made liable. The opposite party's project has no legal impediments as alleged by the complainant. The non-availability of bank loan will not absolve the complainant for making payment to the opposite parties under Clause 24 of the agreement. The complainant has committed delay in making payment and has violated the agreement and is not eligible for the compensation for the delay as per Clause 10.4 of the agreement. The document dated 26-03-2012 is a document, which was addressed to the complainant due to an inadvertent error on the part of the opposite parties. The completion of the project was delayed due to unforeseen reasons which are beyond the control of the opposite parties. The opposite parties have not diverted the funds as alleged in the complaint. The project works are progressing fastly and it will be completed soon. The complainant is not entitled to get any reliefs as prayed for. This complaint deserves dismissal.

3. The complainant was examined as PW1 and Exts. A1 to A12 were marked on his side. The witness for the opposite parties was examined as DW1 and Ext. B1 was marked on their side. Heard the learned counsel for the parties.

4. The points that came up for consideration are as follows :-

1. Whether the complainant is a consumer within the ambit of the Consumer Protection Act?

2. Whether the complaint is referred from arbitration?

3. Whether the complainant is entitled to get possession of the apartment?

4. Whether the complainant is entitled to get compensation for the delayed penalty compensation as per the agreement?

5. Whether the opposite parties are liable to pay compensation and costs of the proceedings to the complainant?

5. Point No. i. :- Section 2 (1) (o) of the Consumer Protection Act affirms that “housing construction“ is a service under the purview of the Consumer Protection Act. The Hon’ble Apex Court in Lucknow Deveopment Authority Vs. M.K. Gupta III (1994) CPJ 7 (SC) and in M/s. Narne Construction Pvt. Ltd. Etc. Vs. Union of India & Ors Ltd. 2012 (3) CPR 1 (SC), in a considered view has categorically sustained the contention that this is a case maintainable in this Forum. So, the contention of the opposite parties that the complainant is not a consumer and this complaint is not maintainable within the ambit of the Consumer Protection Act does not hold water. Rejected hence.

6. Point No. ii. :- At the outset, by relying on clause 49 of Ext. A1 agreement, the opposite parties contended that the disputes arising out of the contract shall be settled through arbitration. We are not to accept the above contention, in view of the decision of the law of the land in Fair Air Engineers Vs. M.K. Modi 1996 CTJ 749 (SC), in which it was held that, “even if there exists an arbitration clause in an agreement and complaint is made by the consumer in relation to certain deficiency of service, then the existence of arbitration clause will not be bar to the entertainment of the complaint by the Redressal Agency.” Flimsy attitude which would wrong, the consumer cannot be accepted by this Forum whatsoever, especially when the same is sustained by the above finding of the Hon’ble Apex Court mentioned.

7. Point Nos. iii. and iv :- The following issues are undisputed :-

1. The complainant and the opposite parties entered into Ext. A1 apartment buyer's agreement dated 30-12-2008 for purchase of apartment bearing No. KO83 on the 8^th floor of the project of the opposite parties by name “New Town Heights DLF” having super built up area of 1236 sq.ft. and proportionate undivided share in the land with a covered car parking area.

2. The complainant and the opposite parties entered into Ext. A4 supplementary agreement on 06-07-2009. As per Ext. A1, the opposite parties agreed to complete the construction of the apartment within a period of 36 months from 30-12-2008.

3. The total sale consideration of the apartment is Rs. 32,41,120/-.

4. DW1 the witness for the opposite parties during evidence fairly conceded that the opposite parties could not complete the construction of the apartment till date for their own reasons not stated or explained.

5. The complainant paid a total sum of Rs. 31,22,702/- to the opposite parties towards consideration of the apartment evident from Ext. A9.

6. Out of the total sale consideration, the balance amount is to be paid by the complainant at the time of handing over possession of the apartment to the complainant.

8. The complainant stated that he is entitled to get compensation as per the terms and conditions in Exts. A1 and A4 agreements for the delay in handing over the possession of the apartment. The opposite parties vehemently and vigorously contended that since the complainant has committed delay in making the payment as per the payment schedule in the agreement, he is not eligible for compensation for the delay. The opposite parties maintain that the delay, if any has been caused due to the reason beyond the control of the opposite parties and so they are not liable to pay compensation as per Clause 10.1 in Ext. A1.

9. We are not to agree with the above contentions of the opposite parties for the simple reason that as per Clause 33 in Ext. A1 in the event of any delay in making payment by the complainant, the opposite parties were entitled to interest on the delayed payment. Indisputably, the opposite parties collected the delayed payments with interest as per Clause 33 in Ext. A1 and so the opposite parties are estopped from taking a contention that the complainant was a defaulter in making the payments. Further, the opposite parties did not produce any evidence to establish that for reasons beyond their control caused a delay in completion of the project.

10. It is a well settled law that when parties entered into an agreement of sale and the terms and conditions incorporated, such an agreement is binding on both parties. Either party is not entitled to deviate with such terms and conditions. Therefore, when the opposite parties entered into an agreement, it is their bounden duty strictly comply with the terms and conditions of the agreement and is expected to execute the registered sale deed and deliver the possession of the flat on the agreed date, in which the opposite parties failed.

11. In view of the above, we are of the firm opinion that the opposite parties are liable to pay compensation to the complainant as per Clause 10.4 in Ext. A4 at the rate of Rs. 10/- per sq.ft. for the period from the agreed date of delivery of possession of the apartment to the actual date of delivery of possession of the apartment, especially when the opposite parties agreed to pay compensation to the complainant in tune with Clause 10.4 evidenced by Ext. A6.

12. Point No. v. :- The primary grievance of the complainant having been met squarely and sufficiently, we refrain from awarding compensation. However, the complainant had to approach this Forum to get his grievances redressed. Had the opposite parties considered the grievances of the complainant and taken a decision to redress the same, this complaint could have been avoided. Costs of the proceedings are called for. We fix it at Rs. 10,000/-.

13. To set things right, we pass the following order :-

1. The opposite parties shall jointly and severally forthwith hand over the possession of the apartment and car parking area to the complainant and convey the proportionate undivided share in the land.

2. The opposite parties shall jointly and severally pay compensation to the complainant @ Rs. 10/- per sq. ft. for the super built area of the apartment per month for the period from 31-12-2011 to the actual date of delivery of possession of the apartment.

3. The opposite parties shall also pay Rs. 10,000/- (Rupees Ten thousand only) to the complainant as regards costs of the proceedings within 30 days from the date of receipt of a copy of this order, failing which the amount shall carry interest @ 12% p.a. till realisation.

The order shall be complied with, in line with the above directions.

Pronounced in the open Forum on this the 28^th day of November 2014.

Forwarded/By Order, Sd/- A. Rajesh, President.

Sd/- Sheen Jose, Member.

Sd/- V.K. Beena Kumari, Member.

Senior Superintendent.

A P P E N D I X

Complainant's Exhibits :-

Opposite party's Exhibits :-

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