STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(COMPLAINT CASE NO.21 OF 2009)

                                                Date of Institution: 22.6.2009

                                                Date of Decision  :  29.10.2010.

Harjinder Singh s/o Sh. Mohinder Singh resident of H.No.4083, Sector 68, SAS Nagar, Mohali.

……Complainant.

V e r s u s

1.                Parsvanath Developers Limited, Registered Office,  6^th Floor, Arunachal Building, 19 12 Khamba Road, New Delhi through its Managing Director.

2.                Parsvanath Developers Ltd., SCO No.1, 1^st Floor, Sector 26, Chandigarh through its Branch Manager.

3.                Chandigarh Housing Board, 8, Jan Marg, Sector 9, Chandigarh through its Managing Director.

              ....Respondents.

BEFORE:          HON’BLE MR. JUSTICE PRITAM PAL, PRESIDENT.

                    MRS. NEENA SANDHU, MEMBER

                    SH. JAGROOP SINGH MAHAL, MEMBER.

Argued by:        Sh. Kapil Sharma, Advocate for the complainant.

                Sh. Ashwani Talwar, Advocate for OPs 1 & 2.

                Sh. Vikas Jain, Adv. for OP-3

PER JAGROOP SINGH MAHAL, MEMBER.

1.                Succinctly put, in July 2008 the complainant made an application for allotment of 4 bedroom penthouse apartment bearing unit No.B-23 PH-3 measuring super area of 3700 sq. ft. in Category B at Parsvanath Pride Asia RGCTP, Chandigarh for total consideration of Rs.2,64,55,000/- and he paid Rs.26,45,500/- being 10% of the total consideration money. The aforesaid flat was allotted to the complainant by the OP vide their letter dated 29.7.2008.  He vide his application dated 7.10.2008 requested for cancellation as he was unable to go ahead with the allotment due to financial problems but his request was never acceded despite service of legal notice dated 28.4.2009.  Hence this complaint alleging that the aforesaid acts of the OPs amount to deficiency in service and unfair trade practice.

2.                In their written reply Parsvnath Developers Ltd./OP-1 admitted the factual matrix of the case.  It has been stated that the complainant in his application dated 7.10.2008 sought cancellation due to personal reasons which was sent to OP-3 vide letter dated 3.11.2008, followed by reminders dated 6.1.2009, 4.5.2009, 8.5.2009 and 14.5.2009, but they did not take any action in the matter.  On 12.6.2009 the OP wrote to the complainant to obtain NOC from HDFC as the flat was mortgaged with HDFC and the same was sent by the HDFC on 17.6.2009.  On 13.7.2009 the OP cancelled the allotment and requested him to collect the payment from their office and on 4.8.2009 he collected the sum of Rs.13,22,750/- vide DD dated 9.7.2009 which was after deduction of 5%  in terms of per clause 5(a) of the Flat Buyer Agreement entered on 25.8.2008.   It has been denied that the complainant was entitled to whole of earnest money of Rs.26,45,500/- alongwith interest from the date of booking till payment.  Pleading that there has been no deficiency in service or unfair trade practice on their part, prayer for dismissal of the complaint has been made. 

3.                The Chandigarh Housing Board in their reply admitted the factual matrix of the case. It has been stated that on 7.10.2008 the complainant himself requested to cancel/surrender the plot due to some personal reasons and after completion of all the formalities OP-3 refunded back the amount of Rs.13,22,750/- vide draft dated 9.7.2009 to OPs 1 & 2 after deducting 5% of the earnest money as per clause 5(a) and the same was strictly in terms of the conditions of allotment.  Pleading that there has been no deficiency in service or unfair trade practice on their part, prayer for dismissal of the complaint has been made. 

4.                Both the parties adduced evidence in support of their contentions.

5.                 We have heard learned counsel for the parties and carefully gone through the record.

6.                The contention of the ld. Counsel for the OPs is that the deduction of Rs.13,22,750/- is perfectly legal and valid in view of clause 5(a) of the Flat Buyer Agreement (Annexure R-3/1) in view of which they can forfeit the earnest money being 5% of the basic price which amounts to Rs.13,22,750/-. Their contention is that in the present case the complainant withdrew from the race within 45 days of his depositing the amount and, therefore, he is not entitled to the amount forfeited by them in view of the agreement between the parties.  Clause 5(a) of the Flat Buyer Agreement reads as follows :-

“5(a)         Timely payment of the installments/amounts due shall be of the essence of this Agreement.  If payment is not made within the period stipulated and/or the Buyer commits breach of any of the terms and conditions of this Agreement, then this Agreement shall be liable to be cancelled. In the eventuality of cancellation, earnest money being 5% of the basic price would be forfeited and the balance, if any, would be refundable without interest.  However, the sellers may allow the revival of the allotment of the unit (subject to its availability) in the name of the Buyer on payment of revival charges amounting to 10% of earnest money.”

The above clause makes it clear that there are only two eventualities under which the earnest money, being 5% of the basic price, can be forfeited by the OPs.  The same are as follows :-

i) if the payment is not made within the stipulated period and/or

ii) if the buyer commits breach of any of the terms and conditions of the agreement

7.                In the present case, there is no such averment, nor any proof adduced by the OPs, if the payment was not made within the period stipulated under the agreement.  Rather their case is that whatever the payment was required, that was promptly made by the complainant and, therefore, there was no question of application of this clause on the complainant. Similarly, there is neither any proof nor any allegation if the complainant committed any breach of any of the terms and conditions of the agreement.  It is not a term of the agreement that if the complainant due to his adverse circumstances requests for cancellation the OPs would be entitled to forfeit the earnest money.  The forfeiture of Rs.13,22,750/-, therefore, cannot be justified under clause 5(a) of the agreement.

8.                It is not a case in which the OPs were ready with the construction and the complainant declined to get the flat.  In fact, till that date the OPs had not even started the preliminaries for raising construction.  Even till today, no construction has been raised though the period of more than 2 years have passed.  It is admitted case that a dispute has arisen between the OPs inter se with respect to the ownership of the land over which the flats are to be constructed due to which the entire matter has gone into dispute.  The agreement was entered into between the OPs on 2.3.2007 and in view of clause 3.3.1 thereof, the OP-1 was to develop the site within 36 months therefrom.  The said period has since expired on 2.7.2010, however, as yet nothing has been done at the spot and, therefore, even if the complainant had not withdrawn the amount the OPs would not have been able to deliver possession of the premises to him within the period agreed between the parties.  The OPs, therefore, cannot be permitted to take benefit of their own wrongs in not raising construction at the spot and then withholding the amount without any basis.

9.                In view of the above discussion, we are of the opinion that the complaint must succeed and the same is accordingly allowed.  The OPs are directed to pay to the complainant the amount of Rs.13,22,750/- within thirty days from the date of receipt of copy of the order failing which they would be liable to pay the same with interest @ 8% per annum since the date of deposit  till its payment to the complainant.  OPs are also liable to pay Rs.5,000/- as litigation costs.

        Certified copies of this order be communicated to the parties, free of charge. The file be consigned to records.

Pronounced.

29^th October, 2010.

Sd/-

[JUSTICE PRITAM PAL]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Sd/-

[JAGROOP SINGH MAHAL]

MEMBER

hg

STATE COMMISSION

(COMPLAINT CASE NO. 21 OF 2009)

Argued by:   Sh. Kapil Sharma, Advocate for the complainant.

                Sh. Ashwani Talwar, Advocate for OPs 1 & 2.

                        Sh. Vikas Jain, Adv. for OP-3

Dated the 29^th day of October, 2010.

ORDER

                Vide our detailed order of even date recorded separately, this complaint has been allowed.

(JAGROOP SINGH MAHAL)          (JUSTICE PRITAM PAL)     (NEENA SAHDHU)

                MEMBER                              PRESIDENT                    MEMBER