JUSTICE V.K. JAIN, MEMBER

On 13.1.2007, the complainant booked a penthouse admeasuring 2737 Sq.ft. with the opposite party in a building which the OP was proposing to construct at Subhash Nagar, New Delhi, making part payment of Rs.2342786.47/- on different dates, the first being the payment of Rs.5 lakhs on 15.1.2007 followed by payment of Rs.15 lakhs on 27.2.2007 and payment of Rs.342786/- on 27.6.2008. According to the complainant though she was assured that the project would be sanctioned soon and the constructions would start within a month or so but the opposite party failed to get the plans sanctioned and start the construction. On seeking information under Right to Information Act from the Municipal Corporation of Delhi, the complainant learnt that no building plan in respect of the aforesaid project had been sanctioned. This is also the case of the complainant that the building plan submitted by the competent authority vide order dated 20.8.2014 and the said building is under the process of sealing. In the meanwhile, the allotment made to the complainant has been cancelled by the OP vide letter dated 18.4.2013. The complainant is, therefore, before this Commission with the following prayers:-

“(b)    Direct the respondent to restore the booking of the pent house in question in favour of the complainant,

(c)     Direct the respondent to cure the deficiencies in the construction of the building as pointed out by the SDMC, thereby raising the construction in accordance with the initial and original sanctioned building plan only, and to allot the agreed pent house to the complainant admeasuring 2727 sq.ft. on the agreed seventh floor only and absolutely not beyond the said floor, in the above project on urgent basis,

(d)     Direct the respondent to reschedule the principal amount of Rs.94,79,166/- towards basic cost of the flat in Parsvnath Paramount, Subhash Nagar, New Delhi.

(e)     Direct the respondent to waive the entire arbitrary exorbitant amount of interest purportedly on the delayed payments; as on the other hand the building has been sealed due to lack of raising of construction in accordance with the sanctioned building plan.

(f)      Direct the respondent to pay a compensation amounting to Rs.25,00,000/- on account of mental, physical and financial harassments as well as gross deficiency in service.

(g)     Direct the respondent to pay the complainant further compensation @ Rs.25,000/- per month for the delay which has been regularly caused from the end of the respondent i.e. for not getting constructed and allotted the said pent house after the expiry of the fixed period of three years from the date of booking, till the allotment and handing over the possession of the said pent house.”

2.      The complaint has been contested by the OP which has taken a preliminary objection that since an earlier complaint filed by this very complainant being Complaint No.126 of 2013 was dismissed by the State Commission on 20.12.2013, a fresh complaint before this Commission is hit by Order II Rule 2(3) of the Code of Civil Procedure and the complaint is also barred by limitation. The OP has also claimed that the complainant is bad for non-joinder of Parsvnath Relcon Pvt. Ltd., the Special Purpose Vehicle formed for this project. On merits, it is alleged that the land for the project in question was allotted to the OP by Delhi Metro Rail Corporation Ltd. on lease of 90 years commencing 17.4.2006. The building plans were submitted to MCD for approval but MCD was not ready to approve the same for want of NOC from the DDA as the land had been allotted to the DMRC for MRTS project and not for residential purposes. It is further alleged that the layout plans were approved by MCD subject to the OP obtaining NOC from DDA before release of the building plans. Eventually, the DMRC issued an NOC dated 9.7.2009 to MCD in terms of an order of Ministry of Urban Development on 30.3.2009 asking MCD to approve the building plan without awaiting NOC from DDA. The building plans were then approved by MCD on 22.7.2010. In the meanwhile, a Notification was issued by the Government stipulating therein that 15% FAR pertaining to EWS units is not to be counted in permissible FAR. The OP, therefore, submitted a revised building plan to MCD. However, MCD withheld the building plans for want of NOC from DDA. It is also alleged that the OP had set up a Special Purpose Vehicle with its subsidiary, namely, Parsvnath Relcon Pvt. Ltd., and assigned the development rights of this project to the aforesaid SPV. It is alleged that construction is likely to be completed within 30 months of its commencement with a grace period of six months, once the building plans and all other requisite approvals are received.

          It is also alleged by the OP that as per Constriction Linked Payment Plan, the complainant was required to pay a sum of Rs.4685572/- by 14.2.2007 but she has failed to pay the balance amount of Rs.4185572.94/- and has also not returned the Flat Buyer Agreement sent to her. It is also alleged that since the complainant failed to make the balance payment despite several letters sent to her, the allotment made to her was cancelled vide letter dated 18.4.2013.

3.      The first question which arises for consideration is as to whether this complaint is barred on account of the previous complaints filed by the complainants before the State Commission having been dismissed. A perusal of the order of the State Commission dated 1.2.2013 would show that the first complaint being C-2009/353  was dismissed as withdrawn after noticing that the prayer made in the complaint pertained only to Rs.10 lakhs. A perusal of the order dated 20.12.2013 would show that the second complaint instituted before the State Commission was dismissed on the ground that it was barred under Order II Rule 2(3) of the Code of Civil Procedure.

4.      Section 17 of the Consumer Protection Act confers jurisdiction upon the State Commission to adjudicate a complaint where the aggregate of the value of the  goods or services as the case may be, and the compensation if any claimed in the complaint exceeds Rs.20 lakhs but does not exceed Rs.1 crore. As held by a three-Members Bench of this Commission vide order dated 7.10.2016 in CC No.97 of 2016 -  Ambrish Kumar Shukla & Ors. Vs. Ferrous infrastructure Pvt. Ltd., the value of the services in such cases would mean the sale consideration agreed to be paid by the flat buyers to the builder. Admittedly, the agreed sale consideration in this case was more than Rs.1 crore, as is also evident from the application form. Therefore, the State Commission did not have the requisite pecuniary jurisdiction to entertain the complaints which were earlier initiated by the complainant. The orders passed in the previous complaints being without jurisdiction, a fresh complaint before a competent forum is not barred.

5.      The main question which arises for consideration in this case is as to whether the OP was entitled to cancel the allotment and forfeit the amount of Rs.2071444/- on account of failure of the complainant to pay the balance sale consideration of Rs.13750069.74/- along with interest quantified at Rs.8802401.61/-. As per Clause 6 of the Application Form submitted by the complainant in case of default the earnest money was to be forfeited and the balance, if any, refunded without interest though in exceptional circumstances, the OP in its discretion could condone the delay on payment of interest @ 24% p.a. As per Clause 5 of the Application Form, 15% of the basic sale price was to constitute the earnest money which could be forfeited by the OP.

6.      Admittedly, the complainant  paid a sum of Rs.2342786.47/- and did not pay even the instalments which were not linked  to the stage of construction. The case of the complainant in this regard is that at the time of booking, he was assured by the OP that the construction would commence very soon but, when he visited the site after booking the flat he came to know that even the building plans for development of this project had not been sanctioned. According to the complainant on making inquiry under Right to Information Act, she was informed by the Municipal Corporation of Delhi on 2.7.2009 that no building plan in respect of the aforesaid project had been sanctioned. The complainant has placed on record a letter dated 7.3.2008 written by her to the OP. The aforesaid letter to the extent it is relevant reads as under:-

“I have booked a pent house in your above said project no. T4-801PH on 15/01/2007 by paying Rs.5,00,000/- vide cheque No.949000, which was handed over to Mr. Vishal at site office at the same time he told us that the site plan and the map etc. have been submitted with the authorities, and the construction will be started within a month or so and only after that we are supposed to pay the balance booking amount.  We also discuss about the financing it from the bank.  We do not have this large amount in cheque, then he told us that you pay 22,50,000/- and the another installment you pay through the bank after it is been finalized.  But bank need the approved papers which you still do not have. 

          After that I regularly visited the site but, site plan and other maps were could not approved other required permissions were could not be obtained.  So, construction not started.  I was regularly in touch with Mr. Vishal and the situation was same, so he never asks me for balance amount, because it was understood to pay after getting site plans and maps approved, and getting construction started. 

          Situation was not clear, answers were not satisfactory, so I visited your head office on Dec.07 and met Mr. Kharbanda explained the whole incident to him, but he was also not sure about the time when the maps will be sanctioned.  He also told me that first “TROPIKANA” will be passed then after we will take this project.  He told me to come after one month.  After that I received a letter from your office stating that I have not paid the balance amount, so it will carry interest.  Then again I called Mr. Kharbanda to fix the meeting, he replied that the situation is still same, wait for some more time to clear the situation.  Then I told the letter for demanding interest.

          On Monday 25^th Feb/08 again, I met Mr. Kharbanda in his office and I told him that the delay is on your part.  So I am not bound to pay any interest and gave him a cheque of Rs.15,00,000/- (Rs. Fifteen lacs only) because my intentions are clear we are actual user, not financers or investors and do not want to make delay.  Discuss the whole matter again, so he asked me to give a letter explaining all the matter.

          I hope you have understood the situation and will take a favourable decision on your account at the earliest and oblige.”

          No communication was sent by the OP to the complainant controverting the averments made in the aforesaid letter dated 7.3.2008. This would mean that the complainant had been assured by the representative of the OP that construction would start within a month or so and only thereafter she was supposed to pay the balance booking amount. The letter further shows that though it was suggested to the complainant that she could pay through the bank, the approved papers were not available. Obviously, the bank would not have sanctioned a loan to the complainant without approval of the plans in respect of the building in which a flat had been booked by her. 

7.      Even otherwise the OP itself has alleged in its written version that the layout plans and building plans submitted by it were not released by MCD prior to 22.7.2010 which was insisting on NOC from DDA. Therefore, it cannot be disputed that before 22.7.2010, the OP was not in a position even to start construction of the building in which booking was made by the complainant despite its representative having assured her that the construction was likely to commence within a month or so. The complainant  cannot be penalised for MCD not approving the plans submitted by the OP without production of NOC from DDA, though it can hardly be disputed that if such an NOC was not required  in law, the OP also cannot be held responsible for the delay upto 22.7.2010. However, the question as to whether NOC was really required or not cannot be gone into by this Commission in these proceedings.

          After the plan had been approved by MCD on 22.7.2010, the OP sought to take advantage of a Notification which Govt. of India had issued in the meanwhile on 19.5.2009 whereby 15% FAR pertaining to EWS units was not to be considered while computing the permissible FAR. In order to take advantage of the aforesaid Notification, the OP submitted the revised building plan with MCD which again insisted on NOC from DDA. Had the OP not sought to take advantage of the aforesaid Notification dated 19.5.2009, it  could have been in a positon to commence construction on the basis of the plans which MCD had approved on 22.7.2010 and probably could also have completed the construction within a reasonable time thereafter. The OP, however, chose to avail an additional 15% FAR on the strength of aforesaid Notification dated 19.5.2009.

8.      It is also not in dispute that sealing proceedings were initiated by MCD in respect of project in question and a stay order has been obtained by the OP from Appellate Tribunal MCD on 8.4.2015.

9.      In my view, the OP could have cancelled the allotment and forfeited the earnest money only if it had got the layout plans and building plans approved and commenced construction as per the representation made to the complainant, but it could not have overlooked its own inability to get the said plans approved and commence the construction and cancel the allotment on account of failure of the complainant to pay the balance instalments. If one party to the agreement fails to perform his part of the contract, it cannot compel the other party to the agreement to perform its part which the other party is required to perform. The complainant booked a residential apartment believing that as per the representation made to her, the construction would commence soon. Since neither the construction commenced nor the plans were approved by the MCD which informed the complainant that no such plans had bene approved by it, the complainant was justified in refusing to pay the balance amount. It would not be unrealistic to expect a prudent person to wait at least for final approval of the building plans in such a disputed case before making the balance payment instead of blocking more amount with the builder, with no certainty of the date by which he would be able to get possession of the apartment booked by him. Cancellation of the allotment and forfeiture of the earnest money, therefore, would not be justified in the above-referred peculiar facts and circumstances of this case.

10.    The next question which arises for consideration is as to what should be the appropriate order to be passed in a situation where even the layout plants and building plans for a booking made more than 10 years ago have not been finally approved so far and the sealing proceedings have already been initiated by the municipal corporation. Though the OP cannot be held responsible for the delay upto 22.7.2010 provided NOC from DDA was not really required in law, the same may not be true for the delay post 22.7.2010, which happened on account of the desire of the opposite party to take advantage of the Notification dated 19.5.2009 whereby the additional FAR could be available to it. It would be pertinent to note here that the aforesaid Notification was not in existence when the land on which this project is sought to be developed was acquired by the opposite party from DMRC and, therefore, the additional FAR made available under the aforesaid Notification came as a bounty could not have been in contemplation while working out the cost of this project.

11.    More importantly the opposite party which collected at least part of the sale consideration from the flat years utilised the said money for its own purposes though it ought to have been used only for developing the project in which the bookings were made if the opposite party does not refund the amount paid to it by the complainant along with appropriate interest that would amount to its enrichment at the cost of the complainant. In the facts and circumstances of the case, as discussed hereinabove, it would be unfair to the complainant if the opposite party is permitted to forfeit the earnest money or even if it is made to pay only the principal amount received from the complainant, without any interest on that amount.

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

(i)      The opposite party shall refund the entire amount of Rs.2342786.47/- received from the complainant along with compensation in the form of simple interest @ 8% per annum on that amount from the date of receipt of each payment till the date on which the whole of the aforesaid amount along with compensation in the form of interest is refunded;

(ii)      The payment in terms of this order shall be made within eight weeks from today;

(iii)     In the facts and circumstances of the case, there shall be no order as to costs.