JUDGMENT 19.8.2010 Justice Pritam Pal, President 1. The aforesaid six complaints have been filed against Parsvnath Developers Limited and Chandigarh Housing Board. Since, in all these complaints similar questions of law and facts are involved, so we propose to decide all these six complaints through common order. 2. The facts are culled out from Complaint NO.4 of 2009 titled Shamsher Singh Sidhu Vs Parsvnath Developers Limited etc. which are epitomized as under ; That M/s Parsvnath Developers Limited – OP NO.1 widely advertised their project of a township in the name of Parsvnath Prideasia, Chandigarh envisaging sale of flats/pent houses to be constructed by them in Chandigarh in a township to be developed in the name of “Parshavnath Prideasia”. OP No.1 also constructed a sample flat at the site and public was invited to visit the said sample flat to facilitate their decision for applying. The complainant impressed by the presentations of the OP regarding the quality and other aspects of construction as well as location of the site, applied for allotment of a flat of category-C Type-1 vide his application No.A-07282 dated 18.9.2007 alongwith booking amount of Rs.9,81,000/-. The said application was submitted under Scheme-1 which was opened to public w.e.f. 2.9.2007 to 21.9.2007. As per terms and conditions mentioned in the application form, more precisely in clause-7, it was stipulated that the price and mode of payment includes the basic price of the super area of the unit plus other charges payable as described in the price list annexed as Annexure-1. It was also stipulated therein that the residential unit was likely to be completed within 36 months of signing of the Development Agreement between OP and Chandigarh Housing Board. The said clause also suggested some delays on account of environmental clearances. The total cost of the flat, including that of the amenities was Rs.2,08,50,000/- and 5% being earnest money to the tune of Rs.9,81,000/- was paid by the complainant at the time of booking. Complainant was issued allotment letter dated 28.9.2007 read with their subsequent letter dated 20.10.2007 allotting flat No.3/Second floor, Block No.C4-203 with tentative super area of 2825 sq.ft for Rs.1,96,33,750/-. A copy of the allotment letter is Annexure C-2 and a copy of the Flat Buyer Agreement is annexure C-3. Subsequently the said flat at the request of complainant was upgraded by OP to a pent house for which a lay out plan was provided to him, a copy of which is Annexure C-4. It is alleged that despite request of complainant, revised cost and revised payment schedule was not intimated by OP to the complainant. Complainant wrote letters dated 12.11.2007 and 3.12.2007 to OP seeking confirmation for upgradation from three bedrooms flat to pent house to be constructed by OP and further confirming that the complainant was willing to make payment, if request of the complainant for upgradation to the pent house was allowed. In response to the said letters, OP communicated their acceptance of the request of the complainant vide their letter dated 5.12.2007 and demanded a sum of Rs.46,31,500/- from complainant as overdue amount towards installments. The complainant then paid the amount of Rs.46,31,500/- vide bank draft dated 6.12.2007. Even after taking the amount of Rs.56,12,500/- the OP did not send any intimation with regard to the status of the project. The complainant learnt on his own that the project had not even taken off and no construction in respect of the project at the site was even commenced by OP. The complainant made enquiries in the matter telephonically from OP but no satisfactory reply was received. Ultimately complainant requested OP either to refund the amount of Rs.56.12 deposited by him or provide him specific schedule construction to enable him to plan his affairs of life. 3. It was further averred that in the course of his discussions with representative of OP, complainant was shocked to learn that OP had threatened to deduct more than Rs.10.00 lacs @ 5% of the basic sale price out of the payment made by the complainant, if he withdraws out of the scheme. According to complainant, OP had explicitly mentioned in its agreement that the construction would be completed within 36 months effective from the date of signing of Development Agreement by them with Chandigarh Administration but the factual position is not being disclosed regarding the commencement of the project. The complainant then sent legal notice dated 27.1.2009 to OP seeking refund of the payment as there was no possibility of completion of the project in the stipulated period of 36 months but to no effect. Hence, alleging deficiency in service and unfair trade practice on the part of OP, complainant filed complaint in this Commission seeking refund of Rs.56,12,500/- alongwith interest @ 24% p.a. besides Rs.10.00 lacs as compensation on account of loss of opportunity of having flat at Chandigarh, mental agony , hardships etc. 4. The detail of amounts deposited by other complainants in their respective complaints is as under ; Complaint No. 15/2009 (i)Rs.5,42,000/- deposited on 21.9.2007 (ii)Rs.5,00,000/- deposited on 21.9.2007 (iii)Rs.10,43,000/- deposited on 13.10.2007 (iv)Rs.34,27,500/- deposited on 5.12.2007 Total: 55,12,500/- | Complaint No. 34/2009 (i)Rs.10,09,937/- deposited on 7.12.2007 (ii)Rs.10,09,938/- deposited on 9.1.2008 (iii)Rs.34,29,812/- deposited on 14.2.2008 Total: 54,49,687/- | Complaint No. 39/2009 (i)Rs.10,00,000/- deposited on 14.9.2007 (ii)Rs.10,15,500/- deposited on 5.10.2007 (iii)Rs.34,23,250/- deposited on 6.11.2007 Total: 54,38,750/- | Complaint No. 44/2009 (i)Rs.5,90,000/- deposited on 20.9.2007 (ii)Rs.5,90,000/- (no specific date mentioned ) (iii) ---------- Total amount deposited : 32,53,750/- | Complaint No. 55/2009 (i)Rs.6,07,750/- deposited on 7.5.2008 (ii)Rs.25,31,000/- deposited on 26.9.2008 Total: 31,78,750/- |
5. Parsvnath Developers Limited and Chandigarh Housing Board contested the complaint and filed their separate replies. Parsvnath Developers Limited – OP NO.1 in their reply admitted that the complainant had deposited Rs.56,12,500/- through cheque in the Escrow account under the name of “Parsvnath Developers Limited-CHB-Account No……”. It was stated that the period of 36 months for completion of the project as committed with the complainant in terms of the Flat Buyer Agreement was as per Clause-2.2.2 from the time when the unencumbered project land was handed over to the OP No.1. After signing the Development Agreement on 6.10.2006 the Chandigarh Housing Board handed over 123.79 acres of land to OP NO.1 claiming it to be unencumbered but on erection of fencing around it, the Haryana Government claimed ownership over a part of it due to which OP No.1 stopped from carrying on its activities. The Chandigarh Housing Board informed OP NO.1 on 9.2.2007 as well as on 12.4.2007 that the dispute had been resolved with the Haryana Government and handed over a revised demarcation plan of the land but they refused to deliver physical possession of the revised/changed area whereas the demarcated land offered to OP by Chandigarh Housing Board included land belonging to the Forest department and despite number of repeated requests and communications, Chandigarh Housing Board did not provide clear and unencumbered land to OP as stipulated under the Development Agreement resulting in delay in obtaining approval and commencement of development of the project. As regards the deduction of amount , it was stated that as per clause 5(a) of the Flat Buyer Agreement there is stipulated forfeiture of 5% of Basic price in the event of cancellation. It was pleaded that as the unencumbered land was not made available by the CHB, so OP could not start construction and as such Chandigarh Housing Board was a necessary party. 6. Chandigarh Housing Board which was impleaded later on in its reply stated that the complainant had entered into Flat Buyer Agreement with the Developer and Chandigarh Housing Board wherein besides other terms and conditions, it was agreed that as per clause 5(a) 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. It was further stated that according to clause 9(e) of the Agreement, it was the responsibility of the developer to timely deliver the residential unit to the buyer and the complainant rightly attributed delay on the developer in his complaint. It was pleaded that as no deficiency was alleged against the CHB, so the complaint against it was liable to be dismissed. 7. In other five complaints opposite parties also filed their separate replies raising the identical pleas. In all the cases parties adduced evidence by way of their respective affidavits and documents. 8.. We have heard learned counsel for the parties and carefully gone through the record and material placed on the files of all the aforesaid six complaints. The first and foremost point of arguments raised on behalf of the complainants is that they had entered into a tripartite Flat Buyer Agreement which is duly signed by the buyer (complainant), Parsvnath Developers Limited (Developer) and the Chandigarh Housing Board (for short hereinafter to be referred as CHB). As per terms and conditions of the said agreement, copy of which is placed on each file , complainants had deposited the required amounts with Parsvnath Developers Limited for the purchase of their respective flats, the possession thereof was to be handed over within three years i.e. 36 months from the date of signing of the Development Agreement between the Parsvnath Developers Limited and CHB. The said Development Agreement was ultimately signed on 6.10.2006 and thereafter the CHB had handed over the possession of 123.79 acres of land to the Parsvnath Developers Limited for raising the construction of flats. According to learned counsel for complainants, no steps whatsoever were taken for the completion of the flats by the Parsvnath Developers Limited . Not only that, the amounts deposited by the complainants have not been returned so far inspite of the fact that the period of 36 months had expired on 5.10.2009 within which the possession of the flats was to be handed over. After putting forth the aforesaid points of arguments, complainants sought refund of their amounts together with interest and compensation. 9. On the other hand, learned counsel for Parsvnath Developers Limited submitted that the possession of the project land delivered to them was not free from encumbrances, so it was not possible to raise construction thereon. Then it was also argued that the amounts deposited towards cost of flats by the complainant is not with the developers, rather it is lying deposited in the joint account with CHB and that the account is not being operated upon by the Parsvnath Developers Limited. At the same time, learned counsel for CHB also repelled the points of arguments raised on behalf of the complainants and submitted that in fact complainants are entitled to refund of their amounts only after making deduction of 5% of the basic sale price. Then it was also argued that in fact there was no legal hitch in raising construction over the area of 123.79 acres of land which was meant for residential purpose only. The dispute, if any was with regard to remaining project land which was earmarked for commercial activities. Then it was also argued that CHB is not liable for making any compensation of any kind, if any, payable to the complainants as per stipulation incorporated in clause-9(c) of the Flat Buyer Agreement. However, at the fag end of his arguments, it was also submitted that in case the amounts are ordered to be refunded to the complainants that can be refunded only after making deduction of 5% of the basic sale price from the amounts deposited by the complainants. 10. We have given our thoughtful consideration to the above points raised on behalf of the parties and have also gone through the relevant terms and conditions of the Development Agreement dated 6.10.2006 and Flat Buyer Agreement. Before we proceed further, it is pertinent to mention here that both OPs i.e. Parsvnath Developers Limited and CHB have fairly admitted that at the spot the project in terms of the Scheme and the Agreement could not take off inspite of the expiry of 36 months period within which the possession of the flat was agreed to be handed over. Thus, now the question to be determined before us is as to who is liable to refund the amounts deposited by complainants and interest thereon as well as compensation. In this regard, both parties have made reference to various clauses of the Flat Buyer Agreement which is duly signed by the Complainants, Developers and CHB. Clause-(a) at page-3 of this Agreement goes to show that the Development Agreement had already been signed between OPs i.e. Parsvnath Developers Limited and CHB on 6.10.2006 and thereafter developer had also acquired development rights in 123.79 acres of land (Project Land) which was meant for residential purposes. Meaning thereby, the project was to be completed on or before 5.10.2009 but no steps whatsoever are shown to have been taken so far for raising construction thereon. 11. It is apparent from clause-2(d) that all the payments towards the construction amount including basic price and other charges payable in terms of Scheme of Allotment and the said agreement was to be paid by Account Payee Cheque/bank drafts in the name of Parsvnath Developers Limited-CHB A/c No.30184417088 payable at Chandigarh. This indicates that both OPs are jointly holding the account in which the amounts of complainants are lying deposited. No doubt that in the case of any breach of condition or terms of the Agreement by the buyer, the allotment was liable to be cancelled and in that eventuality 5% of the basic price was be forfeited and the balance, if any, was refundable with interest as laid down in clause 5(a) of the aforesaid tripartite Agreement. Admittedly there is no breach of any condition of the Agreement committed by any of the complainants regarding payment towards the cost of the flats whereas OPs are proved to have not carried out the terms and conditions in its letter and spirit as required under the Agreement which was duly signed by the parties. Moreover, if there was any dispute between OPs regarding delivery of the possession of Project Land or raising of construction thereon for that complainants cannot be allowed to suffer and at the same time OPs also cannot be allowed to take benefit of their own wrongs. Thus, it is a clearcut case of deficiency in service on the part of OPs. It is well established that the Parsvnath Developers Limited had constructed a sample flat at the site of the project land which allured the complainants who deposited huge amounts in order to fulfill their dreams of having a same kind of flat. Admittedly not a single brick has been laid at the spot and the money collected from the buyers in crores is being used by OPs without taking any steps to refund the same to them. All these acts on the part of OPs further also amount to unfair trade practice. In this view of the matter, question of making any deduction while refunding the deposited amounts of complainants does not arise. 12. Now adverting to the Clause-9(d) of the Flat Buyer Agreement, therein it was agreed upon between both the parties that if the developer is unable to deliver the unit to the buyer, the Developer and CHB shall be liable to refund the buyer the amount received from them with interest. The said clause in fact reads as under ; “ 9(d) If as a result of any rules or directions of the Government or if any competent authority delays, withholds, denies the grant of necessary approvals for the Project, or if due to any force majeure conditions, the Developer is unable to deliver the unit to the Buyer, the Developer and CHB shall be liable to refund to the Buyer the amounts received from the Buyer with interest at the SBI Term Deposit Rate as applicable on the date of refund. ” 13. Thus, a perusal of the aforesaid clause goes a longway to show that the complainants are entitled to interest over their amounts deposited with OPs at the SBI term deposit rate as applicable on the date of refund. In this regard, a tabulated statement showing latest revised payable terms deposit interest effective from 17.8.2010 has been placed on file which indicates that on the term deposit amount for two years to less than three years the interest is 7.75% p.a. which in the given facts and circumstances of complainants is applicable in all the cases before us. 14. Now at the end, we take the question of compensation payable to the complainant and by whom ? In this regard, again we shall have to go by the terms and conditions agreed upon by the parties incorporated in clause-9 ( c) of the Flat Buyer Agreement and the same is reproduced below ; “9(c) In case of possession of the built up area is not offered to the Buyer within a period of 36 months or extended period as stipulated in sub-clause (a) above the Buyer shall be entitled to receive from Developer compensation @ Rs.107.60 per sq.mtr (Rs.10/- per sq.ft) of the super area of the unit per month and to no other compensation of any kind. In case the Buyer fails to clear his account and take possession of the unit within30 days of offer, the Buyer shall be liable to pay to the developer holding charges @ 107.60 per sq.mtr. (Rs.10/- per sq.ft) of the super area of the unit per month in addition to the liability to pay interest to the sellers and other consequences of default in payment. ” 15. Thus, a perusal of the aforementioned clause makes the Parsvnath Developers Limited only accountable for making payment of compensation @ 107.60 per sq. mtr (Rs.10/- per sq.ft) of the super area of the unit per month. To our mind, none of the signatories to the tripartite Flat Buyer Agreement can wriggle out of the terms and conditions laid therein. 16. Therefore, in view of the foregoing discussion, all the complaints are allowed with costs of Rs.5000/- each, in the following terms ; (i) Parsvnath Developers Limited and Chandigarh Housing Board jointly and severally are held liable to refund the amounts deposited by the complainants in each complaint case alongwith interest @ 7.75% p.a. with effect from respective dates of deposits till actual realization ; (ii) Parsvnath Developers Limited shall also pay compensation in each complaint case for not offering the built up flat within 36 months @ Rs.107.60 per sq. mtr (Rs.10/- per sq.ft) of the super area of the unit per month from 5.10.2009 ( i.e. the last date of completion of the project) till actual realization. (iii) The aforesaid directions shall be complied with by OPs in all these complaints within 30 days from the date the copy of order is received, failing which they shall be liable to pay penal interest @ 12% p.a. on the aforesaid payable amounts. Certified copies of this order be communicated to the parties, free of charge. The file be consigned to records.
| | HON'BLE MRS. MRS. NEENA SANDHU, MEMBER | HON'BLE MR. JUSTICE PRITAM PAL, PRESIDENT | , | |
