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Ms. Deepali Arora filed a consumer case on 18 May 2018 against Parsvnath Developers in the StateCommission Consumer Court. The case no is CC/742/2017 and the judgment uploaded on 22 May 2018.
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
Complaint case No. | : | 742 of 2017 |
Date of Institution | : | 13.10.2017 |
Date of Decision | : | 18.05.2018 |
All residents of Flat no.303, GH-7A, Sector 20 Panchkula, Haryana, through authorized representative Sh.Yash Vir s/o Sh.Arjan Dev, resident of Flat no.303, GH-7A, Sector 20 Panchkula
……Complainants
Second Address:-Site of Parsvnath Developers, Sector 20, Panchkula, Haryana, through its Managing Director and Directors.
.... Opposite Parties
Complaint under Section 17 of the Consumer Protection Act, 1986.
BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT.
MR. DEV RAJ, MEMBER
Argued by: Sh. H.P.S. Kochhar, Advocate for the complainants.
Sh. Akash Sharma, Advocate proxy for Sh.Aftab Singh Khara, Advocate for Opposite Parties No.1 to 3.
Complaint qua opposite party no.4 dismissed vide order dated 16.04.2018.
JUSTICE JASBIR SINGH (RETD.), PRESIDENT
The complainants purchased a flat bearing No.T3-602, Sixth Floor, Tower No.T2, measuring 1780 square feet, from opposite parties no.1 to 3, in their project namely “Parsvnath Royale”, Sector 20, Panchkula, for a sum of Rs.57.85 lacs. Buyer’s Agreement was executed between the parties on 03.02.2011. As per Clause 10(a) of the Agreement, possession of the unit was agreed to be handed over within a period of 24 months plus 6 months i.e. total 30 months, of the commencement of construction. Relevant contents of Clause 10 (a) reads thus: -
“Construction of the Flat is likely to be completed within a period of Twenty-Four (24) months, from the date of commencement of construction of the particular Block in which the Flat is located with grace period of six (6) months, on receipt of sanction of building plans/revised building plans and approvals of all concerned authorities including the Fire Service Deptt., Civil Aviation Deptt., Traffic Deptt. Pollution Control Deptt., as may be required for commencing and carrying on construction subject to force majeure, restraints or restrictions from any courts/authorities, non-availability of building materials, disputes with contractors/work force etc. and circumstances beyond the control of the Developers and subject to timely payments by the Flat Buyers in the Scheme. No claim by way of damages/compensation shall lie against the Developers in case of delay in handing over possession on account of any of said reasons. The date of submitting application to the concerned authorities for issue of completion/part completion/occupancy/part occupancy certificate of the Complex shall be treated as the date of completion of the Flat for the purpose of this clause/agreement/*Date of booking whichever is later”
As per Clause 10 (c) it was undertaken by opposite parties no.1 to 3 to compensate the complainants, in case of delay in handing over possession of the unit, by making payment of Rs.53.80Ps. per square meter of the super area of the unit, per month. The complainants were offered construction linked payment plan. Detailed specifications of the material to be used and the articles to be provided in the said unit, were also annexed with the above Agreement. It is further case of the complainants that, as and when it was due, they kept on making the payment and by 11.04.2015, they had paid an amount of Rs.50,58,765.27Ps., vide receipts Annexures C-2 to C-27, in the following manner:-
Sr.No. | Date | Receipt No. | Amount in Rs. |
23.12.2010 | 20128 | 240000.00 | |
23.12.2010 | 20127 | 300000.00 | |
23.12.2010 | 20126 | 350000.00 | |
21.02.2011 | 20392 | 593490.00 | |
04.10.2011 | 21488 | 250000.00 | |
04.10.2011 | 21489 | 218397.00 | |
04.10.2011 | 21490 | 75000.00 | |
04.10.2011 | 21491 | 50000.00 | |
13.09.2012 | 24428 | 596375.00 | |
31.05.2012 | 23676 | 220000.00 | |
31.05.2012 | 23677 | 150000.00 | |
31.05.2012 | 23679 | 70000.00 | |
31.05.2012 | 23680 | 70000.00 | |
31.05.2012 | 23681 | 16375.65 | |
19.06.2012 | 23807 | 70000.00 | |
13.02.2013 | 25569 | 56375.65 | |
13.02.2013 | 25570 | 40000.00 | |
13.02.2013 | 25568 | 500000.00 | |
18.07.2013 | S0122360 | 50000.00 | |
18.07.2013 | S0122363 | 116375.00 | |
18.07.2013 | S0122364 | 80000.00 | |
18.07.2013 | S0122365 | 120000.00 | |
18.07.2013 | S0122366 | 120000.00 | |
01.08.2013 | S0122927 | 110000.00 | |
11.04.2015 | S0132904 | 596376.00 | |
|
| Total | 50,58,765.27 |
It is positive case of the complainants that their visits to the site showed that construction of the tower in which the unit, in question, is located, was going on very slow and at the end, it was noticed that work has virtually stopped. Faced with the situation, they made request for refund of amount paid. However, when they failed to get any response, they failed this complaint.
Even otherwise, the said difficulty/ground i.e. recession in the market/global meltdown would not fall under the definition of force majeure circumstances, for not completing the construction and development work at the site. A change in economic or market circumstances affecting the profitability of a contract or the circumstance, is not regarded as a force majeure condition. Neither any new legislation was enacted nor an existing rule, regulation or order was amended, stopping suspending or delaying the construction/development work of the project, in which flat(s)/plot(s) were agreed to be sold to the consumers. There was no civil commotion, war, enemy action, terrorist action, earthquake or any act of God, which could have delayed the completion of construction/development work in the project, within the time stipulated in the Agreement. A similar question fell for determination before the Hon`ble National Consumer Disputes Redressal Commission, New Delhi, in a case titled as Swaran Talwar & 2 others v. M/s Unitech Limited (along three connected complaints), 2015 (4) CPR 34. The National Commission, in that case, while rejecting the plea of the builder, held as under:-
“Coming to the pleas that there was recession in the economy and a disruption due to agitation by farmers and acute shortage of labour, etc., the following view taken by us In Satish Kumar Pandey (Supra) is relevant.
Neither any new legislation was enacted nor an existing rule, regulation or order was amended stopping suspending or delaying the construction of the complex in which apartments were agreed to be sold to the complainant. There is no allegation of any lock-out or strike by the labour at the site of the project. There is no allegation of any slow-down having been resorted to by the labourers of the opposite party or the contractors engaged by it at the site of the project. There was no civil commotion, war, enemy action, terrorist action, earthquake or any act of God which could have delayed the completion of the project within the time stipulated in the Buyers Agreement. It was contended by the counsel for the OP that the expression ‘slow down’ would include economic slow-down or recession in the Real Estate sector. I, however, find no merit in this contention. The word ‘slow down’ having been used alongwith the words lock-out and strike, I has to be read ejusdem generis with the words lock-out and strike and therefore, can mean only a slow down if resorted by the labourers engaged in construction of the project.”.
The principle of law laid down in the aforesaid case is fully applicable to the facts of the present case. Opposite parties no.1 to 3, therefore, cannot take shelter under the garb of force majeure Clause of the Agreement, for extension of period, for delivery of possession of the unit. By making a misleading statement, that possession of the unit, in question, would be delivered within a period of 30 months (24 months plus 6 months grace period), from the date of start of construction but on the other hand, by not abiding by the commitments made and at the same time, taking a bald stand that time was not essence of the contract, opposite parties no.1 to 3 were not only deficient in providing service but also indulged into unfair trade practice.
It is also necessary to refer to a case titled as Ravinder Kumar Bajaj Vs. Parsvnath Developers Pvt. Ltd. & 3 Ors., First Appeal No. 515 of 2016, decided by the National Commission on 23.08.2016. In that case, qua project launched by the builder/opposite parties (also opposite parties no.1 to 3 in this case), at Rajpura, a complaint was filed by Sh. Ravinder Kumar Bajaj, before this Commission. The said complaint was dismissed for want of territorial jurisdiction, noting that only two payments were credited in the account of the opposite parties no.1 to 3, in a bank at Chandigarh. By noting that neither the Agreement was signed at Chandigarh, nor substantial payment was received by the opposite parties no.1 to 3 at Chandigarh, the complaint was dismissed by this Commission. Sh. Ravinder Kumar Bajaj went in appeal before the National Commission, which was decided by it, vide order dated 23.08.2016, by noting that at one point of time, Company had a Branch Office at Chandigarh. Appeal was allowed by the National Commission, by observing as under:-
“Since in the Grounds of Appeal, a specific averment is made by the Appellant to the effect that in the year 2007, when the subject flat was booked, the Respondent Company did have a Branch office at Chandigarh, where the payments in respect of the project used to be received regularly, on a pointed query, learned Counsel appearing for the Company very fairly states, on instructions, that the stand of the Appellant is correct.
In light of the statement by learned Counsel for the Respondent Company, I am of the view that in the present case, the State Commission UT, Chandigarh has the Territorial Jurisdiction to adjudicate upon the Complaint filed by the Appellant.
Resultantly, the Appeal is allowed; the impugned order is set aside and the Complaint is restored to the Board of the State Commission UT at Chandigarh for adjudication on merits in accordance with law.”
Order passed by this Commission was set aside and the matter was remitted back for hearing the complaint, on merits. In Sh. Ravinder Kumar Bajaj case (supra), admittedly, only two payments were credited in bank account maintained by the opposite parties. Even then, it was held by the National Commission that this Commission has territorial jurisdiction to entertain the complaint because at one time, a Branch Office was being maintained by the opposite parties in Chandigarh. In view of above, objection raised in this regard, stands rejected.
It may be stated here, that the complainants hired the services of the opposite parties no.1 to 3, for purchasing the unit, in the manner, referred to above. It is a simple case of non-delivery of possession of the unit, by the stipulated date or even till date, to the complainants, against which substantial amount of Rs.50,58,765.27ps. towards sale consideration stood paid, which act amounts to deficiency in providing service and adoption of unfair trade practice. Section 2 (1) (o) of the Act, defines service as under:-
“service” means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service”
From the afore-extracted Section 2(1)(o) of the Act, it is evident that housing/construction, also comes within the definition of a service. In Narne Construction P. Ltd., etc. etc. Vs. Union Of India and Ors. Etc., II (2012) CPJ 4 (SC), it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression ‘service’ of any description. Housing construction or building activity carried on by a private or statutory body constitutes ‘service’ within the ambit of Section 2(1)(o) of the Act. Similar principle of law, was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable. Not only this, Section 3 of the 1986 Act, provides an alternative remedy. Even if, it is assumed that the complainants have a remedy to file a suit, in the Civil Court, the alternative remedy provided under Section 3 of the Act, can also be availed of by them, as they fall, within the definition of consumer. In this view of the matter, objection taken by the opposite parties no.1 to 3, in this regard, being devoid of merit, must fail, and the same stands rejected.
The above objection taken by opposite parties no.1 to 3 is also bereft of merit, in view of judgment passed by the Hon’ble National Commission, titled as M/s. Karwa Developers & 3 Ors. Vs. Shree Vinayak Co-Operative Housing Society Ltd. & 3 Ors., First Appeal No. 980 of 2016, decided on 3rd March, 2017, wherein, a similar plea of the builder was negated, while holding as under:-
“We also do not find any substance in the plea taken by the appellant that under clause 14(a) of the development agreement, the complainant was required to file a civil suit under the Specific Relief Act only, because they were asking for monetary relief. The State Commission rightly stated that the relief sought in the complaint were on account of deficiencies committed by the OP Developers, vis-à-vis, the society. Since there is a specific clause in the agreement for giving the possession of the flat within specific time frame and penalty has been provided if the developers failed to develop the same, the society was well within its rights to file consumer complaint against the OP builder.”
At the same time, opposite parties no.1 to 3, also cannot evade their liability, merely by saying that since no fixed time was mentioned in the Agreement, for delivery of possession of the unit, as such, time is not to be considered as essence of the contract. Non-mentioning of exact date of delivery of possession of the unit(s) in the Buyer’s Agreement/allotment letter, is an unfair trade practice on the part of the Builder. The builder is bound to mention the exact/specific date of delivery of possession of the plots/unit(s) to the allottees/purchasers thereof. It was so said by the Hon`ble National Commission, in Rajeev Nohwar & Anr. V/S Sahajanand Hi Tech Construction Pvt Ltd, 2016 (2) CPR 769. Relevant portion of the said case reads thus:-
In view of above, the plea of opposite parties no.1 to 3 in this regard also stands rejected.
It may be stated here that it is an admitted fact that the opposite parties no.1 to 3 failed to offer possession of the unit, in question, by the stipulated date or even as on today, as they could not complete the construction. Thus, if it is so, the complainants were well within their right, to withhold the said amount, in view of principle of law laid down in Prasad Homes Private Limited Vs. E.Mahender Reddy and Ors., 1 (2009) CPJ 136 (NC), wherein it was held that when development work was not carried out at the site, the payment of further installments was rightly stopped by the purchaser. Under these circumstances, plea raised by opposite parties no.1 to 3, in this regard, being devoid of merit, is rejected.
In view of above facts of the case, opposite parties no.1 to 3 are also under an obligation to compensate the complainants, for inflicting mental agony and causing physical harassment to them, as also escalation in prices.
Pronounced.
18.05.2018
Sd/-
[JUSTICE JASBIR SINGH (RETD.)]
PRESIDENT
Sd/-
[DEV RAJ]
MEMBER
Rg.
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