Reserved

State Consumer Disputes Redressal Commission

U.P. Lucknow.

Complaint  Case No.355 of  2016

1- Vibha Rajpal Tyagi, aged about 61 years,

     W/o Rajpal Tyagi, R/o Care of R.M. Nigam,

     C-133, Sector 6, Indira Nagar, Lucknow.

2- Tulika Raj, aged about 36 years, d/o Rajpal Tyagi,

     R/o Care of R.M. Nigam, C-133, Sector 6,

     Indira Nagar, Lucknow.                          …Complainants.

Versus

1- Parsvnath Developers Limited, registered and

    Corporate Office situated at 6^th Floor, Arunachal

    Building, 19, Barakhamba Road, New Delhi

    through its Chairman.

2- Parsvnath Developers Limited, (Parsvnath Planet)    

    situated at Plot No.TC-8, TC-9, Vibhuti Khand,

    Gomti Nagar, Lucknow through its Managing Director.

3- Pradip Jain, Chairman, Parsvnath Developers Limited,

    registered and Corporate Office situated at 6^th Floor,

    Arunachal Building, 19, Barakhamba Road, New Delhi.

4- Sanjiv Jain, Managing Director, Parsvnath Developers

    Limited, registered and Corporate Office situated at 6^th

    Floor, Arunachal Building, 19, Barakhamba Road,

    New Delhi.

5- Ramesh Thappar, Srenior General Manager, Parsvnath

    Developers Limited, (Parsvnath Planet) situated at Plot

    No.TC-8, TC-9, Vibhuti Khand, Gomti Nagar, Lucknow.

                                                                   ...Opposite parties.

Present:-

1- Hon’ble Justice Sri Ashok Kumar, President.

2- Hon’ble Sri Rajendra  Singh, Member.

Sri Piyush Mani Tripathi, Advocate for the complainants.

Sri Rajesh Chaddha, Advocate for Opposite Parties.

Date :  13.4.2022

JUDGMENT

Per Sri Rajendra  Singh,  Member- This complainthas been filed by the complainantsVibha Rajpal Tyagi and Tulika Rajagainst the opposite parties for the following reliefs.

(2)

To direct the opposite parties to provide the physical possession of fully finished Flat no.T5-1104 having an area 202.06 square meters with all the basis civil amenities without claiming any interest and penal interest.

To direct the opposite parties to pay interest @24% on the amount deposited by the complainant with effect from the respective dates of deposit till the date of possession, along with damages stipulated in the agreement dated 7.11.2006 as agreed between the parties.

To direct the opposite parties to pay appropriate amount towards damages for committing serious deficiency in service.

To direct the opposite parties to pay appropriate amount towards compensation occasioned by the complainant.

To direct the opposite parties to pay an amount of Rs.20,000.00 per month towards rent payable with effect from June, 2009 till the physical delivery of possession of fully finished Flat no.T5-1104.

To direct the opposite parties to pay the difference in the cost of escalation which shall be incurred at the time of execution of the registered sale-deed in view of the delay caused by the builder in delivery of the possession of the Flat.

This Hon’ble Commission may graciously be pleased to award separate compensation and damages to the complainants for the loss and inconvenience caused to them by the deficiency in services coupled with unfair trade practice committed by the opposite parties.

To direct the opposite parties to pay appropriated Punitive/ exemplary damages on account of mental agony, harassment and trauma underwent by the complainants and

(3)

also taking into consideration the severity of the deficiency in service committed by the builder in this case as well as with the similarly placed allottees.

To direct the opposite parties not to charge any service tax in pursuance of the Finance Act, 2010 since the possession of the Flat is to be provided till the year 2009 and it is on account of the intentional  and deliberate delay committed by the builder which is the reason for this payment of tax.

Allow the complaint and direct the opposite parties to pay a sum of Rs.50,000.00 towards cost of the case.

Any other order which this Hon’ble State Commission may deem fit and proper in the circumstances of  the case may also be passed. 

The brief facts of the complaint case are that, that the opposite parties no.1 & 2 are limited company and are engaged in the construction of the flats with all the basic civil amenities and the opposite parties no.3 to 5 are the persons who are incharge of the affairs of the company. They published lucrative advertisement to attractthe consumers in the market in order to book residential flats in their scheme known as Parsvnath Planet. The opposite parties demonstrated themselves to be best in the construction activities. The opposite parties on 27.4.2006 issued advertisement to the effect that they have purchased land from Lucknow Development Authority have taken possession thereof and had started the construction of the apartments and further they invited application for the allotment of the flats. They committed that the project shall be completed in the year 2009 and they invited applications for allotment with the

(4)

assurance that the construction shall be done within time and physical possession shall be handed over within a period of 36 months.

The opposite parties assured the complainant at the time of booking that the unit shall be delivered by June, 2009 and by their assurance he applied for a flat. The opposite parties prepared standard form of an agreement and directed the complainant to put their signatures on the specific place in order to facilitate the builder who is on the dominant position and the buyer has no right to modify or amend the terms and conditions of the agreement. This unilateral and one sided flat buyer agreement dated 7.11.2006 was executed between the opposite parties and the complainant regarding flat no.T-5-1104 situated at Block no.T-5 having an area of 202.06 sq. meter and the total cost of the flat was fixed at Rs.40,23,750.00.

The opposite parties issued a letter dated 22.6.2006 informing that the project is approved for housing loan from M/s PNB Housing Finance. The opposite parties issued letter dated 8.12.2006 informing the similarly placed allottee that the amount of payment of installment if defaulted shall  carry interest @ 24% p.a. By virtue of letter dated 23.6.2007, the opposite parties communicated the name of 8 financer and reaffirmed that the project stood approved.

The opposite parties insisted all the allottees of the scheme to deposit the cost of the Flat and to that effect offered 10% rebate on the remaining cost of the flat. The complainants, since were in dire need of the residential accommodation, deposited payment of the installments amount towards the allotted apartment within the stipulated

(5)

period to the opposite parties on different dates. The complainant visited the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of June, 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled.The complainants were constrained to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save their allotment from cancellation.

The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainants on the scheduled period, that is in the month of June, 2009.The complainants visited the construction site of the opposite parties after depositing the entire amount when it was revealed that still the construction activities was on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2020. Even the partial construction done by the opposite parties was defective and did not match the specification provided in the agreement.The complainants felt shocked on hearing the aforementioned statement and immediately contacted the area manager who told the complainant that there is some delay in the construction of the apartment and the apartments shall be ready till  June, 2010.

(6)

The complainants had to undergo a lot of mental agony and stress by the attitude of the opposite parties, since the opposite parties failed to abide with their promise to provide the possession of the apartment till June, 2009 which caused the complainant loss of rent as well.The complainants waited for about a year in a hope that the opposite parties shall give the possession in July, 2010, but to the utter surprise of the complainant a common letter dated 12.2.2020 was received by the complainants, which provides that the opposite parties are planning to complete the project till March, 2011.The complainants on learning about the said letter felt cheated and underwent a lot of mental agony and pain and again made a visit of the construction site in June 2010 and then in June 2011 which revealed that there was no activity of construction going on the site and is not likely to complete in next few years. The daily news papers disclosed the fraudulent and deceptive act of the opposite parties when the news of the cancellation of the allotment was published, by means of which it was revealed that the Lucknow Development Authority has threatened the builder/opposite parties that the allotment of the project shall be cancelled on account of the default committed by the opposite parties.

The opposite parties failed to provide the possession of the flat in March,2011 instead issued a letter dated 05.05.2011 to the complainants by means of which they informed that the possession of the flat shall be given in December, 2011.The opposite parties again issued a letter dated 02.03.2012 to the allottees of the scheme informing them that the possession of the flat shall be given after December 2012, however they informed by this letter that the

(7)

opposite party nos.1 to 2 shall be in a position to apply for the completion certificate in December, 2012 only thereafter possession will be offered. The language used in the letter clearly demonstrate that the opposite party nos.1 to 2 are not in a position to deliver the possession even in December, 2012. However the opposite parties are guilty of showing gross deficiency in services on account of the fact that inordinate delay in the possession of the flat has been committed by them, moreover the complainants are living in rented house paying Rs. 20,000/- towards monthly rent, thus the opposite parties are accountable to pay Rs. 20,000/- per month to the complainants for loss occurred on account of payment of rent with effect from July 2009 till the possession of the flat is given to the complainants.From the aforementioned facts it is amply clear that the opposite parties has obtained huge sum of money from the entire allottees of the scheme and instead of putting the same for the development of the flats misappropriate the same, for which the opposite parties are liable to produce the expenditure and account statement of the scheme before this Hon’ble Commission. In a identical complaint case of one of the allottee of the scheme, this Hon’ble Commission was pleased to pass a direction to the opposite parties to produce the expenditure account of the Parsvnath Planet Scheme before this Hon’ble Commission, but till date the order of this Hon’ble Commission has not been complied.The opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted apartment to the complainant till June, 2009.

(8)

It is axiomatic that this Hon’ble Commission while dealing with a similar question with respect to the development of the project appointed a joint advocate commission who submitted their report and confirmed the fact that the construction activities are at halt. The opposite parties are also accountable for unfair trade practice since they have enjoyed and utilize the hard earned money of the complainant without providing the possession of the apartment. The complainants in order to make the payment of the cost of the apartment took financial assistance and is to repay the loan on exorbitant rateof interest, however the complainant is also deprive of her legitimate right of possession of the flat instead she has been burdened and saddled with the repayment of the installments, which is causing acute mental and physical discomfort to the complainant for which the opposite parties are responsible and are accordingly liable to compensate the complainant by making adequate payment of compensation and damages apart from interest on the amount deposited by the complainants. The complainants are the consumers of the opposite party within the term, meaning and expression as is provided for the consumer under the provisions of the Consumer Protection Act, 1986 and complainant is having continuing and recurring cause of action to file this complaint case before this Hon’ble Commission. Hence, the complainants are entitled for above mentioned reliefs.

The opposite parties have submitted written statement in which they stated thatthe contentions and submission made hereinafter, the opposite parties submit that this Hon’ble Commission has vide its order dated 25.2.2015, disposed off

(9)

33 complaints filed against the opposite parties by the allottees of the project namely Parsvnath Planet which is also in question before this Hon’ble Commission in the captioned complaint. The operative part of the common order and judgment dated 25.2.2015 is reproduced herein below:-

All the aforesaid complaints are hereby partly allowed for the reliefs as follows:- 

1. The opposite parties shall hand over the possession of the flats to the complainants within this year of 2015.
2. The opposite parties shall issue the statement of accounts to the complainants individually on his demand and if there is no dues on the particular allotee, the opposite parties shall pay the amount of credit vide clause 10(c) of the agreement credited in the account of the allottee in cash or by way of cheque or draft to the allotee with interest @ 9% P.A. from the date it has become due till the payment is made. 
3. In complaint case no. 18 of 2013 , Nalin Bhargav and Sanjai Bhargav, the complainants are entitled in addition to get the difference of amount of rent to the tune of Rs 14000 P.M. paid by the complainants and the amount credited by the opposite parties in their account vide clause 10(c) of the agreement w.e.f. Oct. 2012 to June 2014.
4. In complaint case no. 32 of 2012 , Ravinder Singh &Ritesh Kumar Singh, the complainants are entitled in addition to get the difference of amount of rent to the tune of Rs 14000  paid by the complainants and the amount credited by the opposite parties in their account

(10)

vide clause 10(c) of the agreement for the month of May 2010 only.

The complaints for the rest of the reliefs sought shall be deemed to have been dismissed.

This judgment shall be placed on the record of Complaint Case No. C/86/2010 with its copy to be laid on the record of other 32 complaints.

In view of the common order and judgment dated 25.2.2015, it is stated that since the captioned complaint also pertains to the same project and apart from the basic facts of the case which differs from allottees to allottees, the broad stand of the opposite parties remains the same as was averred in the complaints already disposed off by the common order/judgment, the captioned complaint be also disposed off by this Hon’ble Commission in similar manner.

The complainants on 4.5.2006 booked a flat bearing no.T5-1104 admeasuring 2175 sq. ft. in the project named as Parsvnath Planet, Lucknow at the basic cost of Rs.40,23,750.00. It is further submitted that the complainants made a payment of Rs.4,02,375.00 at the time of booking. It is also submitted that two copies of flat buyer agreement were sent to the complainants vide letter dated 21.6.2006 and the flat buyer agreement was duly executed between the parties on 7.11.2006. It is further submitted that the opposite parties sent various demand letters and reminder letter for the payment of the installments to the complainants i.e. on 27.5.2006, 19.7.2006, 11.12.2006, 1.3.2007, 18.8.2007, 14.9.2007, 15.12.2007, 31.1.2008, 5.9.2009, 22.3.2010, 12.1.2007, 15.2.2007, 28.7.2010, 4.9.2010, 1.2.2011, 25.2.2011, 8.9.2011, 10.10.2011, 29.11.2011, 30.12.2011

(11)

and18.12.2012. The opposite party vide their letters dated 12.2.2010 and 5.5.2011 informed the complainants the reasons for delay in completion of the project and further informed the complainants that her interest with regard to delay will be duly protected under clause 10(c) of the Flat Buyer Agreement. Thereafter, the opposite party vide their letter dated 2.3.2012 informed the complainants that the major part of construction has already been completed and completion certificate would be applied in the month of December, 2012. Thereafter, the opposite party vide their letter dated 4.3.2013 informed the complainants that the opposite party has applied for the completion certificate of the Tower no.1, 2, 9 and 10. Further, the opposite party sent the final statement of account wherein the delay penalty was credited by the opposite party.

On 4.5.2015, the opposite party sent  the letter to the complainant of offer of possession for carrying out the fit out  work in the flat  alongwith the final statement of account, wherein the delay penalty was credited by the opposite party upto March, 2015 for a sum of Rs.6,19,875.00,when the completion certificate was applied with the concerned authority. Thereafter, vide mail dated 11.7.2015, the complainants raised certain objections to the offer for fit out letter and again asked the exact date of possession of the flat. It is submitted that the opposite party duly replied to the said mail vide their reply dated 12.8.2015.It is most humbly submitted that as on date the complainants have made a payment of Rs.34,18,559.00 towards the cost of the flat, car parking charges and free hold conversion charges. The

(12)

opposite party as per flat buyer agreement has credited all delay compensations etc. to the complainants account.

The construction in the tower in which the flat of the complainant is located has been completed and the completion certificate has been applied for by the opposite party so that the sale deeds of the flat may by executed  in favour of the complainant. It is pertinent to state that the said project consist of 10 towers wherein the possession of the flats has already been offered in 7 towers wherein the buyers are residing peacefully. It is submitted that in rest three towers bearing no.T-4, 5 and 6, the construction has been completed and few customers have taken the possession of the flat in these towers for carrying out the fit out work in their flats. The opposite parties have not at any point of time, violated or breached the provisions of the flat buyer agreement dated 7.11.2006, Hence, the captioned complaint has been filed without any cause of action. The complainants have not been able to establish any deficiency of service or consumer dispute as  contemplated under the Consumer Protection Act, 1986 which could be attributable to the opposite parties. Therefore, the complaint is liable to be dismissed in limine. No cause of action arisen in favour of the complainants and against the opposite parties for the purpose of filing the present complaint. In fact the complaint has been filed without any substantial proof. It is submitted that bare allegation in the complaint without any proof and without any alleged act on behalf of the opposite parties necessary to charge it for unfair trade practice of deficiency of service, cannot be taken as gospel truth by this Hon’ble Commission to entertain the present complaint and hence, the complaint is

(13)

liable to be dismissed under section 12(3) of the Consumer Protection Act, 1986.

The complainants have prayed for reliefs which otherwise have to be claimed in a suit for damages and recovery of possession, after paying appropriate court fee. In order to avoid the payment of court fee, the complainants have filed the captioned complaint which otherwise is a dispute of a civil nature and required collaborate evidence to be led and thus, the captioned complaint cannot be adjudicated upon under the summary jurisdiction of this Hon’ble Commission. As per the flat buyer agreement entered into between the complainants and the opposite parties, both have agreed upon their respective liabilities in case of breach of any of the conditions  specified therein. It is submitted that the liability of the opposite parties on account of delay is specified in clause 10 (c) of the flat buyer agreement  and as such, the complainants cannot claim reliefs which are beyond the compensation agreed upon by them. In this view of the matter, the captioned complaint is not maintainable in law and is liable to be dismissed in limine.

The dispute  between the parties involves complicated questions of facts and law, which necessarily entail the leading of copious evidence. The issue raised by the complainants cannot be addressed in a common complaint before this Hon’ble Commission which follows a summary procedure. In this view of the matter, the complaint is liable to be dismissed.

It is submitted that bare allegation in the complaint without any proof and without any alleged act on behalf of the opposite parties necessary to charge it for unfair trade

(14)

practice or deficiency of service, cannot be taken as gospel truth by this Hon’ble Commission to entertain the present complaint. It is denied that lucrative advertisement are made by the opposite parties to attract the consumer in the market in order to apply for the booking of residential accommodation in their scheme known as Parsvnath Planet. It is denied that the opposite party issued advertisement to the effect that they have purchased the land from the Lucknow Development Authroity, Lucknow.  

It is submitted that clause 10(c) of the flat buyer agreement clearly stipulates that time was not the essence of the contract. It is submitted that as per clause 10(c) of the flat buyer agreement, it is clearly stated that the construction was likely to be completed within 36 months with a grace period of 6 months from the date of commencement of construction subject to receipt of necessary approval. It was further agreed that in case delay is committed beyond the stipulated period, the delay compensation @5.00  per sq. ft. will be given to the complainants. It is denied that the opposite parties directed the complainants to put their signatures on the blank space. It is relevant to mention here that the flat buyer agreement is a standard agreement which is being signed by all the allottees, who have booked the flats in the project with their free will and volition. However, the terms and condition mentioned in the flat buyer agreement may be changed at the instance of the buyer. It is further submitted herein that the respective flat buyer agreement contains all the terms and conditions pertaining to the right and liabilities/obligations of both the parties with regard to the flats and the same cannot be

(15)

changed/altered for each and every customer as per their requirements/convenience.

The demands for payment of installments were raised as perthe payment plan opted by the complainants. It is further pertinent to mention here that the complainants were persistent defaulter and have defaulted in payment of the installment, for which various demand letters were issued to the complainants on various occasions. It is denied that the complainants made visits of the construction site of the opposite parties. It is denied that the complainants claimed the possession of the allotted flat after depositing the total amount on their due dates. It is further denied that the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainants on the scheduled period that is in the month of June, 2009. It is denied that the opposite parties are guilty of gross deficiency in services on account of the fact that inordinate delay in the possession of the flat has been committed by the opposite parties. It is denied for want of knowledge that the complainants are living in  rented house paying Rs.20,000.00 towards monthly rent. It is submitted that the present complaint has been filed by the complainants without any substantial proof to show that any act as contemplated in the complaint amounts to deficiency in service.

It is denied that the opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted flat. It is further vehemently denied that he opposite parties are accountable for unfair trade practice. It is submitted that the complainants were always

(16)

kept informed of the status of the construction at the project site. It is respectfully submitted that complainants have prayed for reliefs which otherwise have to be claimed in a suit for recovery and damages after paying appropriate court fee. It is submitted that the complaint as made out is not maintainable at all as for all purposes that complaint is a suit for breach of contract and for claim of damages arising allegedly from the said breach and the dispute between the parties therefore, is of civil nature which can be adjudicated only by a civil court.  

We have heard the learned counsel for the complainant Sri Piyush Mani Tripathi and learned counsel for the opposite parties Sri Rajesh Chaddha. We have perused the pleadings, evidence and documents present on the record.

In the present case, The Flat Buyer Agreement executed on 07.11.2006 and flat number T5 -1104 , area 202.06 m² having total cost of ₹ 4,023,750/– has been allotted to the complainant. The opposite parties promised to deliver the possession of the flat by June 2009. But this flat has not been delivered on the scheduled time. Again the opposite parties informed that the flat would be ready by June 2010. Again the that the project would be completed by March 2011. Again the opposite parties informed that the possession of the flat would be given in December 2011. Again the parties informed that the possession of flat shall be given in December 2012. In the meantime the area of the flat has increased from 2175 ft² to 2335 ft² unilaterally. On 24 December 2018 an advocate commissioner submitted his report. According to this report of the learned advocate commissioner , no work of flooring has been done, wall were

(17)

plastered and one coat of white was found, main door was fitted but other doors and windows were not fitted, no flooring done in bathrooms and no plaster and glazed tiles were found in the walls of the bathroom. Flat is total incomplete and is not fit for leaving.

In this case another learned advocate commissioner has been appointed who visited the spot on 17 February 2022. This learned commissioner has submitted a report regarding the present flat and also regarding other flax for which the case are going on in this court with the present case. The learned and a concussion has reported about the present flat number T5- 1104  that the representative of the RWA  Sri Satish Chandra has informed him that this flat is lying without possession. When the learned advocate commissioner visited this flat, he found the flat unfinished, having no wiring, no flooring, no paints, no doors, no sanitary work, no AC and incomplete plaster and entirely unfinished, only structure is there. The learned advocate after has also two photographs are of all the flats including this one. So it is clear that the condition of the flat is what it was in 2018.

The opposite parties filed photocopy of completion certificate regarding tower T5 which is of 12 January 2018. Now the question arises that if the present condition is such, how the completion certificate issued on 12 January 2018. It means that this certificate is not a genuine one and it has been issued without proper inspection of the flat. The commission said in 2018 and again in 2022, according to both report the flat is not in habitable condition. The opposite party did not file NOC of Fire Department, Pollution Department and also

(18)

Occupancy Certificate. So, after perusing this learned Commissioner Report, the court of the 7 March 2022, in view of the learned Commissioner unless the defects of the said flat is removed and basic facilities provided, the flat in question is not habitable and it is not possible to get the possession of this flat. So it is clear that today this flat is not in or habitable condition and the opposite parties are not interested to make it lively.

As per flat buyer agreement dated 07.11.2006, the possession was to be delivered in 42 months that is in May 2010. Now it is 2022 and the flat is still not fit to live.

The Consumer Protection Act, came into existence and implemented in 1986, provides Consumer Rights to prevent consumers from fraud or specified unfair practices. It safeguards and encourages and gives an opportunity to consumers to speak against insufficiency and flaws in goods and services. If traders, manufacturers and distributors follow any foul trade, this act protects their rights as a consumer.

This Protection Act covers entire goods and services of all sectors that are public, private, or cooperative sectors, except those exempted by the central government. The act provides a floor for a consumer where one can file their complaint against the product and the forum takes an action against the concerned supplier and compensation is granted to the consumer for the inconvenience he/she has encountered. The objectives of the consumer petition act may be summarised as –

• To Provide better and all round protection to consumer.
• To Provide machinery for the speedy redressal of the grievances.

(19)

• To Create framework for consumers to seek redressal.
• To Provide rights to consumers.
• To Safeguard rights of Consumers.

What are the rights of consumers ?Let us know more about the rights of consumer. Listed below are the Rights of the Consumer:-

• Right to Safety- Before buying, a consumer can examine on the quality and guarantee of the goods and opt for ISI or AGMARK products.
• Right to Choose- Consumer must have the right to choose from a variety and number of goods and in a competitive price
• Right to be informed- The buyers must be provided with complete information with all the necessary and adequate details of the product, make her/him act wise, and change the buying decision.
• Right to Consumer Education- The consumer must be aware of his/her rights and avoid exploitation.
• Right to be heard- The consumer will get due attention to express their grievances at a suitable platform.
• Right to seek compensation- The consumer has the right to seek or ask for redressal against unfair and inhumane practices or exploitation of the consumer.

Now it is better to discuss some case laws of the Hon’ble Supreme Court and Hon’ble NCDRC which are summarized here as follows:-

(20)

In  R V Prasannakumaar v. Mantri Castles Pvt Ltd., 2019 SCC On Line SC 224, under the terms of the ABA, possession of the flats was to be handed over to the buyers on 31 January 2014. However, the developer received an occupation certificate only on 10 February 2016 and it was thereafter from May 2016 that the developer started issuing letters offering possession. Based on this, the NCDRC awarded compensation in the form of interest at the rate of 6 per cent per annum. The developer had pleaded that since the agreement provided compensation at the rate of Rs.3 per square foot per month for delayed possession, the purchasers were not entitled to anything in addition. Dealing with the submission, this Court observed:

“9. We are in agreement with the view of the NCDRC that the rate which has been stipulated by the developer, of compensation at the rate of Rs.3 per sq. ft. per month does not provide just or reasonable recompense to a flat buyer who has invested money and has not been handed over possession as on the stipulated date of 31 January 2014. To take a simple illustration, a flat buyer with an agreement of a flat measuring a 1000 sq. ft. would receive, under the agreement, not more than Rs. 3000/- per month. This in a city such as Bangalore does not provide just or adequate compensation. The jurisdiction of the NCDRC to award just compensation under the provisions of the Consumer Protection Act, 1986 cannot in the circumstances be constrained by the terms of the agreement. The agreement in its view is one sided and does not provide sufficient recompense to the flat purchasers.”

(21)

The Court observed that there was a delay of two years and hence the award of interest at the rate of 6 per cent was reasonable and justified.

In Pioneer Urban Land and Infrastructure Limited v. Govindan Raghavan, (2019) 5 SCC 725, there was a delay of almost two years in obtaining an occupancy certificate after the date stipulated in the ABA. As a consequence, there was a failure to provide possession of the flat to the purchaser within a reasonable period. This Court dwelt on the terms of the ABA under which the builder was entitled to charge interest at 18 per cent per annum for the delay in payment of instalments by the purchaser. On the other hand, the failure to provide possession on the part of the developer was subject to a grace period of twelve months followed by a termination notice of ninety days and a further period of ninety days to the developer to effect a refund. Adverting to these clauses, the court noted:

“6.4. A perusal of the apartment buyer's agreement dated 8-5- 2012 reveals stark incongruities between the remedies available to both the parties. For instance, Clause 6.4(ii) of the agreement entitles the appellant builder to charge interest @18% p.a. on account of any delay in payment of instalments from the respondent flat purchaser. Clause 6.4(iii) of the agreement entitles the appellant builder to cancel the allotment and terminate the agreement, if any instalment remains in arrears for more than 30 days. On the other hand, as per Clause 11.5 of the agreement, if the appellant builder fails to deliver possession of the apartment within the stipulated period, the respondent flat purchaser has to wait for a period of 12 months after the end of the grace

(22)

period, before serving a termination notice of 90 days on the appellant builder, and even thereafter, the appellant builder gets 90 days to refund only the actual instalment paid by the respondent flat purchaser, after adjusting the taxes paid, interest and penalty on delayed payments. In case of any delay thereafter, the appellant builder is liable to pay interest @9% p.a. only. 6.5. Another instance is Clause 23.4 of the agreement which entitles the appellant builder to serve a termination notice upon the respondent flat purchaser for breach of any contractual obligation. If the respondent flat purchaser fails to rectify the default within 30 days of the termination notice, then the agreement automatically stands cancelled, and the appellant builder has the right to forfeit the entire amount of earnest money towards liquidated damages. On the other hand, as per Clause 11.5(v) of the agreement, if the respondent flat purchaser fails to exercise his right of termination within the time limit provided in Clause 11.5, then he shall not be entitled to terminate the agreement thereafter, and shall be bound by the provisions of the agreement.”  

Hon’ble Justice Indu Malhotra speaking for the Court noted:

 “6.8. A term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the agreement dated 8-5-2012 are ex facie one-sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1)(r) of the Consumer Protection Act, 1986 since it adopts unfair

(23)

methods or practices for the purpose of selling the flats by the builder.” The Court observed that in these circumstances, the flat purchasers could not be compelled to obtain possession which was offered almost two years after the grace period under the agreement had expired. Hence, the NCDRC was held to have correctly awarded interest at the rate of 10 percent per annum.

The decision of this Court in Dhanda Case 2019 SCC On Line SC 689  has been relied upon by learned Senior Counsel appearing on behalf of the developer as elucidating the principle that where a flat buyers agreement stipulates a consequence for delayed possession, exceptional and strong reasons must be established before the forum constituted under the Act of 1986 awards compensation in addition to what has been contractually agreed. In Dhanda’s case, the SCDRC issued a direction for handing over physical possession of the residential unit to the complainant and for execution of a sale deed. In addition, compensation was awarded by way of interest at the rate of 12 per cent per annum with effect from twelve months after the stipulated date under the agreement. In an appeal by the developer, the NCDRC directed that the rate of interest for a house building loan for the corresponding period in a scheduled nationalised bank would be appropriate and if a floating rate of interest was prescribed, the higher rate of interest should be taken for the computation. A sum of Rs. 1 lac per annum from the date for handing over possession to the actual date of possession was regarded as appropriate in the facts of the case. In that case under the terms of the buyer’s agreements, possession was to be delivered within twenty-four months of the

(24)

execution of the agreement i.e. 10 February 2013 – failing which the developer was liable to pay compensation at the rate of Rs.10 per square foot per month for the delay. The developer contended that construction activities were delayed as a result of an injunction granted by this Court over a period of eight months and consequently sought an extension of the period for handing over possession by one year. Alternatively, the developer offered to refund the money deposited with interest at 9 per cent per annum. Construction of 258 independent floors was completed while about 1,500 units were nearing completion. In two sets of Civil Appeals which came up before this Court earlier, agreed terms were arrived at providing for the award of interest at 9 per cent per annum from the date of deposit till refund. While considering the order of the NCDRC, this Court observed:

“16. The District Forum under the Consumer Protection Act, 1986 is empowered inter-alia to order the opposite party to pay such amount as may be awarded as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party including to grant punitive damages. But the forums under the Act cannot award interest and/or compensation by applying rule of thumb. The order to grant interest at the maximum of rate of interest charged by nationalised bank for advancing home loan is arbitrary and no nexus with the default committed. The appellant has agreed to deliver constructed flats. For delay in handing over possession, the consumer is entitled to the consequences agreed at the time of executing buyer's agreement. There cannot be multiple heads to grant of damages and interest when the parties have agreed for

(25)

payment of damages at the rate of Rs. 10/- per sq. ft. per month. Once the parties agreed for a particular consequence of delay in handing over of possession then, there has to be exceptional and strong reasons for the SCDRC/NCDRC to award compensation at more than the agreed rate.”

Now the interest may be 6% to 10% in favour of the allottees if they have not been given possession of the flat/plot within promised or within a reasonable time. The complainant has deposited the entire agreed cost of the flat before June 2009. Now it is the duty and obligation of the opposite party to deliver the possession within stipulated time but they failed to do so.

In  the  case  of   PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC).These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 34 of 2013- Jasleen Viswanathan &Anr. Vs. Parsvnath Developers Ltd. &Anr; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. &Anr; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. &Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. &Anr.; 86 of 2010- Priyanka Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 101 of 2011- Mohd. Aslam Khan &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath Developers Ltd. &Anr; 49 of 2012- Neera Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr; , 74 of 2011- Deepak Bhalla Vs. Parsvnath

(26)

Developers Ltd. &Anr. ; 87 of 2010- Syed Gufran Ali Alvi&Anr. Vs. Parsvnath Developers Ltd. &Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd. &Anr.; 175 of 20130- Umesh Chandra Dixit &Anr. Vs. ParsvnathDevelopers ;byLtd. &Anr.; 97 of 2011- Pravin Kumar Goel &Anr. Vs. Parsvnath Developers Ltd. &Anr. which complaints were partly allowed.

          The  Hon’ble  NCDRC  held that:

“Brief facts of the cases are that opposite parties/respondents are engaged in the activity of housing construction and accordingly they have launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave

(27)

peacefully in their own houses, since the complainants are living in rented houses.

The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for the recovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved  by  the  order  of  Hon’ble  State  Commission, these  appeals

(28)

preferred  before Hon’ble National  Consumer  Disputes  Redressal  Commission.

Hon’ble  NCDRC discussed various  case  laws  and  after  hearing  the  parties held,

“Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under  and complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under  

(29)

Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 ( c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession.

(30)

Against this judgment, parties went to Hon’ble  Supreme  Court. The judgment of Hon’ble  Supreme  Court is:-

In  Nalin Bhargava  vs  Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018 , Hon’ble Supreme Court held:-

          “Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc.          

            It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies have been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition  of  costs as compensation.

            Mr. Sachin Datta, learned senior counsel appearing for the developer has raised   objections    with regard to imposition of costs.

            Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say “cost”, we mean costs alone and nothing else.”

            In the case of Kolkata West International City Pvt. Ltd. Vs. DevasisRudra[Civil Appeal No. 3182 of 2019 @ SLP (C) No(S). 1795 of 2017] judgement delivered on 25.03.2019 , the Hon’ble Supreme Court has held:-

(31)

            “Interestingly, where the buyer is in default, the agreement stipulates that interest at the rate of 18 per cent from the date of default until the date of payment would be charged for a period of two months, failing which the allotment would be cancelled by deducting 5% of the entire value of the property. The agreement was evidently one sided. For a default on the part of the buyer, interest at the rate of 18% was liable to be charged. However, a default on the part of the developer in handing over possession would make him liable to pay interest only at the savings bank rate prescribed by the SBI. There is merit in the submission which has been urged by the buyer that the agreement was one sided.

            In  the Case  of  Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors.  Versus  DLF Southern Homes Pvt. Ltd (now Known as BEGUR OMR Homes Pvt. Ltd.)

and Ors.   (Civil Appeal No. 6239 of 2019 With Civil Appeal No. 6303 of 2019); The  Hon’ble  Supreme  Court  has  held:-

            “24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression “service” in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the

(32)

consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfillment of a contractual obligation. To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice.

            Undoubtedly, as this court held in Dhanda, courts ordinarily would hold parties down to a contractual bargain. Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers. Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the

(33)

removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain.”

These builders are just earning money from the consumers to whom they issued allotment letters and got a huge amount. They keep this amount for a long time and earn interest on it. Property dealing is that part of business where they never pay a penny to the consumers on their amounts deposited for a long-term or if they pay, they pay a meagre interest of about 5% or so but they charge 18 to 24% or more if the consumers default in depositing any instalment. It reminds us the story of “The Merchant of Venice” The Merchant of Venice is the story of a Jewish money lender Shylock who demands that an antisemitic Christian offer “a pound of flesh” as collateral against a loan. These acts of builders also remind us the age of  Sahukari during ancient India and also during British Raj. Whether these builders have power to frame their own law? They put their terms and conditions in such a way that the sufferer will always be the consumer. The Consumer Protection Act 1986 has been enacted for the benefits of consumers,  so the courts dealing with Consumer Protection Act 1986 should come forward for their rescue. The courts are not governed by the builders but they are governed by the law, Custom and Usages. Now in the background of all the facts and also the facts of the present case, we will also discuss something more.

Now it is clear that there is deficiency of service on the part of the opposite party and also they are liable for unfair trade practice. For calculating the compensation/damages we are inclined that after two years the complainants are entitled to get the reliefs from the opposite parties. The cut-off date is

(34)

May 2010. This is the date from which the amount of compensation/damages and other shall be calculated. The built up area of the concerned flat is 102.19 m². Keeping in view all the above mentioned facts, we come to the following conclusions:-

This is a case where the allottee has been given an allotment letter on 07.11.2006 and thereafter the complainant and opposite parties entered into an agreement  for giving the possession of unit number  T 5-1104. The allotment letter has specifically offered the delivery of possession of the unit within 36 months with grace period six months total 42 months meaning thereby that the said unit was to be handed over by May 2010.

In this case the opposite parties issued many letters extending the time of delivery of possession but failed to deliver the possession within stipulated time. The opposite parties were showing daydreams to the complainant and other allottees but actually they were earning interest on the deposited amount of the allottees. A person who invests such a huge amount to get a flat for himself and his family must come under pressure and depression if not get the flat within time. The offer given by the opposite parties has been accepted by the complainant so now the opposite parties are bound by the promise and it is the duty to provide the flat within the time as specified by them. This is a clear case of deficiency in service and unfair trade practice.

One cannot understand that when a flat has been allotted to person of area, how is it possible to increase the area of the flat during construction. The area becomes clear at the time of foundation of the building. When the parties have entered into

(35)

an agreement for the purchase of a flat having a definite area, how the area can be increased during construction. The complainant is entitled to the flat of agreed area. If it is increased, he cannot be compelled to pay for it. It is said that because the buyer has put his signature on the builders buyers agreement, he shall be liable according to the terms and condition of the agreement. Whether these conditions are unilateral? The builder is also liable by the condition of the agreement. If he fails to deliver the possession of the flat within the agreed time as mentioned in the builders buyers agreement, he will also be liable foregoing beyond the terms and conditions of the agreement. Therefore in the present case the buyer is not liable to pay any extra amount in addition to the increased area of the flat because the seller failed to provide the flat within stipulated time.

The complainant visited the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of June, 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled. The complainants were under pressure to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save their allotment from cancellation. The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and

(36)

possession shall be delivered to the complainants on the scheduled period, that is in the month of June, 2009. The complainants visited the construction site of the opposite parties after depositing the entire amount when it was revealed that still the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2020. Even the partial construction done by the opposite parties was defective and did not match the specification provided in the agreement. The complainants felt shocked on hearing the aforementioned statement and immediately contacted the area manager who told the complainant that there is some delay in the construction of the apartment and the apartments shall be ready till  June, 2010. So from the very gaining the opposite parties were defrauding the complainant as well as other allottees either on one pretext or on other pretext. They were being kept in the dark regarding timely construction of the flat. All these show the character of the opposite parties. A lengthy builders buyers agreement is prepared in which heavy penalty is proposed in case of non-payment of instalments by the buyer and also exorbitant rate of interest is levied. Interest at a rate of 24 % is a penal interest. So it shows that the builders are within their safe area and it is the buyer who always suffers.

So in the present case we, after perusing all the pleadings, evidence is, documents and both the reports of advocate commissioner’s come to the conclusion that it is a clear case of deficiency of service and unfair trade practice on the part of the opposite parties. Keeping in view the judgement is of the different Hon’ble higher courts we come

(37)

to the conclusion that the complainant is entitled to the following reliefs:-

1. The opposite parties are jointly and severally liable to hand over the possession of unit no. T 5-1104 , in the Parswanath Planet, Lucknow within within 60 days from the date of judgment of this Complaint case and they will not charge any penny in future except the monthly maintenance charge that too after handing over the possession with completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department and they shall also pay interest at a rate of 10% on the deposited amount to the complainants from 01.06.2010till the date of giving of actual possession of the said unit  . If it is not complied with, within 60 days from the date of judgment of this complaint case, the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.06.2010 till the date of delivery of actual possession of the said flat.
2. We are of the view that the complainants are entitled to get monthly damage according to the area. The area of the said unit is 202.06 square metres and keeping in view the judgment of Hon’ble NCDRC in the case of Priyanka Mittal (supra), the opposite parties are jointly and severally directed to pay ₹ 20,000/- per month from 01.06.2010 till the date of compliance of this
38.  

order and the order shall be complied within 60 days from the date of judgment of this appeal otherwise the opposite parties  shall be liable to pay interest at a rate of 15% per annum on this amount from  01.06.2010 till the date of delivery of actual possession of the said flat.

3. The complainants are entitled to get ₹ 150,000/– in view of Nalin Bhargava Case (supra) as cost.
4. In the relief clause of the complaint, the complainant has prayed that any other order which This Hon’ble State Commission may deem fit and proper in the circumstances of the case may also be passed. So keeping in view all the fraud committed in this case, all the harassment and mental agony given to the complainants , we find that the complainants are also entitled to get ₹ 20 lakhs with interest @ 10% from 01.06.2010 till till the date of compliance of this order towards payment of rent of the flat, mental harassment, agony and sufferings and the order shall be complied within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum  on this amount from 01.06.2010 till the date of actual payment .
5. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

The present complaint is decided accordingly.

(39)

ORDER

1. The complaint is allowed with cost. The opposite parties are jointly and severally liable to hand over the possession of unit no. T 5-1104, in the Parswanath Planet, Lucknow  within within 60 days from the date of judgment of this Complaint case and they will not charge any penny in future except the monthly maintenance charge that too after handing over the possession with completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department and they shall also pay interest at a rate of 10% on the deposited amount to the complainants from 01.06.2010 till the date of giving of actual possession of the said unit  . If it is not complied with, within 60 days from the date of judgment of this complaint case, the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.06.2010 till the date of giving of actual possession.
2. The opposite parties are jointly and severally directed to pay ₹ 20,000/- per month from 01.06.2010 till the date of delivery of possession of the said flat with interest at a rate of 10% per annum and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.06.2010 till the date of delivery of actual possession.

3. The opposite parties are jointly and severally directed to pay the complainants ₹ 150,000/– as cost in view of Nalin Bhargava Case (supra) with interest at a rate of 10% from 01.06.2010 till the date of delivery of possession of the said flat and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.06.2010 till the date of delivery of possession of the said flat.
4. The opposite parties are jointly and severally directed to pay the complainants ₹ 20 lakhs towards payment of rent of the flat, mental harassment, agony and sufferings ,with interest at a rate of 10% from 01.06.2010 till the date of delivery of possession of the said flat and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.06.2010 till the date of giving of actual possession.
5. No amount shall be adjusted by the opposite No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

All the decretal amount shall be paid within 60 days from the date of judgment of this appeal otherwise the opposite parties shall pay interest at a rate of 15% per annum on all the decretal amount. If it is not paid within 60 days from the date of judgment of this appeal, the complainants shall be entitled to present Execution proceedings before this court at the cost of the opposite parties.

(41)

The stenographer is requested to upload this order on the Website of this Commission today itself.

Certified copy of this judgment be provided to the parties as per rules.

(Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                          President

Judgment dated/typed signed by us and pronounced in the open court.

Consign to the Record Room.

(Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                          President

Jafri, PA II

Court 2

Reserved

State Consumer Disputes Redressal Commission

U.P. Lucknow.

Complaint  Case No.356 of  2016

1- NEETA AGARWAL, aged about 62 years, wife of   

    Ashok Kumar Agarwal, resident of 23-B, Singarnagar,  

    Lucknow.

2- ASHOK KUMAR AGARWAL, aged aboutyears, son

of Dr. Devi Chand Aggarwal, resident of 23-B,

Singarnagar, Lucknow.…. COMPLAINANTS

Versus

1- Parsvnath Developers Limited, registered and

    Corporate Office situated at 6^th Floor, Arunachal

    Building, 19, Barakhamba Road, New Delhi

    through its Chairman.

2- Parsvnath Developers Limited, (Parsvnath Planet)    

    situated at Plot No.TC-8, TC-9, Vibhuti Khand,

    Gomti Nagar, Lucknow through its Managing Director.

3- Pradip Jain, Chairman, Parsvnath Developers Limited,

    registered and Corporate Office situated at 6^th Floor,

    Arunachal Building, 19, Barakhamba Road, New Delhi.

4- Sanjiv Jain, Managing Director, Parsvnath Developers

    Limited, registered and Corporate Office situated at 6^th

    Floor, Arunachal Building, 19, Barakhamba Road,

    New Delhi.

5- Ramesh Thappar, Srenior General Manager, Parsvnath

    Developers Limited, (Parsvnath Planet) situated at Plot

    No.TC-8, TC-9, Vibhuti Khand, Gomti Nagar,    

    Lucknow.                                          ...Opposite parties.

Present:-

1- Hon’ble Justice Sri Ashok Kumar, President.

2- Hon’ble Sri Rajendra  Singh, Member.

Sri Piyush Mani Tripathi, Advocate for the complainants.

Sri Rajesh Chaddha, Advocate for Opposite Parties.

Date :   13.4.2022

JUDGMENT

Per Mr. Rajendra Singh, Member: This complaint has been filed by the complainant under section 17 of the Consumer Protection Act, 1986.

(2)

This complaint has been filed by the complainant praying for a direction, to the opposite parties to rectify the inherent defects in the Flat No. T5-701 having an area 202.06 square meters and to provide all the facilities/amenities addendum to the entire project, to direct the opposite parties to pay an interest  @24% on the amount deposited by the complainant with the opposite parties from the respective dates of deposits till the date of possession, to direct the opposite parties to pay appropriate amount towards damages for committing serious deficiency in service and to pay appropriate amount towards compensation occasioned by the complainant, to direct the opposite parties to pay an amount of ₹ 20,000 per month towards rent payable with effect from June 2009 till the physical delivery of possession of fully furnished flat, to direct the opposite parties to pay the difference in the cost of escalation which shall be incurred at the time of the execution of the registered sale deed in view of the delay caused by the builder in delivery of possession, to award separate compensation and damages to the complainants for the loss and inconvenience caused to them by the deficiency in services coupled with unfair trade practice committed by the opposite parties, to direct the opposite parties to pay appropriate punitive/exemplary damages on account of mental agony, harassment and, underwent by the complainants and also taking into consideration the severity of the deficiency in service committed by the builder, to direct the opposite parties not to charge any

(3)

service tax in pursuance of finance active, 2010 since the possession of the flat is to be provided to the ear 2009 and it is on account of the international and deliberate delay committed by the builder which is the reason for this payment of tax, to direct the opposite parties to pay a sum of ₹ 50,000 towards cost of the case and any other relief/order which the Hon’ble State Commission bus may deem fit and proper in the circumstances of the case.

The brief facts of the complaint case are that, that the opposite parties no.1 & 2 are limited company and are engaged in the construction of the flats with all the basic civil amenities and the opposite parties no.3 to 5 are the persons who are incharge of the affairs of the company. They published lucrative advertisement to attractthe consumers in the market in order to book residential flats in their scheme known as “Parsvnath Planet”. The opposite parties demonstrated themselves to be best in the construction activities. The opposite parties on 27.4.2006 issued advertisement to the effect that they have purchased land from Lucknow Development Authority have taken possession thereof and had started the construction of the apartments and further they invited application for the allotment of the flats. They committed that the project shall be completed in the year 2009 and they invited applications for allotment with the assurance that the construction shall be done within time and physical possession shall be handed over within a period of 36 months.

(4)

The opposite parties assured the complainant at the time of booking that the unit shall be delivered by June, 2009 and by their assurance he applied for a flat. The opposite parties prepared standard form of an agreement and directed the complainant to put their signatures on the blank paper in order to facilitate the builder who is on the dominant position and the buyer has no right to modify or amend the terms and conditions of the agreement. This unilateral and one sided flat buyer agreement dated 07.02.2007 was executed between the opposite parties and the complainant regarding flat no.T-5-701 situated at Block no.T-5 having an area of 202.06 sq. meter and the total cost of the flat was fixed at Rs.40,23,750.00.

The opposite parties issued a letter dated 22.6.2006 informing that the project is approved for housing loan from M/s PNB Housing Finance. The opposite parties issued letter dated 8.12.2006 informing the similarly placed allottee that the amount of payment of installment if defaulted shall  carry interest @ 24% p.a. By virtue of letter dated 23.6.2007, the opposite parties communicated the name of 8 financer and reaffirmed that the project stood approved.

The opposite parties insisted all the allottees of the scheme to deposit the cost of the Flat and to that effect offered 10% rebate on the remaining cost of the flat. The complainants, since were in dire need of the residential accommodation, deposited payment of the installments amount towards the allotted apartment within the stipulated period to the opposite parties on different dates.

(5)

The complainant visited the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of June, 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled. The complainants were constrained to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save their allotment from cancellation.

The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainants on the scheduled period, that is in the month of June, 2009.The complainants visited the construction site of the opposite parties after depositing the entire amount when it was revealed that still the construction activities was on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2020. Even the partial construction done by the opposite parties was defective and did not match the specification provided in the agreement. The complainants felt shocked on hearing the aforementioned statement and immediately contacted the area manager who told the complainant that

(6)

there is some delay in the construction of the apartment and the apartments shall be ready till  June, 2010.

The complainants had to undergo a lot of mental agony and stress by the attitude of the opposite parties, since the opposite parties failed to abide with their promise to provide the possession of the apartment till June, 2009 which caused the complainant loss of rent as well.The complainants waited for about a year in a hope that the opposite parties shall give the possession in July, 2010, but to the utter surprise of the complainant a common letter dated 12.2.2010 was received by the complainants, which provides that the opposite parties are planning to complete the project till March, 2011.The complainants on learning about the said letter felt cheated and underwent a lot of mental agony and pain and again made a visit of the construction site in June 2010 and then in June 2011 which revealed that there was no activity of construction going on the site and is not likely to complete in next few years. The daily news papers disclosed the fraudulent and deceptive act of the opposite parties when the news of the cancellation of the allotment was published, by means of which it was revealed that the Lucknow Development Authority has threatened the builder/opposite parties that the allotment of the project shall be cancelled on account of the default committed by the opposite parties.

The opposite parties failed to provide the possession of the flat in March,2011 instead issued a letter dated 05.05.2011 to the complainants by means of which they

(7)

informed that the possession of the flat shall be given in December, 2011.The opposite parties again issued a letter dated 02.03.2012 to the allottees of the scheme informing them that the possession of the flat shall be given after December 2012, however they informed by this letter that the opposite party nos.1 to 2 shall be in a position to apply for the completion certificate in December, 2012 only thereafter possession will be offered. The language used in the letter clearly demonstrate that the opposite party nos.1 to 2 are not in a position to deliver the possession even in December, 2012. However the opposite parties are guilty of showing gross deficiency in services on account of the fact that inordinate delay in the possession of the flat has been committed by them, moreover the complainants are living in rented house paying Rs. 20,000/- towards monthly rent, thus the opposite parties are accountable to pay Rs. 20,000/- per month to the complainants for loss occurred on account of payment of rent with effect from July 2009 till the possession of the flat is given to the complainants.From the  aforementioned facts it is amply clear that the opposite parties has obtained huge sum of money from the entire allottees of the scheme and instead of putting the same for the development of the flats misappropriate the same, for which the opposite parties are liable to produce the expenditure and account statement of the scheme before this Hon’ble Commission. In a identical complaint case of one of the allottee of the scheme, this Hon’ble Commission was pleased to pass a direction to the opposite parties to produce the expenditure

(8)

account of the Parsvnath Planet Scheme before this Hon’ble Commission, but till date the order of this Hon’ble Commission has not been complied with. The opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted apartment to the complainant till June, 2009.

It is axiomatic that this Hon’ble Commission while dealing with a similar question with respect to the development of the project appointed a joint advocate commission who submitted their report and confirmed the fact that the construction activities are at halt. The opposite parties are also accountable for unfair trade practice since they have enjoyed and utilize the hard earned money of the complainant without providing the possession of the apartment. The complainants in order to make the payment of the cost of the apartment took financial assistance and is to repay the loan on exorbitant rateof interest, however the complainant is also deprive of her legitimate right of possession of the flat instead she has been burdened and saddled with the repayment of the installments, which is causing acute mental and physical discomfort to the complainant for which the opposite parties are responsible and are accordingly liable to compensate the complainant by making adequate payment of compensation and damages apart from interest on the amount deposited by the complainants. The complainants are the consumers of the opposite party within the term, meaning and expression as is provided for the consumer under the provisions of the Consumer Protection Act,

(9)

1986 and complainant is having continuing and recurring cause of action to file this complaint case before this Hon’ble Commission. Hence, the complainants are entitled for above mentioned reliefs.

The opposite parties have submitted written statement in which they stated that the contentions and submission made hereinafter, the opposite parties submit that this Hon’ble Commission has vide its order dated 25.2.2015, disposed off 33 complaints filed against the opposite parties by the allottees of the project namely Parsvnath Planet which is also in question before this Hon’ble Commission in the captioned complaint. The operative part of the common order and judgment dated 25.2.2015 is reproduced herein below:-

All the aforesaid complaints are hereby partly allowed for the reliefs as follows:- 

1. The opposite parties shall hand over the possession of the flats to the complainants within this year of 2015.
2. The opposite parties shall issue the statement of accounts to the complainants individually on his demand and if there is no dues on the particular allotee, the opposite parties shall pay the amount of credit vide clause 10(c) of the agreement credited in the account of the allottee in cash or by way of cheque or draft to the allotee with interest @ 9% P.A. from the date it has become due till the payment is made. 

(10)

3. In complaint case no. 18 of 2013, Nalin Bhargav and Sanjai Bhargav, the complainants are entitled in addition to get the difference of amount of rent to the tune of Rs 14000 P.M. paid by the complainants and the amount credited by the opposite parties in their account vide clause 10(c) of the agreement w.e.f. Oct. 2012 to June 2014.
4. In complaint case no. 32 of 2012, Ravinder Singh & Ritesh Kumar Singh, the complainants are entitled in addition to get the difference of amount of rent to the tune of Rs 14000  paid by the complainants and the amount credited by the opposite parties in their account vide clause 10(c) of the agreement for the month of May 2010 only.

The complaints for the rest of the reliefs sought shall be deemed to have been dismissed.

This judgment shall be placed on the record of Complaint Case No. C/86/2010 with its copy to be laid on the record of other 32 complaints.

In view of the common order and judgment dated 25.2.2015, it is stated that since the captioned complaint also pertains to the same project and apart from the basic facts of the case which differs from allottees to allottees, the broad stand of the opposite parties remains the same as was averred in the complaints already disposed offby the common order/judgment, the captioned complaint be also disposed off by this Hon’ble Commission in similar manner.

(11)

The complainants on 27.04.2006  booked a flat bearing no.T5-701  admeasuring  2175 sq. ft. in the project named as Parsvnath Planet, Lucknow at the basic cost of Rs.40,23,750.00. It is further submitted that the complainants made a payment of Rs.4,02,375.00 at the time of booking. It is also submitted that two copies of flat buyer agreement were sent to the complainants vide letter dated 29.6.2006 and the flat buyer agreement was duly executed between the parties on 07.02.2007  It is further submitted that the opposite parties sent various demand letters and reminder letter for the payment of the installments to the complainants i.e. on 19.7.2006, 11.12.2006, 1.3.2007, 18.8.2007, 14.9.2007, 15.12.2007, 31.1.2008, 19.05.2008 , 22.03.2010 and 29.03 2011 . The opposite party vide their letters dated 12.2.2010 and 5.5.2011 informed the complainants the reasons for delay in completion of the project and further informed the complainants that her interest with regard to delay will be duly protected under clause 10(c) of the Flat Buyer Agreement. Thereafter, the opposite party vide their letter dated 2.3.2012 informed the complainants that the major part of construction has already been completed and completion certificate would be applied in the month of December, 2012. Thereafter,  the opposite party vide their letter dated 4.3.2013 informed the complainants that the opposite party has applied for the completion certificate of the Tower no.1, 2, 9 and 10. Further, the opposite party sent the final statement of account wherein the delay penalty was credited by the opposite party.

(12)

On 4.5.2015, the opposite party sent  the letter to the complainant of offer of possession for carrying out the fit out  work in the flat  alongwith the final statement of account, wherein the delay penalty was credited by the opposite party upto March, 2015 for a sum of Rs.6,19,875.00,when the completion certificate was applied with the concerned authority. Thereafter, vide mail dated 11.7.2015, the complainants raised certain objections to the offer for fit out letter and again asked the exact date of possession of the flat. It is submitted that the opposite party duly replied to the said mail vide their reply dated 12.8.2015.It is most humbly submitted that as on date the complainants have made a payment of Rs.39,14,916.00 towards the cost of the flat, car parking charges and free hold conversion charges. The opposite party as per flat buyer agreement has credited all delay compensations etc. to the complainants account.

The construction in the tower in which the flat of the complainant is located has been completed and the completion certificate has been applied for by the opposite party so that the sale deeds of the flat may by executed  infavour of the complainant. It is pertinent to state that the said project consist of 10 towers wherein the possession of the flats has already been offered in 7 towers wherein the buyers are residing peacefully. It is submitted that in rest three towers bearing no.T-4, 5 and 6, the construction has been completed and few customers have taken the possession of the flat in these towers for carrying out the fit out work in their flats. The opposite parties have not at

(13)

any point of time, violated or breached the provisions of the flat buyer agreement dated 07.02.2007 , Hence, the captioned complaint has been filed without any cause of action. The complainants have not been able to establish any deficiency of service or consumer dispute as contemplated under the Consumer Protection Act, 1986 which could be attributable to the opposite parties. Therefore, the complaint is liable to be dismissed in limine. No cause of action arisen in favour of the complainants and against the opposite parties for the purpose of filing the present complaint. In fact the complaint has been filed without any substantial proof. It is submitted that bare allegation in the complaint without any proof and without any alleged act on behalf of the opposite parties necessary to charge it for unfair trade practice of deficiency of service, cannot be taken as gospel truth by this Hon’ble Commission to entertain the present complaint and hence, the complaint is liable to be dismissed under section 12(3) of the Consumer Protection Act, 1986.

The complainants have prayed for reliefs which otherwise have to be claimed in a suit for damages and recovery of possession, after paying appropriate court fee. In order to avoid the payment of court fee, the complainants have filed the captioned complaint which otherwise is a dispute of a civil nature and required collaborate evidence to be led and thus, the captioned complaint cannot be adjudicated upon under the summary jurisdiction of this Hon’ble Commission. As per the flat

(14)

buyer agreement entered into between the complainants and the opposite parties, both have agreed upon their respective liabilities in case of breach of any of the conditions specified therein. It is submitted that the liability of the opposite parties on account of delay is specified in clause 10 (c) of the flat buyer agreement and as such, the complainants cannot claim reliefs which are beyond the compensation agreed upon by them. In this view of the matter, the captioned complaint is not maintainable in law and is liable to be dismissed in limine.

The dispute between the parties involves complicated questions of facts and law, which necessarily entail the leading of copious evidence. The issue raised by the complainants cannot be addressed in a common complaint before this Hon’ble Commission which follows a summary procedure. In this view of the matter, the complaint is liable to be dismissed.

It is submitted that bare allegation in the complaint without any proof and without any alleged act on behalf of the opposite parties necessary to charge it for unfair trade practice or deficiency of service, cannot be taken as gospel truth by this Hon’ble Commission to entertain the present complaint. It is denied that lucrative advertisement are made by the opposite parties to attract the consumer in the market in order to apply for the booking of residential accommodation in their scheme known as Parsvnath Planet. It is denied that the opposite party issued advertisement to the effect that they have purchased the

(15)

land from the Lucknow Development Authroity, Lucknow.  

It is submitted that clause 10(c) of the flat buyer agreement clearly stipulates that time was not the essence of the contract. It is submitted that as per clause 10(c) of the flat buyer agreement, it is clearly stated that the construction was likely to be completed within 36 months with a grace period of 6 months from the date of commencement of construction subject to receipt of necessary approval. It was further agreed that in case delay is committed beyond the stipulated period, the delay compensation @5.00  per sq. ft. will be given to the complainants. It is denied that the opposite parties directed the complainants to put their signatures on the blank space. It is relevant to mention here that the flat buyer agreement is a standard agreement which is being signed by all the allottees, who have booked the flats in the project with their free will and volition. However, the terms and condition mentioned in the flat buyer agreement may be changed at the instance of the buyer. It is further submitted herein that the respective flat buyer agreement contains all the  terms and conditions pertaining to the right and liabilities/obligations of both the parties with regard to the flats and the same cannot be changed/altered for each and every customer as per their requirements/ convenience.

The demands for payment of installments were raised as per the payment plan opted by the complainants. It is further pertinent to mention here that the

(16)

complainants were persistent defaulter and have defaulted in payment of the installment, for which various demand letters were issued to the complainants on various occasions. It is denied that the complainants made visits of the construction site of the opposite parties. It is denied that the complainants claimed the possession of the allotted flat after depositing the total amount on their due dates. It is further denied that the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainants on the scheduled period that is in the month of June, 2009. It is denied that the opposite parties are guilty of gross deficiency in services on account of the fact that inordinate delay in the possession of the flat has been committed by the opposite parties. It is denied for want of knowledge that the complainants are living in  rented house paying Rs.20,000.00 towards monthly rent. It is submitted that the present complaint has been filed by the complainants without any substantial proof to show that any act as contemplated in the complaint amounts to deficiency in service.

It is denied that the opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted flat. It is further vehemently denied that he opposite parties are accountable for unfair trade practice. It is submitted that the complainants were always kept informed of the status of the construction at the project site. It is respectfully submitted that complainants have prayed for reliefs which

(17)

otherwise have to be claimed in a suit for recovery and damages after paying appropriate court fee. It is submitted that the complaint as made out is not maintainable at all as for all purposes that complaint is a suit for breach of contract and for claim of damages arising allegedly from the said breach and the dispute between the parties therefore, is of civil nature which can be adjudicated only by a civil court.

We have heard the learned counsel for the complainant Mr. Piyush Mani Tripathi and learned counsel for the opposite parties Mr Rajesh Chadha. we have perused the pleadings, evidence and documents present on the record.

In the present case, The Flat Buyer Agreement executed on 07.02.2007 and flat number T5 -701 , area 202.06 m² having total cost of ₹ 4,023,750/– has been allotted to the complainant. The opposite parties promised to deliver the possession of the flat by June 2009. But this flat has not been delivered on the scheduled time. Again the opposite parties informed that the flat would be ready by June 2010. Again the that the project would be completed by March 2011.  Again the opposite parties informed vide letter dated 10.02.2010 that the possession of the flat would be given in March 2011. Again the opposite parties vide letter dated 05.05.2011  informed that the possession of flat shall be given in December 2011. In the meantime the area of the flat has increased from 2175 ft² to 2335 ft² unilaterally. The opposite parties vide letter dated  02.03.2012 informed that the possession

(18)

of flat shall be given in December 2012. On 24 December 2018 an advocate commissioner submitted his report. According to this report of the learned advocate commissioner, no work of flooring has been done, wall were plastered and one coat of white was found, main door was fitted but other doors and windows were not fitted, no flooring done in bathrooms and no plaster and glazed tiles were found in the walls of the bathroom. Flat is total incomplete and is not fit for leaving.

In this case another learned advocate commissioner has been appointed who visited the spot on 17 February 2022. This learned commissioner has submitted a report regarding the present flat and also regarding other flats for which the case are going on in this court with the present case. The learned advocate commissioner has reported about the present flat number T5- 701  that this flat is unfinished, having no wiring, no flooring, no paints, no doors, no sanitary work, no AC and incomplete plaster and entirely unfinished, only structure is there. The learned advocate commissioner has also filed photos of all the flats including this one. The representative of the RWA Mr  Satish Chandra has informed that as a to this flat and also two other flats, they are dying possession, however the RWA is raising the bills to all these the but they are not depositing the dues and also a notice from Nagar Nigam for payment of house tax found a fixed at the main entrance of all the facts including this one. So it is clear that the condition of the flat is what it was in the beginning.

(19)

The opposite parties filed photocopy of completion certificate regarding tower T5 which is of 12 January 2018. Now the question arises that if the present condition is such, how the completion certificate issued on 12 January 2018. It means that this certificate is not a genuine one and it has been issued without proper inspection of the flat. The commission has said in 2018 and again in 2022, according to both report the flat is not in habitable condition. The opposite party did not file NOC Of Fire Department, Pollution Department , Civil Aviation Department and also did not file Occupancy Certificate. So , after perusing this learned CommissionerReport, the court of the 7 March 2022, in view of the learned Commissioner unless the defects of the said flat is removed and basic facilities provided, the flat in question is not habitable and it is not possible to get the possession of this flat. So it is clear that today this flat is not in or habitable condition and the opposite parties are not interested to make it lively.

As per flat buyer agreement dated07.02.2007 , the possession was to be delivered in 42 months that is in August 2010 . Now it is 2022 and the flat is still not fit to live.

The Consumer Protection Act, came into existence and implemented in 1986, provides Consumer Rights to prevent consumers from fraud or specified unfair practices. It safeguards and encourages and gives an opportunity to consumers to speak against insufficiency and flaws in goods and services. If traders, manufacturers

(20)

and distributors follow any foul trade, this act protects their rights as a consumer.

This Protection Act covers entire goods and services of all sectors that are public, private, or cooperative sectors, except those exempted by the central government. The act provides a floor for a consumer where one can file their complaint against the product and the forum takes an action against the concerned supplier and compensation is granted to the consumer for the inconvenience he/she has encountered. The objectives of the consumer petition act may be summarised as –

• To Provide better and all round protection to consumer.
• To Provide machinery for the speedy redressal of the grievances.
• To Create framework for consumers to seek redressal.
• To Provide rights to consumers.
• To Safeguarde rights of Consumers.

What are the rights of consumers ?Let us know more about the rights of consumer. Listed below are the Rights of the Consumer:

• Right to Safety- Before buying, a consumer can examine on the quality and guarantee of the goods and opt for ISI or AGMARK products.
• Right to Choose- Consumer must have the right to choose from a variety and number of goods and in a competitive price

(21)

• Right to be informed- The buyers must be provided with complete information with all the necessary and adequate details of the product, make her/him act wise, and change the buying decision.
• Right to Consumer Education- The consumer must be aware of his/her rights and avoid exploitation.
• Right to be heard- The consumer will get due attention to express their grievances at a suitable platform.
• Right to seek compensation- The consumer has the right to seek or ask for redressal against unfair and inhumane practices or exploitation of the consumer.

Now it is better to discuss some case laws of the Hon’ble Supreme Court and Hon’ble NCDRC which are summarized here as follows:-

In  R V Prasannakumaar v. Mantri Castles Pvt Ltd., 2019 SCC On Line SC 224, under the terms of the ABA, possession of the flats was to be handed over to the buyers on 31 January 2014. However, the developer received an occupation certificate only on 10 February 2016 and it was thereafter from May 2016 that the developer started issuing letters offering possession. Based on this, the NCDRC awarded compensation in the form of interest at the rate of 6 per cent per annum. The developer had pleaded that since the agreement provided compensation at the rate of Rs.3 per square foot per month for delayed possession, the purchasers were not entitled to anything in

(22)

addition. Dealing with the submission, this Court observed:

“9. We are in agreement with the view of the NCDRC that the rate which has been stipulated by the developer, of compensation at the rate of Rs.3 per sq. ft. per month does not provide just or reasonable recompense to a flat buyer who has invested money and has not been handed over possession as on the stipulated date of 31 January 2014. To take a simple illustration, a flat buyer with an agreement of a flat measuring a 1000 sq. ft. would receive, under the agreement, not more than Rs. 3000/- per month. This in a city such as Bangalore does not provide just or adequate compensation. The jurisdiction of the NCDRC to award just compensation under the provisions of the Consumer Protection Act, 1986 cannot in the circumstances be constrained by the terms of the agreement. The agreement in its view is one sided and does not provide sufficient recompense to the flat purchasers.”  

The Court observed that there was a delay of two years and hence the award of interest at the rate of 6 per cent was reasonable and justified.

In Pioneer Urban Land and Infrastructure Limited v. Govindan Raghavan, (2019) 5 SCC 725, there was a delay of almost two years in obtaining an occupancy certificate after the date stipulated in the ABA. As a consequence, there was a failure to provide possession of the flat to the purchaser within a reasonable period. This Court dwelt on

(23)

the terms of the ABA under which the builder was entitled to charge interest at 18 per cent per annum for the delay in payment of instalments by the purchaser. On the other hand, the failure to provide possession on the part of the developer was subject to a grace period of twelve months followed by a termination notice of ninety days and a further period of ninety days to the developer to effect a refund. Adverting to these clauses, the court noted:

“6.4. A perusal of the apartment buyer's agreement dated 8-5- 2012 reveals stark incongruities between the remedies available to both the parties. For instance, Clause 6.4(ii) of the agreement entitles the appellant builder to charge interest @18% p.a. on account of any delay in payment of instalments from the respondent flat purchaser. Clause 6.4(iii) of the agreement entitles the appellant builder to cancel the allotment and terminate the agreement, if any instalment remains in arrears for more than 30 days. On the other hand, as per Clause 11.5 of the agreement, if the appellant builder fails to deliver possession of the apartment within the stipulated period, the respondent flat purchaser has to wait for a period of 12 months after the end of the grace period, before serving a termination notice of 90 days on the appellant builder, and even thereafter, the appellant builder gets 90 days to refund only the actual instalment paid by the respondent flat purchaser, after adjusting the taxes paid, interest and penalty on delayed payments. In case of any delay thereafter, the appellant builder is liable to pay interest @9% p.a. only. 6.5. Another instance is Clause 23.4 of the

(24)

agreement which entitles the appellant builder to serve a termination notice upon the respondent flat purchaser for breach of any contractual obligation. If the respondent flat purchaser fails to rectify the default within 30 days of the termination notice, then the agreement automatically stands cancelled, and the appellant builder has the right to forfeit the entire amount of earnest money towards liquidated damages. On the other hand, as per Clause 11.5(v) of the agreement, if the respondent flat purchaser fails to exercise his right of termination within the time limit provided in Clause 11.5, then he shall not be entitled to terminate the agreement thereafter, and shall be bound by the provisions of the agreement.”  

Hon’ble Justice Indu Malhotra speaking for the Court noted:

 “6.8. A term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the agreement dated 8-5-2012 are ex facie one-sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1)(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the builder.” The Court observed that in these circumstances, the flat purchasers could not be compelled to obtain possession which was offered almost two years after the grace period under the agreement had expired. Hence, the NCDRC was held to

(25)

have correctly awarded interest at the rate of 10 percent per annum.

The decision of this Court in Dhanda Case 2019 SCC On Line SC 689  has been relied upon by learned Senior Counsel appearing on behalf of the developer as elucidating the principle that where a flat buyers agreement stipulates a consequence for delayed possession, exceptional and strong reasons must be established before the forum constituted under the Act of 1986 awards compensation in addition to what has been contractually agreed. In Dhanda’s case, the SCDRC issued a direction for handing over physical possession of the residential unit to the complainant and for execution of a sale deed. In addition, compensation was awarded by way of interest at the rate of 12 per cent per annum with effect from twelve months after the stipulated date under the agreement. In an appeal by the developer, the NCDRC directed that the rate of interest for a house building loan for the corresponding period in a scheduled nationalised bank would be appropriate and if a floating rate of interest was prescribed, the higher rate of interest should be taken for the computation. A sum of Rs. 1 lac per annum from the date for handing over possession to the actual date of possession was regarded as appropriate in the facts of the case. In that case under the terms of the buyer’s agreements, possession was to be delivered within twenty-four months of the execution of the agreement i.e. 10 February 2013 – failing which the developer was liable to pay compensation at the rate of Rs.10 per square foot per

(26)

month for the delay. The developer contended that construction activities were delayed as a result of an injunction granted by this Court over a period of eight months and consequently sought an extension of the period for handing over possession by one year. Alternatively, the developer offered to refund the money deposited with interest at 9 per cent per annum. Construction of 258 independent floors was completed while about 1,500 units were nearing completion. In two sets of Civil Appeals which came up before this Court earlier, agreed terms were arrived at providing for the award of interest at 9 per cent per annum from the date of deposit till refund. While considering the order of the NCDRC, this Court observed:

“16. The District Forum under the Consumer Protection Act, 1986 is empowered inter-alia to order the opposite party to pay such amount as may be awarded as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party including to grant punitive damages. But the forums under the Act cannot award interest and/or compensation by applying rule of thumb. The order to grant interest at the maximum of rate of interest charged by nationalised bank for advancing home loan is arbitrary and no nexus with the default committed. The appellant has agreed to deliver constructed flats. For delay in handing over possession, the consumer is entitled to the consequences agreed at the time of executing buyer's agreement. There cannot be multiple heads to grant of

(27)

damages and interest when the parties have agreed for payment of damages at the rate of Rs. 10/- per sq. ft. per month. Once the parties agreed for a particular consequence of delay in handing over of possession then, there has to be exceptional and strong reasons for the SCDRC/NCDRC to award compensation at more than the agreed rate.”

Now the interest may be 6% to 10% in favour of the allottees if they have not been given possession of the flat/plot within promised or within a reasonable time. The complainant has deposited the entire agreed cost of the flat before June 2009. Now it is the duty and obligation of the opposite party to deliver the possession within stipulated time but they failed to do so.

In  the  case  of   PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC).These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 34 of 2013- Jasleen Viswanathan &Anr. Vs. Parsvnath Developers Ltd. &Anr; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. &Anr; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. &Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. &Anr.; 86 of 2010- Priyanka Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 101 of 2011- Mohd. Aslam Khan &Anr. Vs.

(28)

Parsvnath Developers Ltd. & Anr ; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath  Developers Ltd. & Anr; 49 of 2012- Neera Mittal & Anr. Vs. Parsvnath Developers Ltd. & Anr; , 74 of 2011- Deepak Bhalla Vs. Parsvnath Developers Ltd. &Anr. ; 87 of 2010- Syed Gufran Ali Alvi & Anr. Vs. Parsvnath Developers Ltd. & Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd. & Anr.; 175 of 20130- Umesh Chandra Dixit & Anr. Vs. ParsvnathDevelopers Ltd. & Anr.; 97 of 2011- Pravin Kumar Goel & Anr. Vs. Parsvnath Developers Ltd. & Anr. which complaints were partly allowed. 

The  Hon’ble  NCDRC  held that:

“Brief facts of the cases are that opposite parties/respondents are engaged in the activity of housing construction and accordingly they have launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements

(29)

executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave peacefully in their own houses, since the complainants are living in rented houses.

The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the

(30)

project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for the recovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved  by  the  order  of  Hon’ble  State  Commission, these  appeals preferred  before Hon’ble National  Consumer  Disputes  Redressal  Commission.

Hon’ble  NCDRC discussed various  case  laws  and  after  hearing  the  parties held,

“Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under  and complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which

(31)

has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under  

Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 ( c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of

(32)

complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession.

Against this judgment, parties went to Hon’ble  Supreme  Court. The judgment of Hon’ble  Supreme  Court is:-

In  Nalin Bhargava  vs  Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018 , Hon’ble Supreme Court held:-

          “Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc.          

            It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies

(33)

have been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition  of  costs as compensation.

            Mr. Sachin Datta, learned senior counsel appearing for the developer has raised   objections    with regard to imposition of costs.

            Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say “cost”, we mean costs alone and nothing else.”

            In the case of Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra[Civil Appeal No. 3182 of 2019 @ SLP (C) No(S). 1795 of 2017] judgment delivered on 25.03.2019, the Hon’ble Supreme Court has held:-

            “Interestingly, where the buyer is in default, the agreement stipulates that interest at the rate of 18 per cent from the date of default until the date of payment would be charged for a period of two months, failing which the allotment would be cancelled by deducting 5% of the entire value of the property. The agreement was evidently one sided. For a default on the part of the buyer, interest at the rate of 18% was liable to be charged. However, a default on the part of the developer in handing over possession would make him liable to pay interest only at the savings bank rate prescribed by the SBI. There is merit in the submission which has been urged by the buyer that the agreement was one sided.

(34)

            In  the Case  of Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors.  Versus  DLF Southern Homes Pvt. Ltd (now Known as BEGUR OMR Homes Pvt. Ltd.)

and Ors.   (Civil Appeal No. 6239 of 2019 With Civil Appeal No. 6303 of 2019); The  Hon’ble  Supreme  Court  has  held:-

            “24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression “service” in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has

(35)

been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfillment of a contractual obligation. To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice.

            Undoubtedly, as this court held in Dhanda, courts ordinarily would hold parties down to a contractual bargain. Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers. Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain.”

            These builders are just earning money from the consumers to whom they issued allotment letters and got a huge amount. They keep this amount for a long time and earn interest on it. Property dealing is that part of business where they never pay a penny to the consumers on their amounts deposited for a long-term or if they pay, they pay a meagre interest of about 5% or so but they charge 18 to

(36

24% or more if the consumers default in depositing any instalment. It reminds us the story of “The Merchant of Venice” The Merchant of Venice is the story of a Jewish money lender Shylock who demands that an antisemitic Christian offer “a pound of flesh” as collateral against a loan. These acts of builders also remind us the age of  Sahukari during ancient India and also during British Raj. Whether these builders have power to frame their own law? They put their terms and conditions in such a way that the sufferer will always be the consumer. The Consumer Protection Act 1986 has been enacted for the benefits of consumers,  so the courts dealing with Consumer Protection Act 1986 should come forward for their rescue. The courts are not governed by the builders but they are governed by the law, Custom and Usages. Now in the background of all the facts and also the facts of the present case, we will also discuss something more.  

            Now it is clear that there is deficiency of service on the part of the opposite party and also they are liable for unfair trade practice. For calculating the compensation/damages we are inclined that after two years the complainants are entitled to get the reliefs from the opposite parties. The cut-off date is August 2010. This is the date from which the amount of compensation/ damages and other shall be calculated. The area of the concerned flat is 202.06 m². Keeping in view all the above mentioned facts, we come to the following conclusions:-

(37)

This is a case where the allottee has been given an allotment letter/flat buyer agreement executed on 7 February 2007 and thereafter the complainant and opposite parties entered into an agreement  for giving the possession of unit number  T 5-701. The allotment letter has specifically offered the delivery of possession of the unit within 36 months with grace period six months total 42 months meaning thereby that the said unit was to be handed over by August 2010.

In this case the opposite parties issued many letters extending the time of delivery of possession but failed to deliver the possession within stipulated time. The opposite parties were showing daydreams to the complainant and other allottees but actually they were earning interest on the deposited amount of the allottees. A person who invests such a huge amount to get a flat for himself and his family must come under pressure and depression if not get the flat within time. The offer given by the opposite parties has been accepted by the complainant so now the opposite parties are bound by the promise and it is the duty to provide the flat within the time as specified by them. This is a clear case of deficiency in service and unfair trade practice.

One cannot understand that when a flat has been allotted to person of area, how is it possible to increase the area of the flat during construction. The area becomes clear at the time of foundation of the building. When the parties have entered into an agreement for the purchase of a flat having a definite area, how the area can be increased

(38)

during construction. The complainant is entitled to the flat of agreed area. If it is increased, he cannot be compelled to pay for it. It is said that because the buyer has put his signature on the builders buyers agreement, he shall be liable according to the terms and condition of the agreement. Whether these conditions are unilateral? The builder is also liable by the condition of the agreement. If he fails to deliver the possession of the flat within the agreed time as mentioned in the builders/flat buyers agreement, he will also be liable foregoing beyond the terms and conditions of the agreement. Therefore in the present case the buyer is not liable to pay any extra amount in addition to the increased area of the flat because the seller failed to provide the flat within stipulated time.

The complainant visited the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of June, 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled. The complainants were under pressure to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save their allotment from cancellation. The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction

(39)

activities are on the peak and possession shall be delivered to the complainants on the scheduled period, that is in the month of June, 2009. The complainants visited the construction site of the opposite parties after depositing the entire amount when it was revealed that still the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2020. Even the partial construction done by the opposite parties was defective and did not match the specification provided in the agreement. The complainants felt shocked on hearing the aforementioned statement and immediately contacted the area manager who told the complainant that there is some delay in the construction of the apartment and the apartments shall be ready till  June, 2010. So from the very beginning the opposite parties were defrauding the complainant as well as other allottees either on one pretext or on other pretext. They were being kept in the dark regarding timely construction of the flat. All these show the character of the opposite parties. A lengthy builders buyers agreement is prepared in which heavy penalty is proposed in case of non-payment of instalments by the buyer and also exorbitant rate of interest is levied. Interest at a rate of 24 % is a penal interest. So it shows that the builders are within their safe area and it is the buyer who always suffers.

So in the present case we, after perusing all the pleadings, evidence is, documents and both the reports of advocate commissioner’s come to the conclusion that it is

(40)

a clear case of deficiency of service and unfair trade practice on the part of the opposite parties. Keeping in view the judgment is of the different Hon’ble higher courts we come to the conclusion that the complainant is entitled to the following reliefs:-

1. The opposite parties are jointly and severally liable to hand over the possession of unit no. T 5- 701, in the Parswanath Planet, Lucknow within 60 days from the date of judgment of this Complaint case and they will not charge any penny in future except the monthly maintenance charge that too after handing over the possession with completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department and the opposite parties shall also pay interest at a rate of 10% on the deposited amount to the complainants from 07.08.2010till the date of giving of actual possession of the said unit  . If it is not complied with, within 60 days from the date of judgment of this complaint case, the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount07.08.2010 till the date of giving of actual possession of the said unit.

(41)

2. We are of the view that the complainants are entitled to get monthly damage according to the area. The area of the said unit is 202.06 square meters and keeping in view the judgment of Hon’ble NCDRC in the case of Priyanka Mittal (supra), the opposite parties are jointly and severally directed to pay ₹ 20,000/- per month from 07.08.2010 till the date of compliance of this order and the order shall be complied with within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 07.08.2010 till the date of actual payment.
3. The complainants are entitled to get ₹ 150,000/– in view of Nalin Bhargava Case (supra) as cost.
4. In the relief clause of the complaint, the complainant has prayed that any other order which This Hon’ble State Commission may deem fit and proper in the circumstances of the case may also be passed. So keeping in view all the fraud committed in this case, all the harassment and mental agony given to the complainants, we find that the complainants are also entitled to get ₹ 20 lakhs with interest @ 10% from 07.08.2010 till the date of actual payment towards payment of rent of the flat,
42.  

mental harassment, agony and sufferings and the order shall be complied within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 07.08.2010 till the date of actual payment .

5. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

The present complaint is decided accordingly.

ORDER

1. The complaint is allowed with cost. The opposite parties are jointly and severally liable to hand over the possession of unit no.T 5-70, in the Parswanath Planet, Lucknow  within 60 days from the date of judgment of this Complaint case and they will not charge any penny in future except the monthly maintenance charge that too after handing over the possession with completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department and the opposite parties shall also pay interest at a rate of 10% on the deposited amount to the complainants from 07.08.2010 till the date of giving of actual possession of the said unit. If it is not complied with, within 60 days from the date of judgment of this complaint case, the opposite parties shall be liable to pay interest at a rate of 15% per annum on this
43.  

amount from 07.08.2010 till the date of giving of actual possession.

2. The opposite parties are jointly and severally directed to pay ₹ 20,000/- per month from 07.08.2010 till the date of delivery of possession of the said flat with interest at a rate of 10% per annum and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 07.08.2010 till the date of delivery of possession of the said flat.
3. The opposite parties are jointly and severally directed to pay the complainants ₹ 150,000/– as cost in view of Nalin Bhargava Case (supra) with interest at a rate of 10% from 07.08.2010 till the date of delivery of possession of the said flat and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 07.08.2010 till the date of delivery of possession of the said flat.
4. The opposite parties are jointly and severally directed to pay the complainants ₹ 20 lakhs towards payment of rent of the flat, mental harassment, agony and sufferings, with interest at a rate of 10% from 07.08.2010 till the date of delivery of  possession of the said flat and the order shall be
44.  

complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 07.08.2010 till the date of delivery of possession of the said flat.

5. No amount shall be adjusted by the opposite No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

All the decretal amount shall be paid within 60 days from the date of judgment of this appeal otherwise the opposite parties shall pay interest at a rate of 15% per annum on all the decretal amount. If it is not paid within 60 days from the date of judgment of this appeal, the complainants shall be entitled to present Execution proceedings before this court at the cost of the opposite parties.

The stenographer is requested to upload this order on the Website of this Commission today itself.

Certified copy of this judgment be provided to the parties as per rules.

       (Rajendra Singh)                (Justice Ashok Kumar)

              Member                                      President

Judgment dated/typed signed by us and pronounced in the open court.

Consign to the Record Room.

       (Rajendra Singh)                (Justice Ashok Kumar)

              Member                                      President

Jafri, PA II

Court 1

Reserved

State Consumer Disputes Redressal Commission

U.P. Lucknow.

Complaint  Case No.357 of  2016

1.  Mrs. Sarita Gupta, wife of Mr. Ajit Kumar Gupta, resident of Sr. Matt Engineer Project Control, Project Department, P.D.Administration, Building MAB, Refinery P.O.Box No. 69, Safat, Kuwait.
2. Mr. Ajit Kumar Gupta, son of Late Vidya Prakash Gupta, resident of Sr. Matt Engineer Project Control, Project Department, P.D.Administration, Building MAB, Refinery P.O.Box No. 69, Safat, Kuwait.              …. Complainants

Versus

1. Parsvnath Developers Limited, registered and Corporate office situated at 6^th floor, Arunachal Building, 19, Barakhamba Road, New Delhi, through its Chairman.
2. Parsvnath Developers Limited, (Parsvnath Planet) situated at Plot No. TC-8, TC-9, Vibhuti Khand, Gomti Nagar, Lucknow, through its Managing Director.
3. Pradip Jain, Chairman, Parsvnath Developers Limited,

    registered and Corporate Office situated at 6^th Floor,

Arunachal Building, 19, Barakhamba Road, New Delhi.

4. Sanjiv Jain, Managing Director, Parsvnath Developers

    Limited, registered and Corporate Office situated at

    6^th Floor, Arunachal Building, 19, Barakhamba Road,

    New Delhi.

5. Ramesh Thappar, Srenior General Manager, Parsvnath

Developers Limited, (Parsvnath Planet) situated at Plot

No.TC-8, TC-9, Vibhuti Khand, Gomti Nagar, Lucknow.

Present:-

1- Hon’ble Justice  Sri Ashok Kumar, President.

2- Hon’ble Sri Rajendra  Singh, Member.

Sri Piyush Mani Tripathi, Advocate for complainants.

Sri Rajesh Chaddha, Advocate for the Opposite parties.

Date :   13.04.2022

JUDGMENT

Per Mr. Rajendra Singh, Member: This complaint has been filed by the complainant praying for a direction, to the opposite parties to rectify the inherent defects in the Flat No. T8-401 having an area 155.611square meters and to provide

(2)

all the facilities/amenities addendum to the entire project, to direct the parties to pay an interest @24% on the amount deposited by the complainant within the opposite parties from the respective dates of deposits till the date complainant is inducted into the physical possession of the flat, to direct the opposite parties to pay compensation, damages in view of the severity of deficiency in service by them, and also with the player to award punitive damages against the opposite parties for the deceptive/unfair trade practice committed by them.

The opposite parties are limited company which is engaged in the construction activities and has launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow.The opposite parties on 27.4.2006 published advertisement to the effect that they have purchased the land from the Lucknow Development Authority, Lucknow and have taken the possession from the Authority, had started the construction of the Apartments and invited the applications for allotment of the apartments.On the commitment of the opposite parties to complete the project within a period of 36 months and that the project shall be completed till January 2009,the complainant in the year 2007 applied for the apartment in the scheme of the opposite parties.  The opposite parties, at the time of the deposit of the aforementioned booking amount, assured the buyer for delivery of possession of the apartment by January 2009; and reaffirmed their commitment stating that the requisite permission from the authorities to construct the apartment has already been obtained by them after taking the possession of the land from the Lucknow Development Authority, Lucknow.

(3)

A Flat Buyer agreement dated 29.6.2007 was executed between the complainant and opposite parties pertaining to Flat No. T8-401 situated at Block No. T8, the area of the flat was provided to 155.611 square meters and the total cost of the flat was fixed to Rs.27,63,750/-. The payment of the installments amount towards the allotted apartment was duly made within the stipulated period to the opposite parties on different dates. It was assured by the builder that the scheme shall be having facility is which include; club et cetera. These are the facilities for which the charges were often by the builder and further the specifications of the interior of the flat was also communicated to the complainant, thus it is obligated for the builder to complete the entire session work as well as to provide the facilities assured by him.

The opposite parties in order to procure money from the allottees of the scheme issued a letter dated 22.06.2006 informed that the project is approved for housing loan from M/S  PNB Housing Finance, the opposite parties issued letter dated 08.12.2006 informing the similarly placed allottees that the amount of payment of instalment is defaulted shall carry interest at a rate of 24%, thereafter by virtue of letter dated 23.06.2007 the opposite parties communicated the name of a 8 financers and reaffirmed that the project stood approved. The opposite parties insisted all the allottees of the scheme to deposit the cost of the flat and that effect offered 10% rebate on the remaining cost of the flat, complainant since is in that any of the residential accommodation deposited payment of

the instalments amount towards the allotted apartment within the stipulated period to the opposite parties on different dates, however inordinate delay is committed by the opposite parties

(4)

 in this case and till this date necessary basic amenities are not available on the site.

The complainants were constrained to deposit the instalments on their due dates to avoid the liability of making the payment of penal interest at a rate of 24% and to save the allotment from cancellation. The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainant on the scheduled period that is in the month of June 2009. Similarly placed allottees visited the construction site and communicated to the complainant that the construction activities is on the halt and the persons available on the site told them that the apartments are likely to be completed till 2020. Even the partial construction done by the opposite parties was defective and did not match the specifications divided in the agreement. The complainant felt shocked on hearing the aforementioned commutation and immediately contacted the area manager who told the complainant that there is some delay in the construction of the apartment and the apartments shall be ready till June 2010. The complainants had to undergo a lot of mental agony and stress by the attitude of the opposite parties, since the opposite parties failed to abide with their promise to provide the possession of the apartment till June 2009 which caused the complainant loss of rent as well.

The complainant waited for about a year in a hope that the opposite parties shall offer the possession in July 2010 but to their utter surprise the complainant received a common

(5)

letter dated 12.02.2010 issued to all the allottees of the scheme, which provides that the opposite parties are planning to complete the project till March 2011. The daily newspapers disclose the fraudulent and deceptive act of the opposite parties were in it was revealed that the Lucknow Development Authority has threatened the builder/opposite parties that the allotment of the project shall be cancelled on account of the default committed by the opposite parties. The opposite parties failed to provide the possession of the flat in March 2011 instead they issued a letter dated 15.05.2011 to all the similarly placed allottees, by which they informed that the possession of the flat shall be given in December 2011. The opposite parties again issued a letter dated 02.03.2012 to the allottees of the scheme informing them that the possession of the flat shall be given after December 2012, however they informed by this letter that the opposite parties no 1 and 2 shall be in a position to apply for the completion certificate in December 2012 only thereafter possession will be offered. The language used in the letter clearly demonstrate that the opposite party no 1 and 2 are not in a position to deliver the possession even in December 2012. The opposite parties are guilty of gloss deficiency in services on account of the fact that inordinate delay in the possession of the flat has been committed by them.

From the aforementioned facts it is amply clear that the opposite parties has opted huge sum of money from the entire

allottees of the scheme and instead of putting the same for the development of the flats miss a probe dated the same, for which the opposite parties are liable to produce the expenditure and account statement of the scheme before this

(6)

Hon’ble Commission. In an identical complaint case of one of the allottee of the scheme, This Hon’ble Commission was pleased to pass a direction to the opposite parties to produce the expenditure account of the Parsvnath Planet Scheme before this Hon’ble Commission, but till date the order of this Hon’ble Commission has not been complied with. The opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted apartment to the complainant in June 2009. It is axiomatic that this Hon’ble Commission while dealing with a similar question with respect to the development of the project appointed a Joint Advocate Commission who submitted the report and confirmed the fact that the construction activities are at halt. The opposite parties are also accountable for Unfair Trade Practice since they have inside and utilised the hard earned money of the complainant without providing the possession of the apartment.

The complainant in order to make the payment of the cost of the apartment took financial assistance and instead repay the loan on exorbitant rate of interest, however the complainant is also deprive of their legitimate right of possession of the flat instead she has been burdened and saddled with the repayment of the instalments, which is causing acute mental and physical discomfort to the complainant, for which the opposite parties are responsible and are accordingly liable to compensate the complainant by making adequate payment of compensation and damages apart from interest on the amount deposited by the complainant. The opposite parties in a most illegal and arbitrary manner issued a letter dated 08.12.2015 directing

(7)

complainant to provide documents in order to facilitate the possession, it is worth to mention here that the project was not complete, neither the basic facilities are available yet the builder in order to avoid its liability issues this letter. The complainant by mean-spirited 09.02.2016 lodged protest with respect to the defective construction and claimed refund of ₹ 80,116.01/– which was never refunded by the builder per contra a letter dated 09.12.2016 is issued to offer for any additional services, complainant under compulsion deposited an amount of Rs.4,47,500/– on 09.02.2016 towards necessary charges and on18.02.2016  the sale deed was executed, however the State the inherent defects in the flat are not rectified by the builder/opposite parties and illegal and arbitrary amount is collected by the builder from the complainant.

The complainant is the consumer of the opposite party within the, meaning and expression as is provided for the consumer under the provisions of The Consumer Protection Act 1986. It is most respectfully prayed from this Hon’ble commission to direct the opposite parties to complete the entire interior work of the flat and to provide all the basic civic amenities including club as well as swimming et cetera, to direct the opposite parties to pay an amount of Rs.7,50,000/– towards rent at the rate of Rs.15,000/– per month for about 15 months in terms of the order of Hon’ble NCDRC, to direct the opposite parties to pay compensation at the rate of interns of clause 10(c) of the Flat Buyer Agreement dated 29.06.2007 which is 84 months amounting Rs.748,860/–, to direct the opposite parties to refund Rs.80,116/– carry interest at a rate of 24% with effect from

(8)

the date of liability till the date of actual payment, to direct the opposite parties to refund Rs.1,73,250/– which was illegally and trendy collected by them to the alleged access area of 108 square ft which is incomplete version of the agreement, to direct the opposite parties to pay an amount of Rs.10 lakhs towards spirit of damages in view of the deceptive/unfair trade practice, to direct the opposite parties to pay interest at a rate of 24% on the amount deposited by the complainant with effect from the respective dates of deposits, to direct the opposite parties to pay appropriate amount towards damages for committing serious deficiency in service, to direct the opposite parties to pay appropriate amount towards compensation occasioned by the complainant, to direct the opposite parties to pay appropriate punitive/exemplary damages on account of mental agony, harassment and trauma underwent by the complainant, to direct the opposite parties to refund service tax In Pursuance of Finance Act 2010 along with interest since the possession of the flat is to be provided to the ear tooth are nine and it is on account of the intentional and deliberate delay committed by the builder which is the reason for this payment of tax, to direct the opposite parties to pay rupees one lakh towards cost of the case.

The opposite parties submitted the reply and stated that this Hon’ble commission  has vide its order dated 25.02.2015 disposed of 33complaints filed against the opposite parties by the allottees of the project namely “Parsvnath Planet” which is also in question before this Hon’ble commission That in the captioned complaint. The operative part of the common order

(9)

 and judgment dated 25^th of February 2015 is reproduced here in below:-

“all the aforesaid complaints are hereby partly allowed for the release as follows :-

1. the opposite parties shall hand over the possession of the flat to the complainant within this year of 2015.
2. The opposite parties shall issue the statement of account to the complainant individually on his demand and if there is no dues on the particular allottee, the opposite parties shall pay the amount of credit vide clause 10 © of the agreement credited in the account of the allottee in cash or by way of check or draft to the allottee with interest at a rate of 9% per annum from the date it has become due to the payment is made.
3. In complaint case number 18 of 2013 of the complainant Nalin Bhargava  and Sanjay Bhargava , the complainants are entitled in addition to get the difference of amount of rented to the tune of ₹ 14,000 per month Paid by the complainant and the amount credited by the opposite parties in their account vide clause 10 ( c) of the agreement w.e.f October 2012 to June 2014.
4. In complaint case number 32 of 2012 of the complainants Ravinder Singh and Ritesh Kumar Singh,

the complainants are entitled in addition to get the difference of amount of rent to the tune of Rs.14,000 paid by the complainants and the amount credited by the opposite parties in their account vide clause 10 ( c) of the agreement for the month of May 2010 only.

(10)

The complaints for the rest of the reliefs sought shall be deemed to have been dismissed.

This judgment shall be placed on the record of complaint case number no C/86 /2010 with its copy to be laid on the record of other 32 complaints.”

In view of the common order and judgment dated 25.02.2015, it is stated that since the captioned complaint also pertains to the same project and apart from the basic facts of the case which differs from allottees to allottees, the broad stand of the opposite parties remains the same as was averred in the complaint is already disposed of by the common order/judgement, the captioned complaint we also disposed of by this Hon’ble Commission in similar matter. In this case the complainants have placed their flat on rent and are not using the same for their residential purposes. Initially one Mrs.  Amrit Kaur applied for a residential flat in the upcoming project of the opposite parties on 18.09.2005. It is submitted that vide letter dated 21.02.2006the opposite parties provisionally allotted a flat bearing no T8-401, (hereinafter referred to as flat ) in the project named as Parsvnath Planet, Lucknow and the basic cost of ₹ 2,763,750/–. Thereafter Mrs. Amrit Mohan  on 30.12.2006 transferred her rights in the flat in favour of the complainants herein. The flat buyer agreement was duly executed between the parties on 29 June

2007. The opposite parties sent various demand letters and reminder letter for the payment of the instalments to the complainants that is on 16.04.2007, 14.09.2007, 29.07.2008, 06.10.2008,22.10.2008, 03.11.2008, 07.09.2011 and 13.10.2011. Thereafter the upper parties vide letter dated fifth May 2011 inform the complainant about the progress at the

(11)

site and vide letter dated 2 March 2012 the complainants that the appeal parties will be filing the application for getting occupancy certificate by the end of December 2012.

The complainants are previously in the ear tooth and 11 file a similar complaint before the Hon’ble Commission, wherein order dated 25.02 2015 was passed. Thereafter, the complainants settle the dispute and accepted the possession of the flat by opting for credit policy, and got the pending work completed and thereafter put the same on rent. It is submitted that the complainant vide its letter dated 09.02.2016 agreed to take the possession of the flat and also agreed to carry out the interior work on her own. Therefore the component got the credit of 3,74,788/– which was adjusted with the balance payable amount of ₹294,672/– by the complainants. Thus a sum of ₹80,116/– remains payable by the opposite parties, which the opposite parties never denied. The complainant have at no stage raised any dispute regarding the alleged defects of the flat and for the rectification of the same. The registry of the said flat was done on 18.02.2016. Clause 4 of the registry is reproduced here in:

“that vacant and physical possession of the said residential flat has been handed over by the vendor to the vendee herein, and the vendee acknowledges having

taken over the possession of the same to the same vendee’s entire satisfaction after due inspection and the vendee agrees that the Wendy shall have no claim whatsoever against the vendor with regard to any defects are deficiency in construction, quality of material or on account of any delay in possession et cetera.” Hence this complaint has been filed without any

(12)

cause of action. The complaint has been filed without any substantial proof. The complainant has prayed for release which otherwise have to be claimed in a suit for damages and recovery, after paying appropriate court fee. The dispute is of a civil nature. As per the registry entered into by complainant, the parties, have agreed upon their respective liabilities and as such the complainants cannot claim reliefs which are beyond the terms agreed upon by them.

The Dispute between the Parties Involves Complicated Questions of Facts and Law, which necessarily entail the leading of copious evidence. The complaint has been filed without any legally justifiable cause of action and is therefore liable to be dismissed with exemplary cost. The complainant is not a consumer and he has purchased the said flat for investment purpose and is not a bona fide consumer. The complaint is barred by the doctrine of Res Judicata . The complainant has suppressed the material facts and has not come to this Hon’ble Commission with clean hands as the complainant has earlier claimed the reliefs in its earlier complaint filed before the Hon’ble commission and the same was disposed of by the arbitration vide its order dated 25.02.2015. The complainant has suppressed the material facts and has not come to this Hon’ble commission with clean hands. This complaint is nothing but an abuse of the process of law at the same has been filed with ulterior motives just to harass and extort money from opposite parties. The complainant vide its letter dated 09.02.2016 agreed to do the interior work in the flat on her own and for which the opposite party has given the credit for a sum of ₹ 374,788/–

(13)

which was duly accepted by the complainant without any demur.

There is no inherent defect in the flat. The complainants are took the possession of the flat after the entire satisfaction and after due inspection of the same. The directions as by the complainants are not maintainable and is made with the ulterior motive to earn wrong fully from the opposite parties. The complainants have said flat out of their own free will and volition and without any force, coercion and pressure of any sort from any corner whatsoever as the complainant has purchased the said flat from one Mr. Amrit Mann Kaur. In the flat buyer agreement, it is distributed that construction of flats are to be completed in 36 months +6 months grace period, subject to force majeure and other circumstances as directed in the agreement. The flats were expected to be constructed by 30 June 2010. The complainants were fully aware about the delay construction activity at the site at the time of purchase, as the delay had become evident after the economic turndown in October 2008. Due to the recession in the Real Estate Industry all over India during the last 3 to 4 years has resulted in certain circumstances which are beyond the control of the opposite parties leading to the delay in construction. Several bookings made by the applicants were cancelled/transferred this further give rise to a liquidity crisis. This resulted in progress of construction activity getting hampered beyond the control of the opposite parties. All 540 flats in all 10 towers are deconstructed and finishing work of styling windows, plastering, putting tiles et cetera is going on at the site and it is expected that the project will be completed by December 2012 and completion Certificate from the

(14)

Lucknow Development Authority shall be applied for. After receipt of the completion certificate, the possession of the flats would be offered to the respective allottees, including the complainants herein. Clause 10 (a) of the agreement for the kind consideration of this Hon’ble commission is extracted below-

“Clause 10 (a)

Construction of the flat is likely to be completed within a period of thirty six (36) months of commencement of construction of the particular block in which the flat is located with a grace period of six (6 )  month, on receipt of sanction of building plans/advised building plans and approvals of all concerned authorities including the Fire Service Department, civil aberration Department , traffic department, pollution control Department, as may be required for commencing and carrying on construction subject to force majeure, restraints of restrictions from any courts/authorities, non-availability of building materials, disputes with contractors/workforce et cetera and circumstances beyond the control of the development 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 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.”

It is denied that the opposite parties directed the complainant said to put their signatures on the blank space. The flat buyer agreement is a standard agreement which is

(15)

being signed by all the allottees, who have booked the flat is in the project with their free will and volition. However the terms and conditions are of the agreement may be changed at the instance of the customer. The complainant has been given the special rebate for a sum of ₹ 374,788/– on account of the unfinished work which was supposed to be done by the opposite party as agreed by the complainant. It is denied that the parties insisted all the allottees of the scheme to deposit the cost of the flat and to that effect offered 10% rebate on the remaining cost of the payment. The complainants have already taken the possession of the flat and has further placed the flat on rent. The complainants are making such vehicle and frivolous allegations against the opposite parties with the ulterior motive to defame the opposite parties and to earn wrong fully from the opposite parties. The opposite parties have executed the conveyance deed of the flat in favour of the complainant before the suppressed Lucknow and has handed over the peaceful and vacant possession of the flat to the complainant. The instant complaint is false, Mauritius, vexatious and incorrect. No cause of action has arose to the opposite party. In the print case, there is no loss or injury or deficiency attributable to the opposite parties. There is no negligence or delay on the part of the opposite parties so as to in title the complainants to claim any amount from the opposite parties. The complaint of the complainants is level to be dismissed with exemplary cost.

We have heard the learned counsel for the complainants Sri Piyush Mani Tripathi and learned counsel for the opposite parties Sri Rajesh Chaddha. We have perused the pleadings, documents and evidence on record.

(16)

In this case on 14.02.2022 the opposite parties filed the completion certificate of 14.09.2015 without giving any session as to why it has not been filed before hand. This is the photocopy of completion certificate in which the completion certificate has been issued in relation to different towers of M/S Parswanath Developers Ltd in which it has been specifically mentioned about the work which has to be kept in mind by RWA under the Apartment Act. The another completion certificate is of 12.01.2018 in relation to T-4 ,5,& 6 of m/w Parswanath Developers Ltd. having the same direction as in the previous completion certificate. We have perused the reply of opposite parties in which Clause 10 (a) of the builders buyer agreement has been reproduced and according to which it has been clearly mentioned by the builders that construction of the flats likely to be completed within a period of 36 months of commencement of construction of the particular block in which the flat is located with a grace period Of six months, on receipt of sanction of  building plans/revised building plans and approvals of all the concerned authorities including the Fire Service Department, civil aviation Department, Traffic Department, Pollution Control Department, as may be required …... In this case no such NOC of Fire Service Department, civil aberration Department, Traffic Department, Pollution Control Department has been filed by the opposite parties and no genuine cause has been shown for not filing these NOC. How the opposite parties handed over the possession of the said flat to the complainant in absence of these NOC?

(17)

In a nutshell, after going through the pleadings and evidence it emerges out that on 29.06.2007, flat no.T8/401 area 155.611 m², total cost Rs.2,763,750/– has been allotted to the complainant and flat buyer agreement has been executed. The promised date of possession was to 2009. The sale deed was executed on 09.02.2016. The entire amount has been deposited as per the payment plan before June 2 nine but the flat was not deliver as per the specifications and only fit out possession was given in 2016 for which a rebate of Rs.2,25,000/– has  been  given. The opposite parties increased the area without any genuine reason from 155.611 square mtr to 1675 square ft unilaterally in the year 2014. Now one thing is clear that the expected date of delivery of possession was 2009. We have seen the flat buyer agreement dated 29 June 2007. In this agreement the property described is flat bearing no T8-401 on fourth floor in our/block no.T8  having an approx. 1675 square fit (equivalent to 155.611 m²). The basic price of the flat has been mentioned as Rs.2,763,750/– calculated at the rate of Rs.1650.00 per square foot (equivalent to Rs.17,760.64/– per square metre). According to this agreement the buyer has paid a sum of Rs.1,271,325/– towards basic price at the time of booking. In this agreement it is also mentioned that the construction of the flat likely to be completed within a period of 36 months of commencement of construction of the particular block in which the flat is located with a grace period of six months. It is really surprising that time of conception is given as 36 months and again six months grace period has been mentioned. Including the grace period in the time limit of 36 months, it comes 42 months. So the liability of the opposite

(18)

party was to construct the said flat within 42 months which he could not do. The opposite parties was under a level to to handover the possession of the said flat after getting all types of certificate and NOC by the of December 2010. The sale deed has been executed on 18 February 2016. It is not clear as to on which date approvals of all the concerned authorities including the Fire Service Department, civil and aviation Department, Traffic Department, Pollution Control Department, as may be required has been obtained. No copy of such approvals have been filed by the opposite parties.

National Building Code of India covers the detailed guidelines for construction, maintenance and fire safety of the structures. National Building Code of India is published by Bureau of Indian Standards and it is recommendatory document. Guidelines were issued to the States to incorporate the recommendations of National Building Code into their local building bylaws making the recommendations of National Building Code of India as mandatory requirement. This office has also issued advisories on 18th April, 2017 to

all the State Governments to incorporate and implement the latest National Building Code of India 2016 Part – IV “Fire & Life Safety” in their building bye-laws.

Now we come to other aspects of construction mainly delay in construction and entitlement of complainant for compensation, damages and other pecuniary reliefs.

The Consumer Protection Act, came into existence and implemented in 1986, provides Consumer Rights to prevent consumers from fraud or specified unfair practices. It safeguards and encourages and gives an opportunity to consumers to speak against insufficiency and flaws in goods

(18)

and services. If traders, manufacturers and distributors follow any foul trade, this act protects their rights as a consumer.

This Protection Act covers entire goods and services of all sectors that are public, private, or cooperative sectors, except those exempted by the central government. The act provides a floor for a consumer where one can file their complaint against the product and the forum takes an action against the concerned supplier and compensation is granted to the consumer for the inconvenience he/she has encountered. The objectives of the consumer petition act may be summarised as –

• To Provide better and all round protection to consumer.
• To Provide machinery for the speedy redressal of the grievances.
• To Create framework for consumers to seek redressal.
• To Provide rights to consumers.
• To Safeguarde rights of Consumers.

What are the rights of consumers?Let us know more about the rights of consumer. Listed below are the Rights of the Consumer:

• Right to Safety- Before buying, a consumer can examine on the quality and guarantee of the goods and opt for ISI or AGMARK products.
• Right to Choose- Consumer must have the right to choose from a variety and number of goods and in a competitive price
• Right to be informed- The buyers must be provided with complete information with all the necessary and

(20)

adequate details of the product, make her/him act wise, and change the buying decision.

• Right to Consumer Education- The consumer must be aware of his/her rights and avoid exploitation.
• Right to be heard- The consumer will get due attention to express their grievances at a suitable platform.
• Right to seek compensation- The consumer has the right to seek or ask for redressal against unfair and inhumane practices or exploitation of the consumer.

The beneficial legislation of Consumer Protection Act aims to reducing the grievances of the all classes of customers by providing them the preferential treatment. According to the Consumer Protection Act, the consumer dispute is the entity where the consumer/ customers have been given the convenient safeguards against ample exploitation like bad customer service, faulty goods or any unfair trade practices. The interest of the customers is protected by setting up, the three tier quasi-judicial consumer Redressal machinery which are at national, state and district levels as per section 9 of Consumer Protection Act. The Consumer Protection Act, 1986 (CPA) has been enacted in light of certain concerns related to public policy and the benefit of consumer.

As for as arbitration clause is concerned, the following case laws are important in this regard. The Hon’ble Supreme Court Supreme in the case of A. Ayyasamy v. A Paramasivam(2016)10 SCC 386 ;N. Radhakrishnan v. Maestro Engineers) has held that the dispute will not be arbitrable if the civil court’s jurisdiction has been exclusively given to a tribunal or the special court. The Consumer Courts were made to create an organized system for dispute between

(20)

the people who possess the unequal power i.e. the consumer and the large corporations. The commission also pointed out the section 2(3) of the Arbitration and Conciliation Act which refers to the situations where the special categories of disputes are protected from being referred to the arbitration. Therefore this provision protects the Consumer disputes. The court concluded that if the court allows party to go for the arbitration and being in favor of the builder, it will defeat the goals and the main purpose of the Consumer Protection Act.

Section 8 of the Arbitration and Conciliation Act states that the judicial authority can instruct the parties to go for arbitration in the case when there exists the arbitration clause in the arbitration agreement. It does not bars oust the jurisdiction of the Consumer Court, it will continue to hold and enjoy the jurisdiction irrespective of presence of an arbitration clause in the agreement.

The Supreme Court contented that there was no legislative intent of the amended provisions of the section 8(1) in the Arbitration and Conciliation Act, so as to override the other statutes which have the specific remedies. Neither it intends to make disputes related to trusts, criminal law, tenancy, telecom, family law, IPR, etc, as the arbitrable subject and to against the judgment of A Ayyasamy v A Parasivam&Ors.(2016) 10 SCC 729 ) and Booz Allen Hamilton Inc. v SBI Home Finance Limited &Ors.(2011) 5 SCC 532 ). Now it is clear that the consumer courts have addition regarding the dispute between the consumer and service provider.

(22)

Now we came to the facts of present case. It is clear that aBuilder Buyer Agreement has been executed on  29.06.2007 for the said flat having an area of 155.611 m² and the total cost of the flat was fixed to Rs.2,763,750/–. As there was a penalty clause in the builder buyer’s agreement that if there is any default in the payment of the instalments a panel interest at a rate of 24% shall be delay be levied. The complainant deposited the amount as an when demanded to save the penal interest and cancellation of the flat. After depositing the whole amount the complainant asked the opposite parties to deliver the possession but they are divided to give delivery of possession on one or other pretext. The opposite parties first assured the complainant that the delivery of possession shall be given in the month of June 2009. The complainant and other allottees visited the site and found the construction at a halt. The person present on the spot told them that the possession shall be given in 2020. The construction done at the spot was defective and did not match the specifications

provided in the agreement. The opposite parties again assured the allottees that the possession shall be given in June 2010. This caused mental agony and distress to the complainant and also other allottees. Thereafter June 2010 also reached but no possession was delivered to the complainant, instead a common letter has been issued by the opposite parties that the project shall compete in March 2011. Meanwhile some articles also published in the daily newspaper regarding the fraud and deceptive act being paid by the opposite parties. It is scared the complainant.

(23)

Again March 11 reached and there was no hope of delivery of possession. Again the opposite parties issued a letter on 15^th May 2011 that the possession of the flat shall be given in December 2011. Thus the scheduled period as stipulated in the agreement has already been expired and there was no to get the possession of the flat in near future. From these facts it is clear that the parties have collected huge sum of money from the complainant and other allottees to earn interest on the deposition and they are intentionally delayed the construction so that the amount of this site might be used to some other project of the same builders. The opposite parties did not provide any statement of account regarding income and expenditure of the said project. The project did not complete in time or it can be said that the work did not complete according to the specifications, still the opposite parties were asking the complainant to take the possession of the said flat. The sale deed was executed on 18^th February 2016. The finishing work was incomplete and it is fit out possession given to the complainant.  

Now it is better to discuss some case laws of the Hon’ble Supreme Court and Hon’ble NCDRC which are summarized here as follows:-

In  R V Prasannakumaar v. Mantri Castles Pvt. Ltd., 2019 SCC On Line SC 224, under the terms of the ABA, possession of the flats was to be handed over to the buyers on 31 January 2014. However, the developer received an occupation certificate only on 10 February 2016 and it was thereafter from May 2016 that the developer started issuing letters offering possession. Based on this, the NCDRC awarded compensation in the form of interest at the rate of 6

(24)

per cent per annum. The developer had pleaded that since the agreement provided compensation at the rate of Rs.3 per square foot per month for delayed possession, the purchasers were not entitled to anything in addition. Dealing with the submission, this Court observed:

“9. We are in agreement with the view of the NCDRC that the rate which has been stipulated by the developer, of compensation at the rate of Rs.3 per sq. ft. per month does not provide just or reasonable recompense to a flat buyer who has invested money and has not been handed over possession as on the stipulated date of 31 January 2014. To take a simple illustration, a flat buyer with an agreement of a flat measuring a 1000 sq. ft. would receive, under the agreement, not more than Rs. 3000/- per month. This in a city such as Bangalore does not provide just or adequate compensation. The jurisdiction of the NCDRC to award just compensation under the provisions of the Consumer Protection Act, 1986 cannot in the circumstances be constrained by the terms of the agreement. The agreement in its view is one sided and does not provide sufficient recompense to the flat purchasers.”

The Court observed that there was a delay of two years and hence the award of interest at the rate of 6 per cent was reasonable and justified.

In Pioneer Urban Land and Infrastructure Limited v. Govindan Raghavan, (2019) 5 SCC 725, there was a delay of almost two years in obtaining an occupancy certificate after the date stipulated in the ABA. As a consequence, there was a failure to provide possession of the flat to the purchaser within a reasonable period. This Court dwelt on the terms of the ABA under which the builder was

(25)

entitled to charge interest at 18 per cent per annum for the delay in payment of instalments by the purchaser. On the other hand, the failure to provide possession on the part of the developer was subject to a grace period of twelve months followed by a termination notice of ninety days and a further period of ninety days to the developer to effect a refund. Adverting to these clauses, the court noted:

“6.4. A perusal of the apartment buyer's agreement dated 8-5- 2012 reveals stark incongruities between the remedies available to both the parties. For instance, Clause 6.4(ii) of the agreement entitles the appellant builder to charge interest @18% p.a. on account of any delay in payment of instalments from the respondent flat purchaser. Clause 6.4(iii) of the agreement entitles the appellant builder to cancel the allotment and terminate the agreement, if any instalment remains in arrears for more than 30 days. On the other hand, as per Clause 11.5 of the agreement, if the appellant builder fails to deliver possession of the apartment within the stipulated period, the respondent flat purchaser has to wait for a period of 12 months after the end of the grace period, before serving a termination notice of 90 days on the appellant builder, and even thereafter, the appellant builder gets 90 days to refund only the actual instalment paid by the respondent flat purchaser, after adjusting the taxes paid, interest and penalty on delayed payments. In case of any delay thereafter, the appellant builder is liable to pay interest @9% p.a. only. 6.5. Another instance is Clause 23.4 of the agreement which entitles the appellant builder to serve a termination notice upon the respondent flat purchaser for breach of any contractual obligation. If the respondent flat

(26)

purchaser fails to rectify the default within 30 days of the termination notice, then the agreement automatically stands cancelled, and the appellant builder has the right to forfeit the entire amount of earnest money towards liquidated damages. On the other hand, as per Clause 11.5(v) of the agreement, if the respondent flat purchaser fails to exercise his right of termination within the time limit provided in Clause 11.5, then he shall not be entitled to terminate the agreement thereafter, and shall be bound by the provisions of the agreement.”  

Justice Indu Malhotra speaking for the Court noted:

“6.8. A term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the agreement dated 8-5-2012 are ex facie one-sided, unfair and unreasonable. The

incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1)(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the builder.” The Court observed that in these circumstances, the flat purchasers could not be compelled to obtain possession which was offered almost two years after the grace period under the agreement had expired. Hence, the NCDRC was held to have correctly awarded interest at the rate of 10 percent per annum.  

The decision of this Court in Dhanda Case 2019 SCC On Line SC 689  has been relied upon by learned Senior Counsel appearing on behalf of the developer as elucidating the principle that where a flat buyers agreement stipulates a

(27)

consequence for delayed possession, exceptional and strong reasons must be established before the forum constituted under the Act of 1986 awards compensation in addition to what has been contractually agreed. In Dhanda’s case, the SCDRC issued a direction for handing over physical possession of the residential unit to the complainant and for execution of a sale deed. In addition, compensation was awarded by way of interest at the rate of 12 per cent per annum with effect from twelve months after the stipulated date under the agreement. In an appeal by the developer, the NCDRC directed that the rate of interest for a house building loan for the corresponding period in a scheduled nationalised bank would be appropriate and if a floating rate of interest was prescribed, the higher rate of interest should be taken for the computation. A sum of Rs.1 lac per annum from the date

for handing over possession to the actual date of possession was regarded as appropriate in the facts of the case. In that case under the terms of the buyer’s agreements, possession was to be delivered within twenty-four months of the execution of the agreement i.e. 10 February 2013 – failing which the developer was liable to pay compensation at the rate of Rs.10 per square foot per month for the delay. The developer contended that construction activities were delayed as a result of an injunction granted by this Court over a period of eight months and consequently sought an extension of the period for handing over possession by one year. Alternatively, the developer offered to refund the money deposited with interest at 9 per cent per annum. Construction of 258 independent floors was completed while about 1,500 units were nearing completion. In two sets of Civil Appeals

(28)

which came up before this Court earlier, agreed terms were arrived at providing for the award of interest at 9 per cent per annum from the date of deposit till refund. While considering the order of the NCDRC, this Court observed:

“16. The District Forum under the Consumer Protection Act, 1986 is empowered inter-alia to order the opposite party to pay such amount as may be awarded as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party including to grant punitive damages. But the forums under the Act cannot award interest and/or compensation by applying rule of thumb. The order to grant interest at the maximum of rate of interest charged by nationalised bank for advancing home loan is arbitrary and no nexus with the default committed. The appellant has agreed to deliver constructed flats. For delay in

handing over possession, the consumer is entitled to the consequences agreed at the time of executing buyer's agreement. There cannot be multiple heads to grant of damages and interest when the parties have agreed for payment of damages at the rate of Rs. 10/- per sq. ft. per month. Once the parties agreed for a particular consequence of delay in handing over of possession then, there has to be exceptional and strong reasons for the SCDRC/NCDRC to award compensation at more than the agreed rate.”

Now the interest may be 6% to 10% in favour of the allottees if they have not been given possession of the flat/plot within promised or within a reasonable time. The complainant has deposited the entire agreed cost of Rs.2,997,610/– up to 1^st June 2014. Now it is the duty and

(29)

obligation of the opposite party to deliver the possession within stipulated time but they failed to do so.  

In  the  case  of   PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC).These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava &Anr. Vs. Parsvnath Developers Ltd. & Anr.; 34 of 2013- Jasleen Viswanathan & Anr. Vs. Parsvnath Developers Ltd. & Anr; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. & Anr; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. & Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. &Anr.; 86 of 2010- Priyanka Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 101 of 2011- Mohd. Aslam Khan &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath Developers Ltd. &Anr; 49 of 2012- Neera Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr; 74 of 2011- Deepak Bhalla Vs. Parsvnath Developers Ltd. & Anr. ; 87 of 2010- Syed Gufran Ali Alvi & Anr. Vs. Parsvnath Developers Ltd. &Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd. &Anr.; 175 of 20130- Umesh Chandra Dixit & Anr. Vs. Parsvnath Developers Ltd. &A nr.; 97 of 2011- Pravin Kumar Goel & Anr. Vs. Parsvnath Developers Ltd. & Anr. which complaints were partly allowed.

          The  Hon’ble  NCDRC  held that:

(30)

“Brief facts of the cases are that opposite parties/ respondents are engaged in the activity of housing construction and accordingly they have launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave peacefully in their own houses, since the complainants are living in rented houses.

The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was

(31)

defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development

Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for the recovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved  by  the  order  of  Hon’ble  State  Commission, these  appeals preferred  before Hon’ble National  Consumer  Disputes  Redressal  Commission.

Hon’ble  NCDRC discussed various  case  laws  and  after  hearing  the  parties held,

“Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under  and

(32)

complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under   Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 ( c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed

(33)

for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession.

Against this judgment, parties went to Hon’ble  Supreme  Court. The judgment of Hon’ble  Supreme  Court is:-

In  Nalin Bhargava  vs  Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018, Hon’ble Supreme Court held:-

 “Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc.

(34)

            It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies have been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition  of  costs as compensation.

            Mr. Sachin Datta, learned senior counsel appearing for the developer has raised   objections    with regard to imposition of costs.

            Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say “cost”, we mean costs alone and nothing else.”

            In the case of Kolkata West International City Pvt. Ltd. Vs. DevasisRudra[Civil Appeal No. 3182 of 2019 @ SLP (C) No(S). 1795 of 2017] judgment delivered on 25.03.2019 , the Hon’ble Supreme Court has held:-  

            “Interestingly, where the buyer is in default, the agreement stipulates that interest at the rate of 18 per cent from the date of default until the date of payment would be charged for a period of two months, failing which the allotment would be cancelled by deducting 5% of the entire value of the property. The agreement was evidently one sided. For a default on the part of the buyer, interest at the rate of 18% was liable to be charged. However, a default on the part of the developer in handing over possession would make him liable to pay interest only at the savings bank rate prescribed by the

(35)

SBI. There is merit in the submission which has been urged by the buyer that the agreement was one sided.

            In  the Case  ofWg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors.  Versus  DLF Southern Homes Pvt. Ltd (now Known as BEGUR OMR Homes Pvt. Ltd.)

and Ors. (Civil Appeal No. 6239 of 2019 With Civil Appeal No. 6303 of 2019); The  Hon’ble  Supreme  Court  has  held:-  

            “24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression “service” in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being

(36)

available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfillment of a contractual obligation. To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice.

            Undoubtedly, as this court held in Dhanda, courts ordinarily would hold parties down to a contractual bargain. Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers. Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain.”

            These builders are just earning money from the consumers to whom they issued allotment letters and got a huge amount. They keep this amount for a long time and earn interest on it. Property dealing is that part of business where they never pay a penny to the consumers on their amounts deposited for a long-term or if they pay, they pay a meagre interest of about 5% or so but they charge 18 to 24% or more if the consumers default in depositing any instalment. It reminds us the story of “The Merchant of Venice” The Merchant of Venice is the story of a Jewish money lender

(37)

Shylock who demands that an antisemitic Christian offer “a pound of flesh” as collateral against a loan. These acts of builders also remind us the age of Sahukari during ancient India and also during British Raj. Whether these builders have power to frame their own law? They put their terms and conditions in such a way that the sufferer will always be the consumer. The Consumer Protection Act 1986 has been enacted for the benefits of consumers, so the courts dealing with Consumer Protection Act 1986 should come forward for their rescue. The courts are not governed by the builders but they are governed by the law, Custom and Usages. Now in the background of all the facts and also the facts of the present case, we will also discuss something more.

            The counsel for the property has submitted photo copy of completion certificate regarding T4 which is of 12 January 2018. . But no copy of Occupancy Certificate, NOC of Fire Department, Pollution Control Department, Civil Aviation Department Et cetera has been filed. All the NOC,s are necessary but the opposite parties failed to produce its certified copy. In this case And Advocate Commissioner has been sent on the spot. The advocate commissioner visited this flat and also other flats in relation to which the cases are pending before this court. The advocate commissioner in his report dated 18.02.2022 has said “in flat number T-8/401 , electricity + maintenance are well without any complainant and RWA has no concern regarding construction of the flats, RWA is looking after only maintenance of all the towers, regular bills of electricity and maintenance charges are being paid by the flat owner.” When the advocate commissioner visited the flat, he found the family of allottee residing in the

(38)

 said flat and Mr. Ajit Kumar Gupta was living in the said who on the mobile phone of complainant’s counsel told that the sale deed was executed in Feb 2016 and since then he is having possession and living their incomplete satisfaction. He also informed that he has incurred about ₹ 6 lakhs from March to September 2016 to make the flat habitable and he is having receipts of the payment made to carry out the fishing work on the flat. So here that the possession of the flat was delivered not on the stipulated date but after that date.

            Now it is clearthat there is deficiency of service on the part of the opposite party and also they are liable for unfair trade practice. For calculating the compensation/damages we are inclined that after two years the complainants are entitled to get the reliefs from the opposite parties. The cut-off date was 10.06.2013. As the builder buyers agreement was executed on 29^th June 2007 and it was promised to deliver the possession of the said flat within 42 months including grace period of six months. It means that the delivery opposition was to be given in the month of January 2011 .This is the date from which the amount of compensation/damages and other shall be calculated. The area of the concerned flat is 155.611 m². Keeping in view all the above mentioned facts, and also that the sale deed has been executed in February 2016, we come to the following conclusions:-

1. The opposite parties are jointly and severally liable to pay interest at a rate of 10% on all the deposited amount from their respective dates till  02.02.2016.This interest shall be paid within 60 days from the date of judgment of this complaint case otherwise the opposite parties

shall be liable to pay interest at a rate of 15% till the date of actual payment.

1. The complainants are entitled to get monthly damagesaccording to the area. The area of the said unit is 155.611 m² and keeping in view the judgment of Hon’ble NCDRC in the case of Priyanka Mittal (supra), the opposite parties,jointly and severally,are directed to pay ₹15,000/- per month from 01.01.2011 till 02.02.2016with interest at rate of 10% during that period and the order shall be compliedwithin 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount till the date of actual payment .
2. The complainants are entitled to get Rs.150,000/– in view of Nalin Bhargava Case (supra) as cost.
3. In the relief clause of the complaint, the complainant has prayed that any other order which This Hon’ble State Commission may deem fit and proper in the circumstances of the case may also be passed. So keeping in view all the fraud committed in this case, all the harassment and mental agony given to the complainants , we find that the complainants are also entitled to get ₹ 20 lakhs with interest @ 10% from 01.01.2011 till 02.02.2016 towards payment of rent of the flat, mental harassment, agony and sufferings and the order shall be complied within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum  on this amount from 01.01.2011 till the date of actualpayment.

(40)

1. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

The present complaint is decided accordingly.

ORDER

1. The complaint is allowed with cost. The opposite parties are jointly and severally liable to pay interest at a rate of 10% on all the deposited amount from their respective dates of deposit till 02.02.2016. This interest shall be paid within 60 days from the date of judgment of this complaint case otherwise the opposite parties shall be liable to pay interest at a rate of 15% from their respective date of deposition till the date of actual payment.
2. The opposite parties are jointly and severally directed to pay Rs.15,000 per month as damages to the complainant from01.01.2011 till 02.02.2016 with interest at a rate of 10% during that period and the order shall be complied with within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.01.2011 till the date of actual payment.
3. The opposite parties are jointly and severally directed to pay Rs.150,000/– to the complainant in view of Nalin Bhargava Case (supra) as cost.
4. The opposite parties are jointly and severally directed to pay Rs.20 lakhs with interest at a rate of 10% from01.01.2011 till 02.02.2016towards payment of rent of the flat, mental harassment, agony and sufferings, within 60 days from the date of judgment of the appeal otherwise theopposite parties shall be liable to pay interest at a rate of 15% from01.01.2011 till the date of actual payment.

(41)

1. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

All the decreetal amount shall be paid within 60 days from the date of judgment of this appeal otherwise the opposite parties shall pay interest at a rate of 15% per annum on all the decreetal amount. If it is not paid within 60 days from the date of judgment of this appeal, the complainants shall be entitled to present Execution proceedings before this court at the cost of the opposite parties.

The stenographer is requested to upload this order on the Website of this Commission today itself.

Certified copy of this judgment be provided to the parties as per rules.

(Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                       President

Judgment dated/typed signed by us and pronounced in the open court.

Consign to the RecordRoom.

(Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                       President

Jafri, PA II

Court 1

          Reserved

State Consumer Disputes Redressal Commission

U.P. Lucknow.

Complaint  Case No.429 of  2017

                  RAJEEV DUBEY, aged about 51 years, son of Late Shyam

                 Babu Dubey, resident of C-1145, Indira Nagar, near Church

                 Lucknow.                                            …. COMPLAINANT

versus

1. PARSVNATH DEVELOPERS LIMITED, registered and Corporate office situated at 6^th floor, Arunachal Building, 19, Barakhamba Road, New Delhi, through its Chairman.
2. PARSVNATH DEVELOPERS LIMITED, (PARSVNATH PLANET) situated at Plot No. TC-8, TC-9, Vibhuti Khand, Gomti Nagar, Lucknow, through its Managing Director.
3. PRADIP JAIN, CHAIRMAN PARSVNATH DEVELOPERS LIMITED, registered and Corporate office situated at 6^th floor, Arunachal Building, 19, Barakhamba Road, New Delhi.
4. SANJIV JAIN, MANAGING DIRECTOR PARSVNATH DEVELOPERS LIMITED, registered and Corporate office situated at 6^th floor, Arunachal Building, 19, Barakhamba Road, New Delhi.
5. RAMESH THAPPAR, SENIOR GENERAL MANAGER, PARSVNATH DEVELOPERS LIMITED, (PARSVANTH PLANET) situated at Plot No. TC-8, TC-9, Vibhuti Khand, Gomti Nagar, Lucknow.

                                                      …. OPPOSITE PARTIES        

                       Present:-

1- Hon’ble Justice Sri Ashok Kumar, President.

2- Hon’ble Sri Rajendra  Singh, Member.

Sri Piyush Mani Tripathi, Advocate for the complainants.

Sri Rajesh Chaddha, Advocate for Opposite Parties.

Date : 13 .04 .2022

JUDGMENT

Per Mr. Rajendra Singh, Member: This complaint has been filed by the complainant under section 17 of the Consumer Protection Act, 1986.

(2)

The brief facts of the complaint case are that, that by this complaint that complainant has prayed  for a direction to the opposite parties to deliver the physical possession of the fully finished /developed Flat No. T1-604 having an area 190.44 square meters, it is further prayed that this Commission may graciously be pleased to direct the opposite parties to pay an interest as this Hon’ble Commission may deem it fit and proper under the circumstances of this case, on the amounts deposited by the complainant with the opposite parties from the respective dates of deposits till the date of complainant is inducted into the physical possession of the fully finished flat, further prayed that this Hon’ble Commission may graciously be pleased to direct the opposite parties not to claim any amount towards the alleged illegal increase in area of the allotted unit; and to bear the difference in the cost to be incurred at the time of the execution of the registered sale deed. The component also prayed that this Hon’ble Commission taking into consideration the severity of deficiency in service committed by the opposite parties may be pleased to award compensation, damages as well as punitive damages against the opposite parties, complainant being dragged to un warranted litigation in view of the deficiency in service committed by the opposite parties is also entitle for the award of the cost of the litigation.

The opposite parties no 1 & 2 are a limited company and opposite parties no 3 to 5 are the officer in charge of all the day-to-day affairs of the company and all are engaged in the construction of the flats with all the basic civil amenities. Lucrative advertisement are made by the opposite parties to attract the consumer in the market in order to apply for the

(3)

booking of the residential accommodation in their scheme known as Parsvnath Planet . Opposite parties demonstrate themselves to be best in the construction activities in contrast to the other builder who are engaged in the construction activities in the market and on the assurance of the timely construction of the apartment, complainant applied for a residential accommodation in the scheme of the opposite parties. The opposite parties by means of advertisement dated 27.04.2006 communicated to the consumers that they have purchased the land from the Lucknow Development Authority, Lucknow and have taken the possession from the Authority and started the construction of the Apartments and invited the applications for allotment of the Flat . It is assured to the consumers that there shall be no cost escalation.

The opposite parties committed to the consumer of the project that the construction work of the unit as well of the project shall be completed in the year 2009 itself and demand of the price of the flat is made with the assurance that construction shall be done within agreed period of time and complainant as well as other allotttees of the scheme shall be inducted into the physical possession of the fully finished flat within a period of 36 months. The opposite parties by means of the letter dated 21.02.2006 allotted Flat No. T1-604. The opposite parties at the time of the deposit of the booking amount assured the complainant that the possession of the unit shall be delivered with all the civil amenities till June 2009; it was specifically assured by the opposite parties that the requisite permission from the concerned authorities to construct the apartment had already been obtained by them after taking the possession of the land from the Lucknow

(9)

Development Authority, Lucknow. It is pertinent to mention here that had the opposite parties communicated to the complainant that they shall inordinately delay the constriction of the entire project then the complainant ought not have opted for a flat in the scheme of the opposite parties.

The opposite parties prepared a standard form of agreement which is common for all the allottes in the scheme and directed the complainant to put his signatures on the blank space . However this agreement is unilateral and the entire terms of the agreement are prepared in order to facilitate and best suit the convenience of the builder who is on the dominant position and the buyer has no right to modify alter or amend the terms and conditions of the agreement prepared by the opposite parties.  The unilateral and one sided Flat Buyer agreement is executed on 16.09.2006 between the opposite parties and the complainant pertaining to Flat No. T1-604 situated at Block No. T-1, the area of the flat is mentioned as 190.44 square meters and the total cost of the flat was fixed to Rs.36,069,75/- including all other charges. The opposite parties in order to procure money from the allottee of the scheme issued a letter dated 22.06.2006 and 16.09.2006 informing that the project is duly approved for housing loan from M/s PNB Housing Finance and HDFC Bank, the opposite parties issued letter dated 08.12.2006 informing similarly placed allottee that the amount of payment of installment if defaulted shall carry interest at the rate of 24%, thereafter by virtue of letter dated 23.06.2007 the opposite parties communicated the name of 8 financer and re-affirmed that the project stood approved. The opposite parties insisted all the allottees of the scheme to deposit the cost of

(5)

the Flat and to that effect offered 10% rebate on the remaining cost of the flat, complainant since a in dire need of the residential accommodation applied for loan from HDFC Bank Limited and on 16.09.2006 Tripartite Agreement is executed and forthwith payment of the installments amount towards the allotted apartment was duly made within the stipulated period to the opposite parties. The complainant made visits of the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of June, 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled . The complainants were constrained to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save his allotment from cancellation. However the opposite parties did not adhere to their assurance and commitment of the timely completion of the project and development of the scheme . Neither the flats/unit partially constructed are fully finished and are not in a habitable condition, no basic amenities are provided by the opposite parties in the scheme.

The complainants claimed the possession of the allotted flat after depositing the total cost of the unit on their due dates, the same is avoided by the opposite parties on the pretext that the construction activities are at the peak and possession shall be delivered to the complainant on the scheduled period, that is in the month of June, 2009. However no development work is completed by the opposite parties in

(6)

the scheme. The complainant ,on personal visits to the construction site of the opposite parties, was surprised to note that the construction activities is on halt and the persons available on the site told the complainant that the apartments are not ready for possession. Even the partial construction done by the opposite parties was defective and did not match the specification provided in the agreement. It is pertinent to mention here that the complainant deposited the entire cost as agreed by the builder as well other allottees of the scheme too deposited the cost of their units, however the opposite parties despite receipt of the huge amount from the consumers did not utilize the same for the constructions of the Flat, rather the amounts is diverted in other projects by the opposite parties. The complainants had to undergo a lot of mental agony and stress by the attitude of the opposite parties, since the opposite parties failed to abide with their promise to provide the possession of the apartment till June, 2009 which caused the complainant loss of rent as well.

The complainant waited for about a year in a hope that the opposite parties shall give the possession in July, 2010, but to the utter surprise of the complainant a common letter dated 12.02.2010 was received by the complainant, which provides that the opposite parties are planning to complete the project till March, 2011. The complainant on learning about the said letter felt cheated and underwent a lot of mental agony and pain and made several personal visits on the construction site wherein it was revealed that no activity of construction is being carried out by the opposite parties and they are enjoying the hard earned money of the consumer of the entire project as well as of the complainant.

(7)

The daily news papers disclosed the fraudulent and deceptive act of the opposite parties when the news of the cancellation of the allotment was published, by means of which it was revealed that the Lucknow Development Authority threatened the builder/opposite parties that the allotment of the project shall be cancelled on account of the default committed by the opposite parties even in the RTI information dated 04.01.2012, 05.11.2014 and 06.01.2015 revealed that completion is rejected by the LDA. The opposite parties failed to provide the possession of the flat in March, 2011 instead issued a letter dated 05.05.2011 to the complainant, by means of which they were informed that the possession of the flat shall be given in December, 2011. The opposite parties again issued a letter dated 02.03.2012 to the allottess of the scheme informing them that the possession of the flat shall be given after December 2012, however they informed by this letter that the opposite party nos. 1 to 2 shall be in a position to apply for the completion certificate in December, 2012 only thereafter possession will be offered. The language used in the letter clearly demonstrate that the opposite party nos. 1 to 2 are not in a position to deliver the possession even in December, 2012. However the opposite parties are guilty of gross deficiency in services on account of the fact that inordinate delay in the possession of the flat has been committed by them, moreover the complainants are living in rented house paying Rs.15,000/- towards monthly rent, thus the opposite parties are accountable to pay Rs.15,000/- per month to the complainants for loss occurred on account of payment of rent with effect from July 2009 till the possession of the fully finished flat is given to the

(8)

complainants. From the aforementioned facts it is amply clear that the opposite parties has obtained huge sum of money from the entire allottees of the scheme and instead of putting the same for the development of the flats misappropriate the same, for which the opposite parties are liable to produce the expenditure and account statement of the scheme before this Hon’ble Commission.

The opposite parties in a most illegal and arbitrary manner on 11.05.2013 issued a letter for Fit Outs which is in complete contravention of the terms and conditions of the agreement dated 16.09.2006 and even the area of the unit is alleged to increase by 190 square feet and demand of the excess cost is made, thereafter by means of another letter dated 21.11.2015 possession is offered enclosing a Final Statement of Account according to which increase in area is shown as 190 square feet and delay compensation is credited from July 2010 to December 2012 and for period of January 2013 to March 2013, however this statement is not correct and per se wrong as there is absolutely no increase in the area of the allotted unit, further the compensation is never paid to the complainant as per the terms and conditions of the agreement, strangely the opposite parties directed the complainant to prepare a draft of Rs.25,100/- in the name of Mr. Rajesh Chadha Advocate who is conducting the consumer cases of the builder before the Hon’ble State Consumer Commission, there is no reason as to why the opposite parties shall direct the complainant to prepare a draft in the name of their counsel and neither there are any Terms and Conditions in the agreement that the draft shall be prepared in the name of the Advocate of the

(9)

opposite parties, moreover favouring the advocate who is conducting the entire cases of the opposite parties before this Hon’ble State Consumer Commission, this establish the mala fide intention of the opposite parties in procuring illegal money from the consumer of the entire project. The complainant did not subscribe to the illegal and arbitrary demand of the opposite parties in contrary to the agreed Terms and Conditions of the agreement dated 16.09.2006, however again a letter dated 14.02.2017 is issued by the opposite parties by means of which demand of Rs.47560/- is raised towards IFSD and Rs.5,76,800/- towards stamp duty charges and Rs.25,100/- towards Advocate Fee in the name of Mr. Rajesh Chadha Advocate, this demand is in complete contravention of the terms and conditions of the agreement dated 16.09.2006, the opposite parties illegally and arbitrary mounted pressure on the complainant to pay fee to Mr. Rajesh Chadha Advocate, who is conducting all the cases of the opposite parties before this Hon’ble Commission, whereas there is no terms in the agreement that the consumer is bound to pay fee to the Advocate of the opposite parties, this act of the opposite parties amounts Unfair Trade Practice as well as serious deficiency in service.

The opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted apartment to the complainant till June, 2009. Neither the basic civic amenities are available as on site, nor the units are finished in accordance with the specification mentioned by the opposite parties, moreover illegal and arbitrary demand in being claimed by the opposite parties towards increase in the area of the unit and for the fee of their

(10)

advocate, such act of the opposite parties clearly constitute Unfair Trade Practice on their part, thus the complainant is entitle for the award of damages, compensation and punitive damages.  The opposite parties are accountable for committing Unfair Trade Practice in this complaint case, since they have enjoyed and utilize the hard earned money of the complainant without providing the possession of the apartment; and are claiming illegal and arbitrary amount from the complainant. The complainant in order to make the payment of the cost of the apartment took financial assistance from the HDFC Bank and the complainant is repaying the installments on exorbitant rate of interest, however the complainant has been deprived of his legitimate right of possession of the flat instead he have been burdened and saddled with the repayment of the installments, which is causing acute mental and physical discomfort to the complainant, for which the opposite parties are responsible and are accordingly liable to compensate the complainant by making adequate payment of compensation and damages apart from interest on the amount deposited by the complainant.  

This Hon’ble Commission by a common order dated 25.02.2015 decided a bunch of cases similar in nature, with a direction which is being reproduced herein under :

All the aforesaid complaints are hereby allowed for the reliefs as follows:

The opposite parties shall hand over the possession of the flats to the complainants within this year 2015.

The opposite parties shall issue the statement of accounts to the complainants individually on his demand and

(11)

if there is no dues on the particular allottee, the opposite parties shall pay the amount of credit vide clause 10 (c) of the agreement credited in the account of the allottee in cash or by way of cheque or draft to the allottee with interest at the rate of 9% per annum from the date it has become due till the payment is made.

The consumer approached the Hon’ble NCDRC for enhancement of the award passed by this Hon’ble Commission First Appeal No. 250 of 2015, the Hon’ble National Commission by a common order dated 20.01.2016 allowed the appeal of the decree holder, the order of the Hon’ble NCDRC is being reproduced herein under:

Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started.  No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 (c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period.  This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of

(12)

clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs.  As complainants have bene deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status  and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175  sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after  54 months of execution of agreement till delivery of possession.  Complainants- Nalin Bhargava in Complaint No. 18 of 2013 and complainants Ravindra Singh in Complaint No. 32 of 2012, are entitled to get only difference of amount from the amount already awarded by State Commission which has not been challenged by opposite party. 

Perusal of record reveals that in Complaint No. 987 of 2011, Pravin Kumar Goel  Vs. Parsvnath Developers, flat area of complainant has been increased and additional Rs.7,99,997/- has been demanded by opposite party from complainant but Learned State Commission has not allowed penalty  as per clause 10(c) for the increased area and complainants are entitled to get penalty as per aforesaid clause on the increased area also.

Consequently, appeals filed by appellants are partly allowed and order dated 25.2.2015 passed by Learned State Commission in the aforesaid complaints is modified and opposite party is directed to pay @ Rs.15,000/- p.m. and Rs.20,000/- to the allottees of flats upto 175 sq. mt. and

(13)

above 175 sq mtr respectively from beginning of 55th month from the date of execution of flat buyer agreement till delivery of possession of flat to the complainants and complainants in Complaint No. 18 of 2013 and Complainant No. 32 of 2012 are entitled to receive only difference of amount as stated above and opposite party is directed to pay penalty to complainant in Complaint No. 97 of 2011 on the increased area as per clause 10 (c ) of the agreement.

The opposite parties in this case are accountable for serious deficiency in service as pressure is mounted by them to make the illegal payment in contravention to the agreed Terms and Conditions, further inordinate delay in delivery of the possession to the complainant is made by the opposite parties causing them irreparable loss and injury. This Hon’ble Commission in bunch of cases appointed the joint advocate commission who inspected the site and submitted their report wherein it is recorded that the construction work is incomplete and project lacks basic civic amenities, however in a most illegal and arbitrary manner the opposite parties claimed money for the alleged increase in area by means of letter dated 11.05.2013, however it is pertinent to note that no increase is there in the area of the unit allotted to the complainant.

A letter dated 18.09.2017 is issued by Marksmen Facilities Private Limited claiming illegal and arbitrary amount of Rs.7930/- against the Flat No. T-1/604 of the complainant, it is vociferously submitted that the opposite parties did not delivered the physical possession of the fully finished flat to the complainant, neither the basic amenities are available on site, however strangely illegal and arbitrary

(14)

demands are being made by the opposite parties by issuing various letters. In view of the aforementioned facts and circumstances stated in this complaint case, the opposite parties are accountable for serious deficiency in service as well as Unfair Trade Practice and are liable to pay compensation to the complainants.  

The opposite parties submitted the reply and stated that this Hon’ble commission  has vide its order dated 25.02.2015 disposed of 33 complaints filed against the opposite parties by the allottees of the project namely” Parsvnath Planet ”which is also in question before this Hon’ble commission That in the captioned complaint. The operative part of the common order and judgement dated 25^th of February 2015 is reproduced here in below :-

“ All the aforesaid complaints are hereby partly allowed for the release as follows :-

1. the opposite parties shall hand over the possession of the flat to the complainant within this year of 2015.
2. The opposite parties shall issue the statement of account to the complainant individually on his demand and if there is no dues on the particular allottee, the opposite parties shall pay the amount of credit vide clause 10 © of the agreement credited in the account of the allottee in cash or by way of check or draft to the allottee with interest at a rate of 9% per annum from the date it has become due to the payment is made.
3. In complaint case number 18 of 2013 of the complainant Nalin Bhargava  and Sanjay Bhargava , the complainants are entitled in addition to get the difference of amount of rented to the tune of Rs.14,000

(15)

per month Paid by the complainant and the amount credited by the opposite parties in their account vide clause 10 ( c) of the agreement w.e.f October 2012 to June 2014.

4. In complaint case number 32 of 2012 of the complainants Ravinder Singh andRitesh Kumar Singh , the complainants are entitled in addition to get the difference of amount of rent to the tune of ₹ 14,000 paid by the complainants and the amount credited by the opposite parties in their account vide clause 10 ( c) of the agreement for the month of May 2010 only.

The complaints for the rest of the reliefs sought shall be deemed to have been dismissed.

This judgement shall be placed on the record of complaint case number no C/86 /2010 with its copy to be laid on the record of other 32 complaints. ”

In view of the common order and judgement dated 25.02.2015, it is stated that since the captioned complaint also pertains to the same project and apart from the basic facts of the case which differs from allottees to allottees, the broad stand of the opposite parties remains the same as was averred in the complaint is already disposed of by the common order/judgement, the captioned complaint we also disposed of by this Hon’ble Commission in similar matter. In this case the complainant applied for registration of a residential condominium on 12.11.2005 in the upcoming project of the opposite parties. It is submitted that the complainant deposited Rs.3 lakhs towards the said booking. The opposite party, thereafter, provisionally allotted the complainant a flat bearing no T 1-204  (hereinafter referred to as flat )

(16)

measuring 2050 ft² for the basic cost of Rs.3,606,975/– in the project namely Parsvnath Planet , Lucknow . Thereafter the complainant requested the opposite party to shift the allotment. The opposite party being a customer oriented company acceded to the request of the complainant and shifted the allotment of flat from T1-204 to T1-604 and basic cost of the flat got revised to Rs.3,430,162.50/–. The opposite party centre Two Copies of Flat Buyer Agreement to the complainant vide its letter dated 14.06.2006 four perusal and signatures of the complainant. The complainant himself vide his letter dated 16.06.2006 and 05.08.2016 requested to make one-time payment. After amending the complainant for returning the signed copy of Flat Buyer Agreement several times, the Flat Buyer Agreement was duly executed between the parties on 16.09.2006 . The complainant has executed the Flat Buyer Agreement after going thoroughly with the terms and conditions of the same.

The complainant applied for housing loan for which Tripartite Agreement dated 16.09.2006 was executed between the parties and permission to mortgage dated 16.09.2006  one issued by the opposite party in favour of HDFC bank. The opposite party after completion of the tower, in which the flat of the complainant is situated, issued fit outs to the complainant in May 2013 and sought clearance of balance payment as per the final statement of account.

A sum of Rs.338,250/– was treated on account of compensation for the delay in possession to the complainant. The opposite parties vide their letters dated 12.02.10 , 05.05.11 , 02.03.12 , 31.12.12 , and 16.04.13 intimated to the complainant the reason for delay in completing the

(17)

construction work at the site and the complainant was informed that his interest is duly protected under clause 10 ( c ) of the Flat Buyer Agreement. Vide letter dated 21.11.2015 the opposite party offered illegal possession of the flat to the complainant along with final statement of account. A sum of Rs.394,571/– was credited as a special rebate on account of unfinished items to the complainant. The complainant has not cleared the possession -related dues as per the final statement of account, and as such, the complainant has not come forward for taking possession of the said flat despite repeated calls by the opposite parties. The opposite parties have not, at any point of time, violated or breached the provisions of the Flat Buyer Agreement, hence the captioned complaint has been filed without any cause of action. The complainant has not been able to establish any deficiency of service or consumer dispute as contemplated under the Consumer Protection Act, 1986 which could be attributable to the opposite parties.

The construction in the tower in which the flat of the complainant is located has been completed and the completion certificate has been duly applied by the opposite party within the authority and the same was received by the party on 14.09.2015. The opposite party has already offered the possession of the flat to the complainant and the complainant may take the possession of the flat after clearing the possession related dues. The said project consists of 10 towers were in the possession of the flats have already been offered in seven towers were in the buyers are residing peacefully. A substantial number of customers who are having flat in tower number 1 have taken the possession of

(18)

the flat and various allottees have got their sale deed executed. As on date, 160 allottees in the project have got their deed executed and registered and around 250 flat owners have taken the possession and most of them are residing in the complex peacefully. No cause of action arises in favour of the complainant and against the opposite parties for the purpose of filing the present complaint. The complainant has been filed without any substantial proof. Bare allegations in the complaint without any proof and without any alleged act on behalf of the opposite parties necessary to charge it for unfair trade practice or deficiency of service cannot be taken as gospel truth by this Hon’ble Forum. The complainant has prayed for the release which otherwise have to be claimed in a suit for damages and recovery of possession, after paying appropriate court fee. In order to avoid the payment of court fee, the complainant has filed the captioned complaint which otherwise is a dispute of a civil nature and requires elaborate evidential to be led and thus, the captioned complainant cannot be adjudicated upon under the summary jurisdiction of the Hon’ble commission. The Flat Buyer Agreement entered into between the complainant and the opposite parties, both have agreed upon their respective liabilities in case of breach of any of the conditions specified therein. The liability of the opposite parties on account of delay is specified in clause 10 (C) of the flat buyer agreement That and as such the complainant cannot claim leaves which are beyond the compensation agreed upon by him.

The opposite parties vide letter dated 21.11.2015has already offered physical possession in respect of the flat. It is wrong and denied that the complainant has suffered any

damages which will necessitate the payment of any composition, damages and punitive damages. The complainant who has not cleared the possession related dues and has not come forward for taking possession of the flat. The physical possession of the flat shall be given by the opposite parties to the complainant after clearing all the outstanding payments from the site of the complainant and fulfilment of all formalities. In the case of delay of possessionof the flat, the liability of the opposite parties is limited to ₹ 5 per square feet per month after 42 months have elapsed and subject to other conditions. It is denied that the lucrative advertisements were made by the opposite parties to attract the consumers in the market in order to apply for the booking of the residential accommodation in the scheme. The complainant booked the flat out of his own free will. It is submitted that there is no separation in the rate per square feet but due to increase in the super built area of the flat, the basic cost of the flat increased which has been calculated at the old rate for the increased area that is 190 ft² at a rate of Rs.1673 .25 /– per square feet. The constructions were to be completed within a period of 36 months of commencement of construction of the particular block in which the flat is located with a further grace period of six months as stipulated clause 10 (A) of the Flat Buyer Agreement. Clause 10 (a) of the agreement for the kind consideration of this Hon’ble commission is extracted below-

“Clause 10 (a)

 construction of the flat is likely to be completed within a period of thirty six (36) months of commencement of construction of the particular block in which the flat is located

(20)

with a grace period of six (6 )  month, on receipt of sanction of building plans/advised building plans and approvals of all concerned authorities including the Fire Service Department, civil aberration Department, traffic department, pollution control Department, as may be required for commencing and carrying on construction subject to force majeure, restraints of restrictions from any courts/authorities, non-availability of building materials, disputes with contractors/ workforce et cetera and circumstances beyond the control of the development 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 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”.

It is submitted that though the global recession which hit economies all over the world including the Indian economy due to which the real estate sector was the opposite parties strived hard to keep up with the construction activities to ensure completion of its projects. The opposite parties in this view of the matter has not at any point of time breached the terms and conditions of the Flat Buyer Agreement and the averments averred to the country are vehemently denied it is denied that the opposite parties prepared and drafted a standard form of agreement and directed complainant to put his signature on the blank space it is also denied that the agreement is unilateral and the entire terms of the agreement

(21)

was prepared in order to facilitate the builder who is on the dominant position . The opposite parties sent to copy of the Flat Buyer Agreement to the complainant vide letter dated 14.06.2006 and it is only after careful perusal of all the terms of the agreement for almost 3 months, the agreement was executed with the complainant on 16.09.2006 by his free will and consent. The complainant did not make timely payment of instalments on different dates . It is denied that the opposite parties despite receipt of the huge amount from the buyers has not utilised the same for construction of the flat , rather the amount were diverted in other projects by the opposite parties. It is denied that the complainants had to undergo a lot of mental agony and distress by the attitude of the opposite parties . The complainant is making such vague statements with the ulterior motive to earn wrongful from the opposite parties. The construction of the tower in which the flat of the complainant is located has been completed and the completion certificate has already been received by the opposite parties on 14.09.2015 . There is no grass deficiency in services on the part of the opposite parties. As per clause 8 (a) of the Flat Buyer Agreement,  it was specifically agreed by the complainant that the area of the flat is tentative and the same may be revised during the course of construction. As such , increased area has been worked  out on completion of the construction of the flat.

It is submitted that the alleged draft of Rs.25,100/– in the name of advocate, is in fact, towards the registration fee for sale conveyance deed which includes professional fee of the advocate for registration of the unit in terms of clause

(22)

11(a) Of the Flat Buyer Agreement. The complainant is making vague, misleading and frivolous allegations against the opposite parties with the sole motive to earn wrongful from the opposite parties. It is denied that the opposite parties are accountable for committing unfair trade practice and also denied that the opposite parties are claiming illegal and arbitrary amount from the complainant. The complainant has been filed by the complainant without any substantial proof to show that any act as contemplated in the complaint amounts to deficiency in service or unfair trade practice or restrictive trade practice. The opposite parties have adhered to the terms and conditions as stipulated under the Flat Buyer Agreement, however due to certain adverse and unforeseeable circumstances , beyond the control of the opposite parties, the construction has been delayed. The opposite parties have already offered possession of the flat to the complainant herein but it is the complainant who has not cleared the possession related dues and thus failed to take possession of the flat. Marksmen Facilities is a maintenance agency to look after the maintenance and upkeep of the common areas facilities in the complex which is provided vide clause 15 (a) Of the Flat Buyer Agreement. So far as the question of providing basic amenities in the project is concerned, it is submitted that the same have been duly provided in the project wherein a substantial number of families are already residing there. The complainant is based on mere conjectures and surmises and denied. No cause of action arose insurer of the complainant and against the opposite parties for the purpose of filing the captioned complaint thus, the question of invoking the jurisdiction of this Hon’ble Commission does

(23)

not arise at all. The instant complaint is false, malicious , vexatious and incorrect and is nothing but an abuse of the process of law and it is an attempt to waste the precious time of this Hon’ble Commission, as the same has been filed by the complainant just to avail undue advantage and to earn wrongful gain at the cost of the opposite parties the complainant has prayed for release which otherwise have to be claimed in a suit for damages and recovery of possession, after paying appropriate court fee. In order to avoid the payment of court fee, the complainant has raised a consumer dispute which otherwise is of civil nature which cannot be adjudicated upon under the present jurisdiction of this Hon’ble Commission . The contents of prayer clause are exaggerated and unjustified without prejudice to the fact that any such compensation as claimed is neither payable claimable under the contract governing the parties the composition claimed has to be proportionate and rational with the loss or injury suffered by the complainant/claimant. In the instant case, there is no loss or injury or deficiency attribute to be to the opposite parties. There is no negligence or delay on the part of the opposite parties so as to entitled the complainant to claim any amount from the opposite parties. So it is respectfully prayed that the complaint of the complainant may kindly be dismissed with exemplary costs.

We have heard the learned counsel for the complainants Sri Piyush Mani Tripathi and learned counsel for the opposite parties Sri Rajesh Chaddha. We have perused the pleadings, documents and evidence on record.

Before going to discuss the various aspect of the present complaint Case, we have perused the commission report

(24)

 which was sent on the spot vide this court’s order dated 17.02.2022 the learned advocate commissioner Mr Isar Husain submitted the report on 18.02.2022 . When the learned commissioner visited flat number T-1/604  , the doors were closed from entry, and one Sri Sankata Prasad Maurya the representative of the OP was present and he informed that he is not having the key of the flat at the same was handed over to the owner of the flat long back. One Mr A P Singh , project manager has given a photocopy of the letter signed by Sri Rajeev Dubey , in which it is mentioned “ with reference to my flat no T-1/604 in Parswanath Planet , I would like to state that I want to take possession of my flat on as is where basis is” the counsel of the complainant informed the learned advocate commissioner that the condition of the flat is not in a habitable condition and long back the entire cost was taken by the opposite parties in due deliberations harassing the allottees regularly.

Regarding the completion certificate, the counsel of the opposite party submitted a photocopy of the completion certificate dated 14.09.2015 at the very late stage which is issued by The Lucknow Development Authority.  

In a nutshell the main event of this particular case is summarised as follow :

Allotment Letter issued on           21.02.2006

Flat Buyer Agreement                    16.09.2006

Area                                                 2050 square ft

Cost As per Flat Buyer Agreement         Rs.3,430,162.50/

Promised Date of Possession                  June 2009

Increase of Area                                      190 ft²

(25)

Now it is clear that the complainant applied for a flat in the scheme of opposite parties and allotment letter has been issued on 21 February 2006. Flat buyer agreement on 16 September 2006. According to this flat buyer agreement a flat bearing no T1/604 on sixth floor in Tower T1 has been allotted to the complainant having an approximate area of 2050 ft², equivalent to 190.44 m² of super built up area consisting of four bedrooms, living room, dining, one kitchen, 3 toilets , one toilet  with dresser , entrance foyer, lobby, loft, balconies/utility balcony. The basic price was Rs.3,430,162.50 calculated at the rate of Rs.1673 .25 per square feet . Clause 10 (a) of flat buyer agreement states that the flat is likely to be completed within a period of 36 months of commencement of construction of the particular block in which the flat is located with a grace period of six months meaning thereby that the possession of the flat was to be delivered within 42 months from the date of allotment letter which is issued 21.02.2006.  The possession of the concerned that was to be given after 42 months from the date of allotment letter that is by the end of August 2009. A person who applies for a flat, invest his hard earned income/money with the hope that the flat shall be delivered within the time as stipulated assured in the allotment letter. They also take loan from different banks in the hope of timely delivery of possession of the flat. No doubt the builders after getting the hard earned money of the allottees, start delaying the project and use that money in some other new project giving higher rate of per square ft building. The genuine allottees feel themselves cheated. They used to travel from distance basis to the place of their proposed flat and spent a lot of money in

(26)

their journeys. It is duty of the builder to provide the delivery of possession as envisaged in the letter of allotment.

The Consumer Protection Act, came into existence and implemented in 1986, provides Consumer Rights to prevent consumers from fraud or specified unfair practices. It safeguards and encourages and gives an opportunity to consumers to speak against insufficiency and flaws in goods and services. If traders, manufacturers and distributors follow any foul trade, this act protects their rights as a consumer.

This Protection Act covers entire goods and services of all sectors that are public, private, or cooperative sectors, except those exempted by the central government. The act provides a floor for a consumer where one can file their complaint against the product and the forum takes an action against the concerned supplier and compensation is granted to the consumer for the inconvenience he/she has encountered. The objectives of the consumer petition act may be summarised as –

• To Provide better and all round protection to consumer.
• To Provide machinery for the speedy redressal of the grievances.
• To Create framework for consumers to seek redressal.
• To Provide rights to consumers.
• To Safeguarde rights of Consumers.

What are the rights of consumers ? Let us know more about the rights of consumer. Listed below are the Rights of the Consumer

(27)

• Right to Safety- Before buying, a consumer can examine on the quality and guarantee of the goods and opt for ISI or AGMARK products.
• Right to Choose- Consumer must have the right to choose from a variety and number of goods and in a competitive price
• Right to be informed- The buyers must be provided with complete information with all the necessary and adequate details of the product, make her/him act wise, and change the buying decision.
• Right to Consumer Education- The consumer must be aware of his/her rights and avoid exploitation.
• Right to be heard- The consumer will get due attention to express their grievances at a suitable platform.
• Right to seek compensation- The consumer has the right to seek or ask for redressal against unfair and inhumane practices or exploitation of the consumer.

Now it is better to discuss some case laws of the Hon’ble Supreme Court and Hon’ble NCDRC which are summarized here as follows:-

In  R V Prasannakumaar v. Mantri Castles Pvt Ltd., 2019 SCC On Line SC 224, under the terms of the ABA, possession of the flats was to be handed over to the buyers on 31 January 2014. However, the developer received an occupation certificate only on 10 February 2016 and it was thereafter from May 2016 that the developer started issuing letters offering possession. Based on this, the NCDRC awarded compensation in the form of interest at the rate of 6 per cent per annum. The developer had pleaded that since the

(28)

agreement provided compensation at the rate of Rs.3 per square foot per month for delayed possession, the purchasers were not entitled to anything in addition. Dealing with the submission, this Court observed:

“9. We are in agreement with the view of the NCDRC that the rate which has been stipulated by the developer, of compensation at the rate of Rs.3 per sq. ft. per month does not provide just or reasonable recompense to a flat buyer who has invested money and has not been handed over possession as on the stipulated date of 31 January 2014. To take a simple illustration, a flat buyer with an agreement of a flat measuring a 1000 sq. ft. would receive, under the agreement, not more than Rs. 3000/- per month. This in a city such as Bangalore does not provide just or adequate compensation. The jurisdiction of the NCDRC to award just compensation under the provisions of the Consumer Protection Act, 1986 cannot in the circumstances be constrained by the terms of the agreement. The agreement in its view is one sided and does not provide sufficient recompense to the flat purchasers.”  

The Court observed that there was a delay of two years and hence the award of interest at the rate of 6 per cent was reasonable and justified.  

In Pioneer Urban Land and Infrastructure Limited v. Govindan Raghavan, (2019) 5 SCC 725, there was a delay of almost two years in obtaining an occupancy certificate after the date stipulated in the ABA. As a consequence, there was a failure to provide possession of the flat to the purchaser within a reasonable period. This Court dwelt on the terms of the ABA under which the builder was

(29)

entitled to charge interest at 18 per cent per annum for the delay in payment of instalments by the purchaser. On the other hand, the failure to provide possession on the part of the developer was subject to a grace period of twelve months followed by a termination notice of ninety days and a further period of ninety days to the developer to effect a refund. Adverting to these clauses, the court noted:

“6.4. A perusal of the apartment buyer's agreement dated 8-5- 2012 reveals stark incongruities between the remedies available to both the parties. For instance, Clause 6.4(ii) of the agreement entitles the appellant builder to charge interest @18% p.a. on account of any delay in payment of instalments from the respondent flat purchaser. Clause 6.4(iii) of the agreement entitles the appellant builder to cancel the allotment and terminate the agreement, if any instalment remains in arrears for more than 30 days. On the other hand, as per Clause 11.5 of the agreement, if the appellant builder fails to deliver possession of the apartment within the stipulated period, the respondent flat purchaser has to wait for a period of 12 months after the end of the grace period, before serving a termination notice of 90 days on the appellant builder, and even thereafter, the appellant builder gets 90 days to refund only the actual instalment paid by the respondent flat purchaser, after adjusting the taxes paid, interest and penalty on delayed payments. In case of any delay thereafter, the appellant builder is liable to pay interest @9% p.a. only. 6.5. Another instance is Clause 23.4 of the agreement which entitles the appellant builder to serve a termination notice upon the respondent flat purchaser for breach of any contractual obligation. If the respondent flat

(30)

purchaser fails to rectify the default within 30 days of the termination notice, then the agreement automatically stands cancelled, and the appellant builder has the right to forfeit the entire amount of earnest money towards liquidated damages. On the other hand, as per Clause 11.5(v) of the agreement, if the respondent flat purchaser fails to exercise his right of termination within the time limit provided in Clause 11.5, then he shall not be entitled to terminate the agreement thereafter, and shall be bound by the provisions of the agreement.”  

Hon’ble Justice Indu Malhotra speaking for the Court noted:

“6.8. A term of a contract will not be final and binding if it is

shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the agreement dated 8-5-2012 are ex facie one-sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1)(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the builder.” The Court observed that in these circumstances, the flat purchasers could not be compelled to obtain possession which was offered almost two years after the grace period under the agreement had expired. Hence, the NCDRC was held to have correctly awarded interest at the rate of 10 percent per annum.  The decision of this Court in Dhanda Case 2019 SCC On Line SC 689  has been relied upon by learned Senior Counsel appearing on behalf of the developer as elucidating the principle that where a flat buyers

(31)

agreement stipulates a consequence for delayed possession, exceptional and strong reasons must be established before the forum constituted under the Act of 1986 awards compensation in addition to what has been contractually agreed. In Dhanda’s case, the SCDRC issued a direction for handing over physical possession of the residential unit to the complainant and for execution of a sale deed. In addition, compensation was awarded by way of interest at the rate of 12 per cent per annum with effect from twelve months after the stipulated date under the agreement. In an appeal by the developer, the NCDRC directed that the rate of interest for a house building loan for the corresponding period in a scheduled nationalised bank would be appropriate and if a floating rate of interest was prescribed, the higher rate of interest should be taken for the computation. A sum of Rs. 1 lac per annum from the date for handing over possession to the actual date of possession was regarded as appropriate in the facts of the case. In that case under the terms of the buyer’s agreements, possession was to be delivered within twenty-four months of the execution of the agreement i.e. 10 February 2013 – failing which the developer was liable to pay compensation at the rate of Rs.10 per square foot per month for the delay. The developer contended that construction activities were delayed as a result of an injunction granted by this Court over a period of eight months and consequently sought an extension of the period for handing over possession by one year. Alternatively, the developer offered to refund the money deposited with interest at 9 per cent per annum. Construction of 258 independent floors was completed while about 1,500 units

(32)

were nearing completion. In two sets of Civil Appeals which came up before this Court earlier, agreed terms were arrived at providing for the award of interest at 9 per cent per annum from the date of deposit till refund. While considering the order of the NCDRC, this Court observed:  

“16. The District Forum under the Consumer Protection Act, 1986 is empowered inter-alia to order the opposite party to pay such amount as may be awarded as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party including to grant punitive damages. But the forums under the Act cannot award interest and/or compensation by applying rule of thumb. The order to grant interest at the maximum of rate of interest charged by nationalised bank for advancing home loan is arbitrary and no nexus with the default committed. The appellant has agreed to deliver constructed flats. For delay in handing over possession, the consumer is entitled to the consequences agreed at the time of executing buyer's agreement. There cannot be multiple heads to grant of damages and interest when the parties have agreed for payment of damages at the rate of Rs. 10/- per sq. ft. per month. Once the parties agreed for a particular consequence of delay in handing over of possession then, there has to be exceptional and strong reasons for the SCDRC/NCDRC to award compensation at more than the agreed rate.”  

Now the interest may be 6% to 10% in favour of the allottees if they have not been given possession of the flat/plot within promised or within a reasonable time. The complainant has deposited the entire agreed cost of the flat before June 2009. Now it is the duty and obligation of the

(33)

 opposite party to deliver the possession within stipulated time but they failed to do so.  

In  the  case  of   PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC).These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 34 of 2013- Jasleen Viswanathan &Anr. Vs. Parsvnath Developers Ltd. &Anr; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. &Anr; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. &Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. &Anr.; 86 of 2010- Priyanka Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 101 of 2011- Mohd. Aslam Khan &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath Developers Ltd. &Anr; 49 of 2012- Neera Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr; , 74 of 2011- Deepak Bhalla Vs. Parsvnath Developers Ltd. &Anr. ; 87 of 2010- Syed Gufran Ali Alvi&Anr. Vs. Parsvnath Developers Ltd. &Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd. &Anr.; 175 of 20130- Umesh Chandra Dixit &Anr. Vs. ParsvnathDevelopers ;byLtd. &Anr.; 97 of 2011- Pravin Kumar Goel &Anr. Vs. ParsvnathDevelopers Ltd. &Anr. which complaints were partly allowed.

          The  Hon’ble  NCDRC  held that:

“Brief facts of the cases are that opposite parties/respondents are engaged in the activity of housing construction and accordingly they have launched a project

(34)

 named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave peacefully in their own houses, since the complainants are living in rented houses.

The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted

(35)

the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for the recovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved  by  the  order  of  Hon’ble  State  Commission, these  appeals preferred  before Hon’ble National  Consumer  Disputes  Redressal  Commission.

Hon’ble  NCDRC discussed various  case  laws  and  after  hearing  the  parties held,

“Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under  and complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of

(36)

price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under  

 Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 ( c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months

(37)

and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession.

Against this judgment, parties went to Hon’ble  Supreme  Court. The judgment of Hon’ble  Supreme  Court is:-  

In  Nalin Bhargava  vs  Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018 , Hon’ble Supreme Court held:-

          “Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc.          

             It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies have

(38)

been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition  of  costs as compensation.  

            Mr. Sachin Datta, learned senior counsel appearing for the developer has raised   objections    with regard to imposition of costs.  

            Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say “cost”, we mean costs alone and nothing else.”  

            In the case of Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra [Civil Appeal No. 3182 of 2019 @ SLP (C) No(S). 1795 of 2017] judgement delivered on 25.03.2019 , the Hon’ble Supreme Court has held:-  

            “Interestingly, where the buyer is in default, the agreement stipulates that interest at the rate of 18 per cent from the date of default until the date of payment would be charged for a period of two months, failing which the allotment would be cancelled by deducting 5% of the entire value of the property. The agreement was evidently one sided. For a default on the part of the buyer, interest at the rate of 18% was liable to be charged. However, a default on the part of the developer in handing over possession would make him liable to pay interest only at the savings bank rate prescribed by the SBI. There is merit in the submission which has been urged by the buyer that the agreement was one sided.

(39)

            In  the Case  of Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors.  Versus  DLF Southern Homes Pvt. Ltd (now Known as BEGUR OMR Homes Pvt. Ltd.) and Ors.   (Civil Appeal No. 6239 of 2019 With Civil Appeal No. 6303 of 2019); The  Hon’ble  Supreme  Court  has  held:-  

            “24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression “service” in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present

(40)

case is guilty of a delay of years in the fulfillment of a contractual obligation. To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice.

            Undoubtedly, as this court held in Dhanda, courts ordinarily would hold parties down to a contractual bargain. Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers. Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain.”

            These builders are just earning money from the consumers to whom they issued allotment letters and got a huge amount. They keep this amount for a long time and earn interest on it. Property dealing is that part of business where they never pay a penny to the consumers on their amounts deposited for a long-term or if they pay, they pay a meagre interest of about 5% or so but they charge 18 to 24% or more if the consumers default in depositing any instalment. It reminds us the story of “The Merchant of Venice” The Merchant of Venice is the story of a Jewish money lender Shylock who demands that an antisemitic Christian offer “a pound of flesh” as collateral against a loan. These acts

(41)

of builders also remind us the age of  Sahukari during ancient India and also during British Raj. Whether these builders have power to frame their own law? They put their terms and conditions in such a way that the sufferer will always be the consumer. The Consumer Protection Act 1986 has been enacted for the benefits of consumers,  so the courts dealing with Consumer Protection Act 1986 should come forward for their rescue. The courts are not governed by the builders but they are governed by the law, Custom and Usages. Now in the background of all the facts and also the facts of the present case, we will also discuss something more.

Now it is clear that there is deficiency of service on the part of the opposite party and also they are liable for unfair trade practice. For calculating the compensation/damages we are inclined that after two years the complainants are entitled to get the reliefs from the opposite parties. In the present case the allotment letter has been issued on 21 February 2006 and the delivery of possession was promised to be given in 42 months including grace period of six months. So in the present case the cut-off date is  01.09.2009 . This is the date from which the amount of compensation/damages and other shall be calculated. The area of the concerned flat is 190.44 m². Keeping in view all the above mentioned facts, we come to the following conclusions:-

This is a case where the allottee has been given an allotment letter on 21 February 2006 and flat buyer agreement executed on 16 September 2006 and thereafter the complainant and opposite parties entered into an agreement  for giving the possession of unit number  T 1-604. The

(42)

allotment letter has specifically offered the delivery of possession of the unit within 36 months with grace period six months total 42 months meaning thereby that the said unit was to be handed over by August 2009.

In this case the opposite parties issued many letters extending the time of delivery of possession but failed to deliver the possession within stipulated time. The opposite parties were showing daydreams to the complainant and other allottees but actually they were earning interest on the deposited amount of the allottees. A person who invests such a huge amount to get a flat for himself and his family must come under pressure and depression if not get the flat within time. The offer given by the opposite parties has been accepted by the complainant so now the opposite parties are bound by the promise and it is the duty to provide the flat within the time as specified by them. This is a clear case of deficiency in service and unfair trade practice.  

One cannot understand that when a flat has been allotted to person of area, how is it possible to increase the area of the flat during construction. The area becomes clear at the time of foundation of the building. When the parties have entered into an agreement for the purchase of a flat having a definite area, how the area can be increased during construction. The complainant is entitled to the flat of agreed area. If it is increased, he cannot be compelled to pay for it. It is said that because the buyer has put his signature on the builders buyers agreement, he shall be liable according to the terms and condition of the agreement. Whether these conditions are unilateral? The builder is also liable by the condition of the

(43)

 agreement. If he fails to deliver the possession of the flat within the agreed time as mentioned in the builders/flat buyers agreement, he will also be liable foregoing beyond the terms and conditions of the agreement. Therefore in the present case the buyer is not liable to pay any extra amount in addition to the increased area of the flat because the seller failed to provide the flat within stipulated time.

The complainant visited the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of August 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled. The complainants were under pressure to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save their allotment from cancellation. The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainants on the scheduled period, that is in the month of August , 2009. The complainants visited the construction site of the opposite parties after depositing the entire amount when it was revealed that still the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2020. Even the partial construction done by the opposite parties was

(44)

 defective and did not match the specification provided in the agreement. The complainants felt shocked on hearing the aforementioned statement and immediately contacted the area manager who told the complainant that there is some delay in the construction of the apartment and the apartments shall be ready till  June, 2010. So from the very beginning the opposite parties were defrauding the complainant as well as other allottees either on one pretext or on other pretext. They were being kept in the dark regarding timely construction of the flat. All these show the character of the opposite parties. A lengthy  builders buyers agreement is prepared in which heavy penalty is proposed in case of non-payment of instalments by the buyer and also exorbitant rate of interest is levied. Interest at a rate of 24 % is a penal interest. So it shows that the builders are within their safe area and it is the buyer who always suffers.

In the present case one peculiar thing has happened. The opposite parties directed the complainant to prepare a draft of ₹ 25,100/– in the name of Mr Rajesh Chadha advocate who is conducting the consumer cases of the builder before this Hon’ble State Commission. It is really strange that such a letter has been written by the opposite parties to the complainant. The complainant has nothing to do with the fee of opposite parties counsel. This only shows the mentality of the opposite party, the builders. Was there any such condition in the allotment letter or read buyer agreement? This shows how the illegal money can be dragged from the allottees. In spite of this letter, letter has also been issued on 14 February 2017 in which the opposite parties demanded

(45)

₹47,560/towards IFSD, ₹ 5,76,800/ towards the stamp duty charges and ₹ 25,100/towards advocate  fee in the name of Mr Rajesh Chadha and this demand is in contravention of the terms and condition of the agreement. We have also seen such a letter for the first time in this Hon’ble state commission.

So in the present case we, after perusing all the pleadings, evidence is, documents and both the reports of advocate commissioner’s come to the conclusion that it is a clear case of deficiency of service and unfair trade practice on the part of the opposite parties. Keeping in view the judgement is of the different Hon’ble higher courts we come to the conclusion that the complainant is entitled to the following reliefs:-

1. The opposite parties are jointly and severally liable to hand over the possession of unit no. T 1- 604, in the Parswanath Planet ,Lucknow within within 60 days from the date of judgment of this Complaint case and they will not charge any penny in future except the monthly maintenance charge that too after handing over the possession with completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department and the opposite parties shall also pay interest at a rate of 10% on the deposited amount to the complainants from 01.09.2009 till the date of giving of actual possession of the said unit  . If it is not complied

(46)

with, within 60 days from the date of judgment of this complaint case, the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.01.2009 till the date of actual payment.

2. We are of the view that the complainants are entitled to get monthly damage according to the area. The area of the said unit is 190.44 square metres and keeping in view the judgment of Hon’ble NCDRC in the case of Priyanka Mittal (supra), the opposite parties are jointly and severally directed to pay ₹ 20,000/- per month from 01.09.2009 till the date of compliance of this order and the order shall be complied with within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.09.2009 till the date of actual payment.
3. The complainants are entitled to get ₹ 150,000/– in view of Nalin Bhargava Case (supra) as cost.
4. In the relief clause of the complaint, the complainant has prayed that any other order which This Hon’ble State Commission may deem fit and proper in the circumstances of the case may also be passed. So keeping in view all the fraud committed in this case, all the harassment and mental agony given to the complainants , we find that the complainants are also entitled to get Rs.20 lakhs with interest
47.  

@ 10% from 01.09.2009 till the date of actual payment towards payment of rent of the flat, mental harassment, agony and sufferings and the order shall be complied within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.01.2011 till the date of actual payment.

5. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

The present complaint is decided accordingly.

ORDER

1. The complaint is allowed with cost. The opposite parties are jointly and severally liable to hand over the possession of unit no. T 1-604, in the Parswanath Planet ,Lucknow  within within 60 days from the date of judgment of this Complaint case and they will not charge any penny in future except the monthly maintenance charge that too after handing over the possession with completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department and they shall also pay interest at a rate of 10% on the deposited amount to the complainants from 01.09.2009 till the date of giving of actual possession of the said unit  . If it is not complied with, within 60 days from the date of judgment of this complaint case, the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount.

(48)

2. The opposite parties are jointly and severally directed to pay ₹ 20,000/- per month from 01.09.2009 till the date of delivery of possession of the said flat with interest at a rate of 10% per annum and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.09.2009 till the date of actual payment.
3. The opposite parties are jointly and severally directed to pay the complainants ₹ 150,000/– as cost in view of Nalin Bhargava Case (supra) with interest at a rate of 10% from 01.09.2009 till the date of delivery of possession of the said flat and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.09.2009 till the date of actual payment.
4. The opposite parties are jointly and severally directed to pay the complainants ₹ 20 lakhs towards payment of rent of the flat, mental harassment, agony and sufferings ,with interest at a rate of 10% from 01.09.2009 till the date of delivery of possession of the said flat and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount from 01.01.2009 till the date of actual payment.

(49)

5. No amount shall be adjusted by the opposite No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

All the decreetal amount shall be paid within 60 days from the date of judgment of this appeal otherwise the opposite parties shall pay interest at a rate of 15% per annum on all the decreetal amount. If it is not paid within 60 days from the date of judgment of this appeal, the complainants shall be entitled to present Execution proceedings before this court at the cost of the opposite parties.

The stenographer is requested to upload this order on the Website of this Commission today itself.

Certified copy of this judgment be provided to the parties as per rules.     

      (Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                          President

Judgment dated/typed signed by us and pronounced in the open court.

Consign to the Record Room.

     (Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                          President

Jafri, PA II

Court 1

          Reserved

State Consumer Disputes Redressal Commission

U.P. Lucknow.

Complaint  Case No.142 of  2011

1- Mrs. Veera Srivastava, aged about 50 years wife of

    Late Sri Raj Krishna Srivastava, R/o B-26, Police

    Line, University Road, Lucknow. through legal heirs.

2- Arjun Krishna, aged about 25 years, s/o Late Sri

    Raj Krishna Srivastava, R/o B-26, Police Line,

    University Road, Lucknow.

3- Smt. Anupriya w/o Mr. Saumitra Verma, R/o 204B

     Wing, Cosmic Heights, Bhakti Park Wadala (East),

     Mumbai.

1. Divya Srivastava d/o late Veera Srivastava,

R/o T-5/804, Parsvnath Planet, Vibhuti Khand,

Gomti Nagar, Lucknow.…. COMPLAINANTs

versus

1. PARSVNATH DEVELOPERS LIMITED, registered and Corporate office situated at 6^th floor, Arunachal Building, 19, Barakhamba Road, New Delhi, through its Chairman.
2. PARSVNATH DEVELOPERS LIMITED, (PARSVNATH PLANET) situated at Plot No. TCG-8-9, Vibhuti Khand, Gomti Nagar, Lucknow, through its Managing Director.                      …. OPPOSITE PARTIES        

                         Present:-

1- Hon’ble Justice Sri Ashok Kumar, President.

2- Hon’ble Sri Rajendra  Singh, Member.

Sri Piyush Mani Tripathi, Advocate for the complainants.

Sri Rajesh Chaddha, Advocate for Opposite Parties.

Date : 13 .04 .2022

JUDGMENT

Per Mr. Rajendra Singh, Member: This complaint has been filed by the complainant under section 17 of the Consumer Protection Act, 1986.  

The brief facts of the complaint case are that, that by this complaint, the complainant has prayed for a direction to the opposite parties to deliver the physical possession of the

(2)

fully finished/developed Flat No. T5-804 having an area 2175 ft², further prayed that this Hon’ble Commission may graciously be pleased to direct the opposite parties to pay an interest @ 24% on the amount deposited by the complainant from the respective dates of deposition till the date of delivery of possession along with the damages stipulated in the agreement dated  06.06.2006 , to direct the opposite parties to pay a sum of Rs.5 Lacs as damages, to direct the opposite parties to pay a sum of Rs.5 Lacs as compensation for the loss of rent occasioned by the complainant, to direct the opposite parties to pay the difference in the cost of escalation which shall be incurred at the time of the execution of the registered sale deed, to direct the opposite party to pay Rs.50,000 towards cost of the case, to direct the opposite parties to execute and extract any further amount in terms of interest on balance amount of Rs.266,582/ which as per the records is outstanding against the complainants , to pass order which the  Hon’ble Commission may deem it fit and proper under the circumstances of this case.

The opposite parties are a limited company which are engaged in the construction of the flats with all the basic civil amenities. They launched a project known as Parsvnath Planet. Opposite parties on 27^th April 2006 published advertisement to the effect that they have purchased the land from the Lucknow Development Authority, Lucknow and have taken the possession from the Authority and started the construction of the Apartments and invited the applications for allotment of the Flat.

The opposite parties committed to the consumer of the project that the construction work of the unit as well of the

(3)

project shall be completed within a period of 36 months. The complainants on 21.10.2009 got the flat, T 5-804 transferred in their name on paying the entire accrual  amountto the transferee and the opposite parties respectively. The opposite parties at the time of the deposit of the aforementioned amount assured the buyer for delivery of the possession of the apartment till January 2010. Earlier Smt Saroj applied for purchasing the flat and the agreement between her and the opposite parties was executed on 06.06.2006 pertaining to flat no T 2 301, Block T-2 having approximately 1625 sq ft and the total cost of flat was fixed at Rs.2,763,750/– at a rate of Rs.1650 per square metre. The flat number T 2-301 was transferred in the name of Mr. SaroshShere bySaroj wife of late  Sri Hari Prakash, resident of  House number 381, village- Nilothi, Post- office -Nangloi, New Delhi on 29.06.2006 . The allotment of flat no T 2-301 was shifted to T 5-804 having an area of 2175 ft² approximately in the name of Mr. Sarosh Shere resident of 3, Quinton Road, Lalbagh, Lucknow after the payment of the difference amount @ Rs 1900 ft² on 03.08.2006 , thereafter on demise of Mr. Sarosh Shere, the same was endorsed in the name of his wife Smt. Amna Sher.

Flat number T 5-804 was transferred in the name of the complainant, Smt Veera Srivastava and Sri Arjun Krishna , by Mrs Amna Sher  upon making good the payment of entire accrual amount to the transferee and the opposite party respectively on 21.10.2009 . The payment of instalments amount towards the allotted apartment was duly made within the stipulated period, to the opposite parties on relevant, respective dates. The opposite parties informed the

(4)

complainant vide letter dated 12.02.2010 that as per their rescheduling, they plan to complete the project by December 2011 and the assured the complainant that they shall be duly compensated for delay by way of penalty as per clause 10 ( c) of the Flat Buyer Agreement which shall be settled at the time of the possession. The opposite parties vide letter dated 05.05.2011 informed the complainant that the construction was progressing on a steady basis and the construction and finishing activities would be completed by December 2011. The opposite parties vide letter dtd 11.10.2011 informed the complainant that they should pay an outstanding amount of ₹ 266,582/– per their record against the said unit T 5-804 and the interest on delayed period that is Rs.4413/– as on that date. The complainants visited the construction site to ensure that the amount paid by her is being utilised by the opposite parties in terms of raising the construction and finishing activities so that she may possess her apartment within the stipulated period, as enumerated in the agreement, but it was revealed that there was hardly any finishing activities for the project was going to be completed on the site. She lodged a protest with the opposite parties, who did not give any reply till date. Instead of replying, the opposite parties attracted interest at a rate of 24% to the amount of Rs.266,582/– which amounted to Rs.13,177/– as on date. This is an act highly arbitrary on their part. When the complainant visited the construction site, the person available on the site told the complainant that the apartments are likely to be finished till 2015. Even the construction done by the opposite parties was defective and did not match the specifications provided in the agreement.

(5)

The complainant had to undergo a lot of mental agony and stress by the attitude of the opposite parties, since opposite parties failed to abide with their promise to provide the possession of the apartment till December 2011 which caused the complainant loss of rent as well. The daily newspapers disclosed the fraudulent and deceptive act of the opposite parties and when the news of the cancellation of the allotment was published, by means of which it was revealed that the Lucknow Development Authority has threatened the builder/opposite parties that the allotment of the project shall be cancelled on account of the default committed by the opposite parties. It is amply clear that the opposite parties has obtained huge sum of money from the entire allottees of the scheme and instead of putting/using the same for the development of the flats, misappropriated the same, for which the opposite parties are liable to produce the expenditure and account statement of the scheme before this  Commission. The opposite parties have committed serious deficiency in services by not delivering the physical possession of the allotted apartment to the complainant till December 2011 in term of the agreement and assurances. The opposite parties are also accountable for unfair trade practice since they have enjoyed and utilised the hard earned money of the complainant without providing the possession of the apartment. The complainant is the consumer of the opposite parties within the term, meaning and expression as is provided for the consumer under the The Consumer Protection Act, 1986. Therefore it is most respectfully prayed that this Hon’ble commission may graciously be pleased to allow the complaint.

(6)

The opposite parties submitted the reply and stated that they have not, at any point of time, violated or breach the provisions of the Flat Buyer Agreement dated 06.06.2006  . The complaint has been filed without any cause of action. The complainants had not been able to establish any deficiency of service or consumer dispute as contemplated under the Consumer Protection Act 1986. The complaint is therefore liable to be dismissed in limine. The complainants have prayed for reliefs which otherwise have to be claimed in a suit for damages and recovery of possession, after paying appropriate court fees. In order to avoid the payment of court fee, the complainants have raised a dispute of a civil nature, which requires deliberate evidence to be led and which cannot be adjudicated under the summary jurisdiction of this Hon’ble Commission. As per the Flat Buyers Agreement entered into between the complainants and the opposite parties, both have agreed upon their respective liabilities in case of breach of any of the conditions specified therein. It is submitted that the liability of the opposite parties on account of delay is specified in para-10( c) Of the Flat Buyer Agreement and as such the complainants cannot claim reliefs which are beyond the compensation agreed upon by them. The dispute between the parties involved complicated questions of fact and law, which necessarily entail the leading of copious evidence. The issues raised by the complainants are cannot be addressed in a before this Hon’ble Commission which follows a summary procedure. The complainant has been filed without any legally justifiable cause of action and is rendered liable to be dismissed with exemplary cost.

(7)

The complainants are defaulter as the complainants have still to pay an amount of Rs.266,581/– being the principal amount still outstanding as per calls made and interest accrued thereon. Apart from the aforesaid amount, 5% amount of Rs.185,687/– is also payable by the complainants herein at the time of possession, thus more than Rs.5 Lacs is due and payable by the complainant to the opposite parties. Until such payment is made in totality, including but not limited to payments with regard to maintenance, registration fees et cetera, the possession of the said flat cannot be handed over to the complainants. Further there has been no agreement of understanding towards payment of 24% interest by the opposite parties to the complainants and even otherwise the same does not arise. It is wrong and denied that the complainants have suffered any damages which will necessitate the payment of any compensation, damages and cost. Physical possession of the flat shall be given by the opposite parties to the complainants as soon as the construction is complete and only upon receipt of all outstanding payments from the side of the complainants and fulfilment of all formalities. As per clause 10 (c) of the agreement entered by both parties, in case of delay by the opposite parties, the liability of the opposite parties is limited to ₹ 5 per square feet, per month after 42 months have elapsed and subject to other conditions et cetera that is the limit of liability has been fixed as per the termsand conditions of the agreement as agreed to in writing by both the parties. It is submitted that the opposite parties did not issue any such advertisement as alleged.

(8)

It is submitted that originally one Smt. Saroj wife of Sh Hari Prakash resident of House number 381, village Nilathi, PO Nangloi , New Delhi had entered into a Flat Buyer Agreement with the opposite parties on 6 June 2006 for purchase of one flat number T 2 – 301 situated at Parswanath Planet, Vibhuti Khand, Gomti Nagar, Lucknow having an area of 1625 ft² which was allotted to her. Thereafter, the said allottee Smt. Saroj transferred the said allotted flat in favour of one Sh. Sarosh Shere on 29 June 2006. The said New transferee requested the opposite parties for allotment of flat number T 5-804 of four bedrooms and having an area of 2125 ft² super area, costing Rs.3,874,750/– instead of the originally allotted flat number T 2-301 consisting of three bedrooms. The said request was acceded to by the opposite parties vide its letter dated 03.08.2006 and flat number T 5-804 was allotted to  Sh. Sarosh Shere in lieu of the earlier flat. The said Sh. Sarosh Shere expired leaving behind him, his wife Smt. Aamna Shere. The flat number T 5-804 was therefore transferred to the name of Smt. Aamna Shere. The complainant, Smt. Veera Srivastava who has filed the present complaint, purchased the flat number T 5-804 jointly in her name and Sh. Arjun Krishna from the said Smt. Aamna Shere, on 21.10.2009. The said flat number T 5-804 was transferred to the name of the complainants in pursuant to an application dated 21.10.2009 made in this behalf. The tentative cost of the said flat was Rs.3,874,750/– having the basic cost of Rs.37,13,750/–, Rs.1 lakh is payable as car parking charges and R.60,900/– towards Freehold charges. In this regard it is important to that Smt. Veera Srivastava was fully aware that the construction activity at the site was

(9)

delayed, particularly when she herself purchased and got the said flat transferred to her name on 21.10.2009.

A total amount of Rs.2,909,075/– was already paid by the predecessors of the complainant no 1 herein and her co-allottee, before the complainant no 1 and her co-allottee purchased the flat. Thereafter till date, the complainants herein have paid only Rs.6.20 lakhs to the opposite parties and the complainants have still to pay an amount of Rs.266,581/– being the principal amount is still outstanding as per calls made and the interest accrued thereon. Apart from the aforesaid amount, 5% amount of Rs.185,687/– is also payable by the complainants here in at the time of possession, thus more than Rs.5 Lacs is due and payable by the complainants to the opposite parties. As per terms and conditions of the Flat Buyer Agreement executed in respect of the flat, it is a stipulated in clause 10 (b) and clause 10(c) that the construction of flats are to be completed in 36 months +6 months grace period, subject to force majeure and other circumstances as narrated in clause 10 (a) of the said Flat Buyers Agreement, that is starting after December 2006, when all the NOC’s were made available, the flats were expected to be constructed by 30 June 2010. It is reiterated that the complainants were fully aware about the delay construction activity at the site at the time of purchase and transfer of the said flat in their favour from erstwhile allottee on 21 October 2009, as the delay had become evident after the economic turn down in the October 2008. Due to recession in the real estate industry all over India during the last 3 to 4 years has resulted in certain circumstances which are beyond the control of the opposite parties leading to the

(10)

 delay in construction, several bookings made by the applicants were cancelled/transferred, which further gave rise to a liquidity crisis. This resulted in progress of construction activity getting hampered beyond the control of the opposite parties. Despite all odds, the opposite parties have persisted with construction and major construction work at the site has been completed. All 540 flats in all 10 towers are duly constructed and finishing work of installing Windows, plastering, putting tiles et cetera is going on at the site and it is expected that the project will be completed by December 2012, and completion certificate from the Lucknow Development Authority shall be applied for. After receipt of the completion certificate, the possession of the flats would be offered to the respective allottees, including the complainants herein.Clause 10 (a) of the agreement for the kind consideration of this Hon’ble commission is extracted below-

“Clause 10 (a)

 construction of the flat is likely to be completed within a period of thirty six (36) months of commencement of construction of the particular block in which the flat is located with a grace period of six (6 )  month, on receipt of sanction of building plans/advised building plans and approvals of all concerned authorities including the Fire Service Department, Civil Aviation Department , traffic department, pollution control Department, as may be required for commencing and carrying on construction subject to force majeure, restraints of restrictions from any courts/authorities, non-availability of building materials, disputes with contractors/workforce et cetera and circumstances beyond the control of the

(11)

development 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 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”

A bare perusal of above clause of the agreement reveals that construction is to be completed within a period of 36 months with a grace period of six months from the date of commencement of the particular block in which the flat is located, on receipt of all necessary approvals including sanction of building plans, environmental clearances, et cetera, subject to force majeure and restraints/restrictions from any court/authorities, nonavailability of building materials and any circumstances beyond the control of the developers. The opposite party ,in this view, has not at any point of time breached the terms and conditions of the agreement. All the allottees of the opposite parties of the said project including the complainants were informed vide letter dated 12.02.2010 that the project is likely to be completed by March , 2011 and subsequently vide a letter dated 05.05.2011 , the allottees were informed that the project is likely to be completed by December 2011. Vide letter dated 12.02.2012 , the complainants were also apprised that delay in completing the project has been due to circumstances beyond the control of the opposite parties, including global recession which in particular a fact of the real estate sector all over. The allottees were also informed that the allottees will be compensated by

(12)

way of penalty as per clause 10 (c) of the flat buyer agreement, which the amount will be settled at the time of possession. Hence, the allottees, including the complainants, were assured that their interest is duly protected in terms of the Flat Buyer Agreement. The booking of the flat is governed by the terms of the Flat Buyer Agreement and the interest of the allottees, including the complainants are, are duly protected and they shall be compensated at a rate of ₹ 5 per square feet of the super area of the flat per month for the period of delay as per clause 10 (c) of the said Flat Buyer Agreement. Therefore, the Flat Buyer Agreement takes into effect the fact that there could be delay in construction of the flats and handing over possession thereof and therefore makes a contractual provisions for compensating the allottees. This also shows the bona fides of the opposite parties whose prime motto is customer satisfaction.

It is submitted that as per the lease deed , executed by the Lucknow Development Authority in favour of the opposite parties, that the construction is to be raised within five years of the sanction of the map by competent authority, which can further the extended by the payment of penalty. The opposite party no 1 has a pan- India presence and the opposite parties have completed work worth more than ₹ 120 crores at Parswanath Planet that is the present project alone, besides thousands of crores of rupees in various projects developed by the opposite parties. Work is also going on in various projects. Hence, no cause of misappropriation of funds as alleged by the complainant is substantiated or made out and therefore, the present complaint is liable to be dismissed at the threshold. The liability of the opposite party

(13)

with regard to the delay in handing over of possession is specified and limited in clause 10 (c) of the agreement, the complainants cannot override the and overreach the agreed stipulations of this clause limiting the liability of the opposite parties. However it is pertinent to mention here that there has been no delay or breach of the agreement on the part of the opposite parties and hence there is no obligation upon the opposite parties to compensate the complainants on any account. It is denied that any act of negligence or deficiency in service can be attributed to the opposite parties. The opposite parties did not cause any monetary loss to the complainants regarding the possession of the flat in question. The complainant’s have instituted a false, frivolous and vexatious complaint against the opposite parties and the same is liable to be dismissed. In this case there is no loss or injury or deficiency attributable to the opposite parties. There is no breakup to demonstrate to clarify as to how the amount has been arrived at. So it is respectfully prayed that the complainant of the complainants are make any be dismissed with exemplary cost.

We have heard the learned counsel for the appellant Mr. Piyush Mani Tripathi and learned counsel for the respondent Mr. Rajesh Chadha. We have perused the pleadings, evidence and documents present on record.

After going through the various documents, in a nutshell the following points are to be considered.

Flat Buyer Agreement executed on 06.06.2006 for flat number T5-804, area 2125 ft².

Housing loan  taken on 16.09.2006 from HDFC.

Price as per Flat Buyer Agreement – Rs.3,429,075/–

(14)

Date for delivery of possession – December 2009 and with six-month grace period , July 2010.

          03.12.2014 - complainant expired and her son was impeded vide application dated 12.09.2018 various letters have been issued by the opposite parties by which the extended the period of delivery of possession.

The opposite parties filed photocopy of the completion certificate issued by The Lucknow Development Authority only on 14.02.2022 in relation to tower  T-5. The completion certificate is of 12.01.2018 . No reason shown by the opposite parties that under what circumstances this completion certificate has not been filed in 2018 before the court and why did they retain it so long ? It means that this certificate is not a genuine one and it has been issued without proper inspection of the flat. The commission visited the spot in 2018 and again in 2022, according to both report the flat is not in habitable condition. The opposite party did not file NOC Of Fire Department, Pollution Department , Civil Aviation Department and also did not file Occupancy Certificate. So , after perusing this learned Commissioner  Report, the court on 7 March 2022, said that in view of the learned Commissioner’s report unless the defects of the said flat is removed and basic facilities provided, the flat in question is not habitable and it is not possible to get the possession of this flat. So it is clear that today this flat is not in or habitable condition and the opposite parties are not interested to make it lively.  

In the present case with the first buyer, the deed was executed on 06.06.2006 meaning thereby that the possession of the flat was to be delivered after 42 months. Later on this

(15)

flat was transferred by the first allottee to another person  Mr. Sarosh Shere on  29.06.06. During this period the said flat was shifted from T 2/ 301  to T5 /804 . This flat was ultimately purchased by the present owner on  21.10.09 . So if we calculate 42 months from 06.06.2006 , it comes 06.12.2009 . It means that the opposite parties were under an obligation to handover the delivery of possession of the flat on 06.12.2009 . We take it as January 2010 as the month on which delivery of possession of the flat concerned was to be delivered to the allottee. For every subsequent purchaser the date of delivery of possession could not be extended.

In this case this court appointed an advocate commissioner who visited the spot and submitted his report on  18.02.2022. According to this report the advocate commissioner has stated, “in flat number T-5/804 electricity+ maintenance are well without any complaint and RWA has no concern regarding flats construction of the flats, RWA is looking after only maintenance of all the towers, regular bills of T-5/804 regarding electricity and maintenance charges are being paid by the flat owner.” Regarding the factual position of the flat , the advocate commissioner has written, “I have visited first tower no T-5 and flat number 804 after knocking the door, one maid informed Mr Arjun Veer Srivastava , the flat owner, Mr. Arjun Veer Srivastava has informed through mobile the possession of the flat since August 2016, at present he is having no problem but before taking possession he carried all maintenance worker of the allotted flat out of his own pocket, he further informed that he is having possession of all receipts of the work completed out of his own pocket that was about ₹ 9.5 lakhs, the details of the work

(16)

was wiring, tiles, painting, plaster, doors and plumbing et cetera. Mr. Arjun Veer Srivastava has come that the opposite parties are insisting for withdrawal of the complainant when he asked for executing the sale deed, but this fact was denied by the officer of the opposite parties present at the time of inspection. The representative of the OP has informed that he is always ready to execute sale deed in terms of the brochure in favour of the allottee.” This shows that the flat owner has taken possession of the flat and has spent 9.5 lakhs for its finishing and it is surprising that the sale deed has not been executed till today. It shows the work and attitude of the opposite parties. In spite of pending this matter in the court, the opposite parties never intended to execute the sale deed.

The Consumer Protection Act, came into existence and implemented in 1986, provides Consumer Rights to prevent consumers from fraud or specified unfair practices. It safeguards and encourages and gives an opportunity to consumers to speak against insufficiency and flaws in goods and services. If traders, manufacturers and distributors follow any foul trade, this act protects their rights as a consumer.

This Protection Act covers entire goods and services of all sectors that are public, private, or cooperative sectors, except those exempted by the central government. The act provides a floor for a consumer where one can file their complaint against the product and the forum takes an action against the concerned supplier and compensation is granted to the consumer for the inconvenience he/she has encountered. The objectives of the consumer petition act may be summarised as –

• To Provide better and all round protection to consumer.

(17)

• To Provide machinery for the speedy redressal of the grievances.
• To Create framework for consumers to seek redressal.
• To Provide rights to consumers.
• To Safeguarde rights of Consumers.

What are the rights of consumers ?Let us know more about the rights of consumer. Listed below are the Rights of the Consumer

• Right to Safety- Before buying, a consumer can examine on the quality and guarantee of the goods and opt for ISI or AGMARK products.
• Right to Choose- Consumer must have the right to choose from a variety and number of goods and in a competitive price
• Right to be informed- The buyers must be provided with complete information with all the necessary and adequate details of the product, make her/him act wise, and change the buying decision.
• Right to Consumer Education- The consumer must be aware of his/her rights and avoid exploitation.
• Right to be heard- The consumer will get due attention to express their grievances at a suitable platform.
• Right to seek compensation- The consumer has the right to seek or ask for redressal against unfair and inhumane practices or exploitation of the consumer.

Now it is better to discuss some case laws of the Hon’ble Supreme Court and Hon’ble NCDRC which are summarized here as follows:-

(18)

In  R V Prasannakumaar v. Mantri Castles Pvt Ltd., 2019 SCC On Line SC 224, under the terms of the ABA, possession of the flats was to be handed over to the buyers on 31 January 2014. However, the developer received an occupation certificate only on 10 February 2016 and it was thereafter from May 2016 that the developer started issuing letters offering possession. Based on this, the NCDRC awarded compensation in the form of interest at the rate of 6 per cent per annum. The developer had pleaded that since the agreement provided compensation at the rate of Rs.3 per square foot per month for delayed possession, the purchasers were not entitled to anything in addition. Dealing with the submission, this Court observed:

“9. We are in agreement with the view of the NCDRC that the rate which has been stipulated by the developer, of compensation at the rate of Rs.3 per sq. ft. per month does not provide just or reasonable recompense to a flat buyer who has invested money and has not been handed over possession as on the stipulated date of 31 January 2014. To take a simple illustration, a flat buyer with an agreement of a flat measuring a 1000 sq. ft. would receive, under the agreement, not more than Rs. 3000/- per month. This in a city such as Bangalore does not provide just or adequate compensation. The jurisdiction of the NCDRC to award just compensation under the provisions of the Consumer Protection Act, 1986 cannot in the circumstances be constrained by the terms of the agreement. The agreement in its view is one sided and does not provide sufficient recompense to the flat purchasers.”

(19)

The Court observed that there was a delay of two years and hence the award of interest at the rate of 6 per cent was reasonable and justified.

In Pioneer Urban Land and Infrastructure Limited v. Govindan Raghavan, (2019) 5 SCC 725, there was a delay of almost two years in obtaining an occupancy certificate after the date stipulated in the ABA. As a consequence, there was a failure to provide possession of the flat to the purchaser within a reasonable period. This Court dwelt on the terms of the ABA under which the builder was entitled to charge interest at 18 per cent per annum for the delay in payment of instalments by the purchaser. On the other hand, the failure to provide possession on the part of the developer was subject to a grace period of twelve months followed by a termination notice of ninety days and a further period of ninety days to the developer to effect a refund. Adverting to these clauses, the court noted:

“6.4. A perusal of the apartment buyer's agreement dated 8-5- 2012 reveals stark incongruities between the remedies available to both the parties. For instance, Clause 6.4(ii) of the agreement entitles the appellant builder to charge interest @18% p.a. on account of any delay in payment of instalments from the respondent flat purchaser. Clause 6.4(iii) of the agreement entitles the appellant builder to cancel the allotment and terminate the agreement, if any instalment remains in arrears for more than 30 days. On the other hand, as per Clause 11.5 of the agreement, if the appellant builder fails to deliver possession of the apartment within the stipulated period, the respondent flat purchaser has to wait for a period of 12 months after the end of the grace

(20)

period, before serving a termination notice of 90 days on the appellant builder, and even thereafter, the appellant builder gets 90 days to refund only the actual instalment paid by the respondent flat purchaser, after adjusting the taxes paid, interest and penalty on delayed payments. In case of any delay thereafter, the appellant builder is liable to pay interest @9% p.a. only. 6.5. Another instance is Clause 23.4 of the agreement which entitles the appellant builder to serve a termination notice upon the respondent flat purchaser for breach of any contractual obligation. If the respondent flat purchaser fails to rectify the default within 30 days of the termination notice, then the agreement automatically stands cancelled, and the appellant builder has the right to forfeit the entire amount of earnest money towards liquidated damages. On the other hand, as per Clause 11.5(v) of the agreement, if the respondent flat purchaser fails to exercise his right of termination within the time limit provided in Clause 11.5, then he shall not be entitled to terminate the agreement thereafter, and shall be bound by the provisions of the agreement.”  

Hon’ble Justice Indu Malhotra speaking for the Court noted:

 “6.8. A term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the agreement dated 8-5-2012 are ex facie one-sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(1)(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or

(21)

practices for the purpose of selling the flats by the builder.” The Court observed that in these circumstances, the flat purchasers could not be compelled to obtain possession which was offered almost two years after the grace period under the agreement had expired. Hence, the NCDRC was held to have correctly awarded interest at the rate of 10 percent per annum.  

The decision of this Court in Dhanda Case 2019 SCC On Line SC 689  has been relied upon by learned Senior Counsel appearing on behalf of the developer as elucidating the principle that where a flat buyers agreement stipulates a consequence for delayed possession, exceptional and strong reasons must be established before the forum constituted under the Act of 1986 awards compensation in addition to what has been contractually agreed. In Dhanda’s case, the SCDRC issued a direction for handing over physical possession of the residential unit to the complainant and for execution of a sale deed. In addition, compensation was awarded by way of interest at the rate of 12 per cent per annum with effect from twelve months after the stipulated date under the agreement. In an appeal by the developer, the NCDRC directed that the rate of interest for a house building loan for the corresponding period in a scheduled nationalised bank would be appropriate and if a floating rate of interest was prescribed, the higher rate of interest should be taken for the computation. A sum of Rs. 1 lac per annum from the date for handing over possession to the actual date of possession was regarded as appropriate in the facts of the case. In that case under the terms of the buyer’s agreements, possession was to be delivered within twenty-four months of the execution of the agreement i.e. 10 February 2013 – failing

(22)

which the developer was liable to pay compensation at the rate of Rs.10 per square foot per month for the delay. The developer contended that construction activities were delayed as a result of an injunction granted by this Court over a period of eight months and consequently sought an extension of the period for handing over possession by one year. Alternatively, the developer offered to refund the money deposited with interest at 9 per cent per annum. Construction of 258 independent floors was completed while about 1,500 units were nearing completion. In two sets of Civil Appeals which came up before this Court earlier, agreed terms were arrived at providing for the award of interest at 9 per cent per annum from the date of deposit till refund. While considering the order of the NCDRC, this Court observed:

“16. The District Forum under the Consumer Protection Act, 1986 is empowered inter-alia to order the opposite party to pay such amount as may be awarded as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party including to grant punitive damages. But the forums under the Act cannot award interest and/or compensation by applying rule of thumb. The order to grant interest at the maximum of rate of interest charged by nationalised bank for advancing home loan is arbitrary and no nexus with the default committed. The appellant has agreed to deliver constructed flats. For delay in handing over possession, the consumer is entitled to the consequences agreed at the time of executing buyer's agreement. There cannot be multiple heads to grant of damages and interest when the parties have agreed for payment of damages at the rate of Rs. 10/- per sq. ft. per

(23)

month. Once the parties agreed for a particular consequence of delay in handing over of possession then, there has to be exceptional and strong reasons for the SCDRC/NCDRC to award compensation at more than the agreed rate.”

Now the interest may be 6% to 10% in favour of the allottees if they have not been given possession of the flat/plot within promised or within a reasonable time. The complainant has deposited the entire agreed cost of the flat before June 2009. Now it is the duty and obligation of the opposite party to deliver the possession within stipulated time but they failed to do so.  

In  the  case  of   PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC).These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 34 of 2013- Jasleen Viswanathan &Anr. Vs. Parsvnath Developers Ltd. &Anr; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. &Anr; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. &Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. &Anr.; 86 of 2010- Priyanka Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 101 of 2011- Mohd. Aslam Khan &Anr. Vs. Parsvnath Developers Ltd. & Anr.; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath Developers Ltd. &Anr; 49 of 2012- Neera Mittal &Anr. Vs. Parsvnath Developers Ltd. & Anr; , 74 of 2011- Deepak Bhalla Vs. Parsvnath Developers Ltd. &Anr. ; 87 of 2010- Syed Gufran Ali Alvi & Anr. Vs. Parsvnath Developers Ltd.

(24)

&Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd.  & Anr.; 175 of 20130- Umesh Chandra Dixit &Anr. Vs. Parsvnath Developers ;byLtd. &Anr.; 97 of 2011- Pravin Kumar Goel &Anr. Vs. Parsvnath Developers Ltd. &Anr. which complaints were partly allowed.

          The  Hon’ble  NCDRC  held that:

“Brief facts of the cases are that opposite parties/respondents are engaged in the activity of housing construction and accordingly they have launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave peacefully in their own houses, since the complainants are living in rented houses.

(25)

“The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for the recovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved  by  the  order  of  Hon’ble  State  Commission, these  appeals preferred  before Hon’ble National  Consumer  Disputes  Redressal  Commission ”.

(26)

Hon’ble  NCDRC discussed various  case  laws  and  after  hearing  the  parties held,

“Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under  and complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under  ”

“Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in

(27)

the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10 ( c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession.”

Against this judgment, parties went to Hon’ble  Supreme  Court. The judgment of Hon’ble  Supreme  Court is:-

(28)

In  Nalin Bhargava  vs  Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018, Hon’ble Supreme Court held:-

          “Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc.          

            It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies have been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition  of  costs as compensation.

            Mr. Sachin Datta, learned senior counsel appearing for the developer has raised   objections    with regard to imposition of costs.

            Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say “cost”, we mean costs alone and nothing else.”  

            In the case of Kolkata West International City Pvt. Ltd. Vs. DevasisRudra[Civil Appeal No. 3182 of 2019 @ SLP (C) No(S). 1795 of 2017] judgement delivered on 25.03.2019 , the Hon’ble Supreme Court has held:-  

            “Interestingly, where the buyer is in default, the agreement stipulates that interest at the rate of 18 per cent from the date of default until the date of payment would be charged for a period of two months, failing which the allotment would be cancelled by deducting 5% of the entire value of the property. The agreement was evidently one

(29)

sided. For a default on the part of the buyer, interest at the rate of 18% was liable to be charged. However, a default on the part of the developer in handing over possession would make him liable to pay interest only at the savings bank rate prescribed by the SBI. There is merit in the submission which has been urged by the buyer that the agreement was one sided”.  

            In  the Case  of Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors.  Versus  DLF Southern Homes Pvt. Ltd (now Known as BEGUR OMR Homes Pvt. Ltd.) and Ors.   (Civil Appeal No. 6239 of 2019 With Civil Appeal No. 6303 of 2019);The  Hon’ble  Supreme  Court  has  held:-  

            “24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression “service” in Section 2 (1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond

(30)

the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfillment of a contractual obligation. To uphold the contention of the developer that the flat buyer is constrained by the terms of the agreed rate irrespective of the nature or extent of delay would result in a miscarriage of justice”.

“Undoubtedly, as this court held in Dhanda, courts ordinarily would hold parties down to a contractual bargain. Equally the court cannot be oblivious to the one-sided nature of ABAs which are drafted by and to protect the interest of the developer. Parliament consciously designed remedies in the CP Act 1986 to protect consumers. Where, as in the present case, there has been a gross delay in the handing over of possession beyond the contractually stipulated debt, we are clearly of the view that the jurisdiction of the consumer forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain.”

These builders are just earning money from the consumers to whom they issued allotment letters and got a huge amount. They keep this amount for a long time and earn interest on it. Property dealing is that part of business where they never pay a penny to the consumers on their amounts

(31)

deposited for a long-term or if they pay, they pay a meagre interest of about 5% or so but they charge 18 to 24% or more if the consumers default in depositing any instalment. It reminds us the story of “The Merchant of Venice” The Merchant of Venice is the story of a Jewish money lender Shylock who demands that an antisemitic Christian offer “a pound of flesh” as collateral against a loan. These acts of builders also remind us the age of  Sahukari during ancient India and also during British Raj. Whether these builders have power to frame their own law? They put their terms and conditions in such a way that the sufferer will always be the consumer. The Consumer Protection Act 1986 has been enacted for the benefits of consumers,  so the courts dealing with Consumer Protection Act 1986 should come forward for their rescue. The courts are not governed by the builders but they are governed by the law, Custom and Usages. Now in the background of all the facts and also the facts of the present case, we will also discuss something more.  

Now it is clear that there is deficiency of service on the part of the opposite party and also they are liable for unfair trade practice. For calculating the compensation/damages we are inclined that after 42 months the complainants are entitled to get the reliefs from the opposite parties. The cut-off date is 01.01.2010 . This is the date from which the amount of compensation/damages and other shall be calculated. The area of the concerned flat is 202.06 m². Keeping in view all the above mentioned facts, we come to the following conclusions:-

(32)

This is a case where the allottee has been given an allotment letter/flat buyer agreement executed on 06.06.2006  andthereafter the complainant and opposite parties entered into an agreement  for giving the possession of unit number  T 5-804. The allotment letter has specifically offered the delivery of possession of the unit within 36 months with grace period six months total 42 months meaning thereby that the said unit was to be handed over by December 2009. But the possession has not been handed over either one or the other pretext. The cut-off date for delivery opposition is taken as 01.01.2010 for all the purposes. The agreement was entered into with the first buyer but time of delivery of possession of the flat after 42 months is the crux of the Flat Buyer Agreement. The opposite parties issued many letters extending the time of delivery of possession but failed to deliver the possession within stipulated time. The opposite parties were showing daydreams to the complainant and other allottees but actually they were earning interest on the deposited amount of the allottees. A person who invests such a huge amount to get a flat for himself and his family must come under pressure and depression if not get the flat within time. The offer given by the opposite parties has been accepted by the complainant so now the opposite parties are bound by the promise and it is the duty to provide the flat within the time as specified by them. This is a clear case of deficiency in service and unfair trade practice.  

It is said that because the buyer has put his signature on the builders buyers agreement, he shall be liable according to the terms and condition of the agreement. Whether these conditions are unilateral? The builder is also liable by the

(33)

condition of the agreement. If he fails to deliver the possession of the flat within the agreed time as mentioned in the builders/flat buyers agreement, he will also be liable forgoing beyond the terms and conditions of the agreement. Therefore in the present case the buyer is not liable to pay any extra amount on account of any issue whatsoever it may be because the seller failed to provide the flat within stipulated time.

The complainant visited the construction site of the opposite parties where it was revealed that construction activities on the site was halted on which the protest was lodged with the opposite parties who assured that the possession shall be delivered in the month of June, 2009; and directed the complainant to deposit the installments regularly failing which interest @24% shall be charged and the allotment of the complainant shall be cancelled. The complainants were under pressure to deposit the installments on their due dates to avoid the liability of making the payment of penal interest @24% and to save their allotment from cancellation. The complainants claimed the possession of the allotted flat after depositing the total amount on their due dates, the same was avoided by the opposite parties on the pretext that the construction activities are on the peak and possession shall be delivered to the complainants on the scheduled period, that is in the month of June, 2009.  

The complainants visited the construction site of the opposite parties after depositing the entire amount when it was revealed that still the construction activities were on halt and the persons available on the site told the complainants

(34)

 that the apartments are likely to be completed by 2020. Even the partial construction done by the opposite parties was defective and did not match the specification provided in the agreement. The complainants felt shocked on hearing the aforementioned statement and immediately contacted the area manager who told the complainant that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. So from the very beginning the opposite parties were defrauding the complainant as well as other allottees either on one pretext or on other pretext. They were being kept in the dark regarding timely construction of the flat. All these show the character of the opposite parties. A lengthy  builders buyers agreement is prepared in which heavy penalty is proposed in case of non-payment of instalments by the buyer and also exorbitant rate of interest is levied. Interest at a rate of 24 % is a penal interest. So it shows that the builders are within their safe area and it is the buyer who always suffers.

So in the present case we, after perusing all the pleadings, evidence is, documents and both the reports of advocate commissioner’s come to the conclusion that it is a clear case of deficiency of service and unfair trade practice on the part of the opposite parties. Keeping in view the judgement is of the different Hon’ble higher courts we come to the conclusion that the complainant is entitled to the following reliefs:-

1. The opposite parties are jointly and severally liable to pay interest at a rate of 10% on whole of the deposited amount from hand over the

possession of unit no. T 5- 804, with complete finishing work, in the Parswanath Planet 01.01.2010 till the date of giving of actual possession of the said unit i.e, 31.08.2016 according to the advocate commissioner’s report dated 18.02.2022 though the flat was not fully finished for which relief is being given here . The opposite parties are directed not to charge any penny whatsoever it may be from 01.01.2010 to 31.08.2016 ,except the monthly maintenance charge that too from 31.08.2016if completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department has been provided to the complainant and in case the certificates have not been provided to the complainant, the opposite parties shall not charge any amount even towards maintenance till the date of providing a copy of the all of the above mentioned certificate to the complainant. The opposite parties are directed to pay the interest within 60 days from the date of judgement of this appeal and if they failed to pay, the rate of interest shall be 15% from 01.01.2010 till the date of actual payment.

2. We are of the view that the complainants are entitled to get monthly damage according to the area. The area of the said unit is 155.61 m² and keeping in view the judgment of Hon’ble NCDRC
36.  

in the case of Priyanka Mittal (supra), the opposite parties are jointly and severally directed to pay ₹ 15,000/- per month with simple interest @ 10%  from01.01.2010to 31.08.2016  and the order shall be complied with within 60 days from the date of judgment of this appeal otherwise the opposite parties shall be liable to pay interest at a rate of 15% per annum on this amount .

3. The complainants are entitled to get ₹ 150,000/– in view of Nalin Bhargava Case (supra) as cost.
4. In the relief clause of the complaint, the complainant has prayed that any other order which This Hon’ble State Commission may deem fit and proper in the circumstances of the case may also be passed. So keeping in view all the fraud committed in this case, all the harassment and mental agony given to the complainants and also taking into account the fact that the complainant ultimately expired without getting the possession of the flat, we find that the complainants are also entitled to get ₹ 20 lakhs towards payment of rent of the flat, mental harassment, agony and sufferings.
5. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

The present complaint is decided accordingly.

ORDER

1. The complaint is allowed with cost. The opposite parties are jointly and severally liable to pay
37.  

interest at a rate of 10% on whole of the deposited amount from 01.01.2010 till the date of giving of actual possession of the unit no. T 5- 804, with complete finishing work, in the Parswanath Planet i.e, 31.08.2016 . According to the advocate commissioner’s report dated 18.02.2022 though the flat was not fully finished for which relief is being given by this Court. The opposite parties are directed not to charge any penny whatsoever it may be from 01.01.2010 to 31.08.2016, except the monthly maintenance charge that too from 31.08.2016if completion certificate , occupancy certificate, NOC from Fire Department, NOC from Pollution Control Department, NOC from Civil Aviation department, Traffic Department has been provided to the complainant and in case the certificates have not been provided to the complainant, the opposite parties shall not charge any amount even towards maintenance till the date of providing a copy of the all of the above mentioned certificate to the complainant. The opposite partiesare directed to pay the interest within 60 days from the date of judgement of this appeal and if they failed to pay, the rate of interest payable to complainant shall be 15% from 01.01.2010 till the date of actual payment.

2. The opposite parties are jointly and severally directed to pay ₹ 15,000/- per month from 01.01.2010 to 31.08.2016  and the order shall be complied within 60 days from the date of
38.  

judgment of this appeal otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount.

3. The opposite parties are jointly and severally directed to pay ₹ 15,000/- per month from 01.01.2010 till 31.08.2016  with interest at a rate of 10% per annum and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount.
4. The opposite parties are jointly and severally directed to pay the complainants ₹ 150,000/– as cost in view of Nalin Bhargava Case (supra) with interest at a rate of 10% from 01.01.2010 till 31.08.2016  ,the date of delivery of possession of the said flat , and the order shall be complied with, within 60 days from the date of judgment of this complaint case, otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount.
5. The opposite parties are jointly and severally directed to pay the complainants ₹ 20 lakhs towards payment of rent of the flat, mental harassment, agony and sufferings ,with interest at a rate of 10% from 01.01.2010 till 31.08.2016  ,the date of delivery of possession of the said flat,, and the order shall be complied with, within 60 days from the date of judgment of this complaint case,

otherwise they shall be liable to pay interest at a rate of 15% per annum on this amount.

6. No amount shall be adjusted by the opposite parties to these amounts whatsoever it may be.

All the decretal amount shall be paid within 60 days from the date of judgment of this appeal otherwise the opposite parties shall pay interest at a rate of 15% per annum on all the decreetal amount. If it is not paid within 60 days from the date of judgment of this appeal, the complainants shall be entitled to present Execution proceedings before this court at the cost of the opposite parties.

The stenographer is requested to upload this order on the Website of this Commission today itself.

Certified copy of this judgment be provided to the parties as per rules.

      (Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                          President

Judgment dated/typed signed by us and pronounced in the open court.

Consign to the Record Room.

       (Rajendra Singh)                     (Justice Ashok Kumar)

              Member                                          President

Jafri, PA II

Court 1