KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

VAZHUTHACAUD, THIRUVANANTHAPURAM

C.C. No. 137/2015

JUDGMENT DATED: 19.11.2024

PRESENT:

SRI. AJITH KUMAR D.                                                    : JUDICIAL MEMBER

SRI. RADHAKRISHNAN K.R.                                        : MEMBER

COMPLAINANTSS:

1. Santhosh Kurian, S/o T.M. Kurian, residing in Door No. 803, A. Block, Purava Moon Reach, Seaport-Airport Road, Kakkanadu, Pin-682 030.

2. Vinitha Santosh, W/o Santhosh Kurian, residing at Door No. 803, A. Block, Purava Moon Reach, Seaport-Airport Road, Kakkanadu, Pin-682 030.

                                  (By Adv. Baby Antony)

                                                Vs.

OPPOSITE PARTIES:

1. M/s Puravankara Ltd. Formerly known as Puravankara Projects Ltd., having its Registered Office at 130/1, Ulscor Road, Bangalore, Pin-560 042 represented by its Managing Director. 

Additional Opposite Party:

2. Branch Manager, Branch Office, Puravankara Ltd. At G216, Panambilly Avenue, Kochi-682 086.

(By Adv. Jolly John, Adv. Irene Babu and Adv. Liza Meghan Cyriac)

JUDGMENT

SRI. AJITH KUMAR D.    : JUDICIAL MEMBER

This is a complaint filed under Sec. 17 of the Consumer Protection Act, 1986.  Originally the opposite party was arrayed as M/s Puravankara Projects Limited represented by the Senior Vice President and Customer Relationship Manager.  Subsequently, the cause title of the complaint was amended as per I.A. No. 680/2023 on the basis of a Certificate of Registration pursuant to the change in the name of the opposite party as Puravankara Limited, represented by its Managing Director and additional 2^nd opposite party by the Branch Manager, Branch Office, Puravankara Ltd. 

2.  The averments contained in the complaint are that the opposite parties had formulated a scheme for the development of 169.567 cents of land in old survey Nos. 325/4, 325/5, 326/1, 4 and 5(P) of Kakkanadu Village into a residential apartment complex known as ‘Purava Moon Reach’. The complainant’s predecessor one K. George John had entered into two separate agreements with the opposite parties dated 26.09.2007 for the purchase of an undivided 0.5080% share, right, title and interest in the land for a consideration of Rs. 15,00,435/- (Rupees Fifteen Lakh Four Hundred and Thirty Five only).  He paid Rs. 30,499/-(Rupees Thirty Thousand Four Hundred and Ninety Nine only) and agreed to pay the balance in 37 monthly instalments as per the recitals in the agreement.  By virtue of the agreement, the opposite parties had agreed to construct a three bed room apartment bearing No. A 803 on the 8^th floor in the A Block of the residential complex with a built up area of 1494.26 sq. ft.  and covered car parking space.  It was also stipulated to complete the construction on or before 31.08.2010 with a grace period of six months for a total cost of Rs. 37,24,400/- (Rupees Thirty Seven Thousand Twenty Four Thousand Four Hundred only).  The assignor paid an advance amount of Rs. 69,501/- (Rupees Sixty Nine Thousand Five Hundred and One only) on 26.09.2007 and agreed to pay the balance in 37 monthly instalments terminating on 31.07.2010.  As per clause V of the construction agreement the opposite parties had agreed to construct the apartment and deliver the same to the assignor on or before 31.08.2010 with a grace period of six months.  So, the opposite parties had to complete the construction and deliver the same on or before 01.03.2011.  The assignor was prompt in paying the instalments.  As per the valuation statement and the receipts produced in support of the complaint an amount of Rs. 50,90,326/- (Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only) was paid to the opposite parties as on 27.02.2010.  But the pace of construction was very slow.  Since there was no progress in the work, further payment was stopped and waited for further communication from the opposite parties.  As there was inordinate delay in completing the project, the assignor was constrained to sell his rights and liabilities as per the agreement for sale and construction and the complainants had agreed to purchase the same.  When the assignor and the complainants had approached the opposite parties in the first week of December 2011 for consent to transfer the rights, the opposite parties demanded Rs. 2,55,861/-(Rupees Two Lakh Fifty Five Thousand Eight Hundred and Sixty One only) towards transfer charges and Rs. 9,94,477/- (Rupees Nine Lakh Ninety Four Thousand Four Hundred and Seventy Seven only) towards balance consideration, interest, VAT, service tax etc. and as per the demand the complainants had paid Rs. 6,52,217/- (Rupees Six Lakh Fifty Two Thousand Two Hundred and Seventeen only) on 07.12.2011 and Rs. 3,42,260/- (Rupees Three Lakh Forty Two Thousand Two Hundred and Sixty only) was reserved as the last instalment to be paid at the time of execution of the sale deed.  An endorsement of assignment was entered in to among the assignor, the opposite party and the complainants on 07.12.2011.  The construction of the apartment was completed and possession was handed over only on 17.01.2015.  The opposite party had realized a sum of Rs. 45,320/- (Rupees Forty Five Thousand Three Hundred and Twenty only) as interest towards belated payment @ 2% per month though the complainants had paid Rs. 50,90,326/- (Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only)  as on 27.02.2010 which was 97.42% of the total cost as per the agreement.  By virtue of the recitals in the agreement, the construction of the apartment ought to have been completed and possession given on 01.03.2011.  But the apartment was completed and possession was given only on 17.01.2015 and hence there was a delay of 46 months and 17 days.  As per the endorsement of assignment dated 07.12.2011 all the title and claim under the construction agreement had been transferred in favour of the complainants and hence they are entitled to get damages for the delay in handing over possession from the date of completion as stipulated in the agreement.  The assignor had deposited Rs. 50,90,326/- (Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only) on 27.02.2010 and the complainants are entitled to get 18% interest for the said amount from 27.02.2010 till 17.01.2015.  The complainants are also entitled to get back Rs. 2,55,861/- (Rupees Two Lakh Fifty Five Thousand Eight Hundred and Sixty One only) realized from the assignor illegally towards transfer charges.  The complainants would also seek for interest from the opposite parties for Rs. 6,52,217/-(Rupees Six Lakh Fifty Two Thousand Two Hundred and Seventeen only) collected as balance on 07.12.2011.

3.  The opposite parties had entered appearance and filed written version with the following contentions:  The complaint is not maintainable and is liable to be dismissed in limine.  The complaint is barred by limitation and on that ground also the complaint is liable to be dismissed.  The complainants were informed and being duly aware of the delay in handing over of the possession of the apartment at the time of entering into the deed of assignment with the original purchaser ought to have enforced his rights immediately upon the execution of the Deed of Assignment/Endorsement of the Assignment in their favour on 07.12.2011 or within a period of two years thereafter.   The complainants have also claimed for refund of transfer charges paid on 07.12.2011 which is barred by limitation.  The complainants are attempting to gain undue enrichment.  The flat in question along with the undivided share in the land has been conveyed to the complainants by the opposite party as per the sale deed dated 17.01.2015.  The complainants are estopped from filing the present complaint in view of the Declaration-cum-Undertaking dated 08.12.2014 executed by the complainants.  The claim of interest raised by the complainants under various heads @ 18% is not maintainable as there was no contract between the complainants and the opposite parties for payment of interest.  The complaint is not maintainable as the dispute arose from an agreement of sale and agreement of construction and those agreements are commercial contracts and in such cases detailed evidence has to be recorded.   It is also contended that since there are defaults in payment of instalments, the complainants are not entitled for relief for deficiency in service.  As per the application for allotment, the original purchaser was liable to pay a total sum of Rs. 52,24,835/- (Rupees Fifty Two Lakh Twenty Four Thousand Eight Hundred and Thirty Five only) towards the cost of the apartment and undivided share of the land inclusive of Rs. 50,000/- (Rupees Fifty Two Thousand only) towards club membership.  In addition to this, the original purchaser was liable to KVAT and service tax as applicable on the dates of payment of instalments on the land cost and the construction cost.   The original purchaser was liable to pay the amounts      towards KSEB, KWA charges along with service tax, advance maintenance charge, one time building tax, Workers’ Welfare Fund and yearly municipality tax at the time of taking possession of the apartment.  The original purchaser was also liable to pay stamp duty and registration charges for the purpose of registration of the sale deed.  The original purchaser made a payment of Rs. 1,00,000/- (Rupees One Lakh only) towards booking of the apartment.  He had also undertaken to make payment of Rs. 4,22,484/- (Rupees Four Lakh Twenty Two Thousand Four Hundred and Eighty Four only) on or before 07.08.2007 and Rs. 10,44,991/- (Rupees Ten Lakh Forty Four Thousand Nine Hundred and Ninety One only) on or before 07.09.2007.  The balance amount was to be paid in 35 instalments.  On certain occasions, the original purchaser caused delay in making payments.  The apartment was scheduled to be delivered on 01.03.2011, but on account of certain delays beyond the control of the opposite party, the date of completion was postponed.  In 2008 the neighbours of the apartment had approached the Hon’ble High Court on an allegation that the construction was done by violating the provisions of the Kerala Municipality Building Rules.  The division Bench of the Hon’ble High Court partly allowed the writ appeal and ordered that the construction shall be limited to 2.5 F.A.R. Later the opposite parties had approached the Honb'le Supreme Court and on 22.04.2012 the opposite party got approval from the Supreme Court to approach the authorities under the Kerala Municipality Building Rules.  Accordingly, the Thrikkakara Municipality had decided to extend the validity of the NOC up to 24.03.2016.  Subsequently partial occupancy for the completed structure was issued and door numbers were allotted by the Municipality on 30.10.2014.  In and around November/December 2011, the original purchaser informed the opposite party that he had found out a purchaser who was made aware about Clause 14 of the construction agreement that the original purchaser was required to file an application for transfer and he was also made aware for transfer of a sum of Rs. 2,55,861/- (Rupees Two Lakhs Fifty Five Thousand Eight Hundred and Sixty One only) towards transfer fee.  Since he had delayed the payment of instalments, he was also liable to pay interest which is Rs. 47,204/-(Rupees Forty Seven Thousand Two Hundred and Four only).  All these conditions were accepted by the original purchaser who sought for a deduction in the amount of interest as Rs. 45,000/- (Forty Five Thousand only).  The complainants were informed that the balance amount of Rs. 3,42,260/- (Rupees Three Lakh Forty Two Thousand Two Hundred and Sixty only) towards KSEB, KWA charges, service charges, advance maintenance charges, one time building tax, WWF, yearly municipality tax etc.  had to be paid by them at the time of taking possession of the apartment.  The complainants had paid the balance amount of Rs. 3,42,260/-(Rupees Three Lakh Forty Two Thousand Two Hundred and Sixty only) on 03.12.2014 and executed a declaration-cum-undertaking dated 08.12.2014 without any demur confirming that the complainant was fully satisfied with the construction of the apartment.  The opposite parties would deny the allegations of deficiency in service contained in the complaint and they had sought for dismissal of the complaint. 

4.  The 1^st complainant had sworn an affidavit in lieu of chief examination.  Exhibits A1 to A10 were marked for the complainants.  No evidence was let in by the opposite parties.

5.  Heard both sides.  Perused the records.  

6.  The opposite parties had filed I.A. No. 1334 (A)/2018 before this Commission challenging the maintainability of the complaint as the complaint falls beyond the pecuniary jurisdiction of this Commission.  The petition filed by the opposite party was dismissed as per order dated 20.06.2019 with a finding that this Commission has got pecuniary jurisdiction to adjudicate the matter.  Against the said order, the opposite parties had approached the National Consumer Disputes Redressal Commission by way of Appeal No. 1890/2019.  The National Commission did not find any error in the order passed by this Commission.  After the said observation, the appeal was dismissed as withdrawn.  Accordingly, the appeal filed by the opposite party was withdrawn.  So, the order dated 20.06.2019 of this Commission has attained finality. 

7.  The points that arose for determination are:

1. Is there any deficiency in service on the part of the opposite parties as alleged?
2. Whether the complainants are entitled to get transfer charges?
3. Whether the complainants are entitled to get interest and if so, what is the rate of interest?
4. Reliefs and costs.

8.  Points (i) to (iv): The opposite parties had raised a contention that the complaint is not maintainable as time barred on the reason that the agreements were executed on 26.09.2007 whereas the complaint was filed in 2015.  Though agreements were executed on 26.09.2007 with a condition that the construction of the apartment would be completed and hand over possession to the complainants on or before 01.03.2011, a delay of 46 months and 17 days occurred in completing the construction and only on 17.01.2015 the possession was given to the complainants.  So, it is seen that the cause of action continued till 17.01.2015 on which date the construction could be completed and possession given to the complainants.  So, in such a situation it cannot be found that the claim raised as time barred.  Admittedly a delay of 46 months and 17 days occurred in completing the construction and handing over the possession.  Exhibit A3 is the account statement which would prove that an amount of Rs. 50,90,326/- (Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only) was paid up to 27.02.2010. After receiving the said amount the complainants were deprived of getting possession of the apartment, though it was agreed that the construction would be completed on or before 01.03.2011.  This amounts to deficiency in service on the part of the opposite parties.  The complainants would claim interest from 27.02.2010 till 17.01.2015 on which date the delivery of the apartment was effected.  But interest could be awarded from the agreed date of delivery.  As per the recitals in the agreement the possession of the apartment ought to have been given to the complainant on or before 01.03.2011.  So, the claim of interest could be ordered only from 01.03.2011 to 17.01.2015.  The complainants had claimed rate of interest at the rate of 18%.  The opposite parties would submit that rate of interest claimed is exorbitant.  In answer to this submission, the learned counsel for the complainant brought our attention to the clause contained in 5(a) of the construction agreement wherein rate of interest is fixed as 2% per month from the date of default to the date of payment and the opposite parties had collected interest @ 2% per month with regard to the delay of the last payment.  According to the complainants, rate of interest must be one and the same as far as both parties are concerned.  So, the learned counsel for the complainants would submit that they are justified in claiming the rate of interest as 18%.  Admittedly the complainants had taken possession of the completed apartment on 17.01.2015 and they became the absolute owners of the apartment.  They have no contention that the work carried out by the opposite parties is having any defects.  While deciding the claim of interest, this Commission can award reasonable rate of interest.  The rate of interest claimed by the complainants appears to be on a higher side.  Having due regard to the entire facts and circumstances and the conduct of the parties, we find that interest at the rate of 12% would be adequate so as to meet the interest of justice.  So, it is found that the complainants are entitled to get interest for Rs. 50,90,326/- (Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only) @ 12% per annum with effect from 01.03.2011 till 17.01.2015. 

9.  The complainants had also sought for return of the transfer charges realized from the assignor.  The agreement bears a clause that if the original assignor wants to transfer the agreement in favour of a third party, he has to pay a sum of Rs. 2,55,861/-(Rupees Two Lakh Fifty Five Thousand Eight Hundred and Sixty One only).  The original assignor had transferred the right in favour of the complainants by remitting the transfer charges.   Such an amount cannot be ordered to be refunded.  The next claim of the complainant is in respect of the interest with regard to the payment made on 11.12.2011 for Rs. 6,12,217/- (Rupees Six Lakh Twelve Thousand Two Hundred and Seventeen only).  The payment made on 07.12.2011 was in respect of the service tax, KVAT, transfer fee, delayed interest payment by the original purchaser, KSEB, KWA charges, advance maintenance charge, one time building tax, Worker’s Welfare Fund, yearly municipality tax.  These are all payments made towards the statutory authorities for which the opposite parties are not bound to pay interest.  So, the claim of the complainants towards interest for this amount is liable to be rejected.

10.  Having due regard to the aforesaid facts and circumstances, we find that there was deficiency in service on the part of the opposite parties in handing over the apartment after the completion of the work and hence the complainants are entitled to get interest @ 12% per annum for Rs. 50,90,326/-(Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only) from 01.03.2011 (actual date of default) till 17.01.2015 on which date the delivery of the apartment was given to the complainants.   The points are found accordingly.

In the result, the complaint is allowed in part. 

1. The opposite parties are directed to pay the complainants interest at the rate of 12% per annum for Rs. 50,90,326/-(Rupees Fifty Lakh Ninety Thousand Three Hundred and Twenty Six only) from 01.03.2011 till 17.01.2015. 
2. The prayer for refund of the transfer charges and interest on the payment made on 11.12.2011 are disallowed. 
3. Opposite parties are also directed to pay the complainants Rs. 5,000/- (Rupees Five Thousand only) as costs of the proceedings. 
4. The opposite parties shall pay the entire amount ordered as per this judgment within 30 days from the date of receipt of the copy of this judgment failing which the complainants can initiate execution proceedings before this Commission.  

AJITH KUMAR  D. : JUDICIAL MEMBER                                                                 

                                                                        RADHAKRISHNAN K.R.  : MEMBER

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APPENDIX

I.       COMPLAINANT’S WITNESS:

                             NIL

II.      COMPLAINANT’S DOCUMENTS:

A1     - Copy of agreement for sale dated 26.09.2007

A2     - Copy of construction agreement dated 26.09.2007

A3     - Copy of payment statement

A4     - Assignment deed dated 07.12.2011

A5     - Copy of receipt dated 07.12.2011 for Rs. 2,55,861/-

A6     - Copy of receipt dated 07.12.2011 for Rs. 6,52,217/-

A7     - Copy of sale deed dated 17.01.2015

A8     - Copy of lawyer notice dated 30.07.2015

A9     - Postal Receipt

A10   - Acknowledgment card

III.     OPPOSITE PARTY’S WITNESS:

NIL

IV.     OPPOSITE PARTY’S DOCUMENTS:

NIL

AJITH KUMAR  D. : JUDICIAL MEMBER

jb                                                                     RADHAKRISHNAN K.R.  : MEMBER