BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAS NAGAR, MOHALI
Consumer Complaint No.383 of 2014
Date of institution: 28.05.2014
Date of Decision: 11.03.2015
Col. R.S. Ghotra (Retd.), Lt. Cdr. Randeep Singh and Smt. Ravinder Kaur, residents of 2034, Jal Vayu Vihar, Sector 67, Mohali 160062.
……..Complainants
Versus
1. Premium Acres Infratech Pvt. Ltd., SCO 56-57, Sector 17-D, 3rd Floor, Chandigarh 160017.
2. The Site Office, 205 GF Avenue, Premium Acres, TDI City, Sector 110, Mohali.
………. Opposite Parties
Complaint under Section 12 of the
Consumer Protection Act, 1986.
CORAM
Mrs. Madhu. P. Singh, President.
Shri A.B. Aggarwal, Member.
Present: Complainant Col. R.S. Ghotra (Retd.) in person.
Shri Sunny Kohli, counsel for OP No.1.
Opposite Party No.2 ex-parte.
(MRS. MADHU P. SINGH, PRESIDENT)
ORDER
The Opposite Parties (for short ‘the OPs’) floated a scheme for allotment of residential three floors Avenues and five different ranges of villas in TDI Sector 110, Mohali and an advertisement Ex.C-1 in this regard was got published by the OPs in the newspaper Indian Express. The OPs also assured to handover the possession in 18-24 months. The complainants also applied to the OPs for allotment of a villa at an agreed basic sale price of Rs.40,80,000/- plus EDC of Rs.3,50,400/-. The complainant made initial payment of Rs.8,36,000/- i.e. 20% payment by cheque and the remaining payment was to be got financed from IDBI Bank. Allotment letter dated 28.04.2010 Ex.C-3 was issued by the OPs. The loan was sanctioned and disbursed by the bank in July, 2011. Accordingly installment of 85% of the payment of the villa was paid by the complainant with a delay of few days in July, 2012. The OPs in August 2012 called from the complainants demanded service tax and building cess which was not in vogue. The complainants discussed the issue with the MD of the OPs and asked for details of calculations of these taxes vide email 29.08.2012. The OPs sent ST calculations vide E-mail dated 11.09.2012 Ex.C-4 which were not in order. The complainant No.1 discussed the matter with Amit Jain MD of the OPs on 19.09.2012 and handed him over photocopies of the downloaded material on the service tax and building cess and also handed him over the cheque of the service tax as applicable and calculated in the case of the complainants. The OPs had charged the ST and building cess on the full amount of BSP at a uniform rate of 3.09% which is not applicable in the cases of construction linked plans started prior to April, 2012. As per the demand notice Ex.C-7 of the OPs a sum of Rs.1,16,580/- is due from the complainants whereas as per the calculations made by the complainants an amount of Rs.4,753/- is to be paid to the Ops. Thus the OPs are demanding an excess amount of Rs.1,21,333/- illegally. The OPs were to handover the possession by June, 2012 but as per the photographs produced by the complainant the villa is nowhere near completion even as on date. The OPs in the demand notices have been wrongly mentioning the stages of construction. Illegal demand of service tax and building cess and non delivery of possession is an act of deficiency in service and unfair trade practice on the part of the OPs.
With these allegations, the complainants have sought directions to the OPs cancel the demand letter dated 05.05.2014 for service tax and building cess and to demand correct service tax as per rules of Govt.; not to demand any extra amount on account of escalation in the cost of construction or on account of interest on the dues; to compensate them on account of anticipated rent from June 2012; to pay them compensation for mental and physical harassment and costs of litigation.
2. OP No.1 in the preliminary objections of its written statement has pleaded that this Forum has no jurisdiction to entertain the present complaint. The complainants were given due opportunities to take possession but they failed to do so and, therefore, the complainants had to bear charges on account of inflation as per Clause 11 of the agreement. The complainants had opted for construction linked plan. On merits, it is pleaded that as per Clause 9 of the buyers agreement dated 03.08.2011 the delivery of possession within a period of 24 months was subject to force majeure circumstances and on receipt of all payments as per agreed terms. Inspite of issuance of various letters/reminders the complainant have yet not paid the remaining balance amount of Rs.14,67,633/-. As per clause 4 (f) of the agreement the company may in its sole discretion condone the delay in payment by charging interest @ 18% per annum. As per Clause 9 of the agreement the possession was to be delivered within a period of 24 months. The allottee would be liable to pay holding charges @ Rs.5/- per sq. ft. per month if he fails to take possession within 30 days from the date of issue of offer of possession. If the construction is delayed due to normal course, other than conditions set out in point 10, then the company shall pay Rs.15,000/- per month as delay charges for the period of delay. There is no delay in construction of villa on the part of the OPs and it is ready for possession. The OPs have also sent legal notice and cancellation notice to the complainant vide letter dated 06.01.2014 Ex.OP-3. The service tax taken by the OPs, is as per norms and procedure prescribed by laws laid down by the Govt. Thus, denying any deficiency in service or unfair trade practice on its part, OP No.1 has sought dismissal of the complaint.
3. Evidence of the complainants consist of affidavits of complainant No.1 Ex.CW1/1 and Ex.CW-1/2 and copies of documents Ex C-1 to C-20.
4. Evidence of OP No.1 consists of affidavits of Ranjit Singh, its General Manager Ex.OP-1/1 and Ex.OP-1/2 and copies of documents Ex.OP-1 to OP-4.
5. We have heard learned counsel for the parties and gone through the written arguments filed by them.
6. The complainants are allottee of Villa by the OPs. The agreed sale consideration and 95% payment thereof is not disputed. As per allotment letter dated 28.04.2010 Ex.C-3 the payment was construction linked plan and the possession of the property in question was to be handed over to the complainants in 18-24 months. The dispute in the present complaint is regarding the issuance of demand notice for payment of Rs.1,16,580/- vide Ex.C-7 on account of interest on delayed payment, service tax and building cess. As per the complainants the computation sheet showing the demanded amount under three heads is not correct as the service tax and cess has not been levied as per Govt. fixed slab rates of the service tax and further the building cess is not leviable at all. Thus charging of interest on delayed payment of installments, charging of service tax contrary to the slab rates fixed by the Govt. and charging of construction cess in the demand notice Ex.C-7 is unfair trade practice on the part of the OPs.
7. As per the complainants themselves there is a delay in deposit of the installments. For this purpose it is relevant to refer to Para-3 of the complaint wherein the complainants took a stand that the loan was sanctioned and disbursement was made by the Bank in July 2011. Subsequent installments till 85% of the BSP were paid as and when demanded by the OPs, with at times delay of a few days, by July, 2012. Perusal of the demand notice Ex.C-7 clearly shows that interest amount @ 18% of pending amount for 525 days, 465 days, 430 days, 501 days, 485 days has been calculated and levied by the OPs. Thus, the admission of the complainants qua the delay in making payment of due installments and the levy of interest on the delayed payment as per Ex.C-7 cannot be denied and on this account we do not find any deficiency in service/unfair trade practice. Though this fact would have been clarified more thoroughly had both the parties submitted the duly signed Buyers Agreement.
8. Now regarding levy of service tax, contrary to the slab rates fixed by the Govt. is concerned, we are in full agreement with the contention of the complainants. The complainants have produced the slab rate of service tax applicable upto June, 2010 to April, 2012 onwards duly supported by the Govt. notification in this regard Ex. C-5. The perusal of the table mentioned in Para 19 of the complaint and the notification clearly shows that no service tax is leviable upto June, 2010. From July, 2010 to 31st March, 2012 service tax applicable @ 2.575% on the BSP excluding EDC, PLC as per notification No.29/2010 dated 22.06.2010 and from April 01, 2012 onwards service tax is applicable @ 3.09% as per notification No.26/2012 dated 20.06.2012. Perusal of Ex.C-7 i.e. demand notice shows that the OPs have levied 3.09% service tax uniformly on all the installments paid from 2010 onwards. Therefore, the levy of such uniform tax slab of 3.09% service tax is contrary to the Govt. notifications in this regard. On this account, the OPs have indulged into unfair trade practice and wrongful enrichment.
9. Now the issue of building cess is to be looked into. As per the complainants the building cess of 1% levied in Ex.C-7 is not payable by them. In support of their argument the complainants have brought to our notice notification dated 12.10.1996 Ex.C-9 (Page-21 & 22). The notification pertains to levy of cess for the purpose of building and other construction workers, regulation of employment and other conditions of Service Act, 1996 @ 1% of the cost of construction incurred by an employer. As per the said notification the cess is to be payable in case of group housing, big malls, hospitals and apartments by the builder or the contractor as the case may be. Thus, the building/OPs have levied 1% building cess in demand notice against the provisions of this notification which are not payable to them by the complainant. Perusal of Ex.C-7 shows that levy of 1% building cess has been calculated in the computation sheet for the demand notice. We are in full agreement with the contention of the complainants duly supported by the notification. In this regard also the OPs have contravened the statutory provisions governing the levy of building cess and indulged into unfair trade practice.
10. Further it is admitted fact that till date the possession of the property in question has not been handed over by the OPs to the complainants. Therefore, the complainants are deprived of its use and benefits. It is admitted by the OPs that the possession was to given within 18-24 months from the date of allotment i.e. 03.04.2010. The said period of 24 months being the outer limit has already expired on 03.04.2012 and from 03.04.2012 till date the possession has not delivered to the complainants. As per written statement para No.5 of the OPs, the complainant is entitled to compensation @ Rs.15,000/- from the May,2012 till the final handing over of physical villa in questions to the complainants. In fact it was obligatory on the part of the OPs to themselves given this benefit of agreed compensation to the complainants while issuing the final demand notice Ex.C-7. Failing to do so, is per se is an act of unfair trade practice on the part of the OPs for which the complainants deserve to compensated.
11. Therefore, for not delivering the possession and issuance of demand notice Ex.C-7 on these two accounts i.e. service tax in contravention to the fixed slab rates and building cess is illegal and deserves to re-looked by the OPs.
12. Hence the complaint is partly allowed with the following directions to the OPs:
(a) to withdraw the demand notice dated 03.05.2014 Ex.C-7 and re-fix the service tax as per fixed slab rates of the Govt. and not to charge building cess from the complainants.
(b) to pay to the complainants compensation @ Rs.15,000/- (Rs. Fifteen thousand only) per month with interest thereon @ 12% per annum from 01.05.2012 till handing over physical possession of the villa in question.
(c) to pay a lump sum compensation of Rs.50,000/- (Rs. Fifty thousand only) to the complainants for mental agony, harassment and costs of litigation.
The OPs to comply with aforesaid directions within a period of one month from the date of receipt of a certified copy of this order. Certified copies of orders be sent to the parties free of costs and thereafter the file be consigned to the record room.
Pronounced.
March 11, 2015.
(Mrs. Madhu P. Singh)
President
(A.B. Aggarwal)
Member
