Karan Pal Kandhari filed a consumer case on 15 Sep 2016 against PUMA Realtors Pvt Ltd. in the StateCommission Consumer Court. The case no is CC/236/2016 and the judgment uploaded on 17 Sep 2016.
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
Consumer Complaint | : | 236 of 2016 |
Date of Institution | : | 27.05.2016 |
Date of Decision | : | 15.09.2016 |
Sh. Karan Pal Kandhari s/o Late Krishan Kant Kandhari r/o H.No.HM 65, FF, Phase IV, SAS Nagar (Mohali).
……Complainant.
Versus
….Opposite Parties.
Complaint under Section 17 of the Consumer Protection Act, 1986.
BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT
SH. DEV RAJ, MEMBER.
MRS. PADMA PANDEY, MEMBER.
Argued by:
Sh. Munish Bhardwaj, Advocate for the complainant.
Sh. Ramnik Gupta, Advocate for Opposite Party No.1.
PER DEV RAJ, MEMBER
The facts, in brief, are that the opposite party no.1, who is a real estate company, made advertisement of its project and issued brochure (Annexure C-1), as per which, the structure proposed for selling was Ground + 6 floors. In view of representation made, the complainant booked one 2BHK Apartment No.004, IIIrd Floor, Cassia Court D Tower vide application dated 22.07.2011 (Annexure C-2) having tentative area of 1233 sq. ft. in Group Housing Colony, Sector 99, SAS Nagar (Mohali). The total sale consideration of the flat was Rs.40 Lacs approx.. An Agreement (Annexure C-3) was executed between the parties on 13.10.2011, as per which, possession of the unit, in question, was to be handed over within 30 months from the date of the said Agreement i.e. by April 2014. The opposite parties vide letter dated 15.3.2012 (Annexure C-4) informed that Larsen & Tubro Company had been appointed as contractor for construction of the apartments. However, on inspection of the spot, the complainant found that the opposite parties had raised construction of G+8 structure and increased the built up and FAR which was in violation of the terms of the brochure and the Agreement, to which the complainant objected vide letter dated 20.12.2014 (Annexure C-5). It was further stated that possession has still not been offered to the complainant and he had to pay unnecessary rent for two years (Rs.3,60,000/-) @Rs.15,000/- per month. The complainant also took loan from the Bank for purchasing the unit, in question, and he is paying interest on the loan amount. It was further stated that the complainant has paid 9 installments to the Opposite Parties out of 10 installments i.e. Rs.38,49,976/- approximately.
2. As per the complainant, it was promised that modular kitchen would be provided but on-site inspection, it was found that only lower part would be modular and no work on shelves above slab would be undertaken and for that additional work on shelves above slab, additional demand vide letter dated 19.06.2015 (Annexure C-6) was raised. It was further stated that the opposite parties mentioned that they shall be charging 15% compound interest on delayed payments, whereas compensation to be paid by the opposite parties for delay in handing over the possession of the unit was significantly less. It was further stated that when possession was not offered by the stipulated date or uptil 2016, the complainant served legal notice dated 22.04.2016 (Annexure C-7) upon the opposite parties but to no avail. It was further stated that the acts of the Opposite Parties amounted to deficiency, in rendering service and indulgence into unfair trade practice.
3. Alleging deficiency, in rendering service, and indulgence into unfair trade practice, on the part of the Opposite Parties, the complainant filed the instant complaint under Section 17 of the Consumer Protection Act 1986 (in short 1986 Act) seeking directions to the opposite parties to hand over possession of the apartment, in question, immediately; pay Rs.3,60,000/- as rent paid by the complainant for two years and future rent @Rs.15,000/- per month till handing over the possession; Rs.5,00,000/- as compensation i.e. Rs.1 Lac on account of interest paid on loan account, Rs.3 Lac for change of specification/layout plan/contractor and Rs.1 Lac for mental pain & agony suffered by the complainant and 18% interest till handing over possession of the apartment and costs of litigation.
4. Opposite Party No.1, in its written statement, took-up certain preliminary objections, to the effect, that the complaint was liable to be dismissed, due to existence of arbitration Clause No.34 in the Apartment Buyer’s Agreement dated 13.10.2011; that since the present complaint related to an agreement to sell/purchase of a residential apartment i.e. an immovable property, therefore, the same is not covered under 1986 Act and further, since the complainant sought enforcement of the Agreement, only a Civil Court has the jurisdiction, and as such, consumer complaint was not maintainable; that this Commission has no territorial jurisdiction on account of existence of Clause 36 in the Agreement and that the relief claimed is beyond Section 14(1)(d) of the 1986 Act.
5. On merits, it was stated that as per terms and conditions of the Agreement, the complainant had agreed that the layout plan and specifications were tentative and opposite party no.1 would be within its rights to raise additional accommodation. Thus, opposite party No.1 was not in violation of any term or condition of the Agreement. It was further stated that nowhere in the brochure, it was suggested that the Cassia Tower, where the apartment of the complainant is situated, would be only of Ground + 6 floors. It was further stated that vide booking application form, the complainant was made fully acquainted with the terms and conditions of the Agreement.
6. It was further stated that payment plan was construction linked payment plan and the commencement date for possession period does not commence from the date of agreement only but on approval of the building plans or fulfillment of the preconditions imposed thereunder, whichever is later. It was further stated that
in terms of Clause 13.4 of the Agreement, the complainant duly agreed to receive liquidated damages from the end of the grace period i.e. 30 months + 6 months i.e. w.e.f. 17.1.2015 till possession is actually offered as per said clause. It was further stated that the entire development and construction of the Cassia Tower, where the apartment of the complainant is situated, has been done by the said Larson & Tubro Company. It was further stated that Opposite Party No.1 is in progress of obtaining approvals for additional areas as agreed under Clauses 10.10 and 22.3 of the Agreement.
7. It was further stated that Opposite Party No.1 vide their letter dated 19.06.2015 offered to its allottees, including the complainant, for upgradation in specifications, for installation of Split ACs in the living/dining room and overhead cabinets in the kitchen at a nominal charges and the complainant was to opt for the aforesaid upgrades and to confirm his acceptance within a period of 15 days of the receipt of the said letter but the complainant never opted for the same. It was further stated that neither there was any deficiency, in rendering service, on the part of Opposite Party No.1, nor it indulged into any unfair trade practice. The remaining averments, were denied, being wrong.
8. The complainant did not file any rejoinder to the written statement filed by Opposite Party No.1.
9. On 29.06.2016, Sh. Ramnik Gupta, Advocate, who appeared for Opposite Party No.1 only, did not appear on behalf of Opposite Party No.2 - Managing Director of the Company, stating that since no post of Managing Director existed in the Company, therefore, there was no necessity to file reply on behalf of Opposite Party No.2.
10. The complainant, in support of his case, submitted his affidavit, by way of evidence, alongwith which, a number of documents were attached.
11. Opposite Party no.1, in support of its case, submitted the affidavit of Sh. Rohit Tanwar, its Authorised Representative, by way of evidence, alongwith which, a number of documents were attached.
12. We have heard the Counsel for the parties, and have gone through the evidence, and record of the case, carefully.
13. It is evident, on record, that the complainant was allotted Residential Apartment No.CCD-03-004, Third Floor, Tower – Cassia Court-D, in Group Housing Project known as “Ireo Rise”, situated in Sector 99, SAS Nagar, Mohali, having tentative super area of 1233 sq. ft.. Apartment Buyer’s Agreement was executed between the complainant and Opposite Party No.1 on 13.10.2011 (Annexure C-3), as per which, the basic sale price of the unit was Rs.3,101.65 per sq. ft. of super area i.e. Rs.38,24,340/- besides external development charges @100/- per sq. ft. of the super area. It is not disputed that the complainant paid an amount of Rs.38,49,976/- to Opposite Party No.1 as against the total sale consideration of the flat i.e. Rs.40,83,107/- (as per Payment Plan, Annexure IV at page 119 of the reply). The building plans of the IREO Rise were approved on 18.01.2012 and in terms of Clause 13.3. of the Agreement, 30 months period for handing over possession, thus, expired on 17.07.2014. Admittedly, possession has not been offered/delivered to the complainant by Opposite Party No.1. Opposite Party No.1 could raise construction/floors on the tower, where the apartment allotted to the complainant is situated, as agreed under Clause 10.10 and 22.3 of the Agreement.
14. The first question, that falls for consideration, is, as to whether, in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has jurisdiction to entertain the consumer complaint or not. This question has already been elaborately dealt with by this Commission in Consumer Complaint No.213 of 2016 titled ‘Gobind Paul Vs. Emaar MGF Land Limited & Another’ decided on 16.08.2016. Paras 8 to 15 of the said order, being relevant, are inter-alia extracted hereunder:-
“8……….To decide above said question, it is necessary to reproduce the provisions of Section 3 of the Consumer Protection Act 1986 (in short the Act), which reads as under;
“3. Act not in derogation of any other law.—
The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.”
It is also desirable to reproduce unamended provisions of Section 8 of 1996 Act, which reads thus:-
“8. Power to refer parties to arbitration where there is an arbitration agreement.—
(1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.
(2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.
(3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.”
9. Many a times, by making reference to the provisions of Section 8 of 1996 Act, in the past also, such objections were raised and the Hon'ble Supreme Court of India, when interpreting the provisions of Section 3 of 1986 Act, in the cases of Fair Air Engg. Pvt. Ltd. & another Vs. N. K. Modi (1996) 6 SCC 385, C.C.I Chambers Coop. Housing Society Ltd. Vs Development Credit Bank Ltd. (2003) 7 SCC 233, Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, (Civil Appeal No.20923 of 2013) etc., came to a conclusion that the remedy provided under Section 3 of 1986 Act, is an independent and additional remedy and existence of an arbitration clause in the agreement, to settle disputes, will not debar the Consumer Foras, to entertain the complaints, filed by the consumers.
10. In the year 2015, many amendments were effected in the provisions of 1996 Act. After amendment, Section 8 of 1996 Act, reads as under:-
“8. Power to refer parties to arbitration where there is an arbitration agreement.—
(1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.”
11. Now it is to be seen, whether, after amendment in Section 8 of the principal Act, any additional right has accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling the disputes through an Arbitrator, the Consumer Foras have no jurisdiction to entertain a consumer complaint. As has been held by Hon'ble Supreme Court of India, in various cases, and also of the National Commission, in large number of judgments, Section 3 of the 1986 Act, provides additional remedy, notwithstanding any other remedy available to a consumer. The said remedy is also not in derogation to any other Act/Law.
12. Now, we will have to see what difference has been made by the amendment, in the provisions of Section 8 of 1996 Act. After amendment, it reads that a Judicial Authority is supposed to refer the matter to an Arbitrator, if there exists an arbitration clause in the agreement, notwithstanding any judgment, decree, order of the Hon'ble Supreme Court of India, or any other Court, unless it finds that prima facie, no valid arbitration agreement exists. The legislation was alive to the ratio of the judgments, as referred to above, in earlier part of this order. Vide those judgments, it is specifically mandated that under Section 3 of 1986 Act, an additional remedy is available to the consumer(s), which is not in derogation to any other Act. As and when any argument was raised, the Hon'ble Supreme Court of India and the National Commission in the judgments, referred to above, have made it very clear that in the face of Section 8 of 1996 Act and existence of arbitration agreement, it is still opened to the Consumer Foras to entertain the consumer complaints. None of the judgments ever conferred any jurisdiction upon the Consumer Foras to entertain such like complaints. Only the legal issues, as existed in the Statute Book, were explained vide different judgments. If we look into amended provisions of Section 8 of the principal Act, it explains that judicial Authority needs to refer dispute, in which arbitration agreement exist to settle the disputes notwithstanding any judgment/decree or order of any Court. That may be true where in a case, some order has been passed by any Court, making arbitration Agreement non-applicable to a dispute/parties. However, in the present case, the above said argument is not available. The jurisdiction of Consumer Foras to entertain consumer complaints, in the face of arbitration clause in the Agreement, is in-built in 1986 Act. It was not given to these Foras, by any judgment ever. The provisions of Section 3 of 1986 Act interpreted vide judgments vis-à-vis Section 8 of un-amended 1996 Act, were known to the legislature, when the amended Act 2015 was passed. If there was any intention on the part of the legislature, then it would have been very conveniently provided that notwithstanding any remedy available in 1986 Act, it would be binding upon the judicial Authority to refer the matter to an Arbitrator, in case of existence of arbitration agreement, however, it was not so said.
13. We can deal with this issue, from another angle also. If this contention raised is accepted, it will go against the basic spirit of 1986 Act. The said Act (1986) was enacted to protect poor consumers against might of the service providers/multinational companies/traders. As in the present case, the complainant have spent his life savings to get a unit, for their residential purpose. His hopes were shattered. Litigation in the Consumer Fora is cost effective. It does not involve huge expenses and further it is very quick. A complaint in the State Commission can be filed, by making payment between Rs.2000/- to Rs.4000/- (in the present case Rs.4000/-). As per the mandate of 1986 Act, a complaint is supposed to be decided within three months, from the date of service to the opposite party. In cases involving ticklish issues (like the present one, maximum not more than six months to seven months time can be consumed), whereas, to the contrary, as per the principal Act (1996 Act), the consumer will be forced to incur huge expenses towards his/her share of Arbitrator’s fees. Not only as above, it is admissible to an Arbitrator, to decide a dispute within one year. Thereafter, the Court wherever it is challenged may also take up-to one year and then there is likelihood that the matter will go to the High Court or the Hon'ble Supreme Court of India. Such an effort will be a time consuming and costly one. Taking note of fee component and time consumed in arbitration, it can safely be said that if the matter is referred to an Arbitrator, as prayed, in the present case, it will defeat the very purpose of the provisions of 1986 Act.
14. The 1986 Act provides for better protection of interests and rights of the consumers. For the said purpose, the Consumer Foras were created under the Act. In Section 3 of 1986 Act, it is clearly provided that the said provision is in addition to and not in derogation of any provisions of any other law, for the time being in force. The 1986 Act is special legislation qua the consumers. The poor consumers are not expected to fight the might of multinational companies/traders, as those entities have lot of resources at their command. As stated above, in the present case, the complainant has spent his entire life earnings to purchase the unit, in the said project, launched by the opposite parties. However, his hopes were shattered, when despite making substantial payment of the sale consideration, they failed to get possession of the unit, in question, in a developed project. As per ratio of the judgments in the case of Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and United India Insurance Co. Ltd. Vs. M/s Pushpalaya Printers, I (2004) CPJ 22 (SC), and LIC of India and another Vs. Hira Lal, IV (2011) CPJ 4 (SC), the consumers are always in a weak position, and in cases where two interpretations are possible, the one beneficial to the consumer needs to be accepted. The opinion expressed above, qua applicability of Section 8 (amended) of 1996 Act, has been given keeping in mind the above said principle.
15. Not only this, recently, it was also so said by the National Commission, in a case titled as Lt. Col. Anil Raj & anr. Vs. M/s. Unitech Limited, and another, Consumer Case No.346 of 2013, decided on 02.05.2016. Relevant portion of the said case, reads thus:-
“In so far as the question of a remedy under the Act being barred because of the existence of Arbitration Agreement between the parties, the issue is no longer res-integra. In a catena of decisions of the Hon’ble Supreme Court, it has been held that even if there exists an arbitration clause in the agreement and a Complaint is filed by the consumer, in relation to certain deficiency of service, then the existence of an arbitration clause will not be a bar for the entertainment of the Complaint by a Consumer Fora, constituted under the Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force. The reasoning and ratio of these decisions, particularly in Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (Dead) Through LRs. & Others - (2004) 1 SCC 305; still holds the field, notwithstanding the recent amendments in the Arbitration and Conciliation Act, 1986. [Also see: Skypak Couriers Ltd. Vs. Tata Chemicals Ltd. - (2000) 5 SCC 294 and National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr. - (2012) 2 SCC 506.] It has thus, been authoritatively held that the protection provided to the Consumers under the Act is in addition to the remedies available under any other Statute, including the consentient arbitration under the Arbitration and Conciliation Act, 1986.””
In view of the above, the objection raised by Counsel for Opposite Party No.1 that in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint, being devoid of merit, is rejected.
15. An objection was raised by Opposite Party No.1 that since the present complaint related to an agreement to sell/purchase of a residential apartment i.e. an immovable property, therefore, the same is not covered under 1986 Act and further, since the complainant sought enforcement of the Agreement, only a Civil Court has the jurisdiction, and as such, consumer complaint was not maintainable. It may be stated here, that the complainant hired the services of Opposite Party No.1, for purchasing an apartment , in question, in the manner, referred to above. According to Clause 13.3 of the Agreement, subject to force majeure conditions and reasons, beyond the control of Opposite party No.1, it was to hand over possession of the apartment, in question, within a period of thirty months, from the date of execution of the same (Agreement) or approval of the building plans and/or fulfillment of the preconditions imposed thereunder, whichever is later. Section 2 (1) (o) of 1986 Act, defines ‘service’ as under:-
“service” means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service”.
16. From the afore-extracted Section 2(1)(o) of 1986 Act, it is evident that housing/construction, also comes within the definition of a service. In Narne Construction P. Ltd., etc. etc. Vs. Union Of India and Ors. Etc., II (2012) CPJ 4 (SC), it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression ‘service’ of any description. Housing construction or building activity carried on by a private or statutory body constitutes ‘service’ within the ambit of Section 2(1)(o) of 1986 Act. Similar principle of law, was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors., AIR (2014) S.C. 1766. Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable. Not only this, Section 3 of the Act, provides an alternative remedy. Even if, it is assumed that the complainant has remedy to file a suit in the Civil Court, the alternative remedy provided under Section 3 of 1986 Act, can be availed of by him, as he falls within the definition of a consumer, as stated above. In this view of the matter, the objection of Opposite Party No.1, in this regard, being devoid of merit, must fail, and the same stands rejected.
17. The next objection raised by Opposite Party No.1 is that existence of Clause 36 in the Apartment Buyer’s Agreement, bars the territorial jurisdiction of this Commission, to entertain and try the complaint. It may be stated here that according to Section 17 of the Act, a consumer complaint could be filed by the complainant, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to him. In the instant case, it is evident, that provisional allotment letter dated 22.07.2011 (Annexure C-2), letter dated 15.03.2012 (Annexure C-4) and letter dated 19.06.2015 (Annexure C-6), were issued from the Chandigarh address of the Opposite Parties i.e. SCO Nos.6-8, First and Second Floor, Sector 9-D, Madhya Marg, Chandigarh. Thus, since a part of cause of action, arose to the complainant, at Chandigarh, this Commission has got territorial Jurisdiction to entertain and decide the complaint. A similar question arose, before the National Commission, in Smt. Shanti Vs. M/s. Ansal Housing & Construction Ltd., First Appeal No.142 of 2001 decided by the National Commission on 11.04.2002, wherein the National Commission held as under:-
“This appeal is directed against the order dated 9.4.2001 of the Delhi Consumer Disputes Redressal Commission non suiting the appellant on a preliminary issue holding that Delhi State Consumer Dispute Redressal Commission will have no jurisdiction to entertain the complaint.
What led the State Commission to pass this order was clause 24 of the agreement for allotment of residential flat to the appellant. It is stated that ‘any dispute arising out of this agreement shall be subject to jurisdiction of Lucknow Courts only”. State Commission also relied on the decision of the Supreme Court in the case of A.B.C. Laminart Pvt. Ltd. &Anr. Vs. A.P. Agencies, Salem - AIR 1989 SC 1239 to hold that only the courts in Lucknow would have jurisdiction.
We do not think State Commission examined the whole issue in a pragmatic manner. Complainant is a consumer and raised a consumer dispute under the Consumer protection Act, 1986. To help and assist a consumer and to achieve the objects of the Act, Section 11 of the Act was amended. This Section relates to the jurisdiction of the District Forum. Now a complaint could be filed against the opposite party not only at the place where he actually or voluntarily reside or personally works for gain but also where he carries on business or has branch office. The words “carries on business or has a branch office” were added by the amending Act of 1993. Jurisdiction of a District Forum is exclusively covered by Section 11 of the Act. For this we do not have to refer any provisions of the Code of Civil Procedure. Any provision of the agreement which oust the jurisdiction of a District Forum even from a place where the opposite party has a branch office cannot be held to be valid or binding. Moreover, the clause on which the complainant was non-suited refers to the jurisdiction of Lucknow Courts. District Forum is not a court as understood in the Code of Civil Procedure. That clause in the agreement will have no meaning as far as jurisdiction of the District Forum where the opposite party has even branch office is concerned.
National Commission has already taken a view on this aspect of the matter. Accordingly the impugned order of the State Commission is set aside and the matter is remanded to the State Commission to decide the complaint in accordance with law. Party shall appear before the State Commission on 8.7.2002 for further directions. This appeal is disposed of as above.”
It may be stated here that, for determining the territorial jurisdiction, to entertain and decide the complaint, the Consumer Foras are bound by the provisions of Section 11 of the Act. In Associated Road Carriers Ltd., Vs. Kamlender Kashyap & Ors.-I (2008) CPJ 404 (NC), the principle of law, laid down, by the National Commission, was to the effect, that a clause of jurisdiction, by way of an agreement, between the parties, could not be made applicable, to the consumer complaints, filed before the Consumer Foras, as the Foras are not the Courts. It was further held, in the said case, that there is a difference between Section 11 of the Act, and the provisions of Sections 15 to 20 of the Civil Procedure Code, regarding the place of jurisdiction. Further, in Ethiopian Airlines Vs Ganesh Narain Saboo, IV (2011) CPJ 43 (SC)=VII (2011) SLT 371, the principle of law, laid down was that the restriction of jurisdiction to a particular Court, need not be given any importance in the circumstances of the case. In Cosmos Infra Engineering India Ltd. Vs Sameer Saksena & another I (2013) CPJ31 (NC) and Radiant Infosystem Pvt. Ltd. & Others Vs D. Adhilakshmi & Anr I (2013) CPJ 169 (NC) the agreements were executed, between the parties, incorporating therein, a condition, excluding the jurisdiction of any other Court/Forum, in case of dispute, arising under the same, and limiting the jurisdiction of the Courts/Forums at Delhi and Hyderabad. The National Commission, in the aforesaid cases, held that such a condition, incorporated in the agreements, executed between the parties, excluding the jurisdiction of a particular Court/Forum, and limiting the jurisdiction of a particular Court/Forum, could not be given any importance and the complaint could be filed, at a place, where a part of cause of action arose, according to Section 11 of the Act. The principle of law, laid down, in the aforesaid cases, is fully applicable to the instant case. At the same time, it is also held in the face of case Ethiopian Airlines Vs Ganesh Narain Saboo’s (supra), decided by the Supreme Court of India, the judgment titled as M/s Taneja Developers and Infrastructure Limited Vs. Gurpreet Singh and another, First Appeal No.33 of 2014, decided on 25.02.2016, by the National Commission, reliance whereupon has been placed by Counsel for opposite party No.1, to support his contention, that this Commission has no territorial jurisdiction, shall not hold the field. In these circumstances, such a Clause contained in the Agreement, therefore, could not exclude the jurisdiction of this Commission, at Chandigarh, where a part of cause of action accrued to the complainant, to file the complaint. The objection taken by Opposite Party No.1, in this regard, being devoid of merit, must fail, and the same stands rejected.
18. The next question, which falls for consideration, is, as to whether the construction of additional flats over the existing tower(s) by Opposite Party No.1 is at the cost of existing common facilities/amenities and against the agreed terms and conditions. Since Opposite Party No.1 could do so as agreed under Clause 10.10 and 22.3 of the Agreement, the objection of the complainant, therefore, being without any basis, is not tenable.
19. The next question, which falls for consideration, is, as to whether Opposite Party No.1 by not providing complete modular kitchen was deficient in rendering service. As per Annexure I, Opposite Party No.1 was to make provision for modular kitchen. The provision and specifications, so mentioned in Annexure-I appended to the Agreement, at Page 115 of the reply, qua the aforesaid facility, is extracted hereunder:-
KITCHEN | MODULAR KITCHEN | Fitted modular Kitchen, SS Sink, CP fittings, provision for RO system, built-in hob/chimney. |
| COUNTERTOP | Granite |
Admittedly, the provision in accordance with the specifications in the Apartment Buyer’s Agreement was not made. It was argued on behalf of Opposite Party No.1 that it was nowhere agreed that modular kitchen comprising of both upper and lower cabinets/cupboards was to be provided. It was further argued that it was nowhere mentioned that portion above the working slab is a must for a modular kitchen. Opposite Party No.1 cannot draw its own conclusion that modular kitchen would be complete, even if the cupboards are provided only below the slab. Had it been so mentioned in the specifications, the position would have been different. When it is clearly mentioned that modular kitchen is to be provided, it would mean that modular kitchen with cup-boards below and above the slab is to be provided. Therefore, Opposite Party No.1 is clearly deficient in not providing this facility in the Apartment. Not only this, Opposite Party No.1 sought acceptance of complainant to provide this facility at additional cost, which amounted to unfair trade practice. Opposite Party No.1 is, therefore, liable to provide modular kitchen with cup-boards upper the slab also.
20. The next question, that falls for consideration, is, as to whether there is delay in delivering possession of apartment to the complainant and whether the complainant is entitled to delivery of possession of the apartment. As stated above, according to Clause 13.3 of the Agreement, subject to force majeure conditions and reasons, beyond the control of Opposite Party No.1, it was liable to deliver physical possession of apartment, within a period of 30 months, from the date of execution of the same (Agreement) or approval of building plans and/or fulfillment of the preconditions imposed thereunder whichever was later. The building plans were approved on 18.01.2012. Period of 30 months expired on 17.07.2014. On account of force majeure circumstances, referred to above, Opposite Party No.1 was entitled to advantage of 180 days grace period. Opposite Party No.1 has failed to place, on record, any cogent evidence or justification to seek extension of 180 days. However, it is an admitted fact that possession of the unit, in question, has not been offered, by the date of filing the instant complaint, or even till date, despite the fact that 95% of the sale consideration i.e. Rs.38,49,976/- out of Rs.40,83,107/- has been paid by the complainant, for want of basic amenities at the site. No doubt, Opposite Party No.1 has admitted in its written statement that it is in process of obtaining the occupation certificate and possession, complete in all respects, of the apartment, in question, shall be handed over in near future, yet, it failed to place, on record, any cogent and convincing evidence, with regard to date by which construction of the unit is going to be complete. Opposite Party No.1 was duty bound to hand over possession within 30 months i.e. by 17.07.2014. Counsel for Opposite Party No.1 could not give any firm date, by which Opposite Party No.1 would be handing over possession. Clearly there is delay in delivering possession. By making a misleading statement, that possession of the unit, was to be delivered within the maximum period of 30 months from the date of execution of the Agreement/approval of building plans and within further extended period of 180 days and by not abiding by the commitment made despite payment of around 95% payment by the complainant, it (Opposite Party No.1) was not only deficient, in rendering service, but also indulged into unfair trade practice. The complainant is certainly entitled to physical possession of the unit, in question.
21. The next question, that falls for consideration, is, as to whether, the complainant is entitled to compensation, if so, at what rate, for delay in delivering physical possession of the unit beyond the time stipulated in the Agreement. It may be stated here that in case titled Capt. Gurtaj Singh Sahni & anr. Vs Manager, Unitech Limited & anr., consumer complaint bearing no.603/2014, decided on 02.05.2016, the Hon'ble National Commission, directed the opposite party/builder to pay interest on the deposited amount, for the period of delay, till delivery of possession of the unit. Relevant contents of the said order reads thus:-
“8. If the compensation for the delay in construction is restricted to what is stipulated in the Buyers Agreement, there will be no pressure upon the builder to complete the construction since he will be more than happy to keep on paying paltry compensation of about 3% per annum of the capital investment, instead of arranging funds at much higher cost, to complete the construction.
9. xxxxxxxxxxxxx
10. For the reasons stated hereinabove, the complaints are disposed of with the following directions:
(1) xxxxxxxxxxxxxx
(2) The opposite party shall pay compensation in the form of simple interest @ 12% per annum from the expected date of possession till the date on which the possession is actually offered to the complainants after completing the construction in all respects and obtaining the requisite completion certificate.”
22. No doubt in the Buyer’s Agreement, some scope for delay due to unavoidable circumstances was kept, in mind, for compensating the complainant for delay but it does not mean that even in the event of inordinate delay, that too without justified reasons, in completing the construction and delivering the possession, the complainant would be entitled to a meagre compensation of Rs.7.50 per sq. ft. of super area, which is much less than the bank rate for loan or fixed deposit. If the argument of the opposite parties is to be accepted, it would lead to an absurd situation and would give an unfair advantage to the unscrupulous builder, who might utilize the consideration amount meant to finance the project, by the buyer, for its other business ventures, at nominal interest of 3 to 4 per cent, as against much higher bank lending rates. This could never be the intention of legislation that if such a proposition is accepted, it would result in defeating the object of Consumer Protection Act.
23. Thus, keeping in view the principle of law laid down by the Hon'ble National Commission, in the cases, referred to above, award of interest @12% on the deposited amount for the period of delay i.e. w.e.f. 17.07.2014, till delivery of possession of the unit, would meet the ends of justice.
24. The next question, that falls for consideration, is, as to whether, the complainant is entitled to compensation, under Section 14(1)(d) of the Act, on account of mental agony and physical harassment, and injury caused to him, by not delivering physical possession of the unit to him, by Opposite Party No.1, by the promised date in the Agreement i.e. by 17.07.2014. The complainant purchased the unit, with the hope to have a roof over his head alongwith with his family members, and he also raised loan from Bank for making part payment of sale consideration of unit, in question, but inordinate delay and acts of omission and commission of Opposite Party No.1 have caused him mental agony and physical harassment. Even the possession of unit, in question, has not been offered to the complainant, till date by Opposite Party No.1, what to speak of delivery thereof. For delay in delivering possession beyond the stipulated period, the complainant has been granted interest @12% per annum till delivery of possession. Thus, the complainant, in our considered opinion, has been adequately compensated by granting interest @12% per annum for the delay period. In addition, he (complainant) will also get the benefit of escalation in the prices. In these circumstances, compensation, on account of mental agony and physical harassment, caused to the complainant, due to the acts of omission and commission of the Opposite Parties, if granted, to the tune of Rs.1,00,000/-, shall be reasonable, adequate and fair. The complainant, is, thus, held entitled to compensation, in the sum of Rs.1,00,000/-.
25. Since the complainant, with grant of 12% interest on the deposited amount, for delay period has been adequately compensated, in our opinion, no compensation on account of interest paid on loan amount and for alleged loss suffered by the complainant, in paying rent, is being awarded. Further in absence of any cogent evidence about change in specification/layout and as to how the same caused loss to the complainant, we do not see any justification to grant compensation on this account. As regard change of contractor i.e. M/s Akalia Constructions in place of Larsen & Tubro, Opposite Party No.1 has specifically stated in Para 6 of its written statement that some unfinished works of “Frangipani” and “Juniper” Towers were awarded to M/s Akalia Construction in order to avoid delay and the said contract was not with respect to the “Cassia Tower”. This averment of Opposite Party
No.1 was not rebutted by way of rejoinder or during arguments.
26. No other point, was urged, by the Counsel for the parties.
27. For the reasons recorded above, the complaint is partly accepted, with costs against Opposite Party No.1 only. Opposite Party No.1 is held liable and directed as under:-
28. In view of statement given by Counsel for Opposite Party No.1 that since no post of Managing Director (Opposite Party No.2) existed in the Company, the complaint against Opposite Party No.2 stands dismissed being rendered infructuous.
29. Certified copies of this order be sent to the parties, free of charge.
30. The file be consigned to Record Room, after completion.
Pronounced.
[JUSTICE JASBIR SINGH (RETD.)]
PRESIDENT
[DEV RAJ]
MEMBER
[PADMA PANDEY]
MEMBER
Ad
Consumer Court | Cheque Bounce | Civil Cases | Criminal Cases | Matrimonial Disputes
Dedicated team of best lawyers for all your legal queries. Our lawyers can help you for you Consumer Court related cases at very affordable fee.