Chandigarh

StateCommission

CC/237/2016

Mohinder Singh Bajaj - Complainant(s)

Versus

PUMA Realtors Pvt Ltd. - Opp.Party(s)

Sh. Neeraj Sobti, Adv.

19 Sep 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Consumer Complaint	:	237 of 2016
Date of Institution	:	27.05.2016
Date of Decision	:	19.09.2016

 

Mohinder Singh Bajaj S/o Sh. Harbans Singh Bajaj R/o House No.63, Sector 9-A, Chandigarh.

……Complainant.

 

Versus

 

1. M/s Puma Realtors Pvt. Ltd., An IREO Group Company, through its Managing Director/Chairman, Corporate Office at SCO No.6-8, First and Second Floors, Sector 9-D, Madhya Marg, Chandigarh – 160009.

 

2. M/s Puma Realtors Pvt. Ltd., An IREO Group Company, through its Managing Director/Chairman, Registered Office at No.5, Dhanraj Chambers, 1st Floor, Satbari, New Delhi-110074.

….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. Neeraj Sobti, Advocate  for  the complainant.

Sh. Ramnik Gupta, Advocate for the Opposite Parties.

 

PER DEV RAJ, MEMBER

             The facts, in brief, are that in the year 2011, on the assurance of the Opposite Parties, the complainant applied for allotment of a residential plot in their project, namely, IREO Hamlet and paid a sum of Rs.6,50,000/- as the booking amount. The complainant was allotted Plot No.22 measuring 250.59 sq. yards in the said project in Sector 98, SAS Nagar, Mohali and on 07.06.2011, he paid Rs.2,14,536/- towards part price of the said plot. Plot Buyer’s Agreement was executed between the complainant and the Opposite Parties at Chandigarh on 28.07.2011. As per the details given in Para 5 of the complaint, the complainant paid the total amount of Rs.47,79,115/- to the Opposite Parties up to 01.10.2014.

2.          It was further stated that as per Clause 21.2 of General Clauses of the Plot Buyer’s Agreement, the Opposite Parties were to develop the said project by laying roads, water lines, sewer lines, electrical lines etc.. Further, as per Clause 11 of the Agreement, possession of the plot, in question, was to be handed over within 24 months with further grace period of 6 months but not later than 30 months from the date of execution of the Agreement i.e. latest by 27.01.2014. As per Clause 11.2, if the Opposite Parties  failed to offer possession of the plot, in question, by the end of grace period, they were to pay compensation calculated @Rs.50/- per sq. yard of the area of the plot for every month of delay until the possession was handed over. Further as per Clause 11.3 of the Agreement, the Opposite Parties failed to give possession beyond a period of 12 months from the end of the grace period i.e. up to 27.1.2015, then the complainant was entitled to terminate the agreement and seek refund of the amount paid by him.

3.          It was further stated that on 04.05.2015, the Opposite Parties issued notice of possession to the complainant (Annexure C-4). The complainant was shocked to know from other allottees that the Opposite Parties issued letter dated 29.06.2015, wherein the Opposite Parties admitted that the basic amenities like roads and sewerage were not complete/developed at the site. After receipt of letter dated 29.06.2015, the complainant in the month of July, 2015, visited the spot and were shocked to see that development at the site was not complete as promised by the Opposite Parties. The complainant immediately approached the Opposite Parties and inquired about the non-completion of development of the project and agitated issuance of notice of possession dated 04.05.2015. Being aggrieved, the complainant sought refund of the amount paid by him to the Opposite Parties. It was further stated that the Opposite Parties cleverly and intentionally issued notice of possession to the complainant knowing well that development of the plot was not complete in all respects as promised under Clause 21.2 of the Agreement and have tried to take advantage of Clause No.11.3 of the Agreement, to usurp the money of the complainant. 

4.          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) claiming refund of Rs.47,79,115/- alongwith compound interest @18% from the dates of actual payments; compensation in terms of Clause 11.2 of the Plot Buyer’s Agreement @Rs.50/- per sq. yd. w.e.f. 27.01.2014; compensation to the tune of Rs.5,00,000/- towards mental torture and harassment; Rs.1,00,000/- towards Counsel fee and Rs.70,000/- towards litigation charges/cost.

5.          The Opposite Parties, in their 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.33 in the Plot Buyer’s Agreement dated 28.07.2011; that present complaint related to the enforcement of agreement to sell/purchase of a residential plot i.e. an immoveable property and hence was not covered under the Act; that the complainant did not hire any services of the Opposite Parties, as the parties did not enter into any contract for hiring the services; that the complainant owned 33.33% share in Kothi No.63, Sector 9-A, Chandigarh and did not book the plot for his personal use but for investment/commercial purpose and that the allegations in the complaint being of contractual nature, were only triable by a Civil Court. Apart from above objections, a specific objection with regard to the territorial jurisdiction of the Commission on account of existence of Clause 35 in the Agreement has been raised stating that the Courts at Mohali and the Punjab & Haryana High Court at Chandigarh alone had the jurisdiction.

6.          On merits, it was stated that the amount of Rs.2,14,536/- as demanded vide demand note dated 29.04.2011 was paid by the complainant only on 05.06.2011 after reminder dated 02.06.2011. It was further stated that the demand of Rs.9,75,741/- raised vide demand note dated 03.07.2011 was paid on 01.08.2011 after reminder dated 21.07.2011. It was further stated that the payment plan was changed by the Opposite Parties only for the benefit of the allottees, to which the complainant never objected.  It was further

stated in Para 5 of the reply that similarly the amounts of Rs.9,79,612/-, Rs.9,69,816/- and Rs.9,89,410/- were paid by the complainant only on 07.06.2013, 25.02.2014 and 01.10.2014 after sending various reminders and final notice dated 26.09.2014 against the demand note dated 15.07.2014. It was further stated that due installments demanded vide Demand Note dated 16.10.2014 and 06.01.2015 despite reminders and final notices dated 05.01.2015 and 20.03.2015 were not remitted. It was further stated that the Opposite Parties have already laid the roads, water lines, sewer lines electrical lines, etc. as per Clause 21.2 of the Agreement. It was further stated that in case of failure to offer possession within 30 months from the date of the Agreement, the complainant was entitled to liquidated damages as per Clause 11.2 till possession was actually offered.

7.   It was denied that possession was to be offered latest by 27.01.2014. It was further stated that compensation mentioned in Clause 11.2 was payable either on exercising the option of termination of the Agreement under Clause 11.3 or on acceptance of possession as per Clause 11.2 of the Agreement. It was further stated that possession of the plot, in question, was offered vide notice of possession dated 04.05.2015. It was denied that in July 2015, the development was not complete. It was further stated that development work commenced at the site w.e.f. 1.5.2013 and stood carried on continuously in a phased manner at a good pace till April, 2015. It was further stated that the answering Opposite Parties started offering possession of the plots to its allottees w.e.f. 4.5.2015. It was further stated that had there been no development, various notices of possession could not have been issued in May 2015. It was further stated that now

the answering Opposite Parties have already installed and made operational the STP at the site. It was further stated that as per the report of Local Commissioner dated 24.10.2015, the project is fully developed and all the basic amenities are available at the site. It was further stated that the Opposite Parties have been granted all the necessary approvals and necessary permissions to sell, develop and offer the possession of the plot to the allottees. It was further stated that the Opposite Parties were also granted various sanctions/approvals from the competent authorities.

8.         It was further stated that the Opposite Parties have been exempted from the provisions of the Punjab Apartment & property Regulation Act, 1995 vide notification dated 14.08.2008. It was further stated that NOC for withdrawal of ground water was granted on 19.08.2011, environmental clearance was granted on 30.11.2012; NOC by Punjab Pollution Control Board was granted on 14.05.2013, which was then extended upto 13.05.2016 vide letter dated 29.06.2015; service plans were approved on 18.05.2015; revised layout plans were approved on 15.05.2013; NOC by PSPCL was granted on 08.07.2015; approval for commissioning of electrical installation was accorded on 07.08.2015; consent to operate was granted by Punjab Pollution Control Board on 05.01.2016 and Bank Guarantee was submitted to PSPCL on 22.03.2016. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice. The remaining averments, were denied, being wrong.

7.          On 17.08.2016, Counsel for the complainant stated that the complainant did not wish to file any rejoinder.

8.          The complainant, in support of his case, submitted his affidavit, by way of evidence, alongwith which, a number of documents were attached.

9.          The Opposite Parties, in support of their case, submitted the affidavits of Sh. Rohit Tanwar, their Authorised Representative, by way of evidence, alongwith which, a number of documents were attached. 

10.        We have heard the Counsel for the parties, and have gone through the evidence, and record of the case, carefully. 

11.        It is evident, on record, that the complainant was allotted plot No.22 admeasuring 250.59 sq. yards, in the residential project “IREO Hamlet” Sector 98, SAS Nagar, Mohali. Admittedly, Plot Buyer’s Agreement was executed between the complainant and the Opposite Parties on 28.07.2011 (Annexure C-1). The basic sale price whereof was Rs.23,000/- per sq. yard i.e. Rs.57,63,570/- besides External Development Charges (EDC) @Rs.1,275.10 per sq. yard and Preferential Location Charges (PLC) @Rs.500/- per sq. yard and IFMS @Rs.350/- per sq. yard. The payment was to be regulated as per Payment Plan (Annexure I) (at Page 47 of the file). Against the total sale consideration of Rs.63,07,713.66, the complainant made payment in the sum of Rs.47,79,115/-, in accordance with demand(s) raised by the Opposite Parties, as is evident from Account Statement (Annexure C-3). The Opposite Parties offered change of payment plan from Time Linked Payment Plan to the Development Linked Payment Plan vide letter dated 26.09.2011 (Annexure C-2) and the complainant did not raise any objection, to the same. As admitted by the Opposite Parties, the development work started at the site only on 01.05.2013, almost two years after the execution of Plot Buyer’s Agreement dated 28.07.2011 (Annexure   C-1).  

12.           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 no jurisdiction to entertain the consumer complaint. 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, inter-alia, relevant, are 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 the Opposite Parties 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.

13.        To defeat claim of the complainant, the next objection raised by the Opposite Parties was that since the complainant had purchased the plot, in question, for investment/commercial purpose i.e. for resale, as and when there was escalation in the prices of real estate, as such, and since complainant owned Kothi No.63, Sector 9-A, Chandigarh to the extent of 33.33%, he would not fall within the definition of consumer, as defined by Section 2(1)(d)(ii) of 1986 Act. It may be stated here that there is nothing, on record to show, that the complainant is a property dealer, and is indulged in sale and purchase of property, on regular basis. Moreover, the complainant in Para 1 of the complaint has stated that he purchased the residential plot, in question, exclusively for himself and for his family members by constructing house thereon. In the absence of any cogent evidence, in support of the objection raised by the Opposite Parties, mere bald assertion to that effect, cannot be taken into consideration. It may be stated here that in a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd., Consumer Complaint No.137 of 2010, decided on 12.02.2015, by the National Consumer Disputes Redressal Commission, New Delhi, it was held that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. The principle of law, laid down, in Kavita Ahuja’s case (supra) is fully applicable to the present case. Under these circumstances, by no stretch of imagination, it can be said that the plot, in question, was purchased by the complainant, by way of investment, with a view to earn profit, in future. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs  Nirmala Devi Gupta,  Revision Petition No. 3861 of 2014, decided on 26.08.2015.The complainant, thus, falls within the definition of ‘consumer’, as defined under Section 2(1)(d) of the Act. Such an objection, taken by the Opposite Parties, in their written reply, therefore, being devoid of merit, is rejected.  

14.        Another objection raised by Counsel for the Opposite Parties was that since the complainant did not buy goods and did not hire any services, and was seeking enforcement of the Agreement in respect of immovable property, therefore, only a Civil Court can decide the complaint, and consumer complaint was not maintainable. It may be stated here, that the complainant hired the services of the opposite parties, for purchasing the plot, in question, in the manner, referred to above. According to Clause 11.1 of the Agreement, subject to force majeure conditions and reasons,  beyond  the  control  of the Opposite Parties, they were to deliver physical possession of the unit, within a period of 30 months, from the date of execution of the same (Agreement), with complete basic amenities, as provided in Clause 21.2. Section 2 (1) (o) of the Act, defines service as under:-

“service” means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both,  housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service”

 

 

 

 

15.        From the afore-extracted Section 2(1)(o) of the Act, it is evident that housing/construction, also comes within the definition of a service. In Narne Construction P. Ltd., etc. etc. Vs.  Union Of India and  Ors. Etc., II (2012) CPJ 4 (SC),  it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression ‘service’ of any description. Housing construction or building activity carried on by a private or statutory body constitutes ‘service’ within the ambit of Section 2(1)(o) of the Act. Similar principle of law, was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, the complaint involves the consumer dispute, and the same is maintainable. Not only this, Section 3 of the Act provides an alternative remedy. Even if, it is assumed that the complainant has a remedy to file a suit, for specific performance, in the Civil Court, the alternative remedy provided under Section 3 of the Act, can be availed of by him, as he falls within the definition of consumer, as stated above. In this view of the matter, the objection of Opposite Parties, in this regard, being devoid of merit, must fail, and the same stands rejected.

16.        The next objection raised by the Opposite Parties is that Clause 35 in the Apartment Buyers Agreement, bars the territorial jurisdiction of this Commission, to entertain and try the complaint. It may be stated here that this issue has already been dealt with in detail by this Commission in the case of ‘Jarnail Singh Sandhu Vs. M/s Puma Realtors Pvt. Ltd. & Anr.’, Consumer Complaint No.173 of 2016 decided on 02.09.2016. Para 19 of the said judgment, being relevant is, inter-alia, extracted hereunder:-

“19……..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 receipt dated 12.07.2011 in the sum of Rs.9,37,500/- (Annexure C-I), provisional allotment letter dated 04.08.2011 (Annexure  C-II), receipt dated 15.10.2011 in the sum of Rs.10,53,130.58 (Annexure C-III), letter dated 26.09.2011 regarding offer for change of payment plan (Annexure C-IV) and two receipts dated 13.08.2013 (Annexure C-V colly.) were issued by the Chandigarh office of the Opposite Parties i.e. Puma Realtors Private Limited, S.C.O. no.6-7-8, Second Floor, Sector 9-D, Chandigarh. 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 the opposite parties, 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 the Opposite Parties, in this regard, being devoid of merit, must fail, and the same stands rejected.”

 

               In view of above, this objection raised by the Opposite Parties stands rejected.

17.       The next question, which falls for consideration, is, as to whether the possession offered vide letter dated 04.05.2015 (Annexure OP-3) was complete and proper or not. The Counsel for the complainant submitted that possession of the plot, in question, offered vide letter dated 04.05.2015 was of undeveloped plot/project.     

18.       The complainant has challenged the offer of possession dated 04.05.2015 by filing the instant complaint for lack of development and basic amenities at the site. Apparently there was promise to make development and then offer/hand over possession of the plot, to the complainant. From letter dated 29.06.2015 of the Opposite Parties (Annexure C-5), which was issued to similarly situated allottee (Mr. Upjeet Singh Sahota), after offer of possession letter dated 04.05.2015, it is clear that following amenities were yet to be completed:-

• Internal roads not complete as it could be damaged on account of movement of trucks carrying heavy construction material.
• We are in process of completing the balance blacktopping work also.
• The work of roads would be taken up after considerable number of houses are constructed by the allottees.
• Only temporary electricity connection would be made available.
• External roads, networks and infrastructure are the responsibility of Government and the opposite parties are following up with the Government to do so.
• Sewerage treatment plant has not been constructed and will be taken when there is adequate habitation.
• For construction purpose water can be purchased from any authorised vendor permitted by Panchayat, Irrigation department, GMADA etc. 
• Features like swings etc. shall be provided in due course of time.

It has been admitted by the Opposite Parties in Para 7 of their written statement that the aforesaid letter was sent to all its allottees informing them about status of development. Thus, the averment of the complainant that the basic amenities like roads and sewerage were not complete/developed at the site, stands corroborated.

19.        The Opposite Parties were, thus,  duty bound to provide all basic facilities like roads, sewerage, drinking water, electricity, street lights, drainage etc. to the complainant. There is nothing, on record, that complete development, in respect of the plot, in question, and amenities at the site as promised, as per the Plot Buyer’s Agreement dated 28.07.2011, were available at the site. The Counsel for the Opposite Parties argued that the complainant has not alleged any deficiency in regard to non-obtaining of approvals. It may be stated here that certain approvals such as electrical installations, NOC subject to making arrangements for suitable provision for drinking water supply and safe disposal of sullage/storm discharge and sold waste management, are inter-linked with basic amenities. The fact that certain amenities and approvals were complete/obtained after offer of possession, clearly proves deficiency of the Opposite Parties, as is evident from the position indicated hereinafter.

20.       In Memo No.5001 dated 7.8.2015 (Annexure OP-24), which is letter from the Chief Electrical Inspector to Govt. Punjab, Patiala, to M/s IREO Hamlet A(Residential Township Sector 98, Mohali, it is stated that inspection of subject cited electrical installation was carried out by the Electrical Inspectorate and the same was found to be conforming to the relevant provisions of Central Electricity Authority (Measure relating to safety and Electric Supply) Regulations, 2010 and the  installations  were  approved  for commissioning but clearly, this approval was accorded after offer of possession vide letter dated 04.05.2015.

21.       Even the final NOC to the Opposite Parties for 85.25 Acres residential township in Sectors 86, 98 and 99 in Village Sambhalkhi, SAS Nagar, Mohali was accorded by Punjab State Power Corporation Limited on 8.7.2015 (Annexure OP-23), after offer of possession on 04.05.2015. Further letter dated 18.05.2015 (Annexure OP-21) from Greater Mohali Area Development Authority (GMADA), informing the Opposite Parties that “…….Therefore, the arrangements for suitable provision for drinking water supply and safe disposal of sullage/storm discharge and solid waste management shall be made by promoter at his level separately and he shall obtain all necessary approvals from the concerned Authorities as per law in this regard independently. The construction work shall commence only after obtaining approvals as per law from the concerned Authorities……” was issued after offer of possession. As per this letter, number of other conditions were also required to be complied with by the promoter. The Opposite Parties have not stated whether they complied with the aforesaid conditions. Further, consent to operate an outlet for discharge of the effluent u/s 25/26 of Water (Prevention & Control of Pollution) Act, 1974 was granted to the Opposite Parties vide letter dated 05.01.2016 (Annexure OP-25) i.e. after offer of possession. It may also be stated here that the Opposite Parties furnished Bank Guarantee dated 22.03.2016 (Annexure OP-26) with expiry date/ claim expiry date as 21.03.2021 in the sum of Rs.3,24,10,301/- to the PSPCL, after offer of possession. As such, the Opposite Parties had neither completed the development and basic amenities nor did they have all the necessary sanctions/approvals from the Competent Authorities up-till 04.05.2015 when offer of possession was made. The contention of the complainant that possession offered was not a valid and legal possession is corroborated from the evidence on record. It is, therefore, held that the Opposite Parties were not only deficient, in rendering service but also indulged into unfair trade practice, by offering a paper possession to the complainant, before completing the basic amenities as also without obtaining the necessary sanctions/approvals.

22.        The next question which falls for consideration, is, whether the complainant is entitled to refund of the entire amount deposited by him. It may be stated here that Plot Buyer’s Agreement was entered into between the parties on 28.07.2011 (Annexure C-1). As per Clause 11.1 of General Clauses of the Agreement, possession of the plot, in question, was to be handed over within 24 months from the date of execution of the said Agreement with further grace period of 6 months but not later than 30 months i.e. latest by 27.01.2014. Further, as per Clause 11.2 of the Agreement, in case, possession was not offered within the stipulated period, then the Opposite Parties were liable to pay compensation calculated @Rs.50/- per sq. yard of the area every month until possession is actually handed over. Clauses 11.1 and 11.2 of the Plot Buyer’s Agreement dated 28.07.2011, being relevant, are extracted hereunder:-

“11.1 - Subject to Force Majeure, as defined herein, and further subject to the Allottee having complied with all its obligations under the terms and conditions of this Agreement, and not being in default of any provision(s) of this Agreement including but not limited to the timely payment of all dues and charges including the total Sale Consideration, registration charges, stamp duty and other charges, and also subject to the Allottee having complied with all formalities or documentation as prescribed by the Company, the Company proposes to hand over the possession of the said Plot to the Allottee within a period of 24 (Twenty Four) months from the date of execution of this Agreement (“Commitment Period”). The Allottee further agrees and understands that the Company shall additionally be entitled to a period of 6 (Six) months (“Grace Period”), after the expiry of the said Commitment Period.

11.2-Subject to Clause 11.1, if the Company fails to offer possession of the said Plot to the Allottee by the end of the Grace Period, it shall be liable to pay to the Allottee compensation calculated at the rate of Rs.50/- (Rupees Fifty only) per sq. yd. of the area of the said Plot (“Delay Compensation”) for every month of delay until the actual date fixed by the Company for handing over of possession of the said Plot to the Allottee. The Allottee shall be entitled to payment against such ‘Delay Compensation’ only after completion of all documentation including registration of the Conveyance Deed”.

 

23.        Since the Plot Buyer’s Agreement was executed on 28.07.2011, 30 months period including 6 months grace period expired on 28.01.2014. Even the extended period of 12 months, in terms of Clause 11.3 of the Agreement expired on 27.01.2015. Admittedly, possession of the unit, in question, was offered to the complainant vide letter dated 04.05.2015 (Annexure C-4) was a paper possession only. The total price of the unit was Rs.63,07,713.66 and the complainant had made payments in the sum of Rs.47,79,115/-  to the Opposite Parties, which was undoubtedly his hard earned money. No plausible reason has been assigned by the opposite parties, as to why they (Opposite Parties) failed to deliver complete possession of the unit, by the date stipulated. Delay could only be condoned, under the terms and conditions of the Agreement, if there existed plausible and justified reasons. Clearly, there is delay in handing over of possession. It may be stated here that offer sent vide letter dated 04.05.2015, has been held to be a mere paper possession. Under similar circumstances, this Commission, in the case of Brig Ajay Raina (Retd.) and another Vs. M/s Unitech Limited, Consumer Complaint No.59 of 2016, decided on 24.05.2016, while relying upon the judgments rendered by the Hon’ble National Commission, held as under:-

“Further, even if, it is assumed for the sake of arguments, that offer of possession, was made to the  complainants, in July 2015 i.e. after a delay of about three years, from the stipulated date, even then, it is not obligatory upon the  complainants to accept the same. It was so held by the National Commission in Emaar MGF   Land   Limited   and   another   Vs. Dilshad Gill, III (2015) CPJ 329 (NC). Recently also, under similar circumstances, in the case of M/s. Emaar MGF Land Ltd. & Anr. Vs. Dr.Manuj Chhabra, First Appeal No.1028 of 2015, decided on 19.04.2016, the National Commission, held as under:-

“I am of the prima facie view that even if the said offer was genuine, yet, the  complainants was not obliged to accept such an offer, made after a lapse of more than two years of committed date of delivery”.

The principle of law laid down in the aforesaid cases is fully applicable to the present case. It is therefore held that the  complainants could not be held guilty, of filing the present complaint, seeking refund of the deposited amount, alongwith interest and compensation, as possession of the unit was not offered to them by the stipulated date.

It was clearly stated by the National Commission, in Emaar MGF Land Limited and another Vs. Dilshad Gill, III (2015) CPJ 329 (NC), that when the promoter has violated material condition, in not handing over possession of the unit, in time, it is not obligatory for a purchaser to accept possession after that date. 

24.       In the present case also, the Opposite Parties committed breach of their obligation, in not offering possession of the plot, in question, within 30 months from 28.07.2011 i.e. date of signing of Buyer’s Agreement and even after expiry of extended delay period of 12 months, on 27.01.2015. A perusal of Clause 11.3 of the Plot Buyer’s Agreement clearly provides that “……..from the end of the Grace Period (such 12 month period hereinafter referred  to as the “Extended Delay Period”), then the Allottee shall become entitled to opt for termination of the Allotment/Agreement and refund of the actual paid up installment(s) made against the said Plot….”. Since the Opposite Parties failed to handover legal and valid possession of the plot, in question, with complete development and all basic amenities, to the complainant, even after expiry of 42 months from the execution of Plot Buyer’s Agreement, in view of law laid down in Emaar MGF Land Limited and another Vs. Dilshad Gill ‘s case (supra), the complainant was entitled to seek refund. Thus, in our considered opinion, the complainant is entitled to refund of the deposited amount and by not offering possession of the unit, in question, within the stipulated period and during extended delay period and by not refunding the deposited amount, the Opposite Parties were deficient in rendering service.

25.        It is to be further seen, as to whether, interest, on the amount refunded can be granted, in favour of the complainant. It is not in dispute that an amount of Rs.47,79,115/-  was paid by the complainant, without getting anything, in lieu thereof. The said amount has been used by the Opposite Parties, for their own benefit. There is no dispute that for making delayed payments, the Opposite Parties were charging heavy rate of interest, for the period of delay in making  payment  of installments.  It       is well settled law that whenever money has been received by a party which ex ae quo et bono ought to be refunded, the right to interest follows, as a matter of course. The obligation to refund money received and retained without right implies and carries with it, the right to interest. It was also so said by the Hon’ble Supreme Court of India, in UOI vs. Tata Chemicals Ltd (Supreme Court), (2014) 6 SCC 335 decided on March 20th, 2014 (2014) 6 SCC 335). In view of above, the complainant is certainly entitled to get refund of the amount deposited by him, to the tune of Rs.47,79,115/-  alongwith interest compounded quarterly @12% from the respective dates of deposits (less than the rate of interest charged by the Opposite Parties, in case of delayed payment), till realization.

26.        It is also proved on record that the payment of installments was delayed by the complainant. If that is so, certainly he is not entitled to get same compensation for deficiency, mental agony and physical harassment, which we are granting in other cases, qua this very project, in case of delay, in delivery of possession. The complainant defaulted in remitting installments on a number of occasions. Besides delay in making payment of instalments, two installments, demand for which was raised vide demand notes dated 16.10.2014 and 06.01.2015 in the sum of Rs.5,76,357/- and Rs.6,64,063/- respectively, were not deposited despite reminders. Non-payment of the installments in time has a bearing on development of project and contributes to delay in development, infrastructure and amenities, in the project. Accordingly, it is held that the complainant is entitled to Rs.One lac, as compensation, for deficiency in service, mental agony and physical harassment, which in our considered opinion is fair and reasonable. 

27.        No other point, was urged, by the Counsel for the parties.

28.         For the reasons, recorded above, this complaint is partly accepted, with costs. The Opposite Parties are, jointly and severally, held liable and directed in the following manner:-

(i)    To refund the amount of Rs.47,79,115/- , to   the   complainant, alongwith interest @12% compounded quarterly, from the respective dates of deposits, within a period of 45 days, from the date of receipt of a certified copy of this order.

(ii)   To pay an amount of Rs.1,00,000/-  (Rupees One Lac only), to the complainant, as compensation for mental agony, physical harassment, deficiency in rendering service and unfair trade practices, within a period of 45 days from the date of receipt of a certified copy of the order.

(iii)  To pay cost of litigation, to the tune of Rs.50,000/-, to the complainant within a period of 45 days from the date of receipt of a certified copy of the order.

(iv)  In case, the payment of amount, mentioned in Clause (i), is not made, within the stipulated period, then the Opposite Parties, shall be liable to pay the amount mentioned in Clause (i) above, with interest @15% compounded quarterly, from the date of default, till realization and amount mentioned in Clause (ii) and (iii) above, with interest @12% (simple) from the date of filing the complaint till realization.

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.

19.09.2016.

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

 

[DEV RAJ]

MEMBER

 

 

 

[PADMA PANDEY]

 MEMBER

Ad