Chandigarh

StateCommission

CC/595/2016

Harvinder Kaur - Complainant(s)

Versus

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

Sh. Vipul Aggarwal, Adv.

07 Feb 2017

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Consumer Complaint	:	595 of 2016
Date of Institution	:	15.09.2016
Date of Decision	:	07.02.2017

 

Ms. Harvinder Kaur w/o Inderjit Singh r/o H.No.951, Phase 3B-2, Mohali, Punjab.

……Complainant.

 

Versus

 

1. M/s Puma Realtors Private Limited, a Company incorporated under the Companies Act, 1956 (An IREO Group Company), having its Registered Office at No.5, Dhanraj Chambers, 1st Floor, Satbari, New Delhi-110074, through its Managing Director/Director/ authorized Signatory/Representative.

 

2. M/s Puma Realtors Private Limited, a Company incorporated under the Companies Act, 1956 (An IREO Group Company), Corporate Office at SCO No.6-8, First Floor & Second Floors, Sector 9-D, Madhya Marg, Chandigarh – 160009 through its Managing Director/ Director/Authorized Signatory/Representative.

 

….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. Vipul Aggarwal, 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 purchase of a residential plot in their project and paid Rs.6,50,000/- as booking amount alongwith the application. Vide provisional allotment letter dated 29.04.2011 (Annexure C-4), the complainant was allotted a residential plot measuring 250.59 sq. yards at the Basic Sale Price of Rs.23,000/- per sq. yard i.e. Rs.57,63,570/- plus EDC, PLC and IFMS in the project of the Opposite Parties, named, “IREO HAMLET”. The total sale consideration of the said plot was Rs.62,96,098.81. The complainant kept on paying the amounts, demands whereof were raised from time to time. Plot Buyer’s Agreement dated 04.07.2011 (Annexure C-9) was entered into between the parties. Vide letter dated 26.09.2011 (Annexure C-10), the Opposite Parties changed the payment plan opted by the complainant from time Linked Payment Plan to Development Linked Payment Plan.        It was stated that the complainant, in all, paid an  amount of Rs.28,19,889.28 to the Opposite Parties                i.e. 45% of the sale consideration, as on 22.05.2013.          As per Clause 11.1 of the Agreement, possession of            the said plot was to be handed over by the Opposite Parties within 24 months from the date of execution of the Agreement with further grace period of 6 months but not later than 30 months i.e. latest by 03.01.2014. Further as per Clause 11.2 of the Agreement, the Opposite Parties were liable to pay compensation @Rs.50/- per sq. yard of the area per month beyond the stipulated period of 30 months till handing over actual physical possession of the allotted plot. Further as per Clause 21.2 of the Agreement, the Opposite Parties were to develop the said project by laying roads, water lines, sewer lines, electrical lines etc. but there was no development  at  the  site  where  the  plot  allotted to the complainant is situated. It was further stated that even the development work has not even started as yet.  

2.          It was further stated that when the complainant went to the office of the Opposite Parties to enquire about the start of development activities at the site, she was astonished to hear that the Opposite Parties were no longer developing that stretch of area and gave no satisfactory answer about the refund of the money paid by her to them. As per the complainant, after a delay of more than 2 years and 7 months, instead of offering possession of the allotted plot, the Opposite Parties re-allotted another plot bearing No.160 and offered possession of the same vide letter dated 05.01.2016 (Annexure C-13), without giving any prior intimation to the complainant, which amounted to unfair trade practice on their part, thereby causing immense loss and harassment to the complainant. It was stated that the Opposite Parties have now stopped responding to the calls of the complainant, which further caused undue harassment and mental agony to her.

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) claiming refund of Rs.28,19,890/- alongwith interest @18% per annum from the respective dates of deposits till realization; Rs.3,00,000/- as compensation for facing mental agony, physical harassment & deficiency in service and Rs.40,000/- as cost of litigation.

4.          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 04.07.2011; that since the present complaint related to enforcement of an agreement to sell/purchase of a residential plot i.e. an immovable 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 did not book the plot for her personal use but for investment/commercial purpose; that the allegations in the complaint being of contractual nature, were only triable by the Civil Court and that the instant complaint is time barred. Apart from above objections, a specific objection with regard to the territorial jurisdiction of this 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.

5.          On merits, it was stated that the complainant, after having satisfied in all aspects, applied for booking of a plot vide application dated 19.02.2011 by paying a sum of Rs.6,50,000/- towards booking amount. It was further stated that bare perusal of the application for booking and the Agreement, showed that the complainant examined all the documents with respect to the title, approvals, sanctions, layout plan etc. and authority of the Opposite Parties and after satisfying herself        about all aspects of the project, she exercised her own discretion to apply for the plot, in question. It was further stated that the complainant vide recital No. ‘K’ of the said Agreement herself represented that she was not influenced by any kind of sales brochures, advertisements, representations, warranties etc. and she had relied upon her own independent investigations while deciding to purchase the plot, in question. It was denied that the complainant was assured that the possession would be handed over within a period of 24 months from the date of execution of the Agreement. It was further stated that the period of handing over of the plot was subject to the complainant complying with all her obligations under the terms and conditions of the Agreement. It was further stated that as per Clause 11 of the Agreement, the period for offering possession travels beyond the alleged period of 30 months since the complainant duly agreed to receive delayed compensation @Rs.50/- per sq. yard of area of the plot every month until actual date fixed by the Opposite Parties for handing over of possession.

6.          It was further stated that the valid and legal possession of the developed plot No.160 had already    been offered to the complainant vide notice of possession dated 05.01.2016 as per terms of the Agreement only after completing the development work at the site as per clause 21.2 of the Agreement and she was offered various monetary benefits of Rs.14 Lacs approximately. It was further stated that as per Clause 10 of the Agreement, no prior intimation about the change of location of the plot was required to be given to the complainant. It was further stated that development at the site started on 01.05.2013 but later due to planning requirements, the development of a small portion of the said project was postponed.

7.          It was further stated that the Opposite Parties are possessed of all the necessary approvals and permissions to sell, develop and offer possession of the plots to their allotees but not limited to the notification dated 14.08.2008 issued by Government of Punjab exempting the Opposite Parties from the provisions of the Punjab Apartment and Property Regulation Act, 1995 (in short ‘PAPRA 1995’). 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 vide letters dated 09.12.2014, 29.06.2015 & 20.07.2016; 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 installations was accorded on 07.08.2015; consent to operate was granted by Punjab Pollution Control Board on 05.01.2016 and Bank Guarantee to the tune of Rs.3,24,10,301/- was submitted to PSPCL on 22.03.2016. It was further stated that even the report of Local Commissioner filed in complaint titled ‘Abha Arora Vs. PUMA Realtors Pvt. Ltd. and another’, bearing No.170 of 2015, clearly unveils the false allegations made by the complainant. 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.

8.          The complainant filed replication, wherein, she reiterated all the averments, contained in the complaint, and repudiated the same, contained in the written version of the Opposite Parties. In the rejoinder, it was stated that the Opposite Parties are trying to portrait a picture that they had already offered possession of the plot vide notice of possession dated 05.01.2016 but as a matter of fact, as per Clause 11.1, they had to handover the possession of the said plot within  maximum period of 30 months including the grace period of 6 months but they in order to hide their misdeeds had unilaterally offered alternate Plot No.160 without any intimation, after an inordinate and immense delay and without any explanation, which itself shows gross deficiency in service on their part. It was stated that in the present case, the extended period of 12 months including the grace period had already expired. It was further stated that vide representation dated 29.01.2016 (Annexure C-14), the complainant refused the offer of alternate plot and sought refund of the paid amount alongwith interest and penalty and as such, she opted for the termination of the said Plot Buyer’s Agreement. 

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

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

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

12.        It is evident, on record, that the complainant vide provisional allotment letter dated 29.04.2011 (Annexure C-4) was allotted plot No.295 in the residential project “IREO Hamlet” admeasuring 250.59 sq. yards, Sector 98, SAS Nagar, Mohali. Admittedly, Plot Buyer’s Agreement was executed between the complainant and the Opposite Parties on 04.07.2011 (Annexure C-9). 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 62 of the file). Against the total sale consideration of Rs.62,96,098.81, the complainant made payment in the sum of Rs.28,19,890/-, in accordance with demand(s) raised by the Opposite Parties, up-till 22.05.2013. 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-10) and the same was duly acknowledged by the complainant as is evident from her signatures thereon. It is also on record that vide letter dated 05.01.2016 (Annexure C-13), the Opposite Parties changed the location of the plot and offered possession of Plot No.160, instead of originally allotted one, which the complainant refused and sought refund of the deposited amount vide letter dated 29.01.2016 (Annexure C-14). The Opposite Parties admitted receipt of Rs.28,19,889.20 (or say Rs.28,19,890/-) in the aforesaid letter dated 05.01.2016.

13.           The first question, that falls for consideration, is, as to whether, in the face of existence of arbitration  clause No.33 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 case titled ‘Sarbjit Singh Vs. Puma Realtors Private Limited’, IV (2016) CPJ 126. Paras 25 to 35 of the said order, inter-alia, being relevant, are extracted hereunder:-

25.        The next 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.

26.        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.”

27.                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.”

28.      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.

29.       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.”

30.     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.

31.        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 a 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.

32.        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 has spent his life savings to get a unit, for his 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 upto 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.

33.        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 plot, in the said project, launched by the opposite party. However, his hopes were shattered, when despite making substantial payment of the sale consideration, he failed to get possession of the  plot, 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.

34.        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.”

35.     In  view of the above, the plea taken by the opposite party, 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.”

             In view of the above, the objection raised by Counsel for the Opposite Parties, 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 unit, in question. 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 i.e. (24 months + 6 months grace period), 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 remedy to file a suit in the Civil Court, the alternative remedy provided under Section 3 of the Act, can be availed of by her, as she falls within the definition of ‘consumer’, as stated above. In this view of the matter, the objection of the Opposite Parties, in this regard, being devoid of merit, must fail, and the same stands rejected.

16.          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, she 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 her rejoinder, has stated that she had purchased the plot, in question, to construct the house for her own personal use and not for any investment/ commercial purpose. 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. In  Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd., 2016 (1) CPJ 31, it was held by the National Commission 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 unit, 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, 2016 (2) CPJ 316. Not only above, recently under similar circumstances, in a case titled as “Aashish Oberai Vs. Emaar MGF Land Limited”, Consumer Case No.70 of 2015, decided on 14 Sep. 2016, the National Commission, while rejecting similar plea raised by the builder, observed as under:-

“In the case of the purchase of the house which a builder undertakes to construct for the buyer, the purchase can be said to be for a commercial purpose where it is shown, by producing evidence, that the buyer is engaged in the business of a buying and selling of houses and or plots as a trading activity, with a view to make profits by sale of such houses or plots. A person cannot be said to have purchased a house for a commercial purpose only by proving that he owns or had purchased more than one houses or plots. In a given case, separate houses may be purchased by a person for the individual use of his family members. A person owning a house in a city A may also purchase a house in city B for the purpose of staying in that house during short visits to that city. A person may buy two or three houses if the requirement of his family cannot be met in one house. Therefore, it would not be correct to say that in every case where a person owns more than one house, the acquisition of the house is for a commercial purpose. In fact, this was also the view taken by this Commission in Rajesh Malhotra & Ors. vs. Acron Developers Pvt. Ltd. &Ors. First Appeal No.1287 of 2014 decided on 05.11.2015.”

 

Therefore, in view of law settled by the National Commission in the aforesaid cases, the complainant 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.  

17.        The next objection raised by the Opposite Parties was that the complaint was time barred as the complainant could file the present complaint by 02.01.2016 up-to which date, possession of the plot, in question, was to be offered. It may be stated here that this objection of the Opposite Parties is bereft of merit as the Opposite Parties did not offer possession of the originally allotted plot, which was to be offered within the stipulated period of 30 months i.e. 24 months plus six months grace period. However, they offered possession of another plot vide letter dated 05.01.2016 (Annexure C-16), which the complainant did not accept and sought refund of her deposited amount vide letter dated 29.01.2016 (Annexure C-14). Therefore, the cause of action accrued to the complainant to file the instant complaint on 05.01.2016. Even otherwise, since the possession of the originally allotted plot was not offered, there was continuing cause of action. The complaint having been filed on 15.09.2016 is within limitation. Therefore, this objection of the Opposite Parties, being devoid of any substance, stands rejected.

18.        The next objection raised by the Opposite Parties is that Clause 35 in the Plot 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 her. In the instant case, it is evident, that all the documents i.e. letter (Annexure C-1), Receipt against booking amount (Annexure C-2), allotment letter dated 29.04.2011 (Annexure C-4), Demand Notice (Annexure C-5), receipt dated 01.06.2011 (Annexure C-6), Demand Note dated 02.07.2011 (Annexure C-7), Receipt dated 29.07.2011 (Annexure C-8), letter dated 29.09.2011 (Annexure C-10), Demand note dated 30.04.2013 and Receipt dated 22.05.2013 (Annexures C-11 and C-12), 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. Even the Plot Buyer’s Agreement dated 04.07.2011 (Annexure C-9) was executed at 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.

19.        The next question which falls for consideration, is, whether the complainant is entitled to refund of the entire amount deposited by her. It may be stated here that Plot Buyer’s Agreement was entered into between the parties on 04.07.2011 (Annexure C-9). 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 03.01.2014. 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 04.07.2011, 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”.

 

20.        Since the Plot Buyer’s Agreement was executed on 04.07.2011, 30 months period including 6 months  grace

period expired on 03.01.2014. Even 12 months extended period, in terms of Clause 11.3 of the Agreement expired on 03.01.2015. Admittedly, possession of the originally allotted plot was not offered by the Opposite Parties to the complainant. Rather the Opposite Parties  vide letter dated 05.01.2016 (Annexure C-13) relocated the allotted Plot No.295 to Plot No.160, which was allegedly fully developed and ready for possession. Vide this letter, the Opposite Parties asked the complainant to signify her willingness towards the offer made within 30 days from the date of the said letter and in case of acceptance, the complainant was additionally entitled to discount @7.5% on the amount paid by her from the respective dates of payments till the date of the letter, which came out to be Rs.8,30,433/-. It was further stated in the said letter that the complainant would be entitled to another benefit amounting to Rs.5,35,200/- approximately. However, the complainant did not accept the said offer and sought refund of the whole amount of Rs.28,19,890/- vide letter dated 29.01.2016 (Annexure C-14). When despite concession of Rs.13,65,633/-, the complainant did not show her willingness, offer of possession of alternate plot was not valid. The contents of letter dated 29.01.2016 (Annexure C-14) written by the complainant to the Opposite Parties are very clear and categoric. Contents of Annexure C-14 reads thus:-

“As discussed with you telephonically, the undersigned is not at all interested in relocation of plot No.160 in lieu of Plot No.295 originally allotted by you vide Plot Buyer’s Agreement dated 04.07.2011. You on your own, without any information or any intimation, has unilaterally relocated the plot and that too after delay of more than 2 years, which is totally biased and unlawful. Instead of providing the plot at the place as per the Plot Buyer’s Agreement i.e. plot No.295, you have started cheating me, and it has caused immense mental as well as financial loss to me.

         Kindly refund the whole amount i.e. Rs.28,19,890/- paid to you alongwith penal interest otherwise, I would be constrained to approach the court of law and you would be entirely responsible for it.”

 

It was clearly within the domain of the complainant to give her willingness or otherwise to the offer of alternate plot. The complainant was not inclined to accept possession of the alternate plot and immediately sought refund. It is settled principle of law that in case, the complainant refuses to accept the allotment of an alternate plot, he/she cannot be forced to accept the same as per the desire of the Opposite Party. It is so said in case ‘M/s Taneja Developers & Infrastructure Ltd. Vs. Deepak Kumar & Anr., First Appeal No.509 of 2016 decided by National Commission on 03.06.2016. Further in ‘Syed Nizam Ali Vs. Guruprasad’, Revision Petition No.463 of 2016, alongwith which several other Revision Petitions were decided by the National Commission vide order dated29.02.2016, it was held, interalia, as under:-

 

“….This Commission in Emaar MGF Land Ltd. & Anr. V. Amit Puri (First Appeal No.250 of 2014), decided on 30.03.2015, has held that if the Developer fails to deliver possession of the allotted plot/flat within the stipulated time, the allottee is under no obligation to accept an alternative plot. At the cost of repetition, we may reiterate that in the event of Developer failing to deliver possession of the property within the stipulated period, for any reason, save and except a force majeure condition, agreed to between the contracting parties, an allottee cannot be compelled to accept an alternate site/plot and he would be within his rights to seek refund of the amount deposited with the Developer against allotment….”

 

The Opposite Parties were not only deficient for inordinate delay in offering possession of originally allotted plot but were also deficient in rendering service and indulged into unfair trade practice by retaining the hard earned money of the complainant. The total price of the unit was Rs.62,96,098.81 and the complainant had made payments in the sum of Rs.29,19,890/- to the Opposite Parties, which was undoubtedly her hard earned money. No doubt the Opposite Parties have stated that all basic amenities are available at site. Had it been so, then the Opposite Parties would have definitely raised further demands and offered possession of the originally allotted plot and not that of relocated plot, which was not acceptable to the complainant. In such circumstances, an adverse inference is drawn against the Opposite Parties. No cogent and plausible reason has been assigned by the Counsel for the Opposite Parties, as to why they (Opposite Parties) failed to deliver possession of the originally allotted plot, by the date stipulated or till date. Delay could only be condoned, under the terms and conditions of the Agreement, if there existed any plausible and justified reason. Thus, there is clear delay of around two years in offering/handing over possession of originally allotted plot even beyond the extended delay period and still the Opposite Parties are not in a position to offer possession of the originally allotted plot. Computing period from date of Buyer’s Agreement viz. 04.07.2011, the Opposite Parties, despite lapse of 5½ years, have failed to offer possession. It may be stated here that 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. As discussed above, possession of the originally allotted plot, in the instant case, has not been offered/delivered till date.

21.       In the present case also, the Opposite Parties committed breach of their obligation, in not offering possession of the allotted plot, in question, within 30 months from 04.07.2011 i.e. date of signing of Buyer’s Agreement and even after expiry of extended delay period of 12 months, on 03.01.2015. 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 hand over legal and valid possession of the allotted 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. It is not the case that the complainant defaulted and payment against any demand(s) raised by the Opposite Parties is due against the complainant. Thus, in our considered opinion, the complainant is entitled to refund of the deposited amount as by not offering possession of the allotted plot, 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.

22.        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.28,19,890/-  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 her, to the tune of Rs.28,19,890/- 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.

23.        In view of aforesaid position, the Opposite Parties are also under an obligation to compensate the complainant, for inflicting mental agony and causing physical harassment to her, as also escalation in prices. The last payment was made by the complainant, in the sum of Rs.9,79,613/- vide cheque bearing No.378609 dated 15.05.2013 and receipt thereof was issued on 22.05.2013 (Annexure C-12). The Opposite Parties did not raise any demand thereafter. The demands were to be made in accordance with the Development Linked Payment Plan. It is not the case that the Opposite Parties, even when there was no development, continued to raise the demands against the complainant. In such circumstances, compensation in the sum of Rs.1 Lac on account of mental agony, physical harassment, deficiency in rendering service and unfair trade practices, would meet the ends of justice. Thus, the complainant is held entitled to compensation in the sum of Rs.1 Lac.

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

25.         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.28,19,890/-, 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.35,000/-, 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 respective dates of deposits, till realization and amount mentioned in Clause (ii) and (iii) above, with interest @12% (simple) from the date of filing the complaint till realization.

26.        However, it is made clear that in case, the complainant has availed loan facility from any financial institution(s), such an institution shall have the first charge on the amount payable, to the extent, the same is due against the complainant.

27.        Certified Copies of this order be sent to the parties, free of charge.

28.        The file be consigned to Record Room, after completion.

Pronounced.

07.02.2017.

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

 

[DEV RAJ]

MEMBER

 

 

 

[PADMA PANDEY]

 MEMBER

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