Tamil Nadu

StateCommission

CC/29/2015

Vidya Balasubramanian, D/o.Balasubramanian - Complainant(s)

Versus

Puravankara Projects Ltd, Rep by its Managing Director,and anr - Opp.Party(s)

M/s.Giridhar & Sai

24 Feb 2022

ORDER

IN THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI

BEFORE       Hon’ble Thiru Justice R. SUBBIAH         PRESIDENT

                   Tmt. Dr. S.M.LATHA MAHESWARI            MEMBER

 

CC.NO. 29/2015

 DATED THIS THE 24^th DAY OF FEBRUARY 2022

1.       Vidya Balasubramanian

D/o. Balasubramanian

Residing at 513, First West Street

Kamaraj Nagar, Thiruvanmiyur

Chennai – 600 041

 

2.       Shyam Sundar Sankaran

S/o. G.S.Sankaran

Residing at 513, First West Street

Kamaraj Nagar, Thiruvanmiyur

Chennai – 600 041                                                     ....Complainants

 

                                                  Vs 

1.       Puravankara Projects Limited

          Rep. by its Managing Director

          No.227, S.V. Road, Bandra (West)

          Mumbai – 400 050

 

2.       Puravankara Projects Limited

Managing Director

No.7, LVR Center, V.Seshadri Road

Alwarpet, Chennai – 600 018                                    ....Opposite parties

 

Counsel for complainant                               :   M/s D. Geetha

Counsel for 1 & 2 Opposite parties                 :  M/s.R. Sathish Kumar

 

                This complaint coming before us for hearing finally on 14.12.2021 and on hearing the arguments of counsel appearing for complainant and opposite parties,   and upon perusing the material records this Commission made the following order:

ORDER

Justice R. SUBBIAH,  PRESIDENT   

 

1.       This complaint has been filed under Sec.17 of Consumer Protection Act 1986, against the opposite parties claiming a sum of Rs.3560890/- towards refund of the amount paid alongwith interest @10% p.a., to refund the service tax at Rs.56359/- as on 31.3.2013, and to pay interest on the above amounts @10% p.a., alongwith a sum of Rs.25,00,000/- towards compensation for mental agony alongwith cost.

2.       The case of the complainant in brief is as follows:

          The case of the complainant is that the opposite parties are reputed builder having more than 35 years of experience in construction of residential flats all over India.  On seeing the advertisements made by the opposite parties, the complainant  visited the project site and booked a flat bearing flat No.H704 in the said project.  Pursuant to the said booking the complainants entered into an agreement to purchase the proportionate undivided share of land and a construction agreement for the said apartment on 22.5.2007.  As per the agreement the construction ought to be completed by May 2010.  After entering into the agreement, the complainant had approached M/s. HDFC Bank for loan.  In pursuance to the sanction of loan, the complainant entered into a tripartite agreement with M/s. HDFC Bank and the 1^st opposite party.  In furtherance to entering into the above said agreement, the complainant had totally paid approximately Rs.41.91 lacs on various dates.  Though the agreement specified reciprocal obligations to be fulfilled by the opposite parties (as the developer) to the shock and dismay of the complainants that inspite of the substantial payment made by the complainant through HDFC Bank, there was no progress in the construction activities since December 2008.  When the complainant enquired the opposite parties regarding stoppage of work, they were informed that the contractor engaged by the builder had stopped the work because of their income tax problem, and the complainants were also assured by the opposite parties that the construction activities would be commenced by engaging a new contractor.  But there is no satisfactory progress of the work at the site.  The project had come to a standstill without any further construction activities. The opposite parties themselves communicated to the purchasers including the complainant herein, giving a payment holiday on account of delay.  In the meantime, the HDFC bank which had given housing loans to many of the purchasers in the said project, had on its own accord stopped the disbursement of loan since January 2009 as the bank felt that the project progress did not match with the substantial money already disbursed to the opposite parties.  The opposite parties also on its own accord revised the plan of completion of project from April 2010 to February 2011.  Since there was no proper communication from the opposite parties, various buyers of the apartments in the Purva Swanlake formed an Association under the name and style of Purva Swanlake Association in February 2010, complainant alongwith the association members approached the Bangalore office of the opposite parties on 6.1.2010 to appraise themselves about the steps taken by the opposite parties to complete the project and handover the apartment.  During the meeting, the opposite parties informed that the project cannot be completed within stipulated period mentioned in the agreement viz. May 2010, however they would complete the project by January 2011. The complainant’s association requested the opposite parties to focus their energy in construction activity for the promised 8 floors as per plan.  During the meeting Mr.Ashish Puravankara assured the buyers that company would take a call on the freezing the floor at the 8^th floor level as per the original plan sanctioned in March 2007 and will not wait any longer for modified plan for increased FSI of 2.5, and that the company would remove the uncertainty related to the undivided share of land entitled to each buyer.  They even offered to refund the money in full to the purchasers if they feel not satisfied with the company dealings.   The   complainant alongwith other purchasers had also discussed about the issue with regard to non-registration of UDS by the opposite parties.  The opposite parties assumed that they would register the UDS shortly.  But no registration with regard to UDS had taken place.  While so to the shock of the complainant, the opposite parties started construction of the outer shell of the ninth floor in one of the blocks, but according to the sanctioned plan shown to the complainants, the sanction was given by the authorities’ only upto eight floors.  Hence the complainant requested the opposite parties to furnish copy of the sanction plan alongwith grant of approval by competent authorities.  The opposite parties were giving evasive answers, and kept postponing the production of the approved plans. Hence the complainants  approached the authorities under the Right to Information Act for verification of the veracity of the alleged sanctioned plan.  On receiving the reply under RTI Act 2010, on 18.3.2010, the complainant came to know about the fact of suspension of plan   by the office of the DTCP.   So the fact is that the Town and Country planning director’s approval order letter No.5068/07/PA2 dt.26.3.2007 given to the company for its Swanlake project, Kelambakkam for construction of 493 flats with 8 floors has been suspended by Director Town and Country Planning on 23.7.2007 until the opposite parties surrenders the 12 meter wide planned road area going into the project and also the OSR portions to the Town Panchayat.  While the status remain so, on 3.6.2008 the office of the Town and Country planning received, the proposal of the opposite parties company through the Member Secretary of Mamallapuram Local planning authority for modified plan approval for construction of additional floors upto 14 floors in Block I, upto 9 floors in Block 2 and upto 11 floors in Block 3.  After scrutiny the modified proposal was also returned on 23.12.2009.  Hence the opposite parties were not transparent in their dealings, with the buyers and do not come forward to clarify the buyers with regard to the query of suspension of plan.  But to the contrary, the opposite parties started sending remainder emails to all the buyers to resume payments as per schedule though there is no construction activity. The complainants’ alongwith association members had informed the company that its member will not be able to make any further payments to the project which has no plan sanction and is at risk of demolition by authorities for violation.  But the opposite parties resorted to tactics by cancelling and forfeiting amounts in respect of flats booked by the office bearers of the Purva Swanlake Buyers association.  The complainants had been penalised on pre EMI by all bankers for undue delay in project implementation for more than three years.  The complainants dream of owning their homes is shattered as the project has not been completed within time frame as assured.  Further there is no proper plan sanction.  The complainants were not aware about the exact extent of undivided share of interest in the project even after three years and the registration of undivided share has not taken place even after payment of 75% of the amounts, which put the complainants into undue mental agony and sleepless nights as they were afraid of the huge risk of their life saving investment. Which will be swindled by the opposite parties.  The delay caused by the opposite parties is unreasonable and frustrates the contract.  The opposite parties had committed breach of contract and their actions also constitute gross deficiency in service and negligence.   Even the proportionate undivided share was not registered or even communicated with the complainants till the year 2012, and the sale deed had not been executed and registered even after three years of starting of the project inspite of the fact that more than 75% of the amount was paid by the complainants.  As per the meeting held on 20.3.2012 the opposite parties convinced the purchasers stating that “as per revised timelines the project is scheduled for completion in December 2012.  Accordingly, the balance amounts receivables towards the apartments will be distributed in equal instalments from April to December 2012.  The other charges applicable during possession will have to be cleared before handing over of the apartment.  If the possession of apartment is not handed over in December 2012, the entire amount paid by the purchasers will be refunded within 30 days deducting taxes.   But the complainants were not ready to believe the words of the opposite parties, insisted for refund of amount paid alongwith interest and other charges.  The opposite parties by email dt.21.4.2012 gave a special offer that if the purchasers wish to withdraw their booking, then as a special case, the amount paid by them towards the apartments minus service tax would be refunded to them.  If they choose to withdraw their booking, they shall send a letter to that effect and refund will be processed within 30 days from the date of receipt of the letter.  Therefore, the complainant alongwith others opted for cancellation of booking and asked for refund the amount paid by them.  Since the cancellation letter given was very vague, the complainants gave another cancellation letter with all details including the reason for cancellation, but the opposite parties insisted for the cancellation letter strictly in their regular format.  Finally on 4.7.2012 the complainants sent his cancellation letter and requested for refund within 30 days as promised by the opposite parties.  But the promise was not adhered by the opposite parties.  The complainants were made to struggle with the opposite parties since 2007 to 2013 i.e., for more than 6 years, with no fault of the complainants.   Even after this struggle the complainants were refunded only with the principal amount, all the other payments and interest were left unanswered till date by the opposite parties.  Despite having been provided with loan facility for Rs.35.61 lacs alongwith own contribution of Rs.6.29 lacs and after having been very regular in paying the instalments since 2007 till 2013, the complainants left with empty hands, and have never been able to get possession of the flat.  The complainants financial position got locked by booking flat with opposite parties and all his monthly salaries were paid as monthly instalments to HDFC for the loan taken on the flat, and also was left with no choice of buying any other flat for the past 6 years and is now left with empty hands.  Hence he filed the complaint praying for a direction to the opposite parties to refund interest paid by the complainants to HDFC on the amount of Rs.35,60,890/- from 2007 till February 2013, which amounts to Rs.18,99,058/-, alongwith interest compounded annually as on 31.3.2013 that worksout to Rs.23,42,965/-, and to refund a sum of  Rs.56,359/- towards service tax, alongwith compensation of Rs.25,00,000/- alongwith cost.  The total loss suffered alongwith interest and compensation works out to Rs.58,26,206/-. 

 

 

3.       The said complaint was resisted by the opposite parties by filing version as follows:

          The opposite parties denied all the allegations in the complaint.  The preliminary objection is seeking for relief based on contract which was mutually rescinded between the parties, and such relief is impermissible under the provision of Consumer Protection Act.  Hence the complainant is neither a consumer nor an association as envisaged under the Consumer Protection Act 1986.  The opposite parties are the absolute owners of the lands measuring different extends at Kelambakkam Village, Chengalpet taluk, Kancheepuram District.  The opposite parties formulated a scheme for development of schedule property into a residential apartment complex known as “Purva – Swanlake” consisting of several blocks with basement+stilt+14, 9 and 10 & 11 upper floors, common compound, entrances lobbies, staircase, lifts and passage with rights in the common areas in the residential complex.  The purchasers desirous of owning an apartment in the complex would have to join the scheme of development wherein the said purchaser needs to enter into an agreement of sale with the opposite parties for the purchase of undivided share of land in the schedule property proportionate to the size of the apartment to be constructed and the purchasers will also enter into a separate construction agreement for the construction of the apartment and as per the scheme both the agreement of sale for the undivided share of land in the schedule property and the construction agreement are co-terminus with each other.  The complainants offered to join the scheme after scrutinizing, visiting and being satisfied with the title of opposite parties in respect of the schedule property, the sanction plans, scheme of development, and the proposed modification of plans.  The complainant and opposite parties as per the scheme entered into an agreement of sale for purchase of undivided share of land in schedule property and the Construction Agreement of apartment bearing No.H704 measuring 1761 square feet of sale area on 22.5.2007, whereby the terms and conditions were mutually agreed by the parties under the scheme were put on record.  The agreement between the opposite parties and the complainant respectively contained certain specific representations and covenants, subject to which the obligations of the parties to the contract are required to be fulfilled.  Therefore the rendering of service is subject to the terms of the contract that was made between the parties and either of the parties had the right and liberty not to enter into such a contract and having entered into contract the parties are governed by the terms of the contract that was made between the parties and either of the parties had the right and liberty not to enter into such a contract and having entered into contract the parties are governed by the terms of the contract.  The complainant, opposite parties and the Housing Development Finance Corporation (HDFC) have entered into a tripartite agreement dt.5.7.2007 and the salient features of the TPA are as follows:

1.  The HDFC shall disburse pay the loan amount towards sale consideration of the property, upon a demand being raised by the Builder duly endorsed and authorized by the borrower in writing on the basis of a demand letter from the builder. 

In pursuance to clause (a) of the TPA the opposite parties have sent a Demand of Payment Schedule to the complainants on 14.9.2007 as required under clause (a) of TPA.   The opposite parties are not obligatory to make the demand, however since HDFC insisted to have Demand Schedule in terms of the TPA the opposite parties furnished a comprehensive Demand dt.14.9.2007 which is also admitted by the complainant.  The opposite parties were fully performing their obligation under AGS, CA and TPA mentioned herein above by strictly adhering to the terms and conditions, building formalities, time line and the quality.  Unfortunately during the month of December 2008, the primary contractor then engaged by the opposite parties suffered a financial crisis, pursuant to which certain orders were passed against the primary contractor by certain statutory authorities which had indirect repercussions on the progress of the Purva Swanlake Project.  In the aforesaid circumstances, the opposite parties were eventually constrained to terminate the contract with the said primary contractor and had to look for a replacement.  The opposite parties with great difficulty in a short span of time appointed a new contractor for progress with the project.   The project was also affected by various operational constraints including interalia flooding of the project site due to heavy rains, global economic slowdown, leading to erratic supply of construction materials and shortage of labour force in the state of Tamil Nadu.  The complainants were extremely irregular and erratic in making monthly payments to the opposite parties towards continued construction of the apartment.  While the monthly payments were due by 15^th of each month in respect of the apartment the complainants repeatedly were in breach of the AGS and CA by defaulting/ delaying the monthly payments much after the respective due dates.  In this regard the Statement of Accounts furnished by the opposite parties dt.21.8.2010, which is undisputed by the complainants clearly establishes that the total outstanding due from the complainants as on 21.8.2010 amounts to Rs.17,74,329/-.  The terms of the AGS and CA, every instance of such breach of contract by the complainants gave the opposite parties right to terminate such contract or levy the penal interest thereupon and that such rights are not mutually exclusive.  As a goodwill gesture in the year 2009 the opposite parties suo moto extended to a few qualified purchasers of the apartment in Purva Swanlake a payment holiday for a period of six to nine months depending upon the duration of total sale consideration paid until that date by the respective purchaser as contemplated by the terms of AGS and CA.  The complaint is barred by limitation for the reason that the complaint is made after nearly two years from the date of cancellation which is admitted on 4.7.2012 and without prejudice to other contentions of the opposite parties.  The complainant had suppressed the fact that the entire amount has been paid by the opposite parties except the dues remitted towards the applicable taxes to the government.   All the allegations and averments made are false and there is no cause of action to maintain this complaint.  Thus there is absolutely no deficiency in service on the part of the opposite parties, thus prayed for dismissal of the complaint. 

4.       In order to prove their respective complaints, proof affidavits were filed by both parties alongwith 21 documents by the complainant which are marked as Ex.A1 to A21.   There is no document filed on the side of the opposite parties.

 5.      We have carefully gone through the entire material records. In view of the submissions made on either side, the only question raised for consideration is

          1.       Whether the issue raised in this complaint can be considered before the Consumer Commission?

 

6.       POINT NO.1

          It is not as that of a simple case of non-delivery of flat inspite of payment of entire sale consideration.  In the instant case the factual aspect of the case would show that the complainants opted to rescind from the AGS and Construction Agreement alongwith other members of PSBA, and the same was accepted by the opposite parties.   Pursuant to the same the complainants have waived all their rights in the apartment and the schedule property, including the right if any claiming interest for the amounts paid by the complainants, while the opposite parties waived their rights to seek liquidated damages in terms of AGS and CA.  As contended by the opposite parties, now the complainants are estopped from enforcing the AGS and CA, as well as claiming any relief.  Therefore the complaint is liable to be dismissed.  Accordingly, the complaint is liable to be dismissed as not maintainable before the Consumer Fora.  Point No.1 answered accordingly.

 

7.       In the result the complaint is dismissed.  No order as to cost.

           

 

 

  S.M.LATHAMAHESWARI                                                                  R.SUBBIAH

              MEMBER                                                                                     PRESIDENT

 

Exhibits filed on the side of complainant

A1      22.05.2007   Sale Agreement

A2                “        Construction Agreement

A3      05.07.2007   Tripartite Agreement

A4      14.09.2007    Payment schedule

A5      18.03.2010    RTI reply from DRCP with clean copy

A6      31.08.2010    Statement of accounts as on 31.8.2010

A7      02.09.2010    Letter sent by the complainants

A8      23.09.2010    Another letter sent by the complainants

A9      06.10.2010              -do-

A10     18.10.2010              -do-

A11     16.11.2010    Order passed by Director of Town and Country Planning

A12     12.01.2011              “             Member Secretary, Mamallapuram Local Planning

Authority

A13     22.09.2011    Legal notice sent by the complainants

A14     18.10.2011    Reply notice sent by the opposite parties

A15     01.06.2012    Certificate of interest by HDFC for the period from 1.4.2007 to

 31.3.2012

A16     02.07.2012    Cancellation letter by the complainants

A17     30.11.2012    Cheques issued by OP towards the refund of amount

A18     01.02.2013    Prepayment letter by HDFC

A19     17.03.2014    Certificate of interest by HDFC for the period from 1.4.2012 to

31.3.2013

A20     27.05.2014    Statement of account for the period from 1.4.2007 to 31.3.2013

A21                        E-mail communications

 

 

 

Exhibits of the 1st opposite party:……….Nil………           

 

 

 

  S.M.LATHAMAHESWARI                                                                R SUBBIAH     

           MEMBER                                                                                        PRESIDENT

 

 

INDEX : YES / NO

Rsh/d/rsj/ Open court