IA No. 20235 / 2018 & IA No. 20238 /2018

1.            M/s. Narang Construction and Financers Private Limited, the Appellant has filed Applications being IA Nos. 20235/2018 & IA No. 20238/2038 seeking condonation of 733 days’ and 729 days’ delay in filing FA No.1945 of 2018 and FA No. 1946 of 2018 respectively.  Heard the Learned Counsel for the Parties and perused the averments made in the Applications seeking condoantion of delay of 733 and 729 days in filing the First Appeals.  We are satisfied that the Appellant had given sufficient reasons for condonation of the delay.  Accordingly for the reasons stated in the Applications, delay in filing the present Appeals is condoned and the First Appeals be treated as having been filed within limitation.  IA No. 20235/2018 & IA No. 20238/2018 stand allowed.

FIRST APPEALS

2.            Challenge in both the First Appeal Nos. 1945 of 2018 and 1946 of 2018, filed under Section 19 of the Consumer Protection Act, 1986 (hereinafter referred to as “the Act”) by M/s. Narang Construction and Financers Private Limited (hereinafter referred to as “Opposite Party Builder”) is to the Orders dated 29.08.2016 in Complaint No. 128 / 2012 and 129 / 2012 passed by the Delhi State Consumer Disputes Redressal Commission, Delhi, (hereinafter to be referred to as “State Commission”), whereby the Complaints filed by the Complainants were partly allowed and the Opposite Party Builder was directed to pay penalty for delayed possession @15% per annum on ₹27,00,000/- from 10.04.2010 till 31.07.2015.  Opposite Party Builder was also directed to comply with the Order within one month failing which it would also be liable to pay interest @12% per annum from the date of Order till the date of actual refund.

3.            Since the facts and question of law involved in both the Appeals are similar except for minor variations in the flat number and dates and events, these Appeals are being disposed of by this common Order. However, for the sake of convenience, First Appeal No. 1945 of 2018 is treated as the lead case and the facts enumerated hereinafter are taken from Complaint No. 128 of 2018.

4.            Succinctly put, the material facts, giving rise to filing of the Complaint, are that the Opposite Party Builder had launched its Project in the name and style of ‘Max Heights Kundli’ situated at Revenue Estate of Villages Badhkhals in Sector 62, Tehsil and District Sonepat, Haryana (hereinafter referred to as ‘the Project’).  On the assurances given by the representative of the Opposite Party Builder regarding the quality of construction and the track record of the Opposite Party Builder regarding the delivery of possession within stipulated time, the Complainant booked a flat in the said Project of the Opposite Party Builder.  The Complainant was allotted a flat No. 206 in Block ‘D’ of the said Project.  Builder Buyer Agreement (hereinafter referred to as ‘the Agreement’) was executed on 10.04.2007.  As per clause 27(a) of the Agreement, the possession of the flat was to be delivered within 36 months from the date of execution of the Agreement, i.e., 10.04.2007 failing which as per Clause 27(e) of the Agreement the Opposite Party Builder was liable to pay interest @15% p.a. on the deposited amount till the date of possession.  The Complainant made full and final payment of ₹27,00,000/- including External Development Charges, to the Opposite Party Builder uptill 16.04.2007.  The Opposite Party Builder issued receipt/certificate dated 09.06.2007 acknowledging the receipt of the said amount.  Despite making full and final payment on 16.04.2007, the Opposite Party Builder demanded a sum of ₹1,21,550/- towards External Development Charges (EDC) vide letter dated 25.10.2011 which was objected by the Complainant vide letter dated 24.11.2011.  The Complainant enquired the Opposite Party Builder for possession of the flat but he was not given any satisfactory reply.  The Complainant sent legal notice dated 22.02.2012 to the Opposite Party Builder for handing over the possession and compensation in terms of the Agreement, but the Opposite Party Builder neither delivered the Possession of the flat nor had it paid the compensation @15% on the deposited amount in terms of the Agreement.  It was also alleged that at the time of launching of Project, the Complainant was informed that the Project would comprise of 9 towers within 468 flats but at later stage they came to know that the Opposite Party Builder is going to build new additional towers in the Project whose occupants will also share the same amenities and facilities like entrance, parks, swimming pool, club house etc. which were initially promised for exclusive use of original 468 buyers of the Project.  Therefore, the Complainant is entitled to refund of the amount in the same proportion as the extra amount the Opposite Party Builder had received from the buyers of the extra towers.   Alleging deficiency in service and unfair trade practice on the part of the Opposite Party Builder the Complainant filed a Consumer Complaint before the State Commission seeking following reliefs:

“(i)          The demand notice no. NCF/K/359/2011/12013 dated 25.10.2011 demanding ₹1,24,680/- from the Complainant may kindly be quashed;

(ii)           The respondent company be directed to immediately give the possession of finished flat to the Complainants;

(iii)          The respondent company be directed to pay interest @15% per annum on the consideration amount for the period of delay, i.e., from 10th April 2010 till the date of payment to the Complainants;

(iv)         The respondent company be directed to pay a sum of ₹40,000/- per month, being the rent, which the Complainants would have earned on the above flat, till the date of payment;

(v)          The respondent Company be directed to refund the amount regarding the common amenities / facilities in the same proportion in which the respondent company has received the extra mount from the buyers of the flats in the new towers.

(vi)         The respondent Company be directed to pay an amount of ₹ 11 lacs towards the mental agony and harassment suffered by the complainants.

(vii)        The respondent company be directed to pay a sum of ₹ 55,000/- towards the cost of litigation to the complainant.

(viii)       Such other relief or direction which this Hon’ble Commission deems fit and proper may also be passed in favour of the complainants.”

5.            The Opposite Party Builder contested the Complaint before the State Commission by filing Written Statement.  In the Written Statement, the Opposite Party Builder took preliminary objection that the Complaint has been filed after limitation; Complaint is not maintainable for want of jurisdiction; the Complainant does not fall in the category of ‘Consumer’ defined under Section 2(d) of the Act as the Complainant bought the flat mere for investment.  On merits, the Opposite Party Builder submitted that as per Clause 27(a) of the Agreement, they are not liable to pay damages in case of delay in handing over the possession on account of any reasons beyond control of Opposite Party Builder.  The Complainant has not complied with the terms and conditions of the Agreement. In the Agreement it has been specifically mentioned that if any charges imposed or levied by Government of Haryana after sale deed has been executed, the same would be treated as unpaid sale price.  The Opposite Party Builder also submitted that there is no deficiency in service or unfair trade practice on their part and prayed that the Complaint be dismissed.

6.            After hearing both the parties and perusal of material on record, the State Commission narrowed down the controversy to the question of payment of penalty for delay in handing over the possession.  The State Commission partly allowed the Complaints in afore-mentioned terms by observing as under:-

“As regards penalty for delayed payment / possession, luckily the agreement itself provide for payment of interest @15% per annum.  OP should have handed over the possession by 10.04.2010 but he handed over the possession on 31.07.2015.  Thus, OP is liable to pay penalty for delayed possession from 10.04.2010 to 31.07.2015 @15% per annum.

The Complainant cannot claim double benefit (i) in the shape of interest and other in the shape of loss of rental income.

The plea of the OP that it was not liable to pay penalty in case of delay due to circumstance beyond his control cannot be accepted.  OP has not specified any circumstance which was beyond its control.

The plea of limitation cannot be accepted because initially the Complainant prayed for possession also and in case of possession the cause of action is continuous and there is no limitation.  For this reliance may be placed on the decision in Meerut Development Authority vs. M.K. Gupta IV (2012) CPJ 12.”

7.            Feeling aggrieved by the Orders dated 29.08.2016 passed by the State Commission, the Opposite Party Builder has filed the present Appeals before this Commission.

8.            Mr. Sujeet Beniwal, learned Counsel appearing on behalf of the Appellant Builder submitted that the interest @15% is exorbitant in nature especially considering the fact that it is a case of delayed possession and not refund. He further submitted that the Impugned Order passed by the State Commission suffers from material irregularity and without appreciation of facts and circumstances of the case and he prayed that the Impugned Order passed by the State Commission be set aside.

9.            Per contra, Mr. Anuj Bhandari, learned Counsel for the Respondent, supported the Order passed by the State Commission as according to him the State Commission had passed a well-reasoned and justified order, which is based on a correct and rightful appreciation of evidence and material available on record and does not call for any interference.

10.          We have heard learned Counsel for the Parties, perused the Impugned Orders passed by the State Commission, the Complaints, all the documents available on Record and have given a thoughtful consideration to the various pleas raised by the Parties.

11.          In the present case, it is not in dispute that the Buyer’s Agreement was executed between the Parties on 10.04.2007.  The Respondents/Complainants paid the entire sale consideration of the Flat, i.e., ₹27,00,000/- as full and final payment to the Appellant Builder on 09.06.2007.  As per Clause 27(a) of the Agreement, the possession of the Flat was to be delivered by 10.04.2010 and in terms of Clause 27(e), in case of delay, the Appellant Builder was obliged to pay interest @15% p.a. for the period of delay to the Buyer/Complainant.  The possession of the Flat was handed over only on 31.07.2015.  In view of the specific Clause in the Agreement regarding delay compensation @15% p.a., we do not find any illegality or irregularity in the well-reasoned Impugned Orders passed by the State Commission.  Consequently, both the First Appeals are dismissed and the Impugned Orders passed by the State Commission are upheld. 

12.          Keeping in view the peculiar facts and circumstances of the case, there shall be no order as to costs.