1. This First Appeal, under Section 51 of the Consumer Protection Act, 2019 (hereinafter referred to as “the Act”) has been filed by Omaxe Limited (hereinafter referred to as the “Appellant” or the “Opposite Party”), against the Impugned Order dated 31.01.2023 passed by the State Consumer Disputes Redressal Commission, Lucknow, UP (hereinafter to be referred to as “the State Commission”) in Consumer Complaint No. 37 of 2022. 2. The complainant booked an independent residential built up floor named ‘Grand Omax, Lucknow’ floated by the Opposite Party (OP) in July 2015. The OP promised the prospective buyers to complete the project within a period of 36 months from the date of booking. The total consideration as for the said independent floor was Rs.44,73,750/-. For Registration in the housing scheme, the Complainant paid Rs. 2,00,000 on 07.07.2015 and Flat No. GOL/ Florence-A-Sixth/601 was allotted to her. In the course of time, till 2017 she paid Rs. 20,97,558/- to the OP. Even after making such substantial payment and repeated requests, the builder did not get the agreement made. Only on 22.03.2017, the OP entered into Builder Buyer Agreement and handed over a copy to her. 3. Subsequently, the Complainant visited the area of the project and found no progress. The OP indulged in unfair trade practices as the other projects which started later were completed. Being aggrieved, she forwarded a legal notice on 25.09.2017 and sought refund of the entire amount deposited i.e. Rs.20,97,558, along with interest. In reply dated 09.11.2017, the OP reiterated that the construction is progressing in full swing and the project will be completed in time. Thereafter, on being advised, she met Omax Head of UP. He again assured her that the project will be completed in time. Thus, she made further payments demanded by the OP. Subsequently, she visited the site of the project during March 2022 and found that the construction was not progressing. She was disappointed and suffered severe mental agony as the OP was making her wait eternally. The OP committed major fraud by collecting Rs.2,00,000 as the Registration fees on 07.07.2015 itself and did not enter into the Builder Buyer Agreement with the Complainant. Only when continually demanded, the Agreement was done on 22.03.2017. In terms of Para 40(a) of the said Builder Buyer Agreement, the OP has stated that “the Company shall complete the development/ construction of the unit/ project 48 months from the date of signing of this Allotment Letter by the allottee or within an extended period of six months”. 4. As per the Complainant, the period of 54 months commenced on 07.07.2015 when she deposited the registration money and she was issued a genuine receipt and was allotted the Flat in question. So, the period of 54 months having commenced on 07.07.2015 ended in January 2020. There is no hope for completion of the project in the next 3-5 years. There is no Completion Certificate, Occupancy Certificate, NOCs of Fire Department or Pollution Control Department. She is in dire need of residential unit and has taken financial assistance to pay the OP with the hope that the OP will handover the possession of the flat at the earliest. However, she was shocked to see no construction work going on except the skeleton of the building. She lived in Lucknow by taking a flat on rent awaiting the completion of the work and paid Rs. 20,000 per month for two years. Despite several reminders the OP failed to handover the flat to her. The complainant suffered acute mental agony and depression. The OP indulged in unfair trade practices as her hard-earned money was utilized elsewhere. The indefinite delay frustrated her plans beyond redemption. Till date, almost six years have gone by and the fate of completion of the flat still hangs in balance. Therefore, left with no option, she claimed for refund of the market value of the flat along with damages, compensation and interest @ at the rate of 18% interest. 5. The Complainant relied on “Brija Shakeracharya Vs Orissa State Housing Board 1997(1) CPR 124 which directed for adequately compensating a consumer. The Complainant is entitled to get exemplary damages and compensation in the form of similar flat at the present market rate costing about Rs.70,00,000, excluding registration fee, mutation fee, necessary woodwork etc for which she must pay substantially. She claimed Rs.70,00,000 with interest @ 18% from the date of deposition of money to the OP till the date of payment. She also claimed Rs.15,000 per month from the date of proposed delivery till date of payment of market value of the flat along with interest @ 18%; and Rs.20,00,000 as compensation. The Complainant asserted that with due regard to the prayer made in the complaint, the matter is within the pecuniary jurisdiction of the learned state Commission. 6. The learned State Commission, in its interim order dated 31.01.2023, ruled in favor of the Respondent/Complainant, based on the allegation of deficiency in service against the Appellant/OP. The deficiency stemmed from the Appellant’s failure to deliver possession of residential Flat No. 601 in the Florence Project of Omaxe, as per the proposed plan of OP. The Complainant had paid total of Rs. 34,55,529/- to the OP. The total consideration was Rs.44 Lakhs and the possession was to be handed over by the year 2019. For the sake of ready reference, the relevant portions of the Impugned Order dated 31.01.2023 are reproduced below: - - After inspection of the flat the Complainant has submitted that inspection report and colour photograph from which it is found that it will take at least 9 months to complete the aforesaid flat/ apartment/ scheme by the Respondent. Accordingly, after aforesaid period, two months may also be required to meet the access road, electricity, water supply and other requirements, that is in every case, the possession of the above flat to the complainant by Respondent company will be given in the month of December, 2023 by 15.12.2023.
In presence of the learned counsel for both the parties and the parties, it was mentioned by the parties before the court that as per the agreement between the parties, till the date of possession/registration, the Respondent company has to pay Rs. 5/- per square feet to the complainant. Accordingly, the amount of compensation/penalty will be calculated in the above term and shall be paid after deducting the amount payable by the complainant to the respondent company in every case by 31.12.2023. In the event of otherwise, apart from the above, the Respondent company will also be liable to Rs. 10 lakhs as compensation. Keeping in view the above facts, as per the discussion between the parties which has been mentioned above, the inspection of the flat allotted will be ensured by the complainant every month. The Complainant shall ensure to provide the inspection information well in advance to the Authorized Representative of the Respondent Qazi Saidur Rehman. Accordingly, as per the request of the learned counsels of both the parties the matter shall be listed on 20.12.2023 before the same bench (Hon. Justice Mr. Ashok Kumar, President and Mr. Vikas Saxena, Member) for hearing.” (Extracted from English Translation Copy) 7. Dissatisfied with the Impugned Order of the learned State Commission, the Appellant /OP filed the present Appeal before this Commission wherein the Appellant brought out that the impugned order dated 31.01.2023 passed by the learned State Commission, Lucknow involves substantial questions of facts and law. The Complainant is consumer and allotted Flat No. GOL/Florence-A/ Sixth/601 with super area 1250 Sq Ft in the project of the OP at Lucknow. An Agreement was duly executed on 22.03.2017. In terms of the said Agreement the alleged paid value for the property was Rs. 34,55,529 against the total Flat Sale Consideration is Rs.44,73,750. Therefore, in the absence of Pecuniary Jurisdiction Value of less than Rs.50,00,000 as has been prescribed under Section 47 of the Consumer Protection Act, 2019 read with the Consumer Protection (Jurisdiction of the District, the State Commission and the National Commission) Rules 2021, the learned State Commission, Lucknow has no jurisdiction to entertain the Complaint before it and adjudicate the same. However, in an arbitrary and illegal manner the learned State Commission concluded that the Appellant company was lawfully obliged to transfer the Flat to the Respondent in the year 2019. 8. The Appellant admitted that she is a Consumer, being the buyer of the Flat in question. An Agreement was executed between the parties on 22.03.2017. The project is registered vide RERA Regn No. UPRERA PR1775 under the Real Estate Regulation and Development Act, 2016 with validity from 27.07.2017 to 30.01.2024. Due to Covid pandemic, the UP Real Estate Regulatory Authority vide order dated 06.06.2020 extended the completion date by six months. In terms of Clause 40(a) of the said Agreement, subject to adherence to the payment schedule by the Complainant and Force Majeure, the possession of the Flat was to be transferred within 54 months from 23.03.2017. Thus, the OP is obliged to handover the Flat by 21.09.2022. Subsequently, the RERA granted six months extension till 06.6.2020. Thus, as per the duration prescribed in the Agreement and the sanctions accorded by the Competent Authority under RERA, the Appellant is lawfully obliged to transfer the possession by 21.03.2023. The OP asserted that, as the delivery to the Respondent was due only on 21.03.2023 the levy of penalty @ Rs. 5 per Sq Ft per month for the super area of 1250 Sq Ft of the Flat and further the compensation of Rs. 10,00,000 for the alleged delay vide the impugned order dated 31.01.2023 is without lawful cause of action. There is no delay whatsoever and the Complaint was premature and further the order was without jurisdiction. 9. The impugned order was passed overlooking the response dated 23.06.2022 wherein the lack of pecuniary jurisdiction and absence of cause of action were raised at the very first instance. In terms of Section 47 of the Act which explains the jurisdiction of the State Commission read with section 34 of the Act which enunciates the jurisdiction of the District Commission, the subject matter of the consumer complaint for the reason of being based upon the alleged paid value of Rs. 34,55,529 out of the Total Flat Sale Consideration of Rs. 44,73,750. This is undoubtably much less than the desired Rs.50,00,000, which is the minimum pecuniary limit jurisdiction of the learned State Commission as prescribed under Section 47 of the Act read with Consumer Protection (Jurisdiction of the District, the State Commission and the National Commission) Rules, 2021. As per the Appellant, in the absence of pecuniary jurisdiction as well as the Premature/ No cause of action, renders the entire consumer redressal proceedings before the learned State Commission void ab-initio. The appellant raised the following questions of law in the matter: - Whether the learned State Commission has jurisdiction to adjudicate upon a Complaint which is of the alleged paid value of Rs.34,55,529 and the Total Flat Sale Consideration of Rs.44,73,750?
- Whether the learned State Commission has unlawfully usurped the jurisdiction of the District Commission?
- Whether the order dated 31.02.2023 passed by the learned State Commission is based on premature cause of action and non-existing facts and concluded that the Appellant was obliged to transfer the Flat in the year 2019.
10. The Appellant pleaded that the impugned order dated 31.01.2023 passed by the learned State Commission, Lucknow in the matter is liable to be set aside on all the counts. 11. The Complainant, in rejoinder before the State Commission, refuted the contentions of the OP and urged that she constantly requested that the OP to execute the Builder Buyer Agreement from the time the Registration amount was paid on 07.07.2015 and allotment of the flat was done. But the OP failed to do so. The Agreement was finally signed on 22.03.2017. The Complainant relied on the judgement of NCDRC dated 28.08.2020 in “Pyaridevi Chabiraj Steels Private Ltd Vs National Insurance Company Ltd and Ors.” in CC/833/2020 wherein it was held that under the provisions for determining the pecuniary jurisdiction of the District Commission, State Commission or the NCDRC, the value of goods or services paid as consideration alone has to be taken, and not the value of goods or services purchased/ taken. The Complainant urged that this case clearly is within the purview of the State Commission. In addition, the Complainant had sought more relief on top of these and Rs.70,00,000 is claimed. Therefore, the Complainant's case is within the purview of the learned State Commission and the objection to the jurisdiction as submitted by the OP is without merit and so is the situation claimed in the current case, hence there shall not be an issue as regards jurisdiction. 12. When the matter was heard on 17.03.2023, the learned Counsel for the Appellant had stated that the learned State Commission, Lucknow while passing the impugned order dated 31.01.2023 had erred in law in directing the Appellant to pay penalty/ compensation @ Rs.5 per Sq Ft per month after deducting the amount payable by the Complainant. Such direction could have only been given at the time when the Complaint is finally disposed of. Based on the submissions, the operation of impugned order qua the direction to the Appellant to pay compensation/ penalty @ Rs. 5 per Sq Ft per month after detecting the amount payable by the Complainant was stayed. 13. The learned Counsels for both the parties submitted that they wish to rely on the pleadings already submitted in the matter. Further, as the facts and the limited questions of law are clear, and they sought the matter to be heard finally. 14. In his arguments, the learned Counsel for the Appellant raised concerns about the legality of the impugned Order in the case as the same involves substantial questions of law and facts. He averred that the learned State Commission while adjudicating upon the Complaint which is admittedly based upon the alleged Paid Value of Rs.34,55,529/- and Total Flat Sale Consideration of Rs.44,73,750/- failed to appreciate that the case is not within its Pecuniary Jurisdiction, being of the Value of less than Rs. 50 Lakhs as prescribed under Section-47 of the Act read with the Consumer Protection (Jurisdiction of the District, the State Commission and the National Commission) Rules, 2021. Such action of the learned State commission in concluding that the Appellant was lawfully obliged to transfer the Residential Flat in question to the Respondent in the Year 2019 itself is not based on established facts of the case brought on record and entirely arbitrary and illegal. 15. The learned Counsel further argued that, on addition to lack of jurisdiction, in terms of Clause No. 40(a) of the Terms and Conditions of the Agreement dated 22.03.2017, the possession of the said Flat was to be transferred within 54 Months from 22.03.2017 i.e. on or before 21.09.2022, subject to adherence to the payment schedule by the Respondent as the Allottee and Force Majeure conditions. However, due to Covid pandemic, six months more time was granted by the UP RERA on 06.06.2020. Thus, the Appellant is legally obligated to transfer possession of the Flat by 21.03.2023. Therefore, the imposition of penalty @ of Rs.5/- per Sq Ft per month for the Super Area of 1250 Sq Ft and the compensation of Rs. 10 Lakhs for alleged delay period, as stated in the impugned Order, lack any lawful cause of action. 16. On the other hand, the learned Counsel for the Respondent forcefully argued that the Complainant booked the Flat in question in July 2015. The OP promised the prospective buyers to complete the project within a period of 36 months from the date of booking. The total consideration was Rs.44,73,750/-. For Registration, the Complainant paid Rs. 2,00,000 on 07.07.2015 and Flat in question at a total cost of Rs. 39,60,000/- was allotted to her. She paid Rs.20,97,558/- till 2017. However, even after making such substantial payment and making repeated requests, the Agreement was not signed. Only on 22.03.2017, the OP executed the Builder Buyer Agreement and handed over a copy to her. Subsequently, when she visited the site, the Complainant found very limited progress. The OP was found to be involved in unfair trade practices as they completed other projects which started later. Being aggrieved, she issued a legal notice on 25.09.2017 and sought the OP to refund the entire amount paid, along with interest. The OP replied on 09.11.2017 and reiterated that the construction of the project is in full swing and will be completed in time. Thereafter, she met Omax Head of UP, who again assured her that the project will be completed in time. Based on the assurance, she made further payments as demanded. She again visited the site in March 2022 and found no progress. She was disappointed and suffered severe mental agony as she was made to wait for so long without any confirmation of completion. The OP committed major fraud by collecting Rs.2,00,000 as the Registration fees on 07.07.2015 itself and not executed the Agreement. In terms of Para 40(a) of the Builder Buyer Agreement dated 22.03.2017, the OP has stated that “the Company shall complete the development/ construction of the unit/ project 48 months from the date of signing of this Allotment Letter by the allottee or within an extended period of six months”. 17. The learned Counsel forcefully asserted that as the OP had collected the deposit on 07.07.2015 and allotted the Flat, the period of total 54 months commenced from 07.07.2015 itself. Therefore, the period of 54 months shall end in January 2020. However, there is no hope for completion of construction for another 3-5 years as there is no Completion Certificate, Occupancy Certificate, NOCs of Fire Dept., Pollution Control Dept. The Complainant is in dire need of the Flat. She lived in Lucknow by taking a flat on rent, waiting the completion of the work by the OP and had paid Rs. 20,000 per month for two years. Despite several reminders the OP failed to handover the flat to her. She suffered acute mental agony and depression due to the actions of unfair trade practices of the OP and her hard-earned money was utilized elsewhere without building the project and handing over the flat to her. The indefinite delay frustrated her plans beyond redemption. Left with no option, she claimed the refund of the market value of the flat at 70 Lakhs along with damages, compensation and interest @ at the rate of 18% to be refunded. The Complainant relied on the following precedents:- - “Brija Shaekaracharya Vs Odisha State Housing Board 1997(1)CPR 124 it was held that ‘once it is found by the consumer that there is a deficiency in service on the part of housing board then its duty is to adequately compensate the consumer.
- The judgement of NCDRC in Pyaridevi Chabiraj Steels Private Ltd Vs National Insurance Company Ltd and Ors vide order dated 28.08.2020 in CC/833/2020 wherein the NCDRC had held that under the provisions for determining the pecuniary jurisdiction of the District Commission, State Commission or the NCDRC, the value of goods or services paid as consideration alone has to be taken, and not the value of goods or services purchased/ taken.
18. The learned Counsel for the Respondent painstakingly argued that the case is legally within the pecuniary jurisdiction of the State Commission and the objection of OP in this regard is baseless. He asserted that the Complainant had sought relief of the entitled market rate of Rs.70,00,000 and interest @18% and further compensation and costs. Therefore, the case is within the purview of the State Commission. The inordinate delay on the part of the OP in handing over the possession of the Flat constitutes glaring negligence and deficiency in service for which she is entitled to get exemplary damages and compensation as claimed. The learned Counsel reiterated that with due regard to the prayer made in the Complaint, the matter is within the pecuniary jurisdiction of the learned state Commission. 19. I have examined the pleadings and associated documents placed on record and rendered thoughtful consideration to the detailed arguments advanced by the learned Counsels for both the parties. 20. The primary issue for consideration is “whether the learned State Commission had jurisdiction to pass the Impugned Order dated 31.01.2023, over a Consumer Complaint involving an alleged Paid Value of Rs.34,55,529/- and a Total Flat Sale Consideration of Rs.44,73,750/-? 21. It is a statutory position in terms of Section-47 of the Consumer Protection Act, 2019, and the Consumer Protection (Jurisdiction of the District, the State Commission, and the National Commission) Rules, 2021 that the learned State Commission has pecuniary jurisdiction of matters above Rupees Fifty Lakhs, but not exceeding Rupees Two Crores, 22. In the recent Order of this Commission in M/s Pyaridevi Chabiraj Steels Pvt. Ltd. Vs. National Insurance Company Ltd. & Ors. CC No. 833 of 2020, decided on 28.08.2020 it was clarified that the pecuniary jurisdiction of the Consumer Disputes Redressal Commissions under the Consumer Protection Act, 2019, is determined solely by the value of the consideration paid for goods or services and not by the value of the goods or services themselves or any compensation. The relevant paras of the aforesaid Order are reproduced below: - “8. It appears that the Parliament, while enacting the Act of 2019 was conscious of this fact and to ensure that Consumer should approach the appropriate Consumer Disputes Redressal Commission whether it is District, State or National only the value of the consideration paid should be taken into consideration while determining the pecuniary jurisdiction and not value of the goods or services and compensation, and that is why a specific provision has been made in Sections 34(1), 47(1)(a)(i) and 58(1)(a)(i) providing for the pecuniary jurisdiction of the District Consumer Disputes Redressal Commission, State Consumer Disputes Redressal Commission and the National Commission respectively. 9. For ready reference the provisions of Sections 34(1), 47(1)(a)(i) and 58(1)(a)(i) of the Act of 2019 are reproduced below: “34. (1) Subject to the other provisions of this Act, the District Commission shall have jurisdiction to entertain complaints where the value of the goods or services paid as consideration does not exceed one crore rupees:” “47. (1) Subject to the other provisions of this Act, the State Commission shall have jurisdiction— (a) to entertain— (i) Complaints where the value of the goods or services paid as consideration, exceeds rupees one crore, but does not exceed rupees ten crore:” “58. (1) Subject to the other provisions of this Act, the National Commission shall have jurisdiction— (a) to entertain— (i) complaints where the value of the goods or services paid as consideration exceeds rupees ten crore:” 23. The decision in the case of M/s Pyaridevi Chabiraj Steels Pvt. Ltd. (Supra) makes it abundantly clear that, for the purpose of determining pecuniary jurisdiction under the Act, only the value of the consideration paid for goods or services should be considered. The recent notification of the Consumer Protection (Jurisdiction of the District Commission, the State Commission and the National Commission) Rules, 2021, further reinforces this point. According to these rules: - The pecuniary jurisdiction of District Commissions is up to ₹50 lakhs.
- The pecuniary jurisdiction of State Commissions is for cases where the value of goods or services paid as consideration exceeds ₹50 lakhs but does not exceed ₹2 crores.
- The pecuniary jurisdiction of the National Commission is for cases where the value of goods or services paid as consideration exceeds ₹2 crores.
24. This notification aligns with the principles outlined in the Act and provides clarity on the pecuniary jurisdictional limits for different levels of Consumer Disputes Redressal Commissions. Therefore, it is crucial to consider these rules and adhere to them when determining jurisdiction in consumer complaint cases. 25. In view of the forgoing, it is evident and admitted position that the value of consideration paid by the Complainant/Respondent in the case is Rs.34,56,529/-, out of total Consideration of Rs.44,73,750/- lakhs. This does not exceed Rs.50,00,000/-. Therefore, the learned State Commission does not have pecuniary jurisdiction to entertain the Consumer Complaint. 26. Having held that the learned State Commission has no jurisdiction to adjudicate the matter under the Act, I restrain from going into the facts and merits of the case to determine whether the Complaint was premature or without Cause of Action, when the Complaint was preferred. 27. Consequently, the Appeal is allowed, and the impugned order dated 31.01.2023 is set aside. The Respondent/Complainant is granted the liberty to file requisite complaint before the appropriate forum in accordance with law. 28. Pending Applications, if any, are disposed of accordingly. 29. Registry is directed to release the statutory deposit amount, if any, in favour of the Appellant as per law. |