Haryana

Panchkula

CC/273/2021

WAZIR SINGH. - Complainant(s)

Versus

THE CHIEF ADMINISTRATOR,HOSING BOARD HARYANA. - Opp.Party(s)

SURENDER PAL

20 Oct 2022

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,  PANCHKULA

                                                       

 

Consumer Complaint No	:	273 of 2021
Date of Institution	:	18.06.2021
Date of Decision	:	20.10.2022

 

 

Wazir Singh S/o Sh. Nagahia Ram C/o Subash Chander, R/o # 167 A/11 Nehru Garden Colony Kaithal, Haryana-136027.

 

                                                                         ….Complainant

 

Versus

Chief Administrative Housing Board Haryana, Panchkula, C-15, Awas Bhawan, Sector-6, Panchkula- 134109.

….Opposite Party

COMPLAINT UNDER SECTION 35 OF THE CONSUMER PROTECTION ACT, 2019.

 

Before:              Sh. Satpal, President.

                        Dr. Pawan Kumar Saini, Member

Dr. Sushma Garg, Member

 

 

For the Parties:   Sh. Surender Pal, Advocate for the complainant.  

                        Sh. Anil Kumar Garg,  Advocate for OP.

                         

ORDER

(Satpal, President)

1.             The brief facts of the present complaint are that the Housing Board, Haryana i.e. OP floated multi-storied flats for allotment to serving/ex-defense and para-military personal of Haryana upto the rank of JCOs and equivalent on higher purchase basis at Sector-28, Pinjore Haryana, the complainant being an ex-serviceman duly applied with the OP board for Type-A category Flat and also deposited 10% amount i.e. Rs.2,27,000/-. The tentative cost of the flat was mentioned as Rs.22.70 lacs. It is alleged that in pursuance to the application submitted by the complainant, the OP on 10.02.2015 issued allotment letter no. HBH/CRO(PM)/DEFENCE/2015/SPL-2602 to the complainant after holding draw of lots on 29.12.2014. The complainant duly deposited the amount of Rs.3,41,000/- i.e. 15% of the advertised cost, with the OP  on 21.03.2015 by raising loan of Rs.3,41,000/- from Union Bank of India Kaithal. The complainant has paid Rs.5,68,000/-  to the Ops but the Ops not offered the possession of the flat to him till date. Vide letter dated 17.12.2018, OPs has intimated the complainant that there was a delay due to some technical reasons in the construction of flats at Pinjore and as such applicants of Pinjore have been asked their option for taking flats at Sector-31, Panchkula Type-A or Type-B in place of Sector-28, Pinjore. As the complainant was not interested in taking the flat at Panchkula, therefore, he requested the Op to refund his deposited amount as he could not wait or indefinite period for the possession of the flat. However, no heed was paid by the OP and ultimately, a legal notice was served upon the OP on 17.12.2020 but no response was received from the OP. Due to the act and conduct of OP, the complainant has suffered a great deal of financial loss, mental agony and harassment; hence, the present complaint.

2.             Upon notice, OP appeared through counsel and filed written statement raising preliminary objections qua complaint is not maintainable; no cause of action; the complainant has not come with clean hands and suppressed the true & material facts. The OPs floated Muti Storeyed Flats for Serving/Ex-defence and Para-Military Personal of Haryana upto the rank of JCOs & equivalent on Hire Purchase basis at Faridabad, Gurgaon, Mahendergarh, Jhajjar, Panchkula, Pinjore, Palwal, Rewari, Sampla, Rohtak and Bawanikhera on Hire Purchase Basis. The registration period for the said scheme was 17.02.2014 to 15.05.2014 and further date was extended upto 30.06.2014. Accordingly, the complainant submitted form alongwith Bank draft amount of Rs. 2,27,000/- towards registration amount(i.e. 10% costs of flat advertised) with the Ops for registration of his name for the allotment of Type-A flat at Sector-28-A, Pinjore and he was declared successful in the draw of lots held on 29.12.2014 at Panchkula. After that the complainant deposited Rs.3,41,000/-, which was demanded by the Ops vide letter dated 10.02.2015. It is alleged that the complainant has filed the present complaint without approaching the Ops for redressal of his grievance.  It is further stated that the complainant has portrayed the Ops as a Developer of Real Estate whereas Housing Board Haryana is an establishment of Government of Haryana under the Haryana Housing  Act, 1971; hence, the Ops is a statutory body and not a mere Real Estate developer. It is stated that no specific date for handing over the possession of the flat was mentioned in the scheme floated by the Board or in the demand letter of Flat, thus, there is no violation of any terms and conditions of either of the scheme or of allotment letter at the ends of the OPs. The construction work of the project could not be undertaken due to constraint beyond the control of the Board. The complainant has never approached the OPs nor any request from the complainant was ever received by the Ops. It is further stated that the complainant has not ever approached the OPs for the refund of the amount. It is pertinent to mention here that the present project was planned in such a way as  to deliver the possession by 28.02.2017 but due to technical reasons, construction of the same could not started. The Ops have been at no fault anywhere and has acted genuinely, fairly, unarbitrarily, based on uniform approach and natural justice.  However, the applicants of Type-A & Type-B, Sector-28, Pinjore were requested to give their consents for allotment of flat at Sector-31, Panchkula.  So, there is no deficiency in service on the part of the OP and prayed for dismissal of the present complaint.

3.             The learned counsel for the complainant has tendered affidavit as Annexure C-A along with documents Annexure C-1 to C-5 in evidence and closed the evidence by making a separate statement. On the other hand, the ld. counsel for the OP tendered affidavit as Annexure R-A  and closed the evidence.

4.             We have heard the learned counsels for the parties and gone through the entire record available on file including the written arguments filed by the learned counsels for complainant as well as OP, minutely and carefully.

5.             Admittedly, the complainant had applied for registration of a residential flat in 2014 under ‘A’ category in the OPs project to be developed at Pinjore, Sector-28. The payment of sum of Rs.2,27,000/- made by complainant to OP, qua the registration of said flat, is not in dispute. Further, the payment of sum of Rs.3,41,000/- made to OP after the allotment of a flat as conveyed to the complainant vide letter dated 10.02.2015, is also not in dispute. The total tentative price of the residential flat was fixed as Rs.22,70,000/-. In the present complaint, refund of the said deposited amount of Rs.5,68,000/- along with interest has been claimed on the ground that the OPs have failed to raise the construction of flats as well as provide the basic amenities in and around the site in question.

6.             During arguments, the learned counsel for the complainant reiterating the averments made in the complaint, has contended that Ops have not taken any step towards the construction of flats as well as the completion of the development works at site and thus, has prayed for acceptance of the complaint by directing the OPs to refund the amount along with interest & compensation as prayed for in the complaint.

7.             The OPs have contested the complaint by raising several preliminary objections as well as on merits in written statement. Vide first objection, it is stated that the complaint is liable to be dismissed for want of serving of prior legal notice, which is mandatory as per Section 67 of the Haryana Housing Board Act, 1971.

                This objection is rejected because the legal notice as contemplated vide Section 67 of the said Act is not necessary before filing a consumer complaint. Further, the complainant has been found to have sent the legal notice dated 17.12.2020(Annexure C-5) to the OP seeking the possession of a flat at Sector-28, Panchkula or refund of his deposited amount before filing the present complaint. Therefore, the said objection carries no weight being baseless and meritless.

8.             The next objection is that the complainant has not approached the Commission with clean hands. This objection is also not tenable in view of the fact that the OP has not clarified as to which of the relevant facts have been concealed by the complainant.

9.             The last objection to the maintainability of complaint is that that the present complaint is pre-mature as the complainant has filed the present complaint without approaching the OP for redressal of his grievances.         

                This objection is also rejected in the light of the fact that a legal notice dated 17.12.2020(Annexure C-5) by the complainant to the OP seeking the refund of his deposited amount prior to filing of the present complaint and thus, the said objection carries no weight and substance.

                The last plea taken by the OP is that the Housing Board, Haryana, Sector-6, Panchkula is engaged in projects wherein the areas are developed specifically keeping in view the category of army  personnel  and Para-military personnel of Haryana and that the OP is not a developer as portrayed by the complainant. The learned counsel for the OP vehemently contended that the Housing Board Haryana was established under the Haryana Housing Board, Act 1971 and thus, the same is statutory body and not a mere Real Estate developer. It is vehemently contended that the Op never had and in the present scenario also, has no profit motive.

10.            On merits, it is stated that no specific date was given for handing over the possession of the plot and thus, there is no violation of any terms and conditions as contained in the brochure or in the allotment letter. The learned counsel for the OPs while reiterating the averments made in the complaint vehemently contended that the construction work at the site could not be under taken due to various impediments, which were beyond the control of the OPs.

                Controverting the contentions of the complainant qua the prayer for the refund of the deposited amount with interest and compensation, the learned counsel placed reliance upon Clause 12 and 13 of the Housing Board Haryana(Allotment Management and sale of Tenements) and contended that refund is permissible, only after forfeiture of 10% of the earnest money deposited at the time of registration, without any interest.

11.            Admittedly, the applications were invited by the OP for the registration of flat in Multistoried buildings to be constructed at various places of Haryana like Faridabad, Gurgaon, Mahendergarh, Jhajjar, Panchkula, Pinjore, Palwal, Rewari, Sampla, Rohtak and Bawanikhera. As per brochure(Annexure C-1), the serving/Ex-defence and Para –Military Personnel of Haryana up to the rank of JCOs & equivalent and their widows and orphans were entitled for registration of flat w.e.f. 17.02.2014 to 28.03.2014 extended upto 30.06.2014. As the promise and assurance was made by a statutory body i.e. OP, which is a public sector undertaking, vide its brochure qua the construction of flats in multistoried buildings at various places for allotment to army/paramilitary personnel on Hire Purchase Basis, there was no occasion for the applicants including the complainant to entertain any kind of suspicion or doubt about the non fulfillment of the promise made vide its brochure. Believing upon the promise made by OPs vide its brochure, the complainant was allured to invest in the said project  so as to have a dwelling unit and accordingly, made the initial payment of Rs.2,27,000/- and thereafter, made the payment of Rs.3,41,000/- and thus, a total sum of Rs.5,68,000/- was paid to the OP.

12.            Pertinently, a period of about more than seven and a half years has elapsed since making of payment of Rs.2,27,000/- to the OP qua the price of the flat but the Op has not been able to construct the flat as promised vide its brochure. Admittedly, the OP has failed to raise the construction of flat at site.

13.            Since the OP No.1 is a statutory body and engaged in the construction of flats/houses etc., it is necessary to discuss some authoritative judgments delivered by Hon’ble Apex Court, wherein the liability of statutory body/public sector undertaking, engaged in development work like construction of flats, under Consumer Protection Act has been discussed. The Full Bench of Hon’ble Apex Court vide its judgment dated 11.01.2021 in IREO Grace Realtech Pvt. LTD. Vs. Abhishek Khanna and Others reported in (2021) AIR(SC)437: (2021)AIR (SC) Civil 1291 has placed reliance upon the case law titled as Lucknow Development Authority Vs. M.K.Gupta(1994)1 SCC 243, wherein para no.6, it has been as under:-

“As pointed  out earlier  the entire  purpose of widening  the definition is to include  in it  not only day to day buying  and selling activity  undertaken by a common man but even such activities  which are otherwise  not commercial  in nature  yet they partake of a character in which some benefit is conferred  on the consumer. Construction of a house or flat is for the benefit of person for whom it is constructed.  He may do it himself or hire services of a builder or contractor. The latter being for consideration is service as defined in the Act. Similarly when a statutory authority  develops  land or allots  a site or  constructs  a house  of the benefit  of common  man it is as much service  as by a builder  or contractor. The one is contractual service and other statutory service. If the service is defective or it is not what was represented then it would be unfair trade practice as defined in the Act. Any defect in construction activity would be denial of comfort and service to a consumer. When possession of property is not delivered within stipulated period the delay so caused is denial of service. Such  dispute  or claims  are not in respect of immoveable property  as argued  but deficiency  in rendering  of service of particular  standard, quality  or grade. Such deficiencies or omissions are defined in sub-clause(ii) of clause(r ) of Section 2 unfair trade practice”.

14.            The Hon’ble Apex Court vide its celebrated judgment decided on 17.03.2004 in case law titled as Ghaziabad Development Authority Vs. Balbir Singh in Civil Appeal No.7173 of 2002 and connected matters has again placed reliance upon the case law laid down in M.K.Gupta case (supra) as under:-

“However, in the context  of the Consumer Protection Act the principles  laid down  in the case of Lucknow Development  Authority Vs. M.K.Gupta,(1994) 1 SCC 243 have to be kept  in mind. In this case the question was whether a development Authority rendered service to bring it within the purview of the Consumer Protection Act. It has been held that the Development Authority is rendering service. It has been also held as follows:-

8. Having  examined  the wide  reach  of the Act and jurisdiction  of the Commission to entertain a complaint  not only against business or trading  activity  but even against  service  rendered  by statutory  and public authorities, the stage  is now set  for determining if the Commission  in exercise  of its  jurisdiction  under the Act could award  compensation  and if such compensation  could be for harassment  and agony  to a consumer. Both these aspects specially the latter are of vital significance in the present day context. Still more important issue is the liability of payment. That is, should the society or the tax payer be burdened for oppressive and capricious act of the public officers or it be paid by those responsible for it. The administrative law of accountability of public authorities for their arbitrary and even ultra vires actions has taken many strides. It is now accepted both by this Court and English Courts  that the State is liable  to compensate  for loss or injury  suffered  by a citizen due to arbitrary  actions of its employees”.

15.            Apart from above, an another case, which is necessary to he discussed here is that of National Building Construction Corporation Limited(NBCC) Vs. Shri Ram Trivedi, (2021) 5 SCC 273, wherein the Hon’ble Apex Court fastened the liability on the statutory body/public sector undertaking under the Consumer Protection Act on account of its lapses and deficiencies. The Hon’ble Apex Court held that the consumer forums are empowered to award just and reasonable compensation as an incident of its power to direct removal of a deficiency in service and that they are not constrained by the rate prescribed in the agreement.  

16.            From the well settled legal proposition as discussed above, it is clear that liability for any deficiency, on the part of a statutory body like the OPs, can be fastened and the consumer can be awarded the interest as well as the adequate compensation.

17.            Now, we take up the issue raised by the Ops that no specific time or period was given by the OPs about the possession of the flat. As per well settled legal proposition, a consumer cannot be made to wait indefinitely for the possession of the flat. The Hon’ble State Commission, U.T. in consumer complaint no.229 of 2019 vide its order dated 03.12.2020 held that the non mentioning of date or period qua the delivery of possession in the allotment letter or/agreement by OPs in itself amounts to adoption of unfair trade practice. It was held that builder is bound to mention the exact/specific date of delivery of possession of the unit(s) to the allottees/purchasers thereof. The Hon’ble State Commission in the case (supra) had placed reliance on the case law titled as Rajeev Nohwar & Anr. Vs. Sahajanand Hi Tech Construction Pvt. Ltd. 2016(2) CPR 769 decided by the Hon’ble National Consumer Commission, Relevant part of the judgment delivered in the above case reads as under:-

          “Merely making endeavour to deliver possession by a particular date will also not meet the requirement of law and the promoter is under a legal mandate to stipulate a specific date for delivery of possession of the flat in the agreement which he executes with the flat buyer”.

The Hon’ble Supreme Court in the case tiled as M/s Fortune Infrastructure Appellant(s)(Now known as M/s Hicon Infrastructure) & Anr. Vs. Trevor Dlima & Ors. Civil Appellate Jurisdiction Civil Appeal No(s).3533-3534 of 2017, decided on 12.03.2018, held that when no period of delivery is stipulated, then a time period of 3 years would be reasonable for completion of the contract.

18.            Therefore, in view of the law as discussed above, the contentions of the Op that in the absence of any particular date about the delivery of possession of the flat, no deficiency can be attributed, is rejected. Further, the shelter taken by the Op of Clause 12 and 13 of Housing Board Haryana(Allotment Management and Sale of Tenements) denying the refund of the deposited amount along with interest is also not permissible in view of the fact that offer of flat by the OP has not been made so far.  

19.            In view of the aforesaid discussion, we have reached at the irresistible conclusion that there has been lapses and deficiencies on the part of the OP while rendering services to the complainant; hence, the complainant is entitled to relief.

20.            Now, adverting to relief, it is found that the complainant has claimed the possession of a type-A flat at Sector-28, Pinjore or the refund of deposited amount along with interest @18% and compensation amounting to Rs.5,00,000 and Rs.50,000/- on account of mental agony, physical harassment and financial loss etc. and litigation charges respectively.

21.            Admittedly, the OP is unable to deliver the possession of the flat at Sector-28, Pinore. Regarding interest as well as compensation as prayed by the complainant, the OP has contested the same on the ground that as per the said Regulations, 1972, refund is permissible with interest @ mean savings bank interest of the State Bank of India. In this regard, the learned counsel has placed reliance upon the judgment dated 30.05.2022 delivered by Punjab and Haryana High Court, in CWP No.19124 of 2021 and other connected petitions(total 18 CWPs), wherein it has been held as under:-

          “That being so, and with there being no challenge to the regulation  itself  in these petitions, they are disposed of with a direction to the respondents  to refund, in the case of each  petitioner, the entire  amount of money deposited by her/him in the year 2013/2014(as  the case may be), alongwith the mean savings bank interest  of the State Bank of India, running from the date of the closing  of the registration  in respect  of each scheme, by 30.06.2022 in the case of the Defence  Scheme Type-A Sampla, and till 31.10.2022 in the case of the Employees  Scheme, Jind Road, Rohtak”.

                The learned counsel for the Op contended that the complainant is not entitled to any other compensation except the refund of deposited amount alongwith interest @ mean savings bank interest of the State Bank of India.

 22.           On the other hand, the learned counsel for the complainant has contended that the complainant had opted to avail the remedy under the CP Act for the redressal of his grievances and that the said remedy is in addition to any other remedy available to a consumer. It is contended that the Consumer Commission is vested with vast powers under Section 38 of CP, Act 2019(Section 14 of CP, Act 1986, old Act) to grant interest as well as compensation on account of mental agony, physical harassment and financial loss etc. suffered by the complainant due to the deficient services of the service provider. The learned counsel for the Ops has placed reliance on the following case laws:-

1. Ghaziabad Development Authority Vs. Balbir Singh in Civil Appeal No.7173 of 2002 decided on 17.03.2004(SC).
2. Experion Developers Pvt. Ltd Vs. Sushma Ashok Shiror in Civil Appeal No.6044 of 2019 decided on 07.04.2022(SC).
3. Charan Singh Vs. Healing Touch Hospital in Civil Appeal No.767 of 2000 decided on 20.09.2000(SC).
4. Dhanbir Singh Vs. Haryana Urban Development Authority in Civil Appeal No.8639 of 2011 decided on 14.10.2011(SC).
5. Wg.Cdr. Arifur Rahman Khan and Aleya Sultana and ors. Vs. DLF Southern Homes  Pvt. Ltd.(now known  as Begur OMR Homes Pvt. Ltd.) and ors. in Civil Appeal No.6239 of 2019 decided on 24.08.2020.

 23.           After hearing the rival contentions of both the parties, now the question which arises for our consideration is how much interest/ compensation is to be paid to the complainant on the amount deposited by him with OP. As discussed in the preceding paras of this order, the OP has been found deficient, while rendering services to the complainant, and as per well settled legal propositions discussed in earlier para of this order, the liability for deficiencies on the part of the OP can be fastened under CP Act.

               The Hon’ble NCDRC, titled as Emaar MGF Land Limited and Another Vs. Amit Puri in F.A.250 of 2014 decided on 30.3.2015 has made a detailed discussion qua compensation, which is as follows:-

        “It is trite that the word compensation is of a very wide connotation. It may constitute actual loss or expected loss and may extend to compensation for physical, mental or even emotional suffering, insult or injury or loss. Explaining the general meaning and amplitude of the word Compensation in the context of the Act, in Lucknow Development Authority Vs. M.K.Gupta-(1994) 1 SCC 243, the Hon’ble Supreme Court observed as follows:-

“The word compensation is again of very wide connotation. It has not been defined in the Act. According to dictionary,  it means, compensating  or being  compensated thing  given  as recompense;  In legal  sense it may  constitute actual  loss or expected  loss and may extend to physical, mental or even emotional  suffering, insult or injury or loss. Therefore, when the Commission has been vested with the jurisdiction to award value of goods or services and compensation it has to be construed widely enabling the Commission to determine included in wide meaning of compensation. The provision in our opinion enables a consumer to claim and empowers the Commission to redress any injustice done to him. Any other construction would defeat the very purpose of the Act. The Commission or the  Forum in the Act is  thus entitled  to award  not only value  of the goods  or services  but also to compensate  a consumer  for injustice  suffered  by him”.

9.       Endorsing the said observations, in Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65, the Supreme Court held that the provisions of the Act enable a Consumer to claim and empower the Commission to redress any injustice done. A consumer fora is entitled  to award  not only  value  of goods  or services  but also to  compensate  a consumer  to injustice  suffered  by him. However,  sounding  a note of caution   to the effect  that the compensation  cannot  be awarded  in all cases  on a uniform  basis  or at a uniform  rate,  the Court  has observed  that loss has to be determined by the For a  keeping  in view  a number  of factors like loss of rent  which could have been  earned  of possession had been delivered  or the rent  a consumer  had to pay because of non-delivery of possession on time etc. Emphasizing that compensation in a case where delivery of possession is being directed would be different from a case where only refund of amount is being directed, the Hon’ble Court observed thus:-

          “That compensation cannot be uniform and can best be illustrated by considering cases where possession is being directed to be delivered and cases where only monies  are directed to be returned. In cases where possession is being  directed to be delivered  the compensation  for harassment  will necessarily  have  to be less because  in a way that party is being  compensated  by increase  in the value  of the property he is getting. But in cases where monies are being simply returned then the party is suffering, a loss inasmuch as he had deposited the money in the hope of getting a flat/plot. He is being deprived of that flat/plot. He has been deprived of the benefit of escalation of the price of that flat/plot. Therefore, the compensation in such cases would necessarily have to be higher”.

24.             The Hon’ble Apex Court in Civil Appeal No.3182 of 2019 @ SLP(C) Nos.1795 of 2017 decided on 25.03.2019 titled as Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra(SC) has ordered the builder to refund the deposited amount to the Consumer alongwith interest @9%p.a.(S.I.).

25.            The Full Bench of Hon’ble Apex Court vide its judgment dated 11.01.2021 in IREO Grace Realtech Pvt. Ltd. Vs. Abhishek Khanna and Others reported in (2021) AIR(SC)437: (2021)AIR (SC) Civil 129125 has granted the rate of interest @9%p.a.(S.I.) as under:-

          “We are cognizant of the prevailing market conditions as a result of Covid-19 Pandemic, which have greatly impacted the construction industry. In these circumstances, it is necessary to balance the competing interest of both parties. We think  it would be in the interests of justice and fairplay that the amounts deposited  by the Apartment Buyers is refunded with interest @9% S.I. per annum from 27.11.2018 till the date of payment of the entire amount.

          We direct the Developer to refund the entire amount deposited by this respondent along with interest @9% S.I. p.a. within a period of 4 weeks from the date of this judgment. The failure to refund the amount within 4 weeks will make the Developer liable for payment of default interest @12% S.I. p.a. till the payment is made”.

26.            Bearing in mind the aforestated broad principles for determining the question of award of compensation and interest to the complainant, we advert to the facts of the present case, wherein a sum of Rs.5,68,000/- is lying deposited with the OP. Respectfully following the law laid down by the Hon’ble Apex Court in aforementioned cases qua granting of compensation as well as interest, the present complaint is partly allowed with the directions to OP to refund the amount of Rs.5,68,000/- alongwith interest @9% p.a.(S.I.) from the date of each deposits. The OP is further directed to pay a sum of Rs.15,000/- to the complainant as compensation on account of mental agony and harassment and a sum of Rs.5,500/- on account of litigation charges.

27.            The OP shall comply with the order within a period of 45 days from the date of communication of copy of this order failing which the complainant shall be at liberty to approach this Commission for initiation of proceedings under Section 71/72 of CP Act, against the OP. A copy of this order shall be forwarded, free of cost, to the parties to the complaint and file be consigned to record room after due compliance.

Announced on:20.10.2022

 

 

 

Dr.Sushma Garg          Dr. Pawan Kumar Saini         Satpal         

           Member                          Member                     President

 

Note: Each and every page of this order has been duly signed by me.

 

                                         Satpal,                              

                                        President