Chandigarh

StateCommission

CC/324/2015

Rakesh Bhalla - Complainant(s)

Versus

Unitech Limited - Opp.Party(s)

Sunil Toni, Adv.

11 Apr 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

                                UNION TERRITORY, CHANDIGARH

                               

Consumer Complaint No.	324 of 2015
Date of Institution	31.12.2015
Date of Decision	11.04.2016

 

 

 

Rakesh Bhalla s/o Late Sh.R.K.Bhalla, r/o Floor No.60, Mankapur, near Safewag Motor, Nagpur, 440030 (Maharashtra).

….…Complainant

V E R S U S

1. Unitech Limited, Registered Office at 6, Community Centre, Saket, New Delhi 110 017, through its Managing Director.
2. Unitech Limited, SCO No.189-90-91, Sector 17-C, Chandigarh, through its Branch Head.

                                                        .….. Opposite Parties

BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                SH.DEV RAJ, MEMBER

                SMT.PADMA PANDEY, MEMBER

                                                                       

Argued by:        Sh.Sumit Bajaj, Advocate, proxy for Sh.Sunil                                 Toni, Advocate for the complainant.

                        Mrs.Vertika H.Singh, Advocate for the                                   Opposite Parties.

 

PER PADMA PANDEY, MEMBER

              In brief, the facts of the case, are that the complainant applied through an application on 08.04.2011 for allotment of a residential unit in the project of the Opposite Parties and accordingly, he purchased the first floor of plot area of approx. 300 sq. mtrs (approx. 358.80 sq. yards) in Block – D in the mega township to be known as Uniworld City in Sector 97, Mohali for a consideration of Rs.46,09,240/-. The Buyer’s Agreement (Annexure C-1) was executed between the parties in the year 2011. Accordingly, as per the installment payment plan, the complainant made the total payments, copy of which is Annexure C-2 (colly.). The complainant took a floor loan from LIC Housing Finance Limited for the purchase of the said floor and entered into Tripartite Agreement dated 11.05.2011 (Annexure C-3). It was stated that as per Clause 4(a)(i) of  the Agreement, the possession of floor was proposed to be delivered within 12 months of signing of the said Agreement, which expired in the year 2012. It was further stated that the complainant approached the Opposite Parties numerous times for possession of the unit, in question, and every time a tentative time between 6-8 months was given but the Opposite Parties failed to deliver possession of the unit. It was further stated that the Opposite Parties were deficient, in rendering service, as also, indulged into unfair trade practice.  When the grievance of the complainant was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (in short the “Act” only), was filed.

2.             In their written statement, the Opposite Parties stated that this Commission has no territorial Jurisdiction to adjudicate upon the present complaint because the Buyer Agreement was executed between the parties at New Delhi and moreover, the demand for the payment was raised by the Opposite Parties, from their Gurgaon Office and the receipts for the same had also been issued by the Gurgaon Office of the Opposite Parties. It was further stated that the complainant is an investor, who invested in the said plot for re-sale purposes and, as such, he did not fall within the definition of consumer. It was averred that the complainant is seeking refund of the deposited amount, which amounts to breach of Buyer Agreement because as per Clause 8 (b) of the Agreement, the developer should be entitled to a reasonable extension of time in handing over of possession, in case of Force Majeure Circumstances. It was further averred that the Opposite Parties have been severally affected by the global market recession in real estate market, due to which, they are facing utter financial hardships, which are the conditions beyond the control of the Opposite Parties, due to which, possession has been delayed. It was denied that the complainant made the total payments against the sale consideration of the flat. It was further pleaded that the complainant had opted for Down Payment Plan and accordingly the payment against the final notice of possession is still pending against him. It was further stated that the period of 12 months from the date of signing of the Agreement was a tentative time period, which was subject to force majeure circumstances beyond the reasonable control of the developer.  In the present case, the Company could not hand over possession of the unit due to the reasons of Global meltdown of the economy worldwide, wherein, the foreign investors, as anticipated by them (Opposite Parties), had refrained from any kind of investment, in India, and there was cash crunch throughout. It was further stated that the Opposite Parties are facing extreme financial hardship due to recession in the realty market and all these circumstances were beyond the control of the Opposite Parties. It was further stated that the Company is facing problems with regard to providing electricity in the said area as PSPCL raised objections on one pretext or the other. Due to the various formalities and objections raised by PSPCL, the electricity could not be availed by the Opposite Parties and, as such, rest of the development work and the amenities have also been delayed. It was further stated that, recently, the Opposite Parties sorted out all the problems with the PSPCL and paid the requisite bank guarantee and requested to PSPCL to release 1 MW connection for the project vide letter dated 08.01.2016 (Annexure OP-4). It was further stated that despite all the odd conditions, the Opposite Parties are making every endeavor to complete the development work at the site and making sincere efforts to handover possession of the said unit to the complainant. As per Clause 8(b) of the Agreement, the Opposite Parties are entitled to reasonable extension of time of agreed date for delivery of possession of the flat. It was further stated that the construction work is in full swing and possession would be shortly handed over to the complainant. It was further stated that as per Clause 4(c), the Opposite Parties made themselves liable to pay charges @Rs.5/- per sq. ft. per month of the saleable area of the floor for the period of delay in offering the possession. The said clause clearly stipulated that the charges for delayed possession should be adjusted at the time of issuing of final notice of possession by the developer. 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.

3.             The Parties led evidence, in support of their case.

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

5.             Admittedly, the complainant applied to the Opposite Parties vide application on 08.04.2011 for booking of a unit in the project of the Opposite Parties. It is also an admitted fact, that Buyer’s Agreement was executed between the parties at New Delhi on 27.04.2011 (Annexure OP-2). It is clearly proved from Article 1 of the Buyer’s Agreement that the purchaser (complainant) agreed to purchase first floor on plot No.0088 on plot area of approx. 300 sq. mtrs. (approx. 358.80 Sq. yards) in Block D, provisionally allotted to him in the Mega Township to be known as UNIWORLD CITY in Sector 97, Mohali, Punjab. It is also mentioned in Article 2 of the Buyer’s Agreement that consideration of the floor is Rs.46,09,240/-. It is also an admitted fact that the complainant took loan from LIC Housing Finance Limited and Tripartite Agreement was executed between the parties on 11.05.2011 (Annexure C-3). It is clearly proved from the receipts produced on record by the complainant for an amount of Rs.4,55,000/-, Rs.5,63,000/-, Rs.35,00,000/- and Rs.52,166/- (Annexure C-2) that the complainant paid the total amount of Rs.45,70,166/- out of the consideration of Rs.46,09,240/- to the Opposite Parties for the purchase of the unit, in question. It is also the admitted fact that possession was not given to the complainant.  

6.             The first question, that falls for consideration, is, as to whether, this Commission has got territorial Jurisdiction, to entertain and decide the complaint or not. According to Section 17 of the Act, a Consumer Complaint, could be filed, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to the complainant. According to the Counsel for the Opposite Parties, this Commission has no territorial jurisdiction to entertain and decide the complaint because the Buyer Agreement was executed between the parties at New Delhi and receipts of payment of the amount was also issued from their Gurgaon Office. It is, no doubt, true that Buyer’s Agreement dated 27.04.2011 (Annexure OP-2), was executed between the complainant and Unitech Limited at New Delhi, in respect of the unit, in question. It is evident, that a cheque/draft bearing No.402622 dated 19.02.2011 for an amount of Rs.4,55,000/-, towards the booking amount, in respect of the said unit, was received by the Opposite Parties, at Chandigarh (Annexure C-2), as this document bears the stamp Unitech Limited, Regional Office, SCO 189-191, Sector 17-C, Chandigarh – 160017. Since, as per the document, referred to above, it is clearly proved that a part of cause of action, arose to the complainant, at Chandigarh, this Commission has got territorial Jurisdiction, to entertain and decide the complaint. The objection, taken by the Opposite Parties, in their written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.

7.             The next question, that falls for consideration is, as to whether, the complainant falls within the definition of consumer or not? The Counsel for the Opposite Parties submitted that the complainant is an investor, who invested in the said unit for re-sale purposes but he could not do the same due to over all slump in the real estate sector and, as such, he is not covered under the definition of ‘consumer’ as per Section 2(d) of the Consumer Protection Act, 1986.  

                The unit, which was purchased by the complainant, is a residential one and the Opposite Parties did not allot a booth, where the complainant was to run commercial activity.  No evidence was produced by the Opposite Parties, that the complainant is property dealer, who deal in the sale and purchase of the property, and, as such, he purchased the unit, in question, for the purpose of investment, with a view to resell the same, as and when, there is escalation, in the prices of real estate. Under these circumstances, it is held that the complainant availed of the services of the Opposite Parties, for consideration, for the purpose of allotment of the unit, in question, and therefore, he falls within the definition of consumer. The submission of the Counsel for the Opposite Parties, therefore, being without merit must fail and the same stands rejected.

8.             The next question, that falls for consideration, is, as to whether, the complainant is entitled to the refund of amount, deposited by him, in the circumstances, referred to above. The Opposite Parties, failed to deliver possession of the unit, in question, to the complainant, on account of facing extreme financial hardship due to the recession in the reality market.  Moreover, the complainant has already paid huge amount of Rs.45,70,166/-, out of the total sale consideration of Rs.46,09,240/- (mentioned in Article 2 of the Buyer’s Agreement).The complainant also took the loan from LIC Housing Finance Limited, as stipulated in the Tripartite Agreement (Annexure C-3). Admittedly, the Buyer’s Agreement was executed between the parties on 27.04.2011 and till the date of filing the complaint i.e. 31.12.2015, the Opposite Parties failed to deliver possession of the unit, in question, to the complainant.  The submission of the Counsel for the Opposite Parties that due to recession or non granting of permission from the PSPCL, they failed to develop the unit, has no value, at all because the complainant paid his hard earned money to the Opposite Parties and also took loan from LIC Housing Finance Limited. It is clearly proved that about 5 years has expired from the date of Agreement but the Opposite Parties failed to deliver the physical possession of the unit, in question,  to the complainant. Even the complainant approached the Opposite Parties numerous times for possession of the unit but every time they sought tentative time between 6-8 months and after expiry of tentative period, they failed to deliver possession of the unit, in question. So, the Opposite Parties had no right, to retain the hard earned money of the complainant, without rendering him, any service. Since, the unit, in question, had not been completed, even by the time, the complaint was filed, no alternative was left with the complainant, than to ask for the refund of amount, deposited by him. Even till date, the Opposite Parties are unable to hand over the legal physical possession of the unit, in question. In our considered opinion, the complainant is entitled to the refund of amount of Rs.45,70,166/-, deposited by him. By not refunding the amount, deposited by the complainant, with interest, the Opposite Parties were deficient, in rendering service.

9.             The next question, that falls for consideration, is, as to whether, the complainant is entitled to interest, on the amount deposited by him, if so, at what rate. Admittedly, the factum of deposit of an amount of Rs.45,70,166/-, which was more than 90% of the price of the unit, in question, has not been disputed by the Opposite Parties.  The hard earned money of the complainant was utilized by the Opposite Parties, for a sufficiently longer period but they failed to give physical possession of the unit, in question. Had this amount been deposited by the complainant, in some bank, or had he invested the same, in some business, he would have earned handsome returns thereon. In case of delay, in deposit of installment(s), the Opposite Parties were charging interest @18% P.A. (compounded quarterly), as is evident from Article 2.c. of the Buyer’s Agreement (Annexure OP-2). Under these circumstances, in our considered opinion, if  interest  @15% P.A., on the amount deposited by the complainant, from the respective dates of deposits, is granted, that will serve the ends of justice.

10.           The next question, that falls for consideration, is, as to whether, the complainant is entitled to compensation, under Section 14(1)(d) of the Act, on account  of mental agony and physical harassment and injury caused to him,  by not delivering physical possession of the unit, to him or by not refunding the amount deposited. The complainant,  underwent a lot of mental agony and physical harassment, on account of the acts of omission and commission of the Opposite Parties. Compensation,  to the tune of Rs.3.00 lac, on account of mental agony and physical harassment, caused to the complainant, due to the acts of omission and commission of the Opposite Parties, if granted, shall be reasonable, adequate and fair. The complainant, is, thus, entitled to compensation, in the sum of Rs.3.00 lac, as indicated above.

11.           No other point, was urged by the Counsel for the Parties.

12.           For the reasons recorded above, the complaint is partly accepted with costs, against the Opposite Parties, in the following manner:-

(i)             The Opposite   Parties are jointly and severally directed to refund the deposited amount of Rs.45,70,166/-, to the complainant, alongwith interest @15% per annum, from the respective dates of deposits, within 45 days, from the date of receipt of a certified copy of this order.

(ii)            The Opposite Parties are jointly and severally further directed to pay compensation, in the sum of Rs.3.00 lac, for causing mental agony and physical harassment, to the complainant, within 45 days, from the date of receipt of a certified copy of this order.

(iii)           LIC Housing Finance Limited shall have the first charge, on the amount to be refunded, to the complainant, by the Opposite Parties, to the extent, the amount is due to it, against the complainant as it (LIC Housing Finance Ltd.) had advanced loan in his (complainant) favour for part payment of the price of unit, in question, under the Tripartite Agreement dated 11.05.2011 (Annexure C-3).

(iv)           The Opposite Parties are further directed to pay cost of litigation, to the tune of Rs.30,000/-, to the complainant.

(v)            In case the payment of amounts, mentioned in Clauses (i) and (ii), is not made, within the stipulated period, then the Opposite Parties jointly and severally shall be liable to pay the amount mentioned in Clause (i) with interest @17 % P.A., instead of 15% P.A., from the respective dates of deposits, till realization, and interest @15% p.a., on the amount of compensation, mentioned in Clause (ii), from the date of filing the complaint, till realization,  besides payment of litigation costs, to the tune of Rs.30,000/-.

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

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

Pronounced.                                                                                      

11.04.2016                                                                       

[JUSTICE JASBIR SINGH [RETD.]

                                                                                 PRESIDENT

 

                                                                                                                             

[DEV RAJ]

                                                                                                MEMBER

 

 

 [PADMA PANDEY]

MEMBER

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