Chandigarh

StateCommission

CC/129/2023

RAJESH KUMAR ARYA - Complainant(s)

Versus

VERA DEVELOPERS PVT LTD. - Opp.Party(s)

SANDEEP BHARDWAJ

17 May 2024

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T. CHANDIGARH

[Additional Bench]

==================

 

Complaint No.	:	129 of 2023
Date of Institution	:	08.12.2023
Date of Decision	:	17.05.2024

 

1]      Rajesh Kumar Arya son of Sh. Satnam Dass,

2]      Savita Arya wife of Sh.Rajesh Kumar Arya,

Both resident of House Number 70, Young Dwellers Complex, Sector 49-A, Chandigarh -160047

•  

 

V e r s u s

 

1]      Vera Developers Private Limited, Regd. Office:- SCO-1, Peer Mushalla, Zirakpur-160403, Punjab, India through its Director/Managing Director/Authorized signatory.

 

2]      Vera Developers Private Limited, Site Office:-Opposite Kalka Road, Park Street, Near Patiala Chowk, Zirakpur-140603, Punjab India through its Director/Managing Director/Authorized signatory.

 

3]      Rakesh Kakkar, Director/Authorised signatory of Vera Developers Private Limited, Regd. Office:- SCO-1, Peer Mushalla, Zirakpur-160403, Punjab.

 

4]      Kartik Budhiraja, Director/Authorized signatory of Vera Developers Private Limited, SCO-1, Peer Mushalla, Zirakpur-160403, Punjab, India.

 

5]      Vishal Kumar, Director/Authorized signatory of Vera Developers Private Limited,SCO-1, Peer Mushalla, Zirakpur-160403, Punjab, India.

 

6]      Sandeep Arora, Director/Authorized signatory of Vera Developers Private Limited, SCO-1, Peer Mushalla, Zirakpur-160403, Punjab, India

….Opposite Parties.

BEFORE: MRS. PADMA PANDEY   PRESIDING MEMBER

                PREETINDER SINGH      MEMBER

PRESENT	:	Sh. Sandeep Bhardwaj, Advocate for the Complainants.
		Sh. Neetish Handa, Advocate along with Ms. Navdeep Kaur, Advocate for the Opposite Parties.

PER PADMA PANDEY, PRESIDING MEMBER

 

1]                Brief facts of the case, as emerged from the Complaint are that on numerous assurances made by the opposite parties through various newspapers, marketing emails and telemarketing with regard to launching of their integrated residential project under the name & style of “GOLD MARK” located at Old Kalka Road, Park Street, Zirakpur, Punjab, the Complainants planned to buy housing unit for the self-use or for the use of their son or daughter who are unmarried and doctors by profession and also for the use of family. Accordingly, they booked a residential unit with the opposite parties and paid ₹6,50,000/- through cheque as booking amount vide receipt dated 06.06.2016 (Annexure C-1). Thereafter, they paid ₹3,32,500/- by cheque vide receipt dated 01.05.2017 (Annexure C-2) and in all, an amount of ₹9,82,500/- was received by the opposite parties before the allotment. The opposite parties issued allotment letter dated 27.06.2017 (Annexure C-3), wherein a residential unit i.e. Apartment No.702, 7^th Floor of Tower-1 was allotted to the complainants in the aforesaid project. Apartment buyers agreement was executed between the parties on 27.06.2017 (Annexure C-4). As per the said agreement, the basic sale price of the housing unit was fixed at ₹65,50,000/- whereas the total price of the unit including EDC, Power back up, independent covered parking, IFMS, club membership and PLC charges was ₹73,50,000/-. It has been alleged that as per Clause 12(a)(i) of the said agreement the possession of unit was to be handed over on or before 30.12.2019, however, the possession has not been handed over till date by the opposite parties. As per clause 12(iii), in case opposite parties further delay in handing over the apartment beyond the possession date, the opposite parties shall be bound to pay simple interest on the amount so paid till such time by every opposite parties which could be adjusted in the final amount to be paid by the opposite parties. The complainants agreed for construction linked payment plan as per which the specific payment was to be made on the completion of specific stage of construction. It has been averred that the since complainants were not in a position to pay the amount through their own, they availed the loan facility from the State Bank of India amounting to ₹46,50,000/-. As such, the property was mortgaged with the said bank. The complainants have paid an amount of ₹62,99,782.42 and bearing an EMI of ₹63,000/- p.m. on the home loan of ₹46,50,000/-, which is more than the monthly pension of the complainant No.1. It has been alleged that the there is delay of more than 3 years in offering/delivering the actual physical possession of the unit in question, which is continuing, and on account of that, the complainants are suffering huge mental agony and financial loss on account of huge EMI and monthly interest of Home Loan. As per customer ledger dated 23.07.2022 (Annexure C-8) the opposite parties have received an amount of ₹62,99,782.42/- from the complainants, but no intimation of any kind has been received till date about the status and stage of construction at the project site. Eventually, the complainants sent a notice dated 14.06.2023 through email on 16.06.2023 (Annexure C-9), raising their grievance of non-handing over the possession in time, which was never replied by the opposite parties. Thereafter, a legal notice dated 01.09.2023 (Annexure C-10), was served upon the opposite parties, which also remained unanswered till date.

2]                Notice of the complaint was sent to Opposite Parties seeking their version of the case. Since the opposite parties failed to file their reply within the stipulated period of 45 days,  therefore, their defence was ordered to be struck of by this Commission vide order dated 19.02.2024 in view of judgment of Hon’ble Supreme Court of India in case “M/s Daddy’s Builders Pvt. Ltd. & Anr. Vs. Manisha Bhargava and Anr.”, [Petition for Special Leave to Appeal (Civil) No. 1240 of 2021 decided on 21.02.2021. The said order dated 19.02.2024, which reads thus:-

“Today there is no representation on behalf of the parties as the advocates are not appearing as the local bar has abstained from work today.

2.       On the last date of hearing on behalf of Opposite Parties No.1 to 3, Sh.Neetish Handa, Advocate has filed his Vakalatnama, which was taken on record. However, it was undertaken by him  to file Vakalatnama on behalf of remaining Opposite Parties (NO.4 to 6)  alongwith the reply/written version. Sh.Neetish Handa had further stated that written version to the complaint shall be filed before 5.2.2024 and accordingly he was directed to file written version on behalf of the opposite Parties by or before 5.2.2024 in the registry with advance copy to the Counsel opposite.

 3.      After waiting for sufficient time, officials of the Bench on voice call asked the Counsel about non-filing of reply. However, he expressed acquaintance with the  time limit prescribed in the Consumer Protection Act and the law settled by the Hon’ble Supreme Court but  stated that reply could not be filed as he is unwell.  

4.       A perusal of the complaint file shows that opposite parties were served with notice accompanied with complaint/paper-book on 20.12.2023, thus, 45 days’ prescribed period to file reply expired on 05.02.2024. As per office report, no reply/written version to the complaint has been filed by the opposite Parties. 

5.       A five Judge Bench of Hon’ble Supreme Court rendered an authoritative judgment  on 4.3.2020 in New India Assurance Co. Ltd. Vs Hilli Multipurpose cold Storage Pvt. Ltd. Civil Appeal No.10941-10942 of 2013 wherein it has been held  that the District Forum has no power to extend the time for filing the response to the complaint beyond the period of 15 days in addition to 30 days as is envisaged under Section 13 of the Consumer Protection Act; and the commencing point of limitation of 30 days under Section 13 of the Consumer Protection Act would be from the date of receipt of the notice accompanied with the complaint by the opposite party.

6.       Further the Hon’ble Supreme Court in “M/s Daddy’s Builders Pvt. Ltd. & Anr. Vs. Manisha Bhargava and Anr.” [Petition for Special Leave to Appeal (Civil) No. 1240 of 2021] decided on 21.02.2021, by applying the ratio of the above authoritative decision, observed as follows:-

“5.    In any case, in view of the earlier decision of this Court in the case of Dr.J.J.Merchant (supra) and the subsequent authoritative decision of the Constitution Bench of this Court in the case of New India Assurance Company Limited v. Hilli Multipurpose Cold Storage Pvt. Ltd. (2020) 5 SCC 757, consumer fora has no jurisdiction and/or power to accept the written statement beyond the period of 45 days, we see no reason to interfere with the impugned order passed by the learned National Commission.

6. In view of the above and for the reasons stated hereinabove, the present special leave petition deserves to be dismissed and is accordingly dismissed.”

7.       In these circumstances and the settled position of law in the  above judgments of Hon’ble Supreme Court, we are of the view that for not filing reply/written version to the complaint within the stipulated period of 45 days, the Opposite Parties have lost their right to file reply and accordingly their defence is ordered to be struck of.  However,  Opposite Parties No.1 & 6 are  at liberty to submit their  written arguments  in the complaint before the next date of hearing.

          List on 29.02.2024 for arguments.

          In the meanwhile, written arguments, if any, be filed by the parties after exchanging copies with each other, failing which, the matter shall be decided on the basis of material available on record.

                             Copy of the order be sent by email to the parties.”

 

3]                The complainants led evidence in support of their case and also filed written arguments.

4]                Opposite Parties also advanced their written arguments, inter alia, submitting that the complainants have no locus standi to file the present complaint; the opposite parties have already obtained all the requisite sanctions and approvals from the competent authority; the complainants booked the unit after fully satisfying themselves with the floor plan/area of the unit, applicable charges and amenities being provided by the opposite parties; the complainants have been erratic in providing the payment as per the plan and as such, they cannot ask for any kind of compensation or interest etc. It has been pleaded that the possession of the unit was to be handed over by the opposite parties till 30.06.2020 i.e.  30.12.2019 plus 6 months grace period [as per Clause 12(a)(ii) of the agreement to sell]. As per the recommendations of the committee constituted by the Ministry of Housing and Urban Affairs, Government of India (MOHUA) to examine all the concerned issues holistically and recommended ways to complete the stalled projects and help to revive the real estate sector, the State Governments should allow, in order to alleviate financial stress caused by the extraordinary circumstances, suspension of the interest and penalties due to events like the Covid-19 pandemic i.e. 01.04.2020 to 31.03.2022. The said committee also recommended that the State Governments could examine and provide further Zero Period based on the local conditions/circumstances and the same "Zero period" has been implemented by the state of Uttar Pradesh.

5]                We have heard the Counsel for the parties and have gone through the record and the written arguments of the parties very carefully.

6]                Admittedly, an amount of ₹62,99,782.42 stood paid by the complainants to the opposite parties towards purchase of the unit in question and complainant No.1 is bearing a huge EMI of ₹63,000/- p.m. on the home loan of ₹46,50,000/- taken from SBI.  It is also an admitted fact that as per Clause 12(a)(i) of Apartment Buyer’s Agreement dated 27.06.2017 (Annexure C-4), the possession of the aforesaid said unit was to be handed over by the opposite parties to the complainants on or before 30.12.2019, which deadline they miserably failed to meet as neither the possession has been offered nor delivered by them to the Complainants.

7]                Per strength of Clause 12(a)(iii) of the agreement, the Opposite Parties contended that they were entitled to further grace period of 6 months on account of default on the part of the complainants in fulfillment of conditions of the agreement. However, this contention of the opposite parties cannot be accepted at its face value for a sole reason that since the fault, if any, was on the part of the opposite parties themselves in not completing the construction and development work by the promised date, as such, if the complainants have withheld the payment for some days seeing the progress of the project, which was not in consonance with the payment plan (which was construction linked), they cannot be termed as defaulter.  Here, we are fortified by the judicial pronouncement of the Hon’ble Supreme Court of India in Haryana Urban Development Authority Vs. Mrs. Raj Mehta, Appeal (Civil) 5882 of 2002, decided on 24.09.2004, wherein it was held that if the Builder is at fault in not delivering possession of the units/plots by the stipulated date, it cannot expect the allottee(s) to go on paying installments to it. Similar view had also been taken by the Hon’ble National Commission, in Prasad Homes Private Limited Vs. E.Mahender Reddy and Ors., 1 (2009) CPJ 136 (NC), wherein it was held that when development work was not carried out at the site, the payment of further installments was rightly stopped by the purchaser.

8]                It is significant to add, the effect of striking off the defence is that this Commission will not consider the written statement or give any weightage to the defence of the opposite parties. No doubt, when the defence is struck off, the party concerned has the right to appear before the Commission and argue the case,  in view of ratio  of law laid down by the Hon’ble Supreme Court in ARN Infrastructure India Limited Vs Hara Prasad Ghosh, SC (civil appeal diary no 31182/2023, Judgment dated 04.09.2023). However, in the present case, the opposite parties, in order to wriggle out of the aforesaid position, placed on record the para wise reply and documents annexed therewith, under the guise of “Written Arguments”. If we accept this practice, then any party, whose defence is struck off, will later on file para wise reply, evidence and documents, under the garb of “WRITTEN ARGUMENTS”.  In this view of the matter, demands raised by the Opposite Parties vide statement (Annexure R-3) to the extent of ₹4,11,863/- (on account of interest for delayed payment against dues) and ₹2,33,577/- (on account of interest for delay in paying interest) are superfluous and has no evidentiary value in the eyes of law being a document sought to be tendered into evidence after the defence of the Opposite Parties struck off by the order of this Commission; whereas, per Customer Ledger (Annexure C-8) an amount of ₹62,99,782.42 has been received by the opposite parties and only an amount of ₹12,161.58 is payable by the complainants as on 23.07.2022.

9]             The grace period of six months, as claimed by the opposite parties, cannot be taken into consideration in so far as the possession date is concerned. In our considered view, the possession of the unit in question was to be handed over by the opposite parties on or before 30.12.2019 and this period cannot be extended in any case since there is no default on the part of the complainants. Consequently, the opposite parties cannot claim any immunity for delay in offering possession of the unit in question, on the ground of Covid-19 pandemic (subsequent event) since due date of possession was 30.12.2019 before the Covid-19 period, by placing reliance on recommendations of the committee constituted by the Ministry of Housing and Urban Affairs, Government of India (MOHUA).

10]              In Parul Jain Versus Ramprastha Promoters and Developers Pvt. Ltd. & Anr., Consumer Complaint No. 884 of 2017 decided by Hon’ble National Consumer Disputes Redressal Commission, New Delhi on 26.02.2020, it has been held that plea taken towards force majure is not open to the opposite party. It is coming out from the record that the possession of the unit in question has still not been offered or delivered to the complainants and there has been delay therein, which is continuing, because even the date when arguments were heard in this case, it was not offered. Thus, in our considered opinion, by not offering and delivering possession of the unit in question by the possession date i.e. 30.12.2019, the opposite parties are deficient in providing service and guilty of adoption of unfair trade practice.

11]              Needless to mention here that onus to prove the stage and status of construction and development work at the project site and that all the permissions/approvals have been obtained in respect thereof, is on the builder/developer. It was so held by the Hon’ble National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. In the present case, not an iota of evidence has been placed on record, as to at what stage, the development and construction stage has reached. In case, the development/ construction activities at the project is about to complete, even by this year 2024, then it was for the opposite parties, which could be said to be in possession of the best evidence, to produce cogent and convincing documentary evidence, in the shape of the reports and affidavits of the Engineers/ Architects, as they could be said to be the best persons, to testify, as to whether, all these development/construction activities, are being undertaken but they failed to do so.  Under these circumstances, the opposite parties have attracted an adverse inference in the matter to hold that they are not serious in completing the project and on the other hand are utilizing the amount paid by the complainants and other similar located allottees, without providing them anything. 

12]              We can understand the predicament of the complainants who are paying hefty amount of EMIs to the SBI against the loan obtained by them and still they are empty handed. They are being put to double loss as on one hand, they have not been offered the possession of the unit by the opposite parties despite paying hefty amount and on the other, they are paying hefty installments to the Bank. Thus, in our considered view, the complainants are entitled to get possession of their unit, alongwith delayed compensation for the period of delay in delivery of possession.

13]              In Rakesh Mehta Versus Emmar MGF Land Limited, Consumer Complaint No.653 of 2015 titled as, decided on 16.10.2017, the Hon’ble National Commission discarded the contention that time is not the essence of the contract in handing over the possession. Further, in Udam Lal Singla & Anr. Versus Emaar MGF Land Limited & Ors., First Appeal No.113 of 2015 decided on 20.11.2017, the Hon’ble National Commission held that cause of action is continuous till the execution of conveyance deed is registered and completion certificate is obtained by the opposite parties. Still further, in M/s Newtech Shelters Noida Pvt. Ltd. Versus Rajiv S. Gupta, First Appeal No.290 of 2020, decided on 04.03.2020, the Hon’ble National Commission held that possession cannot be given without occupation certificate. Thus, in our concerted view, the opposite parties are bound to deliver the actual physical possession of the unit in question, as per the specifications mentioned in the allotment letter/agreement, to the complainants, complete in all respects, after obtaining requisite occupation and completion certificates from the competent Authorities. 

14]              Now, we will like to decide as to what amount of compensation should be granted to the complainants, for the period of delay in delivery of possession of their unit. On account of delay in actual delivery of possessions of the unit to the complainants, they have been caused mental agony, hardships and financial loss. In the case titled as Lucknow Development Authority v. M K Gupta, (1994) 1 SCC 243, the Hon’ble Supreme Court discussed about the extent of the jurisdiction of the Consumer Fora to award just and reasonable compensation for the harassment and agony suffered by a consumer. It may be stated here that this Commission is not bound to rely on a harsh, oppressive and unconscionable clauses contained in the agreement because it is well settled law that a court can strike down an unfair and unreasonable contract or an unfair and unreasonable clause in a contract, entered into between the parties who are not equal in bargaining power. The consideration or object of an agreement is unlawful inter-alia if it is of such a nature that, if permitted, it would defeat the provisions of any law or if the court regards it as immoral or opposed to public policy. If the object of some terms and conditions of agreement is unlawful, the same are deemed to be void. Our this view is supported by the judgment passed by the Hon'ble Supreme court in the case of Central Inland Water Transport Corporation Ltd. & Anr. Vs. Brojo Nath Ganguly & Ors., (1986) 3 SCC 156, wherein it has been clearly held that the courts can strike down the terms of a contract. The Hon'ble Court has held that "......this principle is that the courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between the parties who are not equal in bargaining power...." The draft legislation provided by the Law Commission of India in its 199th Report which addresses the issue of 'Unfair  (Procedural & Substantive) Terms in Contract' has stated  that "A contract or a term thereof is substantively unfair if such contract or the term thereof is in itself harsh, oppressive or unconscionable to one of the parties."  The above view has been reiterated by the Hon'ble Supreme Court in Pioneer Urban Land and Infrastructure Ltd. vs. Gouvindan Raghavan, Civil Appeal No.12238/2018 wherein in paragraph nos. 3.8, 6.3, 6.6 & 6.7, it has been clearly held that if the terms of contract are harsh, oppressive and unconscionable to one of the parties, such a contract cannot be relied upon and Courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between parties who are not equal in bargaining power. Not only above, in Nagesh Maruti Utekar Vs. Sunstone Developers Joint Venture, Consumer Case No. 12 of 2017, decided on 04 May 2022, the Hon’ble National Commission awarded interest @9% p.a. from the committed date of delivery till possession is delivered. Relevant part of the said order is reproduced hereunder:-

 

“……Consequently, the Opposite Party Developer is directed to pay interest @9% w.e.f. 31.03.2014, i.e., the expected date of delivery of the possession, on the amount deposited by the respective Complainant till 02.09.2017, i.e., the date on which the possession of the Flat was offered by the Opposite Party Developer, within two months from today……”

 

                   In Shreya Kumar & 11 Ors. Vs. M/s. Ansal Housing & Construction Ltd. & 3 Ors., Consumer Case No. 1021 of 2017, decided on 05 May 2022, the Larger Bench of the Hon’ble National Commission has awarded interest @9% p.a. from the committed date of delivery till possession is delivered. In the present case, the complainants have purchased the unit as far as back in 2016 and have made substantial payments of Rs.62,99,782/- and  are still empty handed and they have been forced to approach this Commission for redressal of their grievance by way of filing this complaint. Under above circumstances, in our considered opinion, if we grant interest @9% p.a. to the complainants on the entire amount deposited by them, from the due date of possession of the unit, as held above, till delivery of possession thereof, that will meet the ends of justice.

15]              For the reasons recorded above, this complaint is partly accepted, with costs and the opposite parties, jointly and severally, are directed as under:-

i.        To deliver actual physical possession of the unit in question, as per the specifications mentioned in the allotment letter/agreement, to the complainants, complete in all respects, after obtaining occupation and completion certificates from the competent Authorities, within a period of 45 days from the date of receipt of a certified copy of this order, on receipt of the remaining amount due from them, without charging any delayed interest/penalty thereon.     

ii.       To pay to the complainants, compensation by way of  interest @9% p.a. starting from 31.12.2019  till 31.05.2024, on the amounts deposited by them, within a period of 30 days from the date of receipt of a certified copy of this order, failing which the entire accumulated amount (31.12.2019 till 31.05.2024) shall carry interest @12% p.a. from the date of default till this entire accumulated amount is paid to the complainants.

iii.      To pay to the complainants, compensation by way of  interest @9% p.a. on the amounts deposited, w.e.f. 01.06.2024, onwards (per month), by the 10^th of the following month till actual delivery of physical possession of the unit, complete in all respects. 

iv.      To pay to the complainants, compensation to the tune of ₹1,00,000/- for causing them mental agony and harassment and also for deficiency in providing service and adoption of unfair trade practice and cost of litigation to the tune of ₹50,000/- within a period of 30 days, from the date of receipt of a certified copy of this order, failing which the said amounts shall carry interest @9% p.a. from the date of default till realization.

16]              However, it is made clear that since the interest awarded by this Commission @9% p.a. at Sr. No.(ii) and (iii) above, is by way of compensation, therefore, the opposite parties shall not deduct any TDS thereon. Similarly, no TDS shall be deducted by the opposite parties on the compensation amount of ₹1,00,000/- awarded at Sr. No.(iv) above.

17]              Certified copies of this order be sent to the parties free of charge.

18]              File be consigned to Record Room after completion.

Pronounced

17^th May 2024                                                           

Sd/-

                                                        (PADMA PANDEY)

PRESIDING MEMBER

 

 

Sd/-

                                                        (PREETINDER SINGH)

MEMBER

“Dutt”