STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(APPEAL NO.324 OF 2010)

                                                                   Date of Institution: 13.09.2010

                                                                   Date of Decision:   19.11.2010

1.      M/s Parsvnath Developers Ltd. through its Director, SCO No.1, Madhya Marg No.26, Chandigarh.

2.      The Director, M/s Parsvnath Developers Ltd., Regd. & Corporate Office, 6^th Floor, Arunachal Building, 19 Barakhamba Road, New Delhi.

Regd. Office at:

Parsvnath Metro Tower, Near Shahdara Metro Station, Shahdara, Delhi – 1100032 [Through its Authorized Representative Shri V. Mohan, Sr. Vice President (Legal) & Company Secretary].

……Appellants.

Versus

1.      Sh. Vinod Kathuria son of Mr. Sunder Das Kathuria;

2.      Ms. Anuradha Kathuria w/o Sh. Vinod Kathuria;

(Both residents of Old Vicarage Ellenhall, Stafford, England – ST216JQ)

also resident of H.No.80-D, Sector 1, Parwanoo.

3.      Chandigarh Housing Board, 8, Jan Marg, Sector 9B, Chandigarh through its Principal Officer.

              ....Respondents.

BEFORE:            S.  JAGROOP  SINGH   MAHAL,  PRESIDING MEMBER.

                        MRS.  NEENA  SANDHU,  MEMBER.

Argued by:   Sh. Ashwani Talwar, Advocate for the appellants.

                        Sh. Sanjiv Gupta, Advocate for respondents No.1 and 2.

                        Smt. Uma Gupta, Advocate for respondent No.3 – CHB.

(APPEAL NO.377 OF 2010)

                                                                   Date of Institution: 13.10.2010

                                                                   Date of Decision:   19.11.2010

Chandigarh Housing Board, Sector 9-D, Chandigarh through its Secretary.

……Appellant.

Versus

1.      Sh. Vinod Kathuria son of Mr. Sunder Das Kathuria;

2.      Ms. Anuradha Kathuria w/o Sh. Vinod Kathuria;

(Both residents of Old Vicarage Ellenhall, Stafford, England – ST216JQ)

also resident of H.No.80-D, Sector 1, Parwanoo.

3.      M/s Parsvnath Developers Ltd., SCO No.1, Madhya Marg, Sector 26, Chandigarh through its Principal Officer.

              ....Respondents.

Argued by:   Smt. Uma Gupta, Advocate for the appellants.

                        Sh. Sanjiv Gupta, Advocate for respondents No.1 and 2.

                        Sh. Ashwani Talwar, Advocate for respondent No.3.

PER  JAGROOP  SINGH  MAHAL,  MEMBER.

1.                     This order will dispose of two appeals filed by each of the OPs under Section 15 of Consumer Protection Act, 1986 (hereinafter referred to as the Act) against the order dated 6.8.2010 passed by learned District Consumer Disputes Redressal Forum-II, U.T., Chandigarh (hereinafter referred to as the District Forum) directing the OPs to refund the remaining amount of Rs.10,97,875/- with interest at the current S.B.I Term Deposit rate from the respective date of deposits till its refund and also to pay Rs.50,000/- as compensation and Rs.5,000/- as cost of litigation. It was further ordered that if the said amount is not paid within 45 days from the date of receipt of certified copy of the order, the amount of Rs.11,47,875/- shall be payable with interest @18% per annum from the date of deposit till its actual payment besides Rs.5,000/- as cost of litigation.

2.                     The complainant/respondent applied for the allotment of a 3 Bedroom flat (Type – I) in Parsvnath Pride Asia RGCTP, Chandigarh  on 21.9.2007. On 28.9.2007, Flat No.2, 1^st Floor, Block No.C-18 was allotted by the appellant Parasvnath Developers Limited (OP No.1) for a total cost of Rs.1,96,33,750/-. On 6.10.2006, an agreement was executed between the complainants and OP No.1/appellant regarding its purchase. The possession was to be delivered within 36 months from the date of signing of Developers Agreement (i.e. 9.3.2006). The complainants/respondents paid a sum of Rs.53,12,000/- up to 30.11.2008. The complainant, subsequently requested for upgradation of the flat, the price of which was Rs.2,19,57,500/- and therefore, paid a sum of Rs.5,77,375/- to OP No.1/appellant for upgradation of the flat to C18-PH3 having a super area 3150 Sq. ft. Thus the complainant in all paid an amount of Rs.58,89,375/- to OP No.1/appellant even before the OPs started construction of the flats. However, there arose a dispose between the OPs/appellants inter se and the construction work could not commence. It was  averred that the OPs/appellants have not started the construction at the spot and ultimately on 16.9.2008, vide letter (Annexure C-11), the complainants/respondents requested the OPs to cancel the flat and sought refund of their entire amount already paid to OP No.1/appellant as they were not in a position to wait for an indefinite period for the construction to be completed. OP No.1/appellant refunded a sum of Rs.47,91,500/- to the complainants and deducted Rs.10,97,875/- towards 5% of the purchase price of the flat. The complainants/respondents issued a legal notice dated 11.5.2009 (Annexure C-18) asking OP No.1/appellant to refund the amount of Rs.10,97,875/- along with interest but the same was not refunded. Hence, this complaint.

3.                     The contention of Parasvnath Developers Ltd. OP No.1/appellant was that they had entered into a Developers Agreement with Chandigarh Housing Board/OP No.2/appellant on 9.3.2006 and thereafter, the possession of 123.79 Acres was given to them. They started erecting fence around the said land but the Government of Haryana claimed title over a portion of the same due to which the matter was taken up with OP No.2/appellant and some meetings were held but the dispute with the State of Haryana could not be resolved. It was alleged that due to this dispute, they could not start construction work and the possession of the flats could not be delivered to the applicants within the stipulated period. They had requested the Chandigarh Housing Board/OP No.2-appellant to extend the period of  construction but the same was declined. According to them, the complainants/ respondents asked for the cancellation of their allotment and in view of Clause 5 of Flat Buyers Agreement, a sum of Rs.10,97,875/- being 5% of the total price of the flat was deducted and the remaining amount was paid to them.

4.                     The OP No.2/appellant Chandigarh Housing Board also contested the complaint alleging that the possession of 123.79 Acres of land was given by them to OP No.1 in October 2006. It was admitted that the State of Haryana raised a dispute of title regarding a portion of the said land but that disputed portion is not a part of residential site where the flats were to be constructed. According to them, it was the duty of OP No.1 to timely deliver possession of the flats in view of Flat Buyer Agreement and the OP No.2 has no role in the delay of construction and delivery of possession. It was alleged that there is no deficiency in service on their part and the complaint against them should be dismissed.

5.                     The learned District Forum gave opportunity to the parties to lead evidence in support of their contentions.

6.                     After hearing arguments of learned counsel for the parties and perusing the record, the complaint was allowed in terms as mentioned in the opening para of this order.

7.                     Both the OPs filed separate appeals challenging the said order, which are being decided together through this common order.

8.                     The contention of the appellants is that in view of Clause No.5 of the Agreement, in the eventuality of cancellation, earnest money being 5% of the basic price would be forfeited and the balance, if any, would be refundable without interest. It is argued that the complainants/respondents are not entitled to the said refund of amount of Rs.10,97,875/- being 5% of the basic price nor interest on the said amount of Rs.10,97,875/- or on the total amount of Rs.47,91,500/-, which has been refunded to the complainants. This argument is opposed by the learned counsel for the respondents and rightly so because the cancellation referred to in Clause 5(a) of the Agreement (Annexure C-8) applies to the situation where the OPs/appellants are in a position to carryout the construction and deliver possession in accordance with the agreement and the applicants/complainants are not desirous of purchasing the flats. It may be true in a case where the builder/developer is ready to perform his part of the contract but the applicants withdraw their offer and ask for the cancellation of the agreement, in that situation, the builder may be justified in retaining the 5% of the basic price. However, in the present case, the situation is totally different. The possession of the land is alleged to have been delivered in 2006 and the construction should have been completed by 2009. However, in view of the dispute of the OPs inter se about the extension of time and other matters and also there being dispute regarding title to a portion of the land with the State of Haryana, not even a single brick is admitted to have been laid at the spot for the construction and completion of the flat. Clause 5 of the agreement is not, therefore, applicable in this case.

9.                     At this stage, we may also wish to refer to the judgment of our own Commission dated 30.9.2010 passed in FA No.178 of 2010 titled Chandigarh Housing Board Vs. Sh. Sudhir Sagar’ and FA No.227 of 2010 titled M/s Parsavnath Developers Ltd. Vs. Satya Estates’ vide which the issue involved in the present appeals relating to deduction of 5% of the basic price of the flat from the deposited amount has already been settled by this Commission against the OPs/appellants.

10.                   It is argued by the learned counsel for the complainant that OP No.1 was unable to finalise their master layout and architectural plans and was asking OP No.2 to issue the final layout plan of the site to enable them rework on the master plan of the project. The view of OP No.2 was that the draft scheme forwarded by the developer i.e. OP No.1 to them for approval was incomplete. The OP No.1 has admitted that the entire exercise and time spent on finalizing the concept plan had been wasted and there would be reallocation of the building blocks after a portion of the land was ceded to the State of Haryana. The OP No.1 claims to have informed OP No.2 that they were preparing revised master layout plan for the project and wanted certain important issues to be settled before the start of the project. The OP No.1 also is alleged to have informed OP No.2 regarding various deficiencies in their working leading to the delay in the approval of the master layout plan and the drawings.

11.                   In view of these facts, if the construction is not started at the project, the complainants cannot be penalized for that and if the complainants asked for refund of their amount, no such deduction of 5% can be made. The OPs cannot benefit from their own wrongs and punish the depositors not only of Rs.10,97,875/- but of the interest accruing on the total deposit also, which remained with the OPs and obviously, they would have earned interest there from. In view of these facts, we are of the opinion that neither the OPs can deduct the amount of Rs.10,97,875/- nor they can evade their liability to pay interest on the total amount deposited with them.

12.                   The learned counsel for the OPs also argued that besides interest, a sum of Rs.50,000/- has been imposed to be paid as compensation to the complainants, which could not have been imposed in view of the fact that interest was being awarded on the deposited amount. We do not find anything wrong with this order. The OPs collected the money from the complainants even before verifying the title to the land over which the project was to commence. When even the master layout plan and drawings were not complete and the OPs enticed the public in depositing the huge amounts worth crores of rupees with them. The construction of the flats is not in sight. Needless to mention that the prices of the flats and other immovable properties are increasing day by day and the property, which the complainant could have purchased with the amount of Rs.58,89,375/- may not be available to him today at this price. We are, therefore, of the opinion that the imposition of Rs.50,000/- as compensation is not on the higher side and is hereby maintained.

13.                   The complainants had deposited Rs.58,89,375/- with the OPs, which admittedly went into their joint account. They would have been earning interest thereon. The S.B.I interest rate these days on two year term deposit is about 7.75% per annum. We are, therefore, of the opinion that the complainants would be entitled to interest on the entire amount since the date of deposit till its payment to the complainants as ordered by the learned District Forum.

14.                   In view of the above discussion, we are of the opinion that there is no merit in these appeals and the same are accordingly dismissed with costs. The complainants/respondents would be entitled to Rs.5,000/- as costs of litigation in each appeal.

15.                   Copies of this order be sent to the parties free of charge.

Pronounced.

19^th November 2010.

Sd/-

 [JAGROOP SINGH MAHAL]

PRESIDING MEMBER

Sd/-

 [NEENA SANDHU]

MEMBER

Ad/-

STATE COMMISSION

(APPEAL NO.324 OF 2010)

Argued by:   Sh. Ashwani Talwar, Advocate for the appellants.

                        Sh. Sanjiv Gupta, Advocate for respondents No.1 and 2.

                        Smt. Uma Gupta, Advocate for respondent No.3 – CHB.

Dated the 19^th day of November 2010.

ORDER

                        Vide our detailed order of even date recorded separately, this appeal along with connected appeal bearing No.377 of 2010 have been dismissed with cost of Rs.5,000/- each.

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(APPEAL NO.377 OF 2010)

                                                                   Date of Institution: 13.10.2010

                                                                   Date of Decision:   19.11.2010

Chandigarh Housing Board, Sector 9-D, Chandigarh through its Secretary.

……Appellant.

Versus

1.      Sh. Vinod Kathuria son of Mr. Sunder Das Kathuria;

2.      Ms. Anuradha Kathuria w/o Sh. Vinod Kathuria;

(Both residents of Old Vicarage Ellenhall, Stafford, England – ST216JQ)

also resident of H.No.80-D, Sector 1, Parwanoo.

3.      M/s Parsvnath Developers Ltd., SCO No.1, Madhya Marg, Sector 26, Chandigarh through its Principal Officer.

              ....Respondents.

BEFORE:            S.  JAGROOP  SINGH   MAHAL,  PRESIDING MEMBER.

                        MRS.  NEENA  SANDHU,  MEMBER.

Argued by:   Smt. Uma Gupta, Advocate for the appellants.

                        Sh. Sanjiv Gupta, Advocate for respondents No.1 and 2.

                        Sh. Ashwani Talwar, Advocate for respondent No.3.

PER  JAGROOP  SINGH  MAHAL,  MEMBER.

1.                     For orders, see the orders passed in Appeal No.324 of 2010 titled ‘ M/s Parsvnath Developers & another Vs. Sh. Vinod Kathuria & others’ vide which this appeal has been dismissed with costs of Rs.5,000/-.

2.                     Copies of this order be sent to the parties free of charge.

Pronounced.

19^th November 2010.

[JAGROOP SINGH MAHAL]

PRESIDING MEMBER

 [NEENA SANDHU]

MEMBER

Ad/-