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Judgment
A. P. Sahi, President Member
This complaint has been filed by a senior citizen who is now about 70 years of age seeking the relief of delivery of possession of the premises in question coupled with the payment of penalty @ 10% per annum on the amount received by the opposite party till the date of non-delivery of possession and further pay interest @ 18% per annum on the amount already received by the opposite party in lieu of the consideration paid against the same. A further amount for mental agony has also been claimed.
The complaint was registered and notices were issued after admitting it on 25.09.2018. The opposite party builder took exceptions to the maintainability of the complaint that an arbitration clause existed in terms of the agreement and hence the complaint should not be entertained. I.A. No. 22378 of 2018 raising the aforesaid preliminary objection was dismissed by this Commission on 07.12.2018 in the light of the Judgment of the Apex Court in the case of M/s Emaar MGF Land Ltd. & Anr. Vs. Aftab Singh- I (2019) CPJ 5 (SC).
Thereafter, affidavits were exchanged.
The dispute in the present complaint is with regard to possession of Flat No. C-2201, Floor-22nd, Tower-C, situate in Krrish Provence Estate, Gurugram, Haryana. The same has been developed by the opposite party no. 1 and an Apartment Buyer Agreement in the present case was entered into on 23.12.2011. In the agreement, clause no. 3.1 prescribed a period of delivery of possession within 36 months and clause no. 3.3 subject to force majeure and clause 11 permits a payment of 10% per annum on the entire sum timely deposited by the purchaser as delayed compensation for the delayed period of offer and delivery of possession.
The project was not completed and the opposite party no.1 defaulted in delivering possession inspite of the fact that the period of delivery as stipulated under the agreement including the grace period expired way back in 2015. The other home buyers also seem to have suffered the same fate as they were also allottees under the same project.
After filing of the present complaint, it appears that C.C. No.984 of 2019 was filed by three other home buyers before this Commission who had instituted also a criminal complaint against the builder before the Court of Metropolitan Magistrate, SED, New Delhi. The said three home buyers had also preferred an application under Section 7 of the Insolvency and Bankruptcy Code 2016 (IBC) before the National Company Law Tribunal seeking initiation of CIRP proceedings and also demanding refund due to inordinate delay of the completion of the project and failure in handing over the possession within the stipulated time. The said application had been filed prior to the amendment of the IBC that was entertained and allowed. Against the aforesaid Order of the he NCLT, Mr. Amit Katyal, the promoter and majority shareholder of the opposite party M/s Jasmine Buildmarth preferred an appeal before the NCLAT. The said appeal was dismissed against which a Civil Appeal No. 3788 of 2020 was filed before the Apex Court. In terms of the Order of NCLT, an IRP was appointed who after a public announcement constituted a committee of creditors on 23.11.2020.
The Apex Court while entertaining the aforesaid appeal stayed the operation of the Order dated 03.12.2020 subject to the deposits as directed therein. The flat buyers’ association had also filed a caveat before the Apex Court and three other home buyers had also moved an application for intervention in the said appeal. The Supreme Court recorded that there were 128 home buyers and 176 units in the project out of which 82 home buyers including the three intervenors had proposed and entered into a settlement on 27.01.2022 / 03.02.2022 and this settlement plan was moved along with the application for withdrawal of the CIRP proceedings and disposing of the appeal before the Apex Court.
The said application before the Apex Court for withdrawal of the CIRP Proceedings was ultimately allowed on 03.03.2022 and the appeal was disposed off accepting the settlement plan in respect of 82 home buyers only. The said judgment of the Apex Court Amit Katyal vs. Meera Ahuja & Ors. is reported in (2022)8 SCC 320.
That in so far as the present complaint is concerned, the payment made by the complainant was in full compliance of the terms of the agreement detailed in paragraphs 11 to 21 of the complaint and with regard to some additional payments in paragraph 25. These payments are all admitted and not disputed as is evident from a perusal of paragraphs 17 and 21 of the written version of the opposite party which are extracted herein under:
17 The contents of paragraphs 11-21 of the Complaint need no response, as the same are matter of record.
The contents of paragraph 25 of the Complaint need no response, as the same are matter of record.
This is further evidenced by a letter dated 09.12.2014 issued by the opposite party no.1 which states that the previous dues are Zero. This is followed by certain payments for which demands were raised additionally by the opposite party on 16.12.2016 relating to VAT. This letter also categorically records that the dues till 31st March were Rs. 2,86,30,000/- and the said amount had been received by the opposite party by 31st March in its entirety. Thus no-dues got confirmed and every demand stood paid uptill 31st March as per the said letter which does not complain of any delay in payment by the complainant.
The complainant then points out that according to the own admitted case of the opposite party, the inordinate delay has occurred even though certain flimsy grounds of force majeure have been pleaded. For this, the complainant’s counsel pointed out to paragraphs 7 and 18 of the written version / reply of the opposite party no. 1 which are extracted herein under:
7 It is respectfully submitted that the Complainant is claiming compensation under the Agreement for non-delivery of the physical possession of the residential flat to the Complainant, it is pertinent to mention here that the delay has been caused due to certain circumstances which were beyond the control of the Opposite Party such as shortage of resources including and not limited to labours, depleting market condition, demonetization, environment clearance, dispute with some home buyers etc. That the delay has been therefore caused due to factors which were beyond the control of the Opposite Party. It is respectfully submitted that the project of the Opposite party now nearing completion and it shall be offering possession to all the home buyers and the Complainant soon.
In response to paragraph 22 of the Complaint it is submitted that the delay in possession has been caused due to factors which were beyond the control of the Opposite Party. It is respectfully submitted that the project of the Opposite Party is now nearing completion and it shall be offering possession to all the home buyers and the Complainant soon.
It is, therefore, submitted by the complainant that in this background, the written reply of the opposite party which was filed on 04.12.2018, delay caused is no longer in dispute and is admitted
Learned counsel for the complainant has also invited attention of the Bench to the legal notice that was tendered on behalf of the complainant to the opposite party which is dated 05.07.2016 where all facts were indicated and the possession was sought together with compensation, interest as well as other ancillaries receivable to necessary as prayed for.
As noted above, this default in respect of other flat owners had already reached the Apex Court in the matter pertaining to the proceedings under the IBC 2016. It is relevant to mention that Resolution Professional Mr. J.S. Bedi also in the meantime proceeded to offer possession to the complainant on 25.06.2022 where the statement of accounts indicated a balance of Rs.69,38,800/- to be paid including preferential location charges and club membership charges etc. There is however a recital that on 29.10.2019 the competent authority has granted occupation permission. Learned counsel for the complainant asserted that no such occupancy permission or certificate has been produced nor has been filed on record even till today. After the Apex Court had allowed the withdrawal of the CIRP proceedings which terminated with the Order of the Apex Court dated 23.03.2020, the management again reverted back to the opposite party no. 1 who vide reminder dated 11.10.2021 offered possession of the apartment. This time the statement of accounts, after including the earlier amounts raised by the Resolution Professional, stood enhanced to Rs. 96,71,450/-.
Learned counsel contended that all these invitations and demands were bereft of any actual physical possession being offered as neither the construction was completed nor was the flat in habitable condition to be occupied by the complainant. Learned counsel for the complainant has also invited the attention of the Bench to the legal notice sent by the complainant to the Interim Resolution Professional Mr. Bedi on 13.07.2022. The same has been placed with a separate compilation dated 06.10.2023 which also contains photographs of the uncompleted construction of the project.
The aforesaid compilation had come forth when the opposite party through its counsel had indicated a possibility of settlement that is recorded in the Order dated 01.09.2023. The matter was accordingly adjourned for further consideration in the hope of any settlement but when the case was taken up on 06.10.2023, after hearing the counsel, the following Order was passed:
After having heard learned counsel for the parties, what appears is that there is a serious dispute being raised with regard to the status of the completion of the premises in question i.e. Flat No. C-2201, 22nd Floor, Tower-C, situate at Krrish Provence, Gurugram, Haryana. It is therefore necessary for this Commission to proceed with the matter as learned counsel for the complainant says that according to his instructions, the complainant is prepared to take possession provided the flat is offered to the complainant complete in all respects as per the specifications.
In order to ascertain as to whether the flat is in habitable and complete condition or not, learned counsel for both the parties were relying on certain photographs. Instead of relying on the said photographs, it would be appropriate that the photography of the premises in question is conducted in the presence of learned counsel for both the parties on the date that may be convenient to them.
Let this photography be conducted on Monday, the 9th October, 2023, which shall be in the presence of the complainant as well as the representative of the opposite party. For the said purpose, learned counsel for both the parties can also make it convenient to make their presence at the site itself at 11.00 a.m.
Let the matter come up on 11th October, 2023.
Order dasti.
Consequently, in compliance of the aforesaid orders, the compilation of photographs after serving the same on the counsel for the other side was placed which is dated 11.10.2023. These photographs remain undisputed which demonstrate that the flat is in an absolutely raw unfinished state.
The aforesaid photographs which were taken in presence of the both parties as directed, it is more than evident that the contention raised on behalf of the complainant that the flat is in an uninhabitable, gets confirmed. The nature of the deficiencies in the completion of the flat have also been detailed in the list which establishes the fact that the flat cannot be occupied without carrying out the said works. The offer of possession made by the learned counsel for the opposite party that it will be immediately done without any further delay is an argument only to delay the matter further. The list of unfinished works are quoted herein under:
LIST OF PENDING WORK NEEDS TO BE COMPLETED IN FLAT NO. C-2201, TO MAKE THE FLAT IN HABITABLE CONDITION KRRISH PROVENCE ESDTATE GWAL PAHARI:
· Kitchen works pending. Tile work, Flooring, Granite Counters and Wooden Cabinets, exhausted chimney & duct along with exhausts pending.
· All Toilets need completion. Tile work, Flooring work, plumbing work, counters along with CP & Chinaware / WC & Wash basins, Mirrors and shower Cubicals, exhausts, lighting, etc. pending in all toilets.
· Door shutters pending in all rooms along with veneer / mica cladding and all hardware (locking arrangements etc.) pending in all areas.
· Flooring pending in all bedrooms,
· PVC windows need glass at some places. Also alignment issue and fittings pending.
· Railings incomplete pending glass and hardware in all balconies.
· Electrical work pending. Wiring, Electrical MCB’s, switch plates, switches and sockets, light fixtures pending in all areas.
· VRV Air conditioning Units, Supply lines, Electrical works, Geysers, Fans & Ceiling lights pending in all areas.
· False Ceilings, POP & Paint work pending in all areas.
· Servant room flooring, balconies flooring, servant toilet all works pending.
· Some civil works pending along with wooden chowkhats, moulding etc.
· Polishing & Grinding work pending on all Italian marble work.
· Main lifts pending in tower. Also post this water supply along with electrical supply through panels.
WITHOUT TE ABOVE WORKS APARTMENT CANNOT BECOME HABITABLE.
The undisputed photographs filed on 11.10.2023 are a testimony to the above shortcomings.
It is in this background that the learned counsel for the opposite party has advanced his submissions contending that the force majeure clause was clearly attracted and there was no delay so as to cause the complainant stake compensation as prayed for, and since there was no strict adherence to the payment plan, clause 3.3 would not be attracted for possession as there was default on the part of the complainant. Learned counsel also argued that in fact the forfeiture clause would also be attracted in the event of any compensation or refund is awarded.
Learned counsel for the opposite party however, could not dispute the status of the construction as reflected in the photographs which were taken in the presence of the representatives of the opposite party on 09.10.2023 and has been brought on record on 11.10.2023.
Having considered the aforesaid submissions and having noticed the latest photographs pertaining to the status of the flat and there being no possibility of the matter being resolved the case has been proceeded with for final disposal.
From an assessment of the entire facts on record including the evidence, the affidavits and the latest photographs already mentioned herein above, it is almost now an admitted case of default on the part of the opposite party no.1 in having failed to deliver the possession of the flat within the stipulated period and even beyond reasonable time of default. The Apartment Buyer Agreement is dated 23.12.2011 and the timeline as per the same for handing over possession after the expiry of grace period ended on 22.06.2015. The delay is clearly inordinate and consequently in view of the admission of the opposite party itself as recorded herein above in paragraph 7 and paragraph 18 of the written statement, the issue on delay is answered against the opposite party no.1.
Coming to the plea of force majeure there is hardly any material or substance to attract the said clause except a few unsubstantiated bald statements made in paragraph 7 of the written statement. They are not sufficient in any way to establish that the force majeure cause was the reason for delay. The said argument made on behalf of the opposite party no. 1 is also rejected.
The arguments contending that the complainant had defaulted in the payment is also without any substance. The payment had already being made and it stands admitted from the facts referred to herein above including the payment plan as appended alongwith the evidence on record. There was no default in payment on the part of the complainant as neither any such grievance or objection was raised by the opposite party at all. This stands fortified with the statements made and the recital in the letters of the opposite party no.1 dated 19.12.2014 and dated 16.12.2016 already mentioned above. There is no evidence to substantiate the argument of any default on the part of the complainant. This argument has been advanced orally and against the pleadings and evidence on record and therefore deserves rejection and the same is accordingly rejected.
The opposite party has completely failed in discharging its obligation. This clearly amounts to an unfair trade practice after having received the payments timely. The adjustments which are now sought to be imposed through calculations of the learned counsel on behalf of the opposite party are unacceptable and therefore they have to be rejected. The complainant is entitled to the entire relief as prayed for subject to such any stipulated payment or any balance of payment as per the payment plan. Consequently, the Complaint stands allowed with the following directions:-
(i) Accordingly the Opposite Party is directed to hand over possession of the premises, namely Apartment No. C-2201, 22nd Floor in Tower No. 3(C) in Provence Estate Sector – 3 Gwal Pahari, Faridabad Gurgaon Road, Gurugram, Haryana after completing it including furnishing as per the agreed terms within two months from today or even earlier. The Complainant will be entitled to the possession of the premises which shall be subject to clearance of all the dues as payable under the terms of the Agreement including statutory dues, which would be adjustable from the payments in terms of the relief granted hereinafter.
(ii) As per clause 3.3 of the Agreement, the Opposite Party shall pay penalty @10% p.a. on the entire amount received by it from the Complainant within two months from today.
(iii) In addition thereto, the Opposite Party shall also pay interest @9% p.a. on the entire amount deposited by the Complainant from the respective date of deposit till the date of actual payment of the interest within two months from today. In default of payment, the rate of interest shall stand enhanced to 12% p.a.
(iv) The Opposite Party shall also be liable to pay a sum of Rs.2 Lakh towards mental agony and harassment faced by the Complainant, which shall also be paid within two months from today.