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Judgment
Subhash Chandra, Presiding Member
This complaint under section 21 (a) (i) of the Consumer Protection Act, 1986 (in short, ‘the Act’) is filed against the opposite party alleging unfair trade practice and deficiency in service in delay in handing over the possession of flat no. CD – A2-12-1203 in Tower A 2 in the project Corridors, Golf Course Extension Road, Sector 67 A, Gurgaon, booked by the complainant.
Briefly put, the facts, according to the complainant are that she booked a 3 BHK Study Unit Flat with 2 covered car parking in March 2013 in the above project with an initial booking amount of Rs.17,00,000/- inclusive of development and other charges at the rate of Rs.8750 sq ft on 11.03.2013. As per the allotment letter, possession of the flat was to be handed over within 42 months from the date of building plan approval which was dated 23.07.2013. The second instalment of Rs.19,94,102/- was paid in May 2014. Thereafter an allotment offer letter dated 07.08.2014 was received from the opposite party which indicated the rate of basic sale price of Rs.9400/- sq ft. Rs.327.91 per sq ft was also demanded towards development charges, Rs.2,50,000/- towards club member ship and other ancillary charges which were not part of the sale consideration at the time of booking of the flat. Complainant paid the third instalment of Rs.22,04,360/- . An Apartment Buyer Agreement (in short, ‘the agreement’) which was completely one sided was received from the opposite party. Despite the payment of the third instalment, the issue with regard to the costs and other charges were not resolved by the opposite party. Subsequently further demands for payment were also received. On being pursued through e-mail in March 2015, the opposite party vide e mail dated 13.04.2015 declined to supply a copy of the application form on the ground that the a consumer complaint had been filed.
The complainant, along with 9 other allottees, filed a consumer complaint no.195 of 2015 under section 12 (1) (c) before this Commission which was dismissed as withdrawn on 18.10.2016 with liberty to file a fresh complaint on the ground of pecuniary jurisdiction. On 07.09.2015 a police complaint was also filed in Gurugram alleging fraud and cheating by the opposite parties and FIR no.561 of 2014 was registered by one Rajiv Singhal. Three Civil Suits by different buyers including complainant nos.1 and 2 were filed on 07.12.2016 for a permanent injunction before the Civil Judge, Gurugram in Civil Suit No.178 of 2016 seeking to restrain the opposite party from cancelling the allotments and not to raise unjustified demands for payment along with directions to deliver possession within the time frame mentioned in the agreement. Vide order dated 22.12.2016 these cases were disposed of with directions to the complainant to deposit the outstanding amount @ Rs.8750/- per sq ft within seven days failing which the opposite party were at liberty to cancel the booking. Complainant’s case is that the construction of Tower A 2 is already delayed for which reason no demand for payment was raised by the opposite party and that the opposite party filed an application under Order 7 Rule 11 CPC in all the said civil suits.
The complainant contends that the project has not been completed and possession has not been offered within 42 months from the approval of the building plans as per clause 13 of the agreement. It is stated that the opposite parties have been unethical and had obtained licence no.5 of 2013 dated 21.02.2013 for a Group Housing Colony in Sector 67 A Gurugram against which booking amounts were collected without disclosing the details of the licence as required under the guidelines of the Director, Town and Country Planning, Haryana. It is stated that a false assurance was made by opposite party no.1 that a 90 meter access road from section 63-A to 67 A would be provided. A revised building plan of Cluster A (Building A 1 to A 5), Cluster D (Building D 1 to D 5) was proposed by the opposite party on 04.08.2016 for which no objection was sought. Restraining order dated 22.02.2107 was also issued by the District Town Planner (Enforcement) Gurugram directing to stop the construction with respect to Towers A and D and enquiry was initiated by the Commissioner, Gurugram.
The complainant states that she was allured by unfair trade practice of the opposite party in booking the said flat and the application form had deliberately left certain columns blank in order to fraudulently and dishonestly insert arbitrary rates. Upon enquiry it had come to her notice that no road of 90 mtr width and / or 18 meter road and / or 24 meter service road was proposed. It is stated that the project had not been completed within the scheduled 42 months. However, the occupation certificate granted by the authorities concerned on 22.01.2022 whhich was after the filing of the complaint. Reliance is placed on this Commission’s order in FA no.1358 of 2016 passed against Ireo Fiveriver Pvt Ltd., a sister concern of the opposite party that non disclosure of complete/relevant information to the buyer’s with regard to all necessary approvals amounts to deficiency in service and reflects malafide as well as unfair trade practice by the opposite party. The complainant is before this Commission with the following prayer:
a. Direct the opposite parties to refund the complainant a sum of Rs.58,98,462/- paid by the complainant against the Unit No. CD A 2-12-1203 of 3 BHK + study (having super area of 1906.05 sq ft) in Group Housing Colony located at Golf Course Extension Road, Sector 67 – A in the revenue estate of village Dhumsapur and Maidwas, Tehsil and District Gurgaon, Haryana known by the project Name as ‘The Corridors’ along with interest @ 20% per annum compounding quarterly till its realization;
b. Award the cost and litigation expenses and compensation for harassment and mental agony to the tune of Rs.5,00,000/- to the complainant; and
c. Pass such other or further orders as this Commission may deem fit and proper in favour of complainant and in the interest of justice.
The complaint was resisted by way of written statement by the opposite party. Preliminary objections were taken that this Commission lacks pecuniary jurisdiction in view of this Commission’s order in Ruhi Seth vs Ireo Grace Realtech Pvt. Ltd., in CC no. 1464 of 2017 which held that the value of the complaint has to be the value of the amount deposited and the compensation claimed. In the instant case the refund sought is Rs.58,98,462/- which does not meet the pecuniary threshold of this Commission. It is submitted that civil suit no. 178 of 2016 before the Civil Judge, Senior Division, Gurugram had been dismissed vide order dated 31.10.2017 and had not been appealed against thereby making the order final. As per order dated 22.12.2016 in the Civil Suit, the allotment of the complainant had been cancelled and that the present complaint is an attempt to appeal against this order under the garb of a consumer complaint.
The complaint is also stated to be not maintainable since (i) it seeks to rewrite the agreement dated 13.05.2014 which is beyond the jurisdiction of this Commission as has been held by the Hon’ble Supreme Court in Bharti Knitting Co. vs DHL World Wide Courier, (1996) 4 SCC 704; (ii) that the complainant is not a ‘consumer’ under section 2 (1) (d) of the Act having multiple investments and having filed consumer complaint no. 2918 of 2018 before this Commission in Archana Dhawan vs Vatika Ltd.; (iii) that the complainant already has a residential accommodation and does not require the flat in question for residential purpose; (iv) that allegations relating to the agreement are of a contractual nature which can only be agitated before the Civil Court as held by the Hon’ble Supreme Court in Saurabh Parkash vs DLF Universal Ltd., (2007) 1 SCC 228 and Pawan Hans Ltd., vs UOI and Anr. (2003) 5 SCC 71; (v) that in view of clause 35 relating to arbitration in the agreement this Commission cannot entertain the complaint; (vi) that compensation could be awarded only if section 14 (1) (d) was satisfied to establish the negligence of the opposite party and (vii) that the claim is exorbitant in seeking interest @ 20% per annum compounded quarterly along with Rs.5.00 lakh towards litigation expenses. On merits, it is argued that allotment letter dated 07.08.2013 was dispatched on 16.08.2013 and therefore the contention that the apartment was allotted prior to 23.07.2013 is erroneous. The contention of the complainant that possession was assured within 42 months of approval of the building plan is incorrect since the condition of allotment was “from the date of approval of the building plans and/ or fulfilment of the pre-conditions imposed thereon” along grace period of six months. The approval of the Fire Safety Scheme, which was also one of the pre-conditions, was granted only 27.11.2014. Therefore, the proposed handing over, including 6 months grace period, was due to expire only on 27.11.2018 reckoned from 27.11.2014. The opposite party has denied that the net basic sale price was enhanced to Rs.9000/- sq ft. It is also denied that the allotment of the unit took place prior to the building plan approval since the building plans were approved on 23.07.2013 and allotment offer letter was dated 07.08.2013. Regarding the approach road, it is stated that the sector road was envisaged by HUDA as per the Master Plan and was not to be executed by the opposite party and that the complainant has made these allegations maliciously. It is accordingly prayed that the complaint be dismissed with cost.
Parties led their evidence. The complainant filed rejoinder and both sides filed their written arguments. I have heard the learned counsel for both the parties and carefully considered the material on record.
Learned counsel for the complainant argued that the instant case was squarely covered under the orders of this Commission in CC no. 178 of 2018, CC no.107 of 2019 and CC no.1147 of 2019 which pertain to the same project, namely, ‘The Corridors’ wherein complete refund had been granted on the ground that occupation certificate for Phase II was granted on 22.01.2022 following the law relied upon by the Hon’ble Supreme Court in Ireo Grace Realtech Pvt. Ltd., Vs Abhishek Khanna and Anr., in Civil Appeal no. 5785 of 2019 decided on 11.01.2021.
It was argued that the complainant’s apartment fell in Phase II of the same project for which occupation certificate was granted on 22.01.2022. Relying on Abhishek Khanna (supra) it was argued that the opposite party was not entitled to deduct the earnest money of 20% from the total deposit. Essentially it was argued that the project had been considerably delayed and that the complaint was initiated as per the catena of judgments of the Hon’ble Supreme Court and this Commission to seek remedy of both refund with compensation in the form of interest. Accordingly, it was prayed that the amount of Rs. 58,98,462/-deposited by the complainants be refunded with interest @ 20% per annum compounded quarterly, till realization.
The opposite party argued that the complaint was not maintainable on the ground of pecuniary jurisdiction and the complainant has deliberately inflated the amount by seeking interest @ 20% per annum compounded quarterly till realization along with cost and litigation expenses, with compensation for harassment and mental agony of Rs.5.00 lakh on the total sum of Rs.58,98,462/- deposited by it. It is argued that the period of commitment for handing over possession has been wrongly calculated and ignores the date of approval of Fire Safety Scheme which was associated with the conditions of the approval of the building plan and that the complainant has wrongly interpreted the period of 42 months by excluding the grace period of six months. However, neither in the written statement or the short synopsis of the opposite party has it been mentioned that an offer of possession had been made to the complainant. No such averment was also made during oral submissions by the opposite part.
The preliminary issues raised by the opposite party have been considered. The settled law on pecuniary jurisdiction as held by this Commission in Ambrish Kumar Shukla and 21 Ors vs Ferrous Infrastructure Pvt. Ltd., I 2017 CPJ 1 (NC) and Renu Singh vs Experion Developers Pvt. Ltd., CC no.1703 of 2018 is that the principle for determining the pecuniary jurisdiction is the total consideration paid by the persons who have joined the complaint in a joint complaint and other damages claimed shall determine such jurisdiction. In view of this position of law the contention of the opposite party regarding pecuniary jurisdiction does not sustain. As regards the contention that the complainants are not ‘consumers‘ under section 2(1)(d) of the Act, since they possess other residential premises and a few of them have let them out for residential purpose, in light of the judgment of this Commission in Kavita Ahuja vs Shipra Estate Ltd., (1) 2016 CPJ 31 wherein it was held that the onus of establishing that the complainants were dealing in real estate for commerical purpose rests on the opposite party which in the instant case, has not been discharged by any documentary evidence. Accordingly, the contention cannot be sustained. The contention that in view of the the provision of a clause for arbitration in the FBA, this complaint does not lie before this Commission, not a valid contention in light of of this Commission’s order in Aftab Singh vs Emaar MGF Land Limited and Anr., Consumer Case no. 701 of 2015 wherein, vide order dated 13.07.2017 wherein it was held that “arbitration clause in the buyer’s agreement does not bar the jurisdiction of the consumer fora”, and in the case of Ireo Grace Realtech Pvt. Ltd., vs Abhishek Khanna and Anr., (supra) in Civil Appeal no. 5785 of 2019 decided on 11.01.2021 wherein the Hon’ble Supreme Court held that:
“The Consumer Protection Act, 1986 was enacted to protect the interests of consumers, and provide a remedy for better protection of the interests of consumers, and provide a remedy for better protection of the interests of consumers, including the right to seek redressal against unfair trade practices or unscrupulous exploitation ......... Section 3 of the Consumer Protection act provides that the remedies under the Act are in addition to, and not in derogation of any other applicable.....”
From an analysis of the material on record and the arguments of the learned counsel it is apparent that the complainant had booked an apartment through a real estate agent in the project ‘The Corridors’ for which Rs.58,98,462/- has been paid by her in three instalments. There is a difference in the interpretation of the committed date of handing over possession between the parties, the opposite party contends that the relevant date from which period of 42 months along with 6 months period of grace is not the date of approval of building plans but is 27.03.2013 which is the date of approval of the Fire-Fighting Scheme. In Abhishek Khanna (supra) the Hon’ble Supreme Court has clearly laid down the date from which the construction is to be considered should be the date on which the approval of fire fighting was received which, in this case, was 27.03.2014. The contention of the opposite party that the period of 42 months for construction be reckoned from 27.03.2014 with an additional six months grace till 24.03.2018, therefore, cannot be faulted.
Therefore, the delay in the instant case as per ABA which mentioned that the period for handing over of possession should be calculated from the date of approval of Building Plan, i.e., 23.07.2013, and therefore, the date of handing over possession from this date would be 23.05.2016. Therefore, the delay in handing over possession was of 7 years till date. It has been held by the Hon’ble Supreme Court in Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra , II (2019) CPJ 29 SC that:
“…it would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession…A buyer can be expected to wait for a reasonable period. A period of seven years is beyond what is reasonable”.
In Fortune Infrastructure Vs Trevor D’Lima (2018) 5 SCC 442 the Hon’ble Supreme Court laid down that:
‘a buyer cannot be expected to wait indefinitely for possession and in a case of an unreasonable delay in offering possession, the consumer cannot be compelled to accept possession at a belated stage and is entitled to seek refund of the amount paid with compensation’.
Similarly, in Pioneer Urban Land and Infrastructure Ltd., vs Govindan Raghavan and other connected matters CA no. 3182 of 2019 dated 02.04.2019, the Hon’ble Supreme Court categorically held that:
“the flat purchasers cannot be made to wait for inordinate period of time hoping to seek possession and that refund of amounts deposited is a valid redressal”.
Admittedly, there is no offer of possession as on date. The complainant cannot, therefore, be expected to wait indefinitely for possession of the flat booked. The complainant’s prayer for full refund needs to be viewed in the context of the judgment of the Hon’ble Supreme Court in Govindan Raghavan (supra) which laid down that a purchaser of a flat could not be compelled to take possession of the flat if it was offered almost 2 years after the grace period under the Agreement and that the purchaser was entitled to be granted the relief of refund of the entire amount deposited with the interest. In the instant case the plot has not been made available with the promised amenities even after 10 years and the opposite party has also not made any alternate proposal. Therefore, the complainant is justly entitled to seek a full refund of the deposited amount with interest.
The issue that remains is that of the quantum of compensation and the rate of interest to be awarded. The Hon’ble Supreme Court in Experion Developers Pvt. Ltd. Vs. Sushma Ashok Shiroor, CA No. 6044 of 2019 decided on 07.04.2022 has held that the interest to be paid has to be restitutionary and also compensatory and has to be paid from the date of the respective deposits and that a rate of 9% simple interest per annum is fair and just. Refund of the amount deposited by the complainant with interest @ 9% from the respective dates of deposits would, therefore, meet the ends of justice.
In the light of the above, the complaint is liable to succeed and is accordingly allowed with the following directions:
a. Opposite party no.1 shall refund the entire amount of Rs.58,98,462/- paid by the complainant along with interest at the rate of 9% simple interest per annum from the respective date of deposits till the date of this order:
b. The order shall be complied within 8 weeks from the date of this order failing which the interest rate will be 12% simple interest per annum till realization; and
c. Opposite party shall also pay Rs.50,000/- to the complainant as litigation cost.
The complaint is disposed off with the above directions. All pending IAs, if any, are also disposed of by this order.