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Judgment
Dr. Inder Jit Singh, Member
The present Consumer Complaint (CC) has been filed by the Complainants against Opposite Parties (OPs) as detailed above, inter alia praying for directions to the OPs to:-
i. Replace the defective Italian Marble in the drawing dining and living space of the flat and handover possession to the complainants.
ii. To identify and indicate the size of the parking space allotted to the complainants in the conveyance deed.
iii. Set out suitable and reasonable timeline upon the OPs to (a) erect boundary of AVIDIPTA complex of 9 Acres and distinguish in it from any other development with the adjacent 3.23 acre land (b) rectify the design defect of lack of window shades and take suitable measures with expert opinion.
iv. Pay interest on investment by complainants as compensation for delay in handing over the flat for 18 months @12% or at any rate as deemed appropriate by the Commission.
v. Pay compensation of Rs.5.00 lakh jointly or severally for mental agony and harassment.
Notice was issued to the OPs. Parties filed Written Statement/Reply, Rejoinder, Evidence by way of an Affidavit and Written Arguments/Synopsis etc. as per details given in the Table at Annexure-A. The details of the flats allotted to the Complainants/other relevant details, based on pleadings of the parties and other records of the case are also given in the Table at Annexure- A.
It is averred/stated in the Complaint that:
i. The complainants, booked a HIG flat in the Project of the OPs, namely, AVIDIPT, situated at Kolkata for a consideration of Rs.one crore. The complainants paid Rs.87,95,165/- in several tranches and were provided provisional allotment of flat No.1H-901 and covered Car Parking Space No.1 HC/19 vide allotment letter dated 07.09.2011. The possession was to be given within 48 months from the date of issuance of allotment letter, i.e. September 2015.
ii. The OP-1 had raised a demand for final payment of Rs.12,04,835/- vide execution notice dated 12.12.2016, whereby besides such payment the builders issued guidelines on immediate registration of sale deed. Before making final payments, the complainants made an inspection of the flat and found multiple cracks and distortions on the flooring surface of the drawing dining and living space of the flat which was deemed to be of Italian Marble. The complainants immediately informed to the OP and the same was duly acknowledged by the OP-1. However, without any intent to rectify the defects, the OP offered the complainants to withdraw their investments from the said project, vide letter dated 2nd March 2017 by refusing to change the cracked flooring. The OP insisted of keeping the said flooring in the pretext that the same had resulted out of a natural phenomena which is grossly illogical, unreasonable, illegal and unacceptable. It was the duty of the OP to hand over a flat to its allottees as per specification and without any defects.
iii. The complainants alongwith other allottees had also raised issues with the developer as – (a) to clearly identify the car parking space of the complainants indicating the size of the car parking space specifically (b) to identify 52% Greenery out of the 9 –acre land promised for with a clear undertaking that such greenery has not been used for any other phase or project of the Bengal Peerless beyond it’s 9.23 Acre project area of Avidipta complex. A boundary wall around Avidipta housing complex should be in place to avoid any confusion/violation of rights and liabilities which the complainant may be subjected to individually and collectively as apartment owners of Avidipta HIG. The complainants also notified that due to gross design defect (Lack of window shades/canopy), water seepage from the windows have been found to cause damaging effects to the apartment users in the individual flat and in the common space of building.
iv. The complainants also subscribed to the demands for rectifications made in the meeting dated 09.03.2017 by the Avidipta HIG owners with CEO Bengal Peerless/Developer and all such demands are part of the notice raised by them.
v. The complainants have already invested 90% of the consideration price of the HIG flat, cannot withdraw their investment made against allotment of flat No.1H-901 and covered Car Parking Space No.1HC/901 where they intend to reside on illegal and unlawful whims and facies of the Developer. The Developers failed to hand over the defect free with all agreed specifications and parameters in place. The complainants had never made any delay in payments and were ready with final balance payment of Rs.12,04,835/- subject to curing the defects. There is delay of 18 months in handing over the possession, the Developer had admitted the delay in the project vide their letter dated 2nd March 2017. The OP failed to rectify the defects and hand over the defect-free possession in time.
The OP-1 in their written statement/reply stated that: -
i. The complainants have not approached this Commission with clean hands and have suppressed material communications, relevant to the present complaint. There is neither deficiency of service nor any unfair trade practice and therefore, complaint is liable to be dismissed. OP-1 is a Joint Sector Company and OP-2 is a body corporate owned 100% by the Government of West Bengal. The possession was delayed beyond the scheduled time due to force majeure conditions. In Clause VI (f) of the GTC states that subject to force majeure condition if the completion of the housing project was delayed beyond the scheduled time and if on this account the allottee wishes to withdraw their application, in that event the amount deposited by them would be refund with simple interest at the then prevailing rate applicable to a savings bank account in a Nationalized Bank without any other claim for damages or compensation whatsoever.
ii. The complaint is wholly frivolous and an abuse of the process of this Commission. The complainants have raised minor issue alleged ‘cracks’ in the marble flooring despite affording inspection of the flat No.1HC/19 of Type H Flat allotted to the Complainants twice. The OP-1 informed the complainants that the alleged defects or cracks are not defects but in fact a natural feature of the marble. The complainants have suppressed these communications from this Commission and the complaint therefore needs to be rejected on this ground alone.
iii. In respect of the allegation of seepages, a pre-inspection checklist was provided to the complainants vide letter dated 10.05.2016. The complainants inspected the flat on 25.05.2016 and subscribed OK against the column provided for doors and windows. The said checklist bears the signature of the complainant. The complainants subsequently, were invited to inspect the flat a second time in the month of October 2016. After the second inspection the complainants did not raise any concern relating to the windows or the sunshade as has been alleged in this complaint. These facts have been suppressed by the complainants and the complaint is clearly an after-thought.
iv. The complaint is premature as the complainants have not taken possession of the flat and there can be no occasion to have a grievance regarding seepage in the flat without the complainants taking possession and living in the flat.
v. By an email dated 18.01.2017 the OP-1 intimated the complainants that the Italian Marble is made from metamorphic rock formation of sedimentary carbonate rocks, distinguished by veins of various miners deposits, such as quartz, clay, iron oxides, sand and other sediments from the metamorphism of lime stone, the materials are naturally fused together under intense pressure to create marble, this natural stone comes in many different colours, shapes and textures, a lot of these stones have certain inherent natural features, mostly in the nature of fractures and superficial holes and pits which are ordinarily repaired at the polishing phase, done prior to handing over possession. The OP installed Italian Marble as specified in the brochure but cannot overcome the natural features of the stone. Adequate measures have been taken to overcome the said natural features of the stone. The allegation of unfair trade practice by the OP-1 is totally uncalled for and cannot be sustained. It is also contended that so far as the FAR (Floor Area Ratio) is concerned the same has been clarified suo moto by the OP-1 vide letter dated 08.06.2017. When the State Government obtained the right, title and interest of the entire 12.67 acres of land, the said land was demarcated by a boundary wall and the same still exists and will exist forever. The allegations neither come within the meaning of deficiency of service nor unfair trade practice by the OPs.
vi. The complainants failed to make payments of Rs.12,04,835/- as full and final consideration amounts. In terms of the Provisional Allotment Letter and General Terms and Conditions of the contract, if the complainants do not pay the full price of the flat and the covered car parking space within the specified period, then even upon the payment of 90% of the total price, their allotment may be cancelled by OP-1 and in the instant case, the allotment of the complainants was cancelled by a letter dated 07.06.2017 affording another seven days’ time to clear the outstanding.
vii. The OP completed all the flats and the residential block of the project by July, 2016 and Kolkata Municipal Corporation by its letter dated 5th July, 2016 issued the provisional completion certificate of the project. In view of the facts and circumstances of the case, complaint be dismissed.
The OP-2 in their written statement/reply stated that:
i. OP-2 is a body corporate constituted under the West Bengal Housing Board Act, 1972 and is 100% owned by the State of West Bengal. In terms of the provisions of Section 27A of the West Bengal Housing Board Act, 1972 (as amended in the year 1994) for execution of different housing scheme of the West Bengal Housing Board, Bengal Peerless Housing Development Co. Ltd., the OP-1, a Joint Sector Company was incorporated in collaboration with the West Bengal Housing Board and Peerless General Finance and Investment Co. Ltd. both having equal shareholding of 45.5% each and 1% to be held by the public. The Bengal Peerless Housing Development Company Ltd., the opposite party No.1 is run by an independent Board of Directors, the majority of whom are nominated by the Government of West Bengal. The legality and validity of the incorporation of such joint sector company for the aforesaid object and purpose has been confirmed by the Hon’ble Supreme Court in the year 1997. For implementation of Housing Scheme for a public purpose , the Government of West Bengal intended to acquire a land measuring 12.67 acres situated in Barakhola Mouza, Kolkata.
ii. A Land Acquisition Proceeding being LA-4/14 of 2000-2001 under the Land Acquisition Act, 1894 was started and following all the provisions of the said Act, 1894, the said land was acquired and vested absolutely in the Govt. of West Bengal free from all encumbrances and on 15.03.2005 the Govt. of Bengal took possession of the said land. The validity of the said land was confirmed by the Hon’ble Supreme Court in a case reported in 2009.
iii. On 9th August 2007, in terms of Section 29(1) of the West Bengal Housing Board Act, 1972 the Government of West Bengal had transferred the rights, title and interest of the said land to the West Bengal Housing Board the OP-2. On 31.08.2007, the OP-2 had handed over the permissive possession of the land to OP-1 for implementing the said housing project thereupon. On 8th July 2009, OP-2 executed a Registered Agreement and also Power of Attorney by which OP-1 was appointed as a developer and agent of the OP-2 and has been authorized to maintain, manage and develop the said land for implementation of a housing project thereupon for LIG, MIG and HIG people with all other facilities and amenities therein at an affordable price and to sell and transfer the flats to the respective purchaser for and on behalf of and as per the scheme of the OP-2.
iv. The said land falls within the territorial of Kolkata Municipal Corporation (KMC) and the said land has been mutated in the Assessment Roll of KMC as a land owned by the OP-2 and the said land has been numbered as Premises No.401, Barakhola, Kolkata. On 23rd January, 2011, OP-1 published an advertisement inviting application from the public for sale and allotment of flats through public lottery in the housing complex to be constructed on the said land which was named as ‘Avidipta’.
v. As per policy of the Government, the prices of all the flats were fixed much lower than the prevailing market price as on 2011 so that it could be affordable for LIG,MIG as well as the HIG people with the benefits of all modern amenities and facilities therein.
vi. It is also contended by the OP-2 that with regard to the statements made by the complainants in the complaint, OP-2 rely upon all the averments made in the written version filed by the OP-1.
Heard learned counsels of both sides.
We have gone through the rival contentions of the parties, as contained in the complaint/written statement, written arguments as well as oral arguments, on different issues. These are briefly summed up as follows:-
7.1. Regarding cracks in the Italian marble, we agree with the contentions of the complainants that OPs as builder are obligated to hand over the newly built flat in defect free conditions. There is an admission on the part of OPs that there are cracks/defects in the Italian marble of the flooring of drawing, dining and living space of the said flat. The explanation given by the OPs that the alleged defects or cracks are not defects but in fact a natural feature of the marble, which is made from metamorphic rock formation of sedimentary carbonate rocks, distinguished by veins of various minerals deposits etc. are not acceptable. Home buyers cannot be made to accept a new flat which has such defects right from the beginning at such prominent spaces of the flat. Hence, we agree with the contention of complainants that they are entitled to a defect free floor, and that marble flooring or tiles in a floor are such items which are replaceable. Similarly, with respect to seepage in windows, even if it is accepted that window shades/canopies were not part of original approved plan, OPs are obligated to ensure that all such window/ventilator joints on the external walls are seepage proof. Hence, before possession is offered, the OPs must conduct appropriate checks on these joints in the presence of complainants so that they feel assured that on their occupation there will be no seepages.
7.2. As regards car parking, considering the categorical statement of OPs that complainants’ car parking space has been duly allotted and identified as 1HC/19, with parking space of about 135 sq.ft. as per norms of KMC, and that a parking space is also demarcated in the deed of conveyance and the said demarcation is visible at the relevant space allocated at the project, no specific directions to OPs appears necessary on it and it is expected that on possession of the flat, the OPs will deliver car parking too as per the above stated assurance.
7.3. As regards boundary wall, considering the categorical statement of OPs that the boundary wall around the project was constructed to demarcate the project as is customary and the same is still in existence and accepting the contention of OPs that boundary wall demarcating HIG flats from MIG & LIG flats by a public/JV authority like OPs is impermissible as it would be discriminatory, no specific directions to OPs appear necessary in this. Similarly, the OPs have categorically stated that they have delivered green cover as per brochure and more than promised 52% open area and greenery exists in the said complex. Considering this, no specific directions to OPs appear necessary on this.
7.4. As regards partial Completion Certificate (CC), OPs have contended that KMC has issued a partial completion certificate in view of the fact that premises No. 401 Barakhola is a single holding and another housing project being Avidipta Phase- II is coming up thereon and only after completion of the said housing KMC will give a full completion certificate and as such for the completed phase of Avidipta Phase I the KMC has issued a Partial Completion Certificate. We tend to agree with these contentions of OPs and hold that offer of possession with this partial CC, which covers all the towers of Avidipta, Phase I project is in order and that delay compensation will be payable only till the date of offer of possession with such valid partial CC of the project in question.
7.5. Coming to the main issue of cancellation of the flat by the OPs and prayer of complainants for delivery of possession with defect free amenities/facilities, the OPs have stated that the flat of the complainants has been cancelled by the OPs for non payment. As the flat has been cancelled, the OPs at the time of filing their reply and at the time of final arguments have stated that the Complainant may be refunded his entire amount paid with interest as prevailing in a nationalised bank or in terms of the orders of this Hon'ble Tribunal @ 8% payable annually. The complainants argued that the complainants sought rectification of defect of a fixed asset before physical hand over and cannot be forced to accept a refund under a unilateral action of the Developer. Such action resulted in unfair trade practice with the fact that the complainants had deposited the final instalment amount of Rs.12,04,835/- before the NCDRC as per direction of the Hon’ble National Commission vide order dated 07.07.2017. After considering the rival contentions of parties on this issue, we tend to agree with the reasoning given by complainants for not depositing the final instalment of Rs.12,04,835/- when demanded by OPs and that they cannot be compelled to seek refund even if OPs offer it with interest as decided by the Commission and that they have a right to seek possession of a defect free flat, alongwith delay compensation as decided by the Commission. Of course, the complainants will have to make due balance payments to the OPs at the time of taking possession of the flat. Vide order dated 07.07.2017 cited, the operation of letter dated 07.06.2016 of OP-1, ‘for depositing the dues of Rs.12,04,835/- with the OP-1 otherwise the allotment shall be cancelled and money would be refunded after deduction of 10% of the amount’ was stayed subject to complainants depositing the said amount with the Commission. Hence, the cancellation of flat by the OPs is held to be invalid and is set aside.
7.6. Public authorities/Joint Ventures of public authorities like the OPs in the present case have to act in a transparent manner and remain accountable to its allottees for the promises made in the brochure/allotment letter etc. Such authorities/its officials cannot pass on the results of its negligence or inefficiencies onto the allottes. It was held by the Hon’ble Supreme Court in Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65 “The Consumer Protection Act, 1986 has a wide reach and the Commission has jurisdiction even in cases of service rendered by statutory and public authorities. Such authorities become liable to compensate for misfeasance in public office i.e. an act which is oppressive or capricious or arbitrary or negligent provided loss or injury is suffered by a citizen. The Commission/Forum must determine that such sufferance is due to mala fide or capricious or oppressive act. It can then determine the amount for which the authority is liable to compensate the consumer for his sufferance due to misfeasance in public office by the officers. Such compensation is for vindicating the strength of the law. It acts as a check on arbitrary and capricious exercise of power. It helps in curing social evil. It will hopefully result in improving the work culture and in changing the outlook of the officer/public servant. No authority can arrogate to itself the power to act in a manner which is arbitrary. Matters which require immediate attention should not be allowed to linger on. The consumer must not be made to run from pillar to post. Where there has been capricious or arbitrary or negligent exercise or non-exercise of power by an officer of the authority, the Commission/Forum has a statutory obligation to award compensation. If the Commission/Forum is satisfied that a complainant is entitled to compensation for loss or injury or for harassment or mental agony or oppression, then after recording a finding it must direct the authority to pay compensation, and also direct recovery from those found responsible for such unpardonable behaviour. Where there is a specific finding of misfeasance in public office, compensation for mental agony can be granted.”
The contention of the OPs that complainants are not the consumers as they have invested in the said property merely for speculative purposes is rejected as no such evidence has been adduced by the OPs in this regard. It has been observed by this Commission in various cases (Kavita Ahuja Vs Shipra Estates Ltd, CC 137 of 2010, decided on 12.02.2015, Santosh Johri Vs M/s Unitech Ltd, CC 429 of 2014 and connected Cases, decided on 08.06.2015, Aloke Anand Vs M/s Ireo Grace Pvt Ltd & Others, CC no 1277 of 2017 decided on 01.11.2021) that purchase of a house can only be for a commercial purpose if the purchaser is engaged in the business of purchasing and selling houses or plots on a regular basis, solely with a view to make profit by way of sale of such houses, if the house is purchased purely as an investment and the purchaser is not undertaking the trading of houses on regular basis, then it would be difficult to say that he had purchased it for commercial purpose. The plea of OP(s) that delay was due to force majeure circumstances is not valid. Reasons like delay in cable laying works by CESC, floods, which might have lasted for a very short period, and stop work notice for about two years in the absence of any documentary evidence that the project work indeed was stopped for this period on account of this notice, cannot be construed as ‘Force Majeure. Hence, complainants are entitled to delay compensation for the period from committed date of possession till offer of possession with OC/partial CC.
For the reasons stated hereinabove, and after giving a thoughtful consideration to the entire facts and circumstances of the case, various pleas raised by the learned Counsel for the Parties, the Consumer Complaint is allowed/disposed off with the following directions/reliefs: -
i. The OP(s) shall hand over the actual physical possession of the unit in question to the complainants, complete in all respects as per scope & specifications and alongwith all the facilities/amenities as promised in the brochure/scheme document, in particular defect free replaced marble flooring of same quality/specification in the drawing, dinning, living area etc. and ensuring seepage free windows/ventilator points on the external walls, within three months of date of this order subject to the complainants paying the balance amount, if any, after adjusting the amount deposited with the Commission, within 30 days of this order. OP(s) shall also arrange joint inspection of the unit with the complainants/their representative to satisfy them about the completeness of the unit as per the scope & specifications and alongwith amenities/facilities as per brochure/scheme document. If any deficiencies are noticed as a result of such joint inspection, the same shall be got rectified within 15 days of date of such joint inspection. As regards provision of ‘replaced defect free marble flooring of same quality/specifications’, OPs will have the option to give the possession with existing marble flooring on ‘as is where is basis’ along with a lump sum compensation of Rs.5.00 lakh (Rs. Five lakhs) (in addition to other reliefs/ sums payable under this order) with which complainants can themselves get the flooring replaced/repaired at a later date. OPs shall convey this option to the complainants well before the date of joint inspection.
ii. OPs shall also be liable to pay delay compensation in the form of simple interest @6% from 07.09.2015 (Committed date of possession) to the date of offer of possession or date of receipt of valid partial OC, whichever is later.
iii. The OPs shall pay a sum of Rs.25,000/- as cost of litigation to the complainants.
iv. The liability of the OP(s) shall be joint as well as several.
v. The payments in terms of this order shall be paid within three months from today.
The pending IAs, in the Consumer Complaint, if any, also stand disposed off.
Annexure-A
Details of the Unit and other related details
Sr No
Particulars
1
Project Name/Location etc.
‘Avidipta’
2
Apartment no.
1H-901
3
Date of allotment (provisional)
07.09.2011
4
Committed date of possession as per allotment letter (with Grace period, if any)
07.09.2015
5
D/o offer of possession
30.06.2016
6
D/o Obtaining CC by the OP (Partial CC)
05.07.2016
7
Amount Paid
Rs.87,95,165/-
8
D/o Filing CC in NCDRC
18.04.2017
9
D/o Issue of Notice to OP(s)
09.05.2017
10
D/o Filing Reply/Written Statement by OP1
15.09.2017
11
D/o Filing Reply/Written Statement by OP2
15.09.2017
12
D/o filing Rejoinder by the Complainant(s)
07.12.2017
13
D/o Filing Evidence by way of Affidavit by the Complainant(s)
07.12.2017
14
D/o Filing Evidence by way of Affidavit by the OP-1
15.02.2018
29.06.2018
(supplementary Affidavit)
15
D/o Filing Evidence by way of Affidavit by the OP-2
15.02.2018
16
D/o filing Written Synopsis by the Complainant(s)
Date not mentioned
17
D/o filing Written Synopsis by the OP-1&2
01.02.2023