Ashok Patni & Anr. vs Turf Estate J V & 2 Ors.

The complainants namely Shri Ashok Patni and Mrs. Sadhna Patni booked residential flats bearing No. 1401 and 1402 on the 14th floor and 1501 and 1502 on the 15th floor in the B Wing of a proposed building namely 'Orchid Turf View' which the opposite party No.1 was proposing to construct on C.S. No. 66, 2/66, 3/66 and 67 of Lower Parel Division situated at Dr. E Moses Road in Mumbai. The aforesaid flats are stated to be one duplex flat. The sale consideration for the flats was agreed at Rs.32.00 crores and an initial payment of Rs.50.00 lacs was made to opposite party No.1. The allotment letter dated 31.8.2009 was issued to the complainants by opposite party No.1 Turf Estate JV, which inter-alia stipulated as under:

"3. You shall in the same format as shall be executed with other purchasers / allottees before taking possession execute a printed agreement for sale (hereinafter referred to as 'the Said Agreement') being executed with other purchasers/ allottees of flat as and when required by us. Further, provisions of the Said Agreement will be treated as provided herein and the Said Agreement shall always be read and construed together with this letter of allotment and the provisions contained therein shall be applicable and binding to you over and above the provisions of this letter of allotment. The draft agreement will be provided soon.

The possession of the aforesaid flat shall be given to you on the date to be stipulated in the Agreement. Kindly refer to the attached section plan for the floor location and the floor plan for the internal dimension of the said flat. The same has also been sufficiently explained to you at the time of booking.

The Developer shall endeavor to complete the construction of the said flat within the time frame mentioned in the Agreement for Sale subject to any force majeure or viz-majeure."

The complainants made further payment of Rs.6.5 crores on 16.9.2009, Rs.3.2 crores on 02.10.2010 and Rs.8,24,000/- on 09.2.2012, thereby making an aggregate of Rs.10,28,24,000/-. Since the draft agreement was not sent to the complainants nor were they given any information with respect to the progress of the work, they vide notice dated 05.12.2015 terminated the allotment letter and required the opposite parties to refund the aforesaid amount of Rs.10,28,24,000/- to them, along with interest. Since payment has not been made in terms of the said demand notice, the complainants are before this Commission, seeking a direction to the opposite parties to pay the aforesaid amount along with compensation etc.

CC/542/2016

In CC/542/2016, the complainants agreed to purchase s 4-BHK Unit consisting of 3801 and 3802 on the 38th floor and flat No 3901 and 3902 on the 39th floor of the above referred building for a consideration of Rs.32.00 crores. An allotment letter dated 31.8.2009 was issued to them and the said allotment letter contained terms identical to the terms of the allotment letter issued in CC/541/2016. The complainants in CC No. 542/2016 have also paid a sum of Rs.10,28,24,000/- to the opposite party No.1 on different dates. They also have terminated the allotment letter vide notice dated 5.12.2015 on the ground that neither the draft agreement was provided to them nor were they informed of the progress of the project. Since the amount paid by them has not been refunded, they are also before this Commission seeking identical relief.

CC/543/2016

The complainants in this matter were allotted a 4 BHK Unit consisting of flat No.3401 and 3402 on the 34th floor and Flat No.3501 and 3502 on the 35th floor of the above referred proposed building and allotment letter dated 31.8.2009 was issued to them on identical terms. They also made payment of Rs.10,28,24,000/- to the opposite party No.1 on different dates and later on terminated the allotment letter vide notice dated 05.12.2015 on the same ground on which the allotment letters in the other consumer complaints were terminated.

CC/544/2016

The complainants in CC/544/206 were allotted a 4-BHK unit consisting of flats No. 3201 and 3202 on the 32nd floor and Flat No. 3301 and 3302 on the 33rd floor of the above referred proposed building for a consideration of Rs.32.00 crores. They also made payment of Rs.10,28,24,000/- to the opposite party on different dates and later on terminated the allotment letter vide notice dated 5.12.2015 on the very same ground on which the other allotment letters were terminated. They are also before this Commission, seeking refund of the amount paid by them, along with compensation etc.

The complaints have been resisted by the opposite parties which has admitted the payment received from the complainants as well as the allotments made to them. It is stated in the written version filed by the opposite parties that the complainants were fully aware of the facts that the approvals were not in place at the time allotment was made and the construction activity will take a long time. It is pointed out in the written version that no commencement date or completion date was mentioned in the allotment letter and that in view of the changes made in the Development Control Regulations for Greater Mumbai, opposite party No.1 was unable to proceed with the project as originally envisaged and was constrained to rework the entire layout and building of the project, which took considerable time. It is claimed that the project is still viable in the revised DC Regulations and the opposite parties are keen to conclude the same.

I have heard the learned counsel for the parties.

As noted earlier, neither the allotments made to the complainants nor the payment received from them have been disputed by the opposite parties. It is therefore an admitted case that the residential flats in the proposed residential building were allotted by the opposite party No.1 to the complainants in each complaint, for a consideration of Rs.32.00 crores. It is also an admitted position that the complainants in each complaint have paid a sum of Rs.10,28,24,000/- to the opposite party No.1. It was expressly promised by the opposite party No.1 in para-3 of the allotment letter that the draft agreement for sale would be provided soon to the allottees. This was necessary considering that the provisions of the proposed agreement were to be treated as part of the allotment letters and were to be binding upon the parties. As noted in Clause 6 of the allotment letter, the possession of the flats was to be given on the dates to be stipulated in the agreement and the opposite party was to endeavor to complete the construction of the flats within the time frame mentioned in the agreement for sale. Therefore, unless the draft agreement for sale was made available to the complainants, they could not even have known by which date the possession was likely to be delivered to them. Even all the terms and conditions governing allotment could not have been known by them unless the draft agreement was provided. Despite making a promise to provide the draft agreement soon after the allotment letter, the opposite party No.1 failed to provide the same though more than six years had expired by the time the complainants were constrained to terminate the allotment letter. The complainants therefore were fully justified in refusing to wait further for the flats allotted to them and in terminating the allotment letter, thereby seeking refund of the amount paid by them to opposite party No.1, along with compensation etc.

Though the opposite parties have alleged that because of the changes in the Development Control Regulations, the project was delayed, they have not explained what steps they had taken to complete the project between 31.8.2009 when the allotment letter was issued and the date on which the Development Control Regulations were amended. Had the builder been vigilant and sincere, it could have not only got the building plans duly sanctioned, even the construction could have been completed before the date on which the complainants were constrained to terminate the allotment letters. The complainants, in my view, cannot be compelled to wait indefinitely for the possession of the flats, when the opposite party has not even been able to start the same in last more than eight years. The complainants are therefore, entitled to refund the entire amount paid by them, along with compensation etc.,

The learned senior counsel for the opposite parties has pointed out that in terms of Section 8 of the Maharashtra Ownership Flats Act, 1963, interest in such an eventuality is to be paid @ 9% per annum. In terms of the statutory provisions contained in MoFA, the opposite Party No.1 must refund the entire principal amount received from the complainants, alongwith interest at the statutory rate of 9% per annum from the date of each payment till the date of refund. The opposite party should also suitably compensate the complainants for the mental agony and harassment suffered by them in last more than eight years, besides paying the cost of litigation to them. The complaints are therefore disposed of with the following directions:

(i) Opposite party No.1 namely Turf Estate JV shall refund the entire principal amount of Rs.10,28,24,000/- to the complainants in each complaint, along with compensation in the form of simple interest @ 9% per annum from the date of each payment till the date on which the full refund along with compensation in the form of interest in terms of this order is made.

(ii) The opposite party No.1 shall pay Rs.5,00,000/- as compensation in each complaint for the mental agony and harassment undergone by the complainants at its hand.

(iii) The opposite party No.1 shall pay Rs.25,000/- as the cost of litigation in each complaint.

(iv) The payment in terms of this order shall be made within three months from today.