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Judgment
Subhash Chandra, Presiding Member
This consumer complaint under section 21 of the Consumer Protection Act, 1986 (in short, the ‘Act’) is filed against the opposite party alleging deficiency in not handing over possession of the flat booked by the complainants within the promised time and seeking refund of the amount deposited with interest as compensation and other costs.
The complainants’ state that they booked a flat admeasuring 2198 sq ft for a sale consideration of 1,63,35,000/- in the project ‘Sovereign Floors Esencia’, Sector 67, Gurgaon, Haryana on 23.01.2013. Flat no. D1560SF was allotted an amount of Rs. 17,69,244/- was paid the booking amount. A Buyer’s Agreement was signed on 18.04.2013 between the parties and as per clause 3.1 the complainants were to pay Rs 1,63,35,000/- as the sale consideration @ Rs 7431.76 per sq ft. The complainants opted for a construction linked payment plan as per Annexure 2 of the Agreement. The opposite party undertook to complete the development of the project within 36 months (i.e. by 18.04.2016) with an extended period of 6 months as per clause 5.1 and as per clause 5.4 to compensate the complainants @ Rs 10/- per sq ft of the super area in case of failure to deliver as per the time frame. The complainants obtained a loan from of Rs 1,27,75,000/- from State Bank of India and a Tripartite Agreement was signed on 29.04.2014 between the parties and the bank. The complainants paid Rs.1,74,09,480 between 23.01.2913 to 07.04.2016. In June 2015 a demand of Rs.9,80,038.36 was raised which was due on completion of internal finishing and on visiting the site on 22.06.2015 the complainants found the work was slow despite payment of nearly 90%. A reply to email dated 23.06.2015 regarding the slow pace of work was received on 04.11.2015 assuring completion before handing over possession. Despite further mails dated 06.12.2015 and 17.01.2016 regarding the pace of work, opposite party only reminded them about the payment. A pre-cancellation notice dated 31.03.2016 was received by the complainants requiring payment of Rs.10,73,582/- inclusive of interest @ 18% p.a. which was paid on 07.04.2016 under the apprehension that the Rs.1,64,15,518/- already paid would be in jeopardy. Despite assurances to complete the project, the complainants saw on 21.06.2019 that the project was incomplete even 3 years after the promised date of possession. In view of the fact that the complainants were paying nearly Rs.1,00,000/- as EMI per month, and the project had not been completed on time, the complainants are before this Commission alleging deficiency in service with the prayer to direct the opposite party to:
(a) refund the sum of Rs.1,74,09,480/- towards the amount paid by the complainants along with interest @18% p.a. from the date of payment till the disposal of the complaint;
(b) pay compensation of Rs.1,00,00,000/- for delayed possession;
(c) pay Rs.2,00,000/- towards litigation expenses by the complainants;
(d) any other orders as deemed fit.
The opposite party did not file any reply to the complaint. However, both sides filled their short synopsis of arguments.
I have heard the learned counsel for both the sides and perused the evidence on record carefully.
The counsel for the complainant argued that the opposite party was to hand over the flat within 36 months with 6 months grace from the date of execution of the Agreement by October 2016 as per clause 5.1 which it had failed to do despite accepting a substantial amount of Rs.1,74,09,480/-; that the Agreement dated 18.04.2013 was one-sided, arbitrary and unreasonable since a large amount had been collected prior to it and the complainants were not in a position to oppose it; that the opposite party kept the complainants in the dark about the status of work progress and were given false assurances and the opposite party was guilty of deficient services and unfair trade practice. No occupation certificate or completion certificate had been produced by the opposite party till date and no offer of possession had been made. Therefore, deficiency in service was writ large and the complaint therefore prayed for refund of the deposited amount with interest and other damages and costs. The counsel for the complainant argued that the present case was squarely covered by a recent judgment of this Commission pertaining to the very same project and relied upon this Commission’s orders in Chirag Aggarwal and Anr. Vs. M/s Ansal Phalak Infrastructure Pvt. Ltd. in CC No. 933 of 2017 dated 21.11.2022 which had upheld the prayer for refund of the deposited amount with interest @ 9% p.a. from the respective dates of deposit till the date of realization within 3 months, failing which the applicable rate of interest would be 12% p.a. with no order as to costs. Reliance was also placed on the judgment of the Hon’ble Supreme Court in Pioneer Urban Land and Infrastructure Ltd. Vs. Geetu Gidwani Verma & Anr., Civil Appeals No. 12238 of 2018 with No. 1677 of 2019 dated 02.04.2019 to argue that a buyer cannot be compelled to take possession of a flat when there is delay in delivery of possession by the builder and the buyer is entitled to refund along with compensation/interest for such delay.
The opposite party admitted that there had been a delay in the completion of the project. Reliance was placed on clause 5.1 of the Agreement to state that the last pre-requisite permission of building plan approval was received on 23.01.2013 and, therefore, it was entitled to the period of 42 months for construction as per the Agreement. It was argued that the reasons for the delay were beyond the control of the opposite party as it was due to orders of the National Green Tribunal and the Hon’ble Supreme Court imposing restrictions on construction activities in the NCR which resulted in delay. The Occupation Certificate dated 04.10.2021 for the project was now available and the opposite party was willing to offer possession to the complainant with compensation for the delay at a reasonable rate of interest. Reliance was placed on Bikram Chatterji & Ors. Vs. Union of India & Ors. in WP (C) No. 940 of 2017 which directed that outstanding dues despite delay in completion of the project and on Wg Cdr Arifur Rahman & Aleya Sultana & Ors. Vs. DLF Southern Homes Pvt. Ltd. & Ors, CA No. 6239 of 2019 dated 24.02.2020 which held that no claim for loss can be allowed if the alleging party does not produce any proof of it. As regards the claim of compensation @ 18% p.a. interest, it is argued that as per Hon’ble Supreme Court’s orders in Arifur Rahman (supra) and R.V. Prasannakumaar & Ors. Vs. Mantri Castles Pvt. Ltd. & Anr., 2019 SCC OnLine SC 224 and DLF Home Developers Ltd. & Anr. Vs Capital Greens Flat Buyers Association, CA Nos. 3864-3889/2020 a reasonable rate of interest would be 6% per annum.
From the material on record and the arguments advanced by both the learned counsel for the parties, it is manifest that the opposite party failed to deliver possession of the flat to the complainant by the promised date of 18.04.2016 or even by 18.10.2016 after factoring in the grace period of 6 months. The occupation certificate has been obtained by the opposite party only on 04.10.2021, i.e. after nearly 4 years. An offer of possession was made on 28.12.2020 to enable the complainant to undertake fitout of the flat. However, in view of this complaint date 09.08.2019 this offer was not accepted.
The Hon’ble Apex Court has laid down in Pioneer Urban land and Infrastructure Ltd., vs Govindan Raghavan in Civil Appeal no. 12238 of 2018 decided on 02.04.2019 (2019) 5 SCC 725 that an allottee as a consumer is entitled to seek refund of the money paid by him to the opposite party/builder in case of inordinate delay on the part of the opposite party to hand over possession. The Hon’ble Supreme Court has also held in Kolkata West International City Pvt., Ltd. Vs. Devasis Rudra, Civil Appeal No. 3182 of 2019 decided on 25.03.2019 that “It would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession”. In the present case, the delay is of nearly 8 years reckoned from 18.10.2016. This is certainly inordinate as a delay of up to two years could be considered reasonable depending on whether there are mitigating circumstances. A delay of nearly 8 years is certainly not a reasonable delay. The complainant is within his rights to refuse to accept possession in view of this delay and to seek refund instead.
For the aforementioned reasons, the complaint is found to have merits and is liable to succeed. It is accordingly allowed in part with the following directions:
(i) opposite party is directed to refund the entire amount of Rs.1,74,09,480/- to the complainant with interest @ 9% p.a. from the respective dates of deposit till the date of realization;
(ii) this order shall be complied within 8 weeks of this order failing which the rate of interest shall be 12% per annum;
(iii) Opposite party shall pay litigation cost of Rs.25,000/- to the complainant.