Kamal Girotra & Anr vs M/s Ansal Crown Infrabuild Pvt. Ltd

R.K. Agrawal,President

The present Consumer Complaint has been filed under Section 12(1)(a) read with Section 21 of the Consumer Protection Act, 1986 (for short "the Act") 'by Mrs. Kamal Girotra and her husband, Mr. S. C. Girotra (hereinafter to be referred to as the "Complainants") against Opposite Party, M/s. Ansal Crown Infrabuild Pvt. Ltd. (hereinafter referred to as the "Developer) seeking refund of the amount paid towards purchase of Apartment along with interest as the Opposite Party Developer failed to hand over the possession of the Apartment booked by them in the Project launched by the Developer in the name and style of Änsal Crown Heights"" (hereinafter to be referred to as "the Project') located at Sector 80, Faridabad, Haryana.

The facts as narrated in the Complaint are that on 12.08.2012, the Complainants had applied for booking of a Residential Apartment in the Group Housing Project namely, "Ansal Crown Heights", proposed to be developed by the Opposite Party Developer. Vide Allotment Letter dated 15.09.2012 the Complainants were allotted Flat No. 102, Tower 4 of the Project having approximate Super Area of 1788 sq. ft. at the basic rate of 3168/- per sq. ft. for a total Sale Consideration of 70,23,264/-. The Flat Buyer's Agreement (hereinafter to be referred to as "the Agreement") was executed on 23.09.2016. As per Clause 4 of the Agreement, the Opposite Party had contemplated to complete the construction of the Apartment within 18 months from the date of execution of the Builder Buyer Agreement, meaning whereby, in terms of the Builder-Buyer Agreement, the possession ought to have been handed over to the Complainants on or before 23.03.2018.

According to the Complainants, they have paid a sum of 56,19,972/- out of total Sale Consideration of 70,23,264/- to the Developer during the period from August 2012 to April, 2016. It is also stated that a sum 2,36,000/- was adjusted by way of reduction in the per Sq. Ft. rate from 3,300/- to 3,168/- and this amount has been mentioned as special discount in the ledger of the Opposite Party. It is averred that the Opposite Party Developer has committed gross deficiency in service and adopted Unfair Trade Practices, since the Complainants had, time and again, requested for execution of the Flat Buyer's Agreement but the same was executed only on 23. 09.2016, i.e., after delay of 4 years. The Complainants have sought to rely on the decision of this Commission in the case of Satish Kumar Malhotra Vs. DLF Ltd- (2019) SCC On Line NCDRC 154 wherein it was held that the time period for putting the buyers in possession should be counted from the acceptance of the first installment at hand, therefore, keeping in parlance with the said decision, the Complainants have inferred that since the first installment was collected by the Opposite Party Developer in August, 2012, the possession should have been handed over to them on or before August, 2015. The Complainants have further relied upon the Photographs as annexed in the Complaint evidencing that as on 02.06.2019, only nearly 50% of the construction work was complete. It is submitted that in the absence of exact date of completion of Project, the Complainants are no longer interested in taking possession of the Apartment. Accordingly, on 23. 06.18, 06.08.18, 11.11.18, 10.12.18 and 02.04.19, the Complainants send letters/emails to the Developer seeking refund of the amount paid along with interest. However, the Developer did not refund the amount as prayed. Feeling aggrieved, the Complainants have filed the present Complaint with the following reliefs : -

"(a) Direct the Opposite Party to refund to the complainants the amount deposited by them with the opposite party amounting to Rs. 59,16,972/- along with compensation in the form of simple interest @18% interest per annum from the date of deposit of each instalment till the date of actual refund;

(b) Direct the Opposite Party to pay o the complainants a sum of Rs. 10,00,000/- on account of mental harassment and agony;

(c) Pass any such further order or orders which this Hon'ble Commission deems fit and proper in the facts and circumstances of the present case."

The Opposite Party Developer has filed its Written Version denying the contents of the Complaint and contending that the Complainants have been flouting with the terms of the Agreement. They have defaulted in making timely payments and requested the Developer for waiving of the interest on delayed payment. There was delay of 452 days at various occasions in rendering the payment towards due instalments. However, on their request that they will not claim any penalty for any delay in completion of Project, the interest on the delayed payment was waived of despite the fact that such set off has ultimately been detrimental to the interest of the Opposite Party. In view of such consensus reached between the parties wherein the Complainants have already waived off their right to claim any delayed compensation on possession, such

demand made now, does not stand to be entertained .

The Opposite Party Developer has further contended that the Complaint is not maintainable before this Commission for want of pecuniary jurisdiction inasmuch as the total consideration paid by the Complainant is less than 1,00,00,000/- and further the Complainants are merely investors as they had booked the subject Apartment for commercial purposes and to earn profit. There is no cause of action in favour of the Complainants due to delay on their part to make timely payment and as such they are not entitled for the reliefs prayed in the Complaint. Clause 4 of the Agreement clearly provides that the Opposite Party Developer would endeavor to hand over the possession of the booked Apartment within a period of 36 months from the date of execution of the Agreement subject to force majeure circumstances and on receipt of due installments. Time is not the essence of contract. Hon'ble Supreme Court in the cases of Chand Rani vs. Kamal Rani, 1993 (1) SCC 519 and Gomathinayagam Pillai vs. Palaniswami Nadar, 1967 (1) SCR 227, has held that fixation of the period within which the contract has to be performed, does not make the stipulation as to time, the essence of the contract and when a contract relates to a sale of immovable property, it will normally be presumed that time is not the essence of the contract. The Project is already registered with the Haryana Real Estate Regulatory Authority with Registration No. HRERA-PKT-FBD-28-2018 dated 24.08.2018 and granting refund at an advanced stage of construction, will be against the interests of the Allottees in general as it will cause a deep financial strain on the Opposite Party Developer and will in turn delay the Project.

The Opposite Party Developer has further pleaded that the Project got delayed due to reasons which were beyond their control, as substantial amount of delay was caused by Directorate of Town and Country Planning, Haryana, in renewing the license of the Opposite Party and in approving the Building Plans of the Project, construction was further delayed due to ban on construction as imposed from time to time by various authorities due to air pollution level in the Delhi NCR. It is also submitted that various Allottees have defaulted in making timely payments of due instalments, which led to deficiency of funds resulting in delayed construction. With respect to the stage of construction, the Developer submitted that the construction work of 4 out of the 8 Towers is almost complete and at the moment, only finishing of the interiors and service facilities are going on. It is also submitted that no amount of 2,36,000/- was ever received in cash or adjusted by the Developer and it was also intimated to the Complainant vide letter dated 10. 05.2019 .

I have heard the learned Counsel for the Parties and perused the material available on record and evidence add uced by the parties .

Mr. Chandrachur Bhattacharya, learned Counsel appearing for the Complainants has submitted that the Complainants have not defaulted in making the payments of installment as the payment was linked with the Construction. the Opposite Party Developer has been raising illegal demands from the Allottees despite of incomplete and delayed construction and that the ACHFB Association has also filed criminal complaint before the Economic Offence Wing, Haryana, alleging embezzlement of funds to the tune of 34 crores by the Developer, which is pending for adjudication. Learned Counsel has further submitted that breach of contract has been committed by the Developer by not handing over the possession within the stipulated time and that the Complainants are Consumers in view of judgments passed by this Commission in Vasant Prabhakar Darekar, Proprietor of Darekar Developers Chandan Bungalows vs. Anand Vyankatesh Horaddi, - 2016 SCC On Line NCDRC 2352 and Aashish Oberai vs Emaar MGF Limited, 2016 SCC OnLine NCDRC 2322. It is also contended by him that in view of the inordinate delay caused by the Opposite Party in handing over possession, the Complainants are left with no other option but to seek refund of 59,16,972/- along with interest @18% per annum.

As against this, Mr. Sonam Sharma, Learned Counsel for the Developer has argued that delay in handing over the possession of the Units is attributable to delay caused by various allottees in making timely payments including the Complainants herein and due to various other reasons which were beyond its control. That the Developer has been running from pillar to post in order to complete the construction and even infused a sum of 16,63,00,000/- from the management in order to combat the financial crisis. That till date, the Developer does not have any loan from any banking or non-banking Institute except a Bank Guarantee of 1.36 Crores with Punjab National Bank. Learned Counsel has also urged that the construction work of 4 out of 8 Towers is almost complete except the interior works and construction work of rest 4 towers is complete to the extent of 70%. It is also vehemently argued that the Opposite Party is charging only 9% interest instead of 24% on delayed payments by the allottees. The Learned Counsel has thus prayed that the Complaint filed by the Complainants be dismissed.

I have given my thoughtful consideration to the Arguments advanced by learned Counsel for the Parties .

The defence taken by the Developer for delay in completion of the Project and handing over the possession to the Complainants has already been dealt with in detail by a Co-ordinate Bench of this Commission in the case of Deepak Verma Vs. M/s. Ansal Crown Infrabuild Pvt. Ltd. - (Consumer Complaint No. 748 of 2019 decided on 10.11.2021) which relates to the same Project, i.e. "Ansal Crown Heights" located at Sector 80, Faridabad, Haryana. While rejecting the contentions of the Learned Counsel for the Developer, it was held as under:-

" The Complaint was resisted by the Opposite Party Developer by filing its Written Statement in which the Opposite Party Developer took preliminary objection that the Complaint is not maintainable as the terms of the Agreement are binding on both the Complainants and the Opposite Party and therefore, this does not give any rise to any cause of action entitling the Complainants to file the purported Complaint; the Project is registered under RERA, 2016 and therefore, in terms of RERA, this Commission is barred from entertaining the present Complaint and since the sale price of the Flat was below 1.00 crores, this Commission lacks pecuniary jurisdiction to entertain the present Complaint and the Complainants is habitual defaulter in making payments. On merits, it was stated that the delay in completion of Project occurred due to delay on the part of the Directorate of Town & Country Planning Haryana in renewing the license of the Opposite Party and the Construction work was affected on account of the contractor appointed by the Developer having not completed the construction in time and thereafter having created hindrance in completion of the Project by another contractor. It is also alleged that out of ten towers, construction work is going on in eight towers and 95% work is completed in four towers whereas 70% work is complete in remaining towers. It is also alleged that during the intervening period, majority of the buyers defaulted in making payments in terms of their Agreement and a sum of 30 crores (Approx.) is outstanding from the flat buyers to the Developer, leading to a financial crunch. It is also alleged that as per the agreement between the parties, in the event of delay in construction, compensation quantified at Rs.5/- per sq.ft. per month for the period of delay was payable to the flat buyers, provided the delay can be attributed to the builder and no claim by way of damages or compensation is payable if the delay is on account of reasons beyond the control of the promoter. It was also submitted that the delay in construction is due to the reasons which were beyond the control of the Developer, therefore, there is no Deficiency in Service or Unfair Trade Practice on their part. They prayed that the Consumer Complaint be dismissed.

We have heard Mr. Saurabh Jain, learned Counsel for the Complainants, Mr. Rohit Gupta, learned Counsel appearing on behalf of the Opposite Party Developer and have given a thoughtful consideration to the various pleas raised by the learned Counsel for the Parties.

The contention of the learned Counsel for the Opposite Party Developer that the Complainants is bound by the terms of the Agreement and it did not give any rise to any cause of action to Complainants to file the present Complaint, we have gone through the various clauses of the Agreement. Clause 4 and 3 (b) viii c of the Agreement reads as under:-

"4. .......In case of delay in construction of the said Unit attributable to delay on the part of intending Developer/Seller, the Intending Developer / Seller would pay a penalty to the Unit Buyers @Rs.5/- per sq. ft. per month for the period of delay and likewise it would be applicable vice-versa......

3(b)viii (c) In exceptional circumstances, the Owner/Promoter may, in its sole discretion condone the delay in payment, by charging interest at minimum rate of 24% per annum. In the event of the Owner/Promoter waiving the right of forfeiture and accepting interest/other compensation on that account, no right whatsoever would accrue to any other defaulting Flat Buyer."

A bare perusal of above Clauses makes it clear that as per Clause 4 of the Flat Buyer Agreement, in case of delay the Opposite Party Developer is liable to pay 5/- per sq. ft. per month for the period of delay in offering of possession, whereas in terms of Clause 3(b)(viii)c, in case of late payment, the Complainants/Buyer is liable to pay interest @24% p.a. This shows that the terms of the Agreement are wholly one-sided and unfair. Therefore, the Complainants cannot be made bound to the terms of the Agreement, which is one-sided and unfair in the light of the recent Judgment of the Hon'ble Apex Court in Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, II (2019) CPJ 34 (SC), wherein the Apex Court has observed as follows:-

"6.7. A terms of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the Agreement dated 08.05.2012 are ex-facie one sided, unfair and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the Builder.

In view of the above discussion, we have no hesitation in holding that the terms of the Apartment Buyer's Agreement dated 08.05.2012 were wholly one-sided and unfair to the Respondent-Flat Purchaser. The Appellant-Builder cannot seek to bind the Respondent with such one-sided contractual terms."

So far as the plea that the Project is registered under RERA, 2016 and therefore, in terms of RERA, this Commission is barred from entertaining the present Complaint is concerned, we place reliance upon a recent Judgment delivered by Hon'ble Supreme Court in "M/s Imperia Structures Ltd. v. Anil Patni and Anr." (2020) 10 SCC 783 wherein it has been held that the remedies under the Consumer Protection Act were in addition to the remedies available under special statutes. The absence of a bar under Section 79 of the RERA Act to the initiation of proceedings before a fora which is not a civil court, read with Section 88 of the RERA Act makes the position clear. Section 18 of the RERA Act specifies that the remedies are without prejudice to any other remedy available. In M/s. Imperia Structures Ltd. (supra), Hon'ble Supreme Court observed as under:

"31. Proviso to Section 71(1) of the RERA Act entitles a complainant who had initiated proceedings under the CP Act before the RERA Act came into force, to withdraw the proceedings under the CP Act with the permission of the Forum or Commission and file an appropriate application before the adjudicating officer under the RERA Act. The proviso thus gives a right or an option to the complainant concerned but does not statutorily force him to withdraw such complaint nor do the provisions of the RERA Act create any mechanism for transfer of such pending proceedings to authorities under the RERA Act. As against that the mandate in Section 12(4) of the CP Act to the contrary is quite significant.

Again, insofar as cases where such proceedings under the CP Act are initiated after the provisions of the RERA Act came into force, there is nothing in the RERA Act which bars such initiation. The absence of bar under Section 79 to the initiation of proceedings before a fora which cannot be called a civil court and express saving under Section 88 of the RERA Act, make the position quite clear. Further, Section 18 itself specifies that the remedy under the said section is without prejudice to any other remedy available. Thus, the parliamentary intent is clear that a choice or discretion is given to the allottee whether he wishes to initiate appropriate proceedings under the CP Act or file an application under the RERA Act.

So far as the pecuniary jurisdiction is concerned, in terms of Section 21 of the Consumer Protection Act, this Commission possesses the requisite pecuniary jurisdiction where the value of the goods or services as the case may be and the compensation claimed exceeds Rs.1 Crore. As held by a three Members Bench of this Commission in CC No.97 of 2016 Ambrish Kumar Shukla & Ors. Vs. Ferrous Infrastructure Pvt. Ltd., decided on 07.10.2016, the value of the services in such a case would mean the sale amount agreed to be paid by the flat buyer to the developer, which has been held to lay down the law correctly on the issue relating to pecuniary jurisdiction and the sale consideration which was agreed between the Parties for buying the goods or hiring or availing the services is relevant for determination of pecuniary jurisdiction in cases of refund also by a larger Bench of 5 Members of this Commission in "CC No. 1703 of 2018, Renu Singh vs. Experion Developers Private Limited" and other connected matters" decided on 26.10.2021. In the present case, the agreed sale consideration was Rs.56,49,765/-. If even a part of the compensation claimed by the complainants is added to the said sale consideration, the aggregate would be much above Rs.1 Crore. Therefore, it would be difficult to say that this Commission does not possess the requisite pecuniary jurisdiction As far as the plea that the Complainants is habitual defaulter in making payments and as such the present Complaint is not maintainable, is concerned, we observe that there was remedy available with the Developer either to charge penal interest on delayed payment or cancel the allotment of the Complainants and refund the amount deposited by the Complainants but it neither cancelled the allotment nor refunded the amount deposited by the Complainants. Now, at this stage the Developer cannot take this plea, which is an afterthought.

So far as the plea of delay on the part of the Directorate of Town & Country Planning Haryana in renewing the license of the Developer is concerned, the Developer knew well in advance the expiry date of licence, they ought to have completed all the formalities and had applied for its renewal well in time. It was Developer's duty and responsibility and the Complainants cannot be penalized for that. Therefore, the alleged delay in the renewal of the licence does not justify the delay in completion of the construction. As far as the delay on account of the contractor appointed by the Opposite Party Developer having not completed the construction in time is concerned, that would hardly be relevant from the point of view of the Complainants. If the contractor appointed by the Opposite Party Developer had delayed the construction, they can take such action as may be open to it in law against the said contractor including the recovery of damages from him but, the Complainants/Allottee is not at all concerned with the delay on the part of the private contractor appointed by the Developer.

As far as the alleged delay on the part of other flat buyers in making payment is concerned, If flat buyers were in default, it was for the Opposite Party Developer to take such action as was open to it in terms of the Contract it had executed with them including cancellation of their allotments and sale of the flats allotted to such defaulting buyers in the market and to arrange finance from alternative sources in the meanwhile.

In view of aforesaid discussions, we do not find any force in the defence taken by the Opposite party Developer for the inordinate delay in completion of the Project.

It is not in dispute that the Complainants were allotted the Flat in the year 2011 and till date construction of the Flat is not completed. Keeping in view the Judgment passed by this Commission in Emmar MGF Land Ltd. & Ors. vs. Amit Puri [II (2015) CPJ 568 NC], wherein it was laid down that after the promised date of delivery, it is the discretion of the Complainants whether he wants to accept the offer of possession, if any, or seek refund of the amounts paid with reasonable interest, it is held that it is well within the Complainants' right to seek for refund of the principal amount with interest and compensation as construction is still not complete. We are of the view that the Complainants cannot be made to wait indefinitely for the delivery of possession and the act of the Opposite Party Developer in retaining the amounts deposited by the Complainants, is not only an act of Deficiency of Service but also amounts to Unfair Trade Practice.

We find it a fit case to place reliance on the judgment of the Hon'ble Supreme Court in Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra, II (2019) CPJ 29 SC, in which the Hon'ble Apex Court has observed as hereunder:-

".....It would be manifestly unreasonable to construe the contract between the parties as requiring the buyer to wait indefinitely for possession. By 2016, nearly seven years had elapsed from the date of the agreement. Even according to the developer, the completion certificate was received on 29 March 2016. This was nearly seven years after the extended date for the handing over of possession prescribed by the agreement. A buyer can be expected to wait for possession for a reasonable period. A period of seven years in beyond what is reasonable. Hence, it would have been manifestly unfair to non-suit the buyer merely on the basis of the first prayer in the reliefs sought before the SCDRC. There was in any event a prayer for refund.

In the circumstances, we are of the view that the orders passed by the SCDRC and by the NCDRC for refund of moneys were justified."

The similar view was taken by this Commission in the case of Suresh Chandra Vs. M/s. Ansal Crown Infrabuild Pvt. Ltd. - Consumer Complaint No. 2170 of 2017 decided on 11.11.21 which also relates to the same Project i.e. "Ansal Crown Heights" situated at Sector 80, Faridabad, Haryana.

With regard to dispute of payment of 2,36,000/- by the Complainant to the Opposite Party, Exhibit CW-1/6 clearly established the fact that a sum of 2,36,016.00 has been adjusted as Special Discount as claimed by the Complainant .

So far as, the plea taken by the Developer that delay has occurred due to Ban imposed by the various Authorities because of air pollution in Delhi NCR, is concerned, I am of the considered view that the Ban has been imposed in the 2019, however, the committed period for handing over the possession was in the Year 2014 .

For the aforesaid reasons, I am of the view that in the present case also, the Complainants cannot be made to wait indefinitely for possession of the flat, as the construction is still not complete and the Developer is not in a position to give an exact date of offering of possession to the Complainants. Therefore, the Complainants are entitled for refund of the principal amount with reasonable rate of interest .

Respectfully following the decisions of the Co-ordinate Benches of this Commission, I partly allow the Complaint and direct the Opposite Party Developer to refund the entire principal amount deposited by the Complainants with interest @9% p.a. from the respective date of deposit till the realization, within a period of six weeks from the date of receipt of a copy of this Order failing which the amount shall carry interest @ 12% p.a. for the same period. The Opposite Party Developer shall also be liable to pay 50,000/- as costs of litigation to the Complainants.