Kare Electronics And Development Pvt. Ltd vs Roshan Jain & 3 Ors

V.K. Jain, J

The appellant Kare Electronics and Development Pvt. Ltd. (hereinafter referred to as the owner) entered into an agreement with M/s Skyline Construction and Housing Pvt. Ltd. (hereinafter referred to as the developer), whereunder, the developer was to construct residential apartments on the land owned by the appellant. The apartments so constructed by the developer were to be shared between the owner and the developer. Vide a separate Tripartite Agreement between the owner, the developer and the concerned complainant, he agreed to purchase an apartment in the above referred project, for the consideration mentioned therein. The possession of the apartment was to be delivered within 24 months from the receipt of the Commencement Certificate or securing of all necessary permissions, whichever was later. However, the developer was entitled to an extension of time for giving delivery of these flats, if the flat was delayed on account of any of the factors mentioned in clause 5 of the Tripartite Agreement. The construction of the apartments having not been completed and consequently, the possession having not been offered to the complainants, they approached the concerned State Commission by way of separate Consumer Complaints.

The complaints were opposed by the developer, as also by the owner in some of the cases. However, the execution of the Joint Development Agreement as well as the Tripartite Agreement was not disputed. Even the payments received by the developer were not disputed. Vide impugned orders dated 26.09.2016 & 06.01.2017, the State Commission directed the owner as well as the developer to complete the project in all respects, obtain the Occupancy and Completion Certificate and execute separate Sale Deeds in respect of the allotted apartments in favour of the concerned complainants and hand over possession of the said apartments to them. It was also directed that in the event of the OPs in the Consumer Complaints i.e. the owner and the developer failing to complete the pending works, the complainants shall be at liberty to complete the remaining construction work in coordination with other apartment owners and the Apartment Association, if any. The OPs were directed to re-imburse the amount spent by each of the complainant to complete such pending work. It was also directed that in the event of the OPs i.e. the developer and the owner failing to execute and register Sale Deeds, the complainants shall be at liberty to get the said Sale Deeds registered as per law through the Commission. The OPs in the Consumer Complaints were also directed to pay compensation by way of rent @ Rs.10,000/- per month to each of the complainants beyond six months from the stipulated date of completion till the handing over of possession.

Being aggrieved from the order passed by the State Commission, the owner is before this Commission by way of these appeals.

It is informed during the course of hearing that the developer had filed separate appeals which were dismissed as withdrawn.

All these appeals pertain to the apartments, which were to go to the share of the developer and did not form part of the apartments which were to go to the share of the owner. It is also not in dispute that the entire sale consideration was paid by the concerned complainants/allottees only to the developer and no payment to the owner was made. A perusal of the Joint Development Agreement between the owner and the developer would show that the entire construction work was to be got executed by the developer alone, in whose favour a Power of Attorney had been executed by the owner. It is also not in dispute that the entire expenditure on the construction of the apartments was to be incurred by the developer. In these circumstances, the only obligation of the owner, qua the complainants, in my opinion, was to execute the Sale Deed alongwith the developer.

It is informed during the course of hearing that such Sale Deeds can be executed in Karnataka even without completion of the apartments. Therefore, in my opinion, the State Commission was not justified in directing both, the developer as well as the owner to complete the project and obtain the requisite statutory permissions such as Occupancy Certificate and Completion Certificate. Similarly, since the delay in completion of the construction happened at the hands of the developer, the State Commission, in my opinion, ought to have been awarded compensation only against the developer.

I am also not in agreement with the liberty granted by the State Commission to the complainants to complete the remaining construction as per the required specifications and plans in coordination with other apartment owners and Apartment Association, if any. It has to be kept in mind that the building plans have been approved in the names of the owner/developer. It is only they who can submit the completion plans and apply for and obtain the issuance of the requisite Occupancy Certificate/Completion Certificate. The individual allottees have no right to apply for and obtain the requisite Occupancy Certificate and the Completion Certificate. Moreover, if individual allottees are permitted to complete the construction of their respective apartments, that may result in a situation where varying amounts are spent by different allottees on completion of the same work in their respective apartments. Moreover, there is no ceiling put by the State Commission, on the expenditure they can incur to finish the remaining work.

For the reasons stated hereinabove, the impugned order is modified and the complaints are disposed of in the following terms:

(i) The appellant as well as the developer shall execute the requisite Conveyance Deed/Sale Deed of the allotted apartments in favour of the concerned allottees, within six weeks from today.

(ii) If the appellant and the builder fail to execute and register the Sale Deeds/Conveyance Deeds in terms of this order within six weeks from today, such Sale Deeds/Conveyance Deeds shall be executed and got registered by the Registrar of the State Commission.

(iii) The requisite stamp duty for execution of the Sale Deed/Conveyance Deed shall be paid by the concerned allottees. The format of the Sale Deed/Conveyance Deed will be approved by the concerned State Commission after hearing the learned counsel for the parties.

(iv) The developer shall complete the entire project including the amenities in terms of the Tripartite Agreement within nine months from today and obtain all the requisite statutory permissions such as Occupancy Certificate and Completion Certificate within next three months.

(v) The developer shall pay the compensation awarded by the State Commission to the complainants. The compensation payable till the date of the impugned order shall be paid by the developer within three months from today.

The compensation for the subsequent period shall be paid at the time of delivery of possession in terms of this order.

(vi) Such of the complainants who do not want to wait for completion of the construction and delivery of the possession in terms of this order, shall be entitled to refund of the entire amount paid by them to the developer alongwith compensation in the form of simple interest @ 10% per annum from the date of each payment till the date of refund. They shall be entitled to the said payment only from the developer, the payment having been made only to the developer. The option in terms of this liberty shall be exercised by the concerned complainants/allottees within six weeks from today. The option to take refund, if exercised, shall be conveyed to both, the developer as well as the owner within six weeks from today.

The learned counsel for the appellant wants liberty to withdraw the unutilized conveyance charges. The request is declined.