M/s BPTP Ltd. & Anr. vs Kishan Kumar Rathee & Anr.

First Appeal No. 529/2024 is filed by M/s BPTP Ltd. and M/s Countrywide Promoters Pvt. Ltd. against Mr. Kishan Kumar Rathee and Mr. Ashok Kumar Rathee; whereas FA No. 532/2024 is filed by M/s BPTP Ltd. and M/s Countrywide Promoters Pvt. Ltd. against Mr. Subhash Chander and Mr. Omvir Singh. These appeals challenge the State Consumer Dispute Redressal Commission, New Delhi ('State Commission'), order dated 27.05.2024 in CC No. 1080 of 2019 and 1079 of 2019 respectively.

Since the facts and questions of law involved in both Appeals are substantially similar, these Appeals are being disposed of by this common Order. For ease of reference, FA No. 529/2024 is considered as the lead case, and the facts outlined below are derived from CC No. 1080 of 2019.

Brief facts of the case, as per the complaint, are that the Complainants booked Unit No. D-147-GF, admeasuring 1770 sq. ft., in the project "Amstoria" of the OPs, situated in Gurgaon, Haryana, at a basic sale price of Rs.71,03,999. The Complainants opted for a self-funding payment plan, under which 35% of the total amount was payable at the time of booking, 15% within two months of booking and the remaining 50%, along with IMS, stamp duty, registration charges and administrative charges, at the time of possession. The Complainants paid 35% of the amount to OPs and requested execution of the Builder Buyer Agreement. The Floor Buyer Agreement (FBA) was eventually executed between the parties on 23.04.2012. As per Clause 5 thereof, the OPs were to hand over possession of the unit within the stipulated period. However, despite receiving Rs.48,68,205, the OPs failed to hand over possession. After considerable delay and repeated follow-ups, the OPs, vide letter dated 16.10.2019, offered possession of the unit along with a demand of Rs.6,43,841 towards increase in super area from 1770 sq. ft. to 1924 sq. ft., Rs.5,90,490 towards cost escalation and increased GST charges. The Complainants sought justification for the said demands but received no satisfactory response. They further visited the project site and found the construction to be incomplete. Aggrieved thereby, the Complainants filed the instant consumer complaint.

On being issued notice, the OPs filed written version and were rendered opportunity to file evidence by way of affidavit. However, they failed to file the same within stipulated period. Consequently, the State Commission vide order dated 12.05.2023, closed the right of the OPs to file evidence. It held that since the OPs failed to file the evidence by way affidavit to prove the averments made in written statement, the contentions raised by them in the written statement could not be taken into consideration and that consequently the complaint remained unrebutted.

After hearing all the parties and appreciating facts of the case, the State Commission on 27.05.2024 passed the following Order:

Aggrieved by the State Commission order, OPs filed FA No. 529/2024 before this Commission seeking to:

In the Appeal, mainly the following grounds were raised:-

The learned counsel for OPs argued that the State Commission erred in finally disposing of the Complaint without deciding I.A. No. 1195 of 2023, whereby the OPs sought recall of the order closing their right to file evidence. Consequently, their evidence was not taken on record and their Written Statement was not duly considered. He argued that the Complainants defaulted in making timely payments and, despite the offer of possession dated 16.10.2019 and reminders, failed to complete formalities or take possession. The unit was complete, the OC had been obtained, and delay compensation of Rs.3,84,800 had been adjusted. The Complaint was therefore filed to avoid their contractual obligations. They further argued that the unit was complete when the OC was obtained on 24.09.2019 and possession was offered on 16.10.2019. The OPs had also adjusted Rs.3,84,800 towards delay compensation, though it was described as "Loyalty Bonus". Reliance was placed on Raju Hans & Anr. v. Vatika Limited, CC/2357/2017, decided on 15.09.2023, to contend that an offer accompanied by a final demand did not become invalid merely because formalities or payments remained outstanding. They contended that under Clauses 2.8 and 12 of the FBA, the OPs were entitled to levy interest on delayed payments. Since possession was validly offered on 16.10.2019 but not accepted by the Complainants, the demand was justified and the direction to issue a revised offer without interest or penalty was erroneous. It was asserted that the FBA permitted determination of the final super area after construction and grant of the OC. The final area of 1924 sq. ft. was communicated in the offer of possession. Since the FBA and offer were admitted documents, the State Commission erred in disallowing the corresponding charges. Reliance was placed on DLF Home Developers Limited & Ors. v. Capital Green Flat Buyer's Association & Ors., (2021) 5 SCC 537. It was argued that the demand for cost escalation was raised under Clause 20.12 of the FBA and supported by the calculation in Annexure-F to the offer of possession. The State Commission overlooked these contractual provisions and wrongly held that no explanation had been furnished. Reliance was placed on the judgments of the Hon'ble Supreme Court in Supertech Limited v. Rajni Goyal, Civil Appeals No. 6649-50 of 2018, decided on 23.10.2018, and of this Commission in Rajni Goyal v. Supertech Limited, CC/708/2017, decided on 07.02.2018. He asserted that under the FBA, the period for delivery i.e. 24 months was subject to force majeure and a 180-day grace period. The delay was attributed to revisions in layout and demarcation, delayed governmental approvals for building and service plans, and NGT restrictions on construction in NCR, including restrictions affecting transportation of material, which were circumstances beyond the control of the OPs. The building plan and the service plan were ultimately approved on 19.09.2012 and 30.06.2014 respectively, resulting in a claimed force majeure delay of 649 days. The State Commission therefore erred in holding that possession was delayed without justification. They submitted that the OC had been obtained on 24.09.2019, before the offer of possession dated 16.10.2019, which specifically referred to it. Since the Complainants had not denied receipt of the OC, the finding that the offer was unjustified was erroneous. Reliance was placed on Raju Hans & Anr. v. Vatika Limited (supra). He further argued that no compensation was payable under Clause 6 of the FBA, as the delay was attributable to force majeure circumstances. In any event, compensation could be awarded only up to the valid offer of possession, particularly as the Complainants defaulted in making payments. Reliance was placed on DLF Homes Panchkula Pvt. Ltd. v. D.S. Dhanda, II (2019) CPJ 117 (SC), to contend that overlapping compensation under multiple heads was impermissible. It was argued that the park-facing unit attracted PLC at Rs.209.04 per sq. ft. and, for the super area of 1924 sq. ft., the Respondents were liable to pay Rs.4,02,192.96. The State Commission therefore erred in directing the OPs to raise the PLC demand in accordance with Annexure-D of the FBA. Accordingly it was prayed that the First Appeal be allowed and the impugned order dated 27.05.2024 passed by the State Commission, Delhi in CC No. 1080/2019 be set aside.

On the other hand, the learned counsels for Complainants argued that the Complainants purchased residential unit No.D-147-GF in the project "Amstoria", Gurgaon, for a basic sale price of Rs.71,03,999 under the Self-Funding Plan, relying on the OPs' assurance that possession would be delivered within two years and that the property was free from encumbrances with all requisite approvals in place. An allotment-cum-demand letter dated 11.04.2011, bearing customer code BE 56/130872, was issued to the Complainants, requiring payment of 35% of the total consideration at the time of booking; 15% along with additional charges within 12 months; and the remaining 50% together with IFMS, stamp duty, registration and administrative charges, at the time of possession. He argued that the statement of account furnished by OPs itself established that the Complainants had duly paid the agreed amounts, including the charges payable under the agreement, and that no amount remained outstanding against them till the offer of possession. Under the agreement, possession was due by 22.04.2014, i.e. within 24 months of 23.04.2012. However, despite repeated personal, telephonic and written inquiries, the OPs neither carried out the construction as scheduled nor delivered possession, merely assuring the Complainants that the project was progressing on time. While denying any delay, OPs assured them of compensation under Clause 6 of the agreement at Rs.10 per sq. ft. per month for the first six months, Rs.20 per sq. ft. per month for the next six months, and Rs.30 per sq. ft. per month thereafter. Having paid about Rs.50,00,000, the Complainants awaited possession relying on the OPs' assurances of timely completion and payment of the compensation as stated. He argued that although the Complainants made all payments on time, the OPs failed to complete and deliver the unit within the agreed period and subsequently offered possession of an incomplete unit vide possession letter dated 16.10.2019 and demanded an unjustified amount exceeding the agreed consideration, including Rs.6,43,841 towards an unexplained increase in super area from 1770 sq. ft. to 1924 sq. ft. The learned Counsel asserted that the possession letter dated 16.10.2019 raised unjustified demands aggregating to Rs.18,40,427.84, including Rs.6,43,841 towards increase in super area, Rs.5,90,494.84 towards cost escalation and Rs.6,06,092 towards GST, besides enhanced preferential location charges based on the alleged increase in area. It was argued that the cost-escalation demand arose solely from OPs' delay of over 5 years, while GST would not have been payable had possession been offered within the stipulated period, when the VAT regime was applicable. It was submitted that these amounts were liable to be deducted from the possession demand and that the OPs had indulged in unfair trade practice by imposing such unjustified charges while failing to honour Clause 6 of the agreement providing compensation for delayed possession. He argued that the Complainants were entitled to possession by 22.04.2014 and compensation under Clause 6 of the agreement until the unit was fully ready for possession. However, OPs neither adjusted such compensation against the possession demand nor withdrew the unjustified charges, despite repeated requests through letters and emails. Instead, they threatened to levy holding charges or cancel the allotment if the demands raised in the possession letter dated 16.10.2019 were not paid. The learned counsel reiterated and affirmed the State Commission findings regarding the OPs' delayed completion and delivery of Unit No. D-147-GF; the Complainants' payment of the entire amount, including all charges under the agreement, with no outstanding when possession was offered; and the OPs' false representations regarding the progress of construction, continued demands for and receipt of payments, and eventual offer of possession of an incomplete unit. It was further asserted that, despite repeated opportunities, the OPs failed to file evidence, resulting in closure of their right to do so vide order dated 12.05.2024. The said order and the subsequent order dated 23.05.2024 were not independently challenged by the OPs. The OPs could not, therefore, assail these procedural orders indirectly at this stage in the present appeal. Reliance was placed on Pawan Gupta v. Experion Developers Pvt. Ltd., I (2021) CPJ 72 (NC), and Arifur Rahman Khan and Ors. v. DLF Southern Homes Pvt. Ltd. and Ors., 2020 (3) RCR (Civil) 544 and it was prayed that the First Appeal be dismissed with costs.

We have examined the pleadings and associated documents placed on record and rendered thoughtful consideration to the arguments advanced by the learned counsels for both the parties.

From the pleadings, material available on record and rival submissions, the primary question which arises for consideration in the present Appeal is whether the State Commission was justified in finally deciding the Complaint without first adjudicating I.A. No. 1195 of 2023 filed by the OPs seeking recall of the order dated 12.05.2023 whereby their right to file evidence by way of affidavit was closed.

Admittedly the Complainants booked Unit No.D-147-GF, measuring 1770 sq. ft., in the project "Amstoria" of the OPs at Gurgaon, Haryana, at a basic sale price of Rs.71,03,999. The FBA was executed between the parties on 23.04.2012. It is not in dispute that the Complainants paid a sum of Rs.48,68,205 to the OPs. During the proceedings before the State Commission, the Written Statement was filed by the OPs and they were directed to file evidence by way of affidavit. The OPs failed to file the same within the stipulated period. Consequently, vide order dated 12.05.2023, the State Commission closed the right of the OPs to file evidence by way of affidavit. The State Commission observed that, since the OPs had failed to file evidence to prove the averments made in the Written Statement, the contentions raised therein could not be taken into consideration and the Complaint remained unrebutted. The OPs, however, subsequently filed I.A. No. 1195 of 2023 seeking recall of the order dated 12.05.2023 and also placed their evidence by way of affidavit on record. Their grievance before us is that the said application was neither decided nor their evidence considered before the Complaint was finally disposed of.

It is the case of the Complainants that the OPs were granted adequate opportunities to file evidence and failed to avail the same within the prescribed period. They contend that the order dated 12.05.2023 closing the right of the OPs to file evidence was not independently challenged and, therefore, the OPs cannot assail the same indirectly in the present Appeal. It is further argued that the Complaint was rightly decided on the basis of the material available before the State Commission.

It is no doubt correct that pleadings do not constitute evidence and that a party which fails to avail an opportunity granted by the Commission to lead evidence cannot ordinarily claim an indefeasible right to do so thereafter. The State Commission was, therefore, justified in taking note of the fact that the OPs had failed to file their evidence within the stipulated period. At the same time, however, the issue before us is not merely whether the State Commission was justified in closing the right of the OPs to file evidence vide order dated 12.05.2023. The material question is whether, after the OPs had filed I.A. No.1195 of 2023 seeking recall of the said order, the State Commission could proceed to finally adjudicate the Complaint without first deciding the said application.

I.A. No. 1195 of 2023 directly concerned the OPs' opportunity to lead evidence in support of their defence. The evidence sought to be placed on record was relevant to the substantive issues arising in the Complaint. The OPs have, inter alia, relied upon the said evidence in support of their contentions concerning the validity of the offer of possession dated 16.10.2019, the OC dated 24.09.2019, the alleged increase in super area, cost escalation, and the plea of force majeure. These are not peripheral matters but go to the very merits of the dispute between the parties.

Once an Application seeking recall of an order closing the right to lead evidence had been filed and remained pending, it was incumbent upon the State Commission to adjudicate that application before finally deciding the Complaint, particularly when the proposed evidence had a direct bearing upon the defence of the OPs. The State Commission, instead, proceeded on the basis that the Written Statement remained unrebutted and that the averments contained therein could not be taken into consideration for want of evidence.

We are conscious of the fact that the OPs cannot seek to indefinitely prolong the proceedings merely by filing an application after expiry of the time granted for filing evidence. However, whether the delay in filing evidence was sufficiently explained, whether OPs deserved an opportunity to lead evidence in the interest of justice, and whether any prejudice would be caused to the Complainants by permitting such evidence were matters which fell for consideration by the State Commission in I.A. No. 1195 of 2023. Without deciding the said application, the State Commission could not have effectively foreclosed consideration of the very evidence which was the subject matter of that application and thereafter finally adjudicated the Complaint.

The fact that certain aspects of the transaction are admitted does not alter the position. The Floor Buyer Agreement dated 23.04.2012 evidences the transaction between the parties, and payment of Rs.48,68,205 by the Complainants is not disputed. These admitted facts and documents can undoubtedly be taken into consideration by the State Commission. However, the existence of admitted documents does not render the pending application for recall of the order closing evidence redundant.

We also find that the impugned order proceeds to record substantive findings against the OPs on several disputed questions, including the validity of the offer of possession, the demand towards increase in super area, cost escalation and the liability of the OPs towards compensation for delay. The OPs' defence on these questions was substantially founded upon contractual provisions and supporting material which they sought to place on record. In the circumstances, we consider it to be not appropriate for this Commission to finally adjudicate those disputed questions without the State Commission first deciding whether the OPs ought to be permitted to lead the evidence sought to be placed on record.

We make it clear that we have not expressed any opinion on the merits of the rival claims. In particular, we do not deem it appropriate at this stage to record a finding on the validity of the offer of possession dated 16.10.2019, the OC, the increase in super area, the plea of force majeure, etc. These are best left open for consideration by the learned State Commission after the issue of the OPs' evidence is duly addressed.

The impugned order, therefore, cannot be sustained in its present form. The appropriate course, in the facts and circumstances of the case, is to set aside the impugned order and remand the matter to the State Commission for fresh adjudication.

Accordingly, the First Appeal No. 529 of 2024 is allowed by way of remand. The order dated 27.05.2024 passed by the learned State Commission in Consumer Complaint No. 1080 of 2019 is set aside and the matter is remanded back and the learned State Commission is directed to first take up and decide I.A. No. 1195 of 2023 filed by OPs seeking recall of the order dated 12.05.2023 closing their right to file evidence, in accordance with law and on its own merits. If the said Application is allowed, the State Commission shall permit the OPs to place their evidence on record and shall afford the Complainants an opportunity to respond thereto and decide the complaint. If the Application is declined, the learned State Commission shall proceed to adjudicate the Consumer Complaint on the basis of the pleadings and evidence otherwise available on record and decide the Complaint afresh, after affording adequate opportunity of hearting to both, uninfluenced by any observations contained in the impugned order or in the present order on the merits of the substantive disputes.

The parties are directed to appear before the State Commission on 21.10.2026. Considering the fact that the Complaint was instituted in 2019, the State Commission is requested to dispose of the same as expeditiously as possible, preferably within three months from the date of receipt of this order.

First Appeal No. 529/2024 and First Appeal No. 532/2024 stand disposed of in the above terms.

All pending Application(s), if any, also stand disposed of accordingly.