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Judgment
A complaint was filed in FORM ‘M’ on 09.06.2021 by Mr. Atul Gupta (hereinafter referred to as “Complainant”) stating that in the year 2010 he approached “M/s Parsavnath Landmark Developers Pvt. Ltd.” (hereinafter referred to as “Respondents”) for booking of an apartment in the Respondents project, “La Tropicana Khyber Pass, Civil Lines”, Delhi (hereinafter referred to as “project”).
The Complainant executed a Flat Buyer Agreement (hereinafter referred to as “Agreement”) dated 05.09.2011 with the Respondents for unit no. T9-902 with 3480 sq. ft. super built up area at a total cost of Rs. 4,00,89,600/- (Rupees Four Crore Eighty Nine Thousand and Six Hundred Only). He stated he has paid an amount of Rs.3,10,91,083/- (Rupees Three Crore Ten Lakh Ninety One Thousand and Eighty Three Only) to the Respondents for the flat till date.
The Complainant intends to withdraw from the project owing to change in size of the flat, unreasonable delay in completion of the project and violation of various provisions of RE (RD) Act of 20161.
The Respondents vide letter dated 17.07.2018 communicated to him that the unit allotted to him earlier has been changed from T9-902 with super built up area of 3480 sq. ft. to T8-1101 with super built up area of area 3550 sq. ft. without his consent. Therefore, he seeks refund of amount deposited with Respondents along with interest.
A preliminary hearing in this case was held on 20.07.2021 and a notice to the Respondents was issued on same date.
The matter was heard in several hearings dated 20.07.2021, 24.08.2021, 10.11.2021, 15.12.2021, 20.01.2022 and 09.03.2022. The Respondents filed their reply on 28.10.2021.
We have heard the arguments and perused the records. For the sake of convenience, the arguments and submissions made on behalf of Respondents are summarized as under:
M/s Parsavnath Developers Ltd. got the lease right of the land for the development of the subject project from Delhi Metro Rail Corporation Limited (DMRC) vide allotment letter dated 08.03.2004.
Due to, inter se, dispute between the government agencies i.e., DMRC and Land and Development Office, there was a delay in the project, the same could be resolved in the year 2019. For the resolution of certain disputes, the Residents Welfare Association (RWA) of the allottees namely LA Tropicana Association (LTRA) had approached Hon’ble National Consumer Disputes Redressal Commission (NCDRC). Before the Hon’ble NCDRC, a Memorandum of Understanding (MoU) between the Promoter and RWA of the allottees was executed on 30.04.2019 which was further amended vide Amended Agreement dated 27.10.2020.
The MoU dated 30.04.2019 has been ratified by the Hon’ble High Court of Delhi in the suit filed by LTRA bearing number CS (OS) No. 2030 of 2014 titled “La Tropicana Resident Association vs. Parsavnath Landmark Developers Pvt. Ltd.” and consequently vide order dated 13.08.2019, the Hon’ble High Court of Delhi was pleased to decree the said Suit in terms of MoU.
As per the terms and conditions of the MoU’s dated 30.04.2019 and 27.10.2020, the timelines for completion of the project have been revised and the remaining construction work of the project is to be completed in accordance with the revised timelines as mentioned in MoU cum Amended Agreement dated 27.10.2020. The Hon’ble NCDRC had also taken note of these MoU’s in their orders dated 30.04.2019, 11.09.2019 and 28.10.2020. The Hon’ble NCDRC has also stated in their order dated 28.10.2020 that the Amended Agreement dated 27.10.2020 shall be binding and applicable on all the allottees of the project. The construction of the said project is being carried out in terms of the MoU and any violation of the conditions of MoU’s would amount to contempt of the Court.
The Hon’ble Supreme Court of India vide orders dated 29.01.2021 and 09.04.2021 has upheld the judgement passed by the Hon’ble NCDRC and the Complainant is bound by the terms of the MoU dated 30.04.2019 cum Amended Agreement dated 27.10.2020.
Analysis and Consideration:
A perusal of the documents available on record shows that the Respondents have issued fifteen receipts dated 11.09.2010, 09.10.1010, 10.11.2010, 12.01.2011, 21.04.2011, 10.01.2012, 22.05.2012, 01.06.2012, 05.10.2012 and 12.02.2013 acknowledging deposits of Rs.38,650/-, Rs.15,00,000/-, Rs.25,08,960/-, Rs. 64,606/-, Rs.1,18,680/-, Rs.46,08,960/-, Rs.32,07,168/-, Rs.82,585/-, Rs.32,89,726/-, Rs.32,07,168/-, Rs. 82,585/-, Rs.32,89,752/-, Rs.33,06,269/-, Rs.28,92,986 and Rs.28,92,986/- respectively. Hence, payment of Rs.3,10,91,083/- (Rupees Three Crore Ten Lakh Ninety One Thousand and Eighty Three Only) by the Complainant to the Respondents is a recorded fact.
It has been argued by the Respondents that as per the terms and conditions of the original MoU dated 30.04.2019 and Amended Agreement dated 27.10.2020, the timeline for completion of the project has been revised. The remaining construction work of the project will be completed in accordance with the revised timelines.
The RE (RD) Act, 2016 has been enacted to induct professionalism and standardization in the real estate sector accelerating growth and investments in the long run. This Act is a special law enacted to address issues in the real estate sector. All dispute between homebuyers/allottees and promoters/developers of a real estate project, covered under RE (RD) Act of 2016, can be raised before the Real Estate Regulatory Authority (RERA).
The statement of objects and reasons of the RE (RD) Act, 2016 clearly states that it attempts to balance the interests of consumers and promoters by imposing certain responsibilities on both. It seeks to establish symmetry of information between the promoter and purchaser, enhance transparency of contractual conditions and also sets minimum standards of accountability and a fast-track dispute resolution mechanism.
An allottee/home buyer can seek refund of amount invested with promoter under Section 18 of RE (RD) Act, 2016, if the promoter fails to complete the project by the date specified in Agreement for Sale with interest including compensation and also under Section 12 of RE (RD) Act, 2016 if he/she was misled by any information furnished by promoter with regard to the project either through advertisement or otherwise.
In the present complaint, the Complainant intends to withdraw from the said project and is seeking refund of the amount paid to the Respondents in respect of subject unit under Section 18(1) of the RE (RD) Act, 2016 which reads as under:
“Section 18. Return of amount and compensation.-
18(1). If the promoter fails to complete or is unable to give possession of an apartment, plot, or building, —
(a). in accordance with the terms of the agreement for sale or, as the case may be, duly completed by the date specified therein; or
(b). due to discontinuance of his business as a developer on account of suspension or revocation of the registration under this Act or for any other reason,
he shall be liable on demand to the allottees, in case the allottee wishes to withdraw from the project, without prejudice to any other remedy available, to return the amount received by him in respect of that apartment, plot, building, as the case may be, with interest at such rate as may be prescribed in this behalf including compensation in the manner as provided under this Act.”
Section 12 of the RE (RD) Act, 2016 casts duty upon the promoter to provide correct and updated information to allottees regarding the project. It reads as under:
Section 12. Obligations of promoter regarding veracity of the advertisement or prospectus.-
“Where any person makes an advance or a deposit on the basis of the information contained in the notice advertisement or prospectus, or on the basis of any model apartment, plot or building, as the case may be, and sustains any loss or damage by reason of any incorrect, false statement included therein, he shall be compensated by the promoter in the manner as provided under this Act: Provided that if the person affected by such incorrect, false statement contained in the notice, advertisement or prospectus, or the model apartment, plot or building, as the case may be, intends to withdraw from the proposed project, he shall be returned his entire investment along with interest at such rate as may be prescribed and the compensation in the manner provided under this Act.”
The Respondents, in complete disregard to their duties have apparently failed to furnish correct information to the Complainant regarding the reasons for delay in implementation of the project.
The Ld. Counsel for the Respondents submitted that as per the MoU dated 30.04.2019 and Amended Agreement dated 27.10.2020 the construction work of the project is being undertaken in accordance with the revised timelines. He submitted that Hon’ble NCDRC has taken the said MoU on its record and vide its order dated 11.09.2019 has stated that the MoU shall be binding and applicable on all the allottees of the project. He argued that delay in completion of the project is on account of inter se dispute between the government agencies which could be resolved in the year 2019.
We have gone through the orders of the Hon’ble NCDRC. The dispute before us is not only with regard to the alleged delay in completion of the project but also change in location & size of the flat booked by the Complainant. The order of Hon’ble NCDRC in this case entitles the Respondents to continue with the project with the changes, modifications permitted considering conditions as mentioned in Section 14(2)(ii) which requires the consent of 2/3rd allottees, fulfilled.
We are of the considered opinion that this order of NCDRC, does not affect the bilateral understanding and agreement between the Complainant and the Respondents with regard to the allotment of a particular flat of a particular size. Any such bilateral agreement between the promoter/builder and the homebuyer is recognized in Section 14(2)(i) of the RE (RD) Act, 2016, which conveys in clear terms that to make any addition and alteration in the sanctioned building or layout plans or specifications in respect of an apartment or building the previous consent of the buyers is mandatory.
Section 14(2)(i) of RE (RD) Act, 2016 reads as under:
“……….. …….(2) Notwithstanding anything contained in any law, contract or agreement, after the sanctioned plans, layout plans and specifications and the nature of the fixtures, fittings, amenities and common areas, of the apartment, plot or building, as the case may be, as approved by the competent authority, are disclosed or furnished to the person who agree to take one or more of the said apartment, plot or building, as the case may be, the promoter shall not make-
(i)any additions and alterations in the sanctioned plans, layout plans and specifications and the nature of fixtures, fittings and amenities described therein in respect of the apartment, plot or building, as the case may be, which are agreed to be taken, without the previous consent of that person:…..”
The Respondents in their reply have admitted in para 6 (v) that the originally allotted unit of the Complainant has been changed from T9-902 to T8-1101. Annexure R-9, attached to the reply is a letter dated 17.07.2018 whereby Respondents have intimated the Complainant about the change. As per Section 14(2) (i), the Respondents could not have changed the allotment without the consent of the Complainant. Thus, the Respondents are in violation of Section 14(2)(i) of the RE(RD) Act, 2016. A homebuyer invests his/her hard earned money to buy a house after ascertaining its size and location. He cannot be forced to take flat at a changed location in a project without his/her consent. Thus, he has every right to withdraw from the project if the re-location is not as per his choice or consent.
A plain & simple reading of provisions of the RE(RD) Act, 2016 shows that the allottees/home buyers hold an unqualified right to seek refund along with interest as prescribed and the Authority hold the exclusive jurisdiction to direct refund along with interest. This view has been upheld in judgments in cases: “Imperia Structures Ltd. Vs. Anil Patni and Another, 2020 (10) SCC 783, and Newtech Promoters and Developers Pvt. Ltd. v. State of UP And Ors. LL 2021 SC 641” by the Hon’ble Supreme Court. Any construction of the language used in Sections 12 & 18 to deprive the allottee / home buyer of their right to refund would be absurdity & render the object of the Act unattainable.
In the light of the aforesaid, we consider it appropriate to direct the Respondents, M/s Parsavnath Landmark Developers Pvt. Ltd. to refund the entire amount of Rs.3,10,91,083/- (Rupees Three Crore Ten Lakh Ninety One Thousand and Eighty Three Only) to the Complainant within 45 days of issuance of this order along with interest at the rate of 10% per annum (MCLR+2%) from the date of payment of each sum until the date of its actual return.
The case is disposed of accordingly.
No orders as to costs.
Footnotes
- 1.The Real Estate (Regulation and Development) Act, 2016