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Judgment
The present Complaint has been filed by Mr. Padam Sain Tyagi (also called as buyer) under section 31 and 71 of The Real Estate Regulation and Development Act, 2016 (in short, hereinafter being referred to as “the Act”) against the Respondents/builders.
Brief facts as stated in the complaint are that grievance of the Complainant relates to breach of contract, false promises and unfair trade practices committed by the Respondents with regard to 2BHK+2 toilets having Unit No. A-503, Tower-A, 5th floor with total super area of 900 sq.ft. @ Rs. 5000/- per sq.ft. (Net basic price of Rs. 45,00,000/-) including one car parking +Rs 2,02,500/- PLC+Rs. 1,00,000/-other charges booked by him with the respondents. It is further stated that total sale consideration amount of the said flat was Rs. 48,02,500/- situated in the project called “Antriksh Urban Greek at Delhi L-Zone, Dwarka Extn.” and complainant had made part payment of Rs. 9,00,000/- towards the sale consideration amount but after so many years, not even a single apartment at “Urban Greek Project, Dwarka, Delhi, L-Zone Dwarka Extn” was handed over to any buyer including the complainant.
It is further stated that said part payment of Rs 9,00,000/- was made from time to time as and when demanded by the respondents, but after so many years and onsite inspection, it was transpired that construction not even started. It is further stated that respondents were under obligation to inform the complainant about progress/status of the project but no satisfactory reply was given by them and subsequently a settlement agreement dated 9.05.2019 got executed between the parties, wherein 24 PDC (Post dated cheques) towards total paid amount of Rs. 9,00,000/- were handed over to the complainant by the respondents.
It is further stated that only an amount of Rs. 4,12,500/- was received by the complainant till march 2020 and thereafter cheques were dishonoured and remaining amount of Rs. 4,87,500/- is due & payable till date. It is further stated that respondents had given false promises, committed breach of contract & unfair trade practices due to which the complainant is suffering monetary loss, mental agony and harassment.
Complainant has prayed for the grant of following reliefs:
Direct the Respondents/sellers/developers/builders/promoters to return/refund the earnest sum of Rs. 4,87,500/-(Rupees Four Lakh Eighty Seven Thousand And Five Hundred Only) which is left unpaid out of the total sum of Rs. 9,00,000/- along with punitive charges and with interest of 24 percent per annum or at such rate prescribed under the RERA Act, 2016.
Direct the Respondents to pay Rs.4,87,500/-(Rupees Four Lakh Eighty Seven Thousand Five Hundred only) to the Complainant with interest which the Respondents had to pay to the Complainant after execution of settlement Agreement dated 09/05/2019
Direct the Respondents to pay compensation for mental agony and harassment, breach of contract, false promises, anxiety, stress and damages caused to the Complainant for the lapses and faults committed by the Respondents.
Direct the Respondents to pay legal expenses of Rs 50,000/-incurred by the Complainant.
On the other hand, Respondents have contested the complaint by filing a reply. It is submitted that present complaint is filed in order to extort money from them under the garb of vexatious litigation as Settlement Agreement was executed with the complainant and in furtherance of that an amount of Rs 4,12,500/- is already refunded to him. It is further submitted that respondents are ready to pay/refund the remaining principle amount of Rs. 4,87,500/- to the complainant on a monthly equitable basis.
It is further submitted that allegations made in the complaint are false and baseless as respondents had approached its buyers and offered the complainant for a refund of Rs.9,00,000/- in lieu of settlement agreement and as such he cannot claim any compensation and complaint may be dismissed.
Having heard the arguments on behalf of parties and considering the documents placed on record.
It is an undisputed fact that complainant had booked a flat with the respondents in their project at Antriksh Urban Greek Project Dwarka L-Zone Delhi in the year 2015 and part payment of Rs 9,00,000/- was made by him. It is also an undisputed fact that subsequently a settlement agreement dated 09.05.2019 was executed between the parties and said amount of Rs 9,00,000/- was to be paid by the respondents through 24 PDC (post dated cheques). It is also an undisputed fact that only amount of Rs. 4,12,500/- was refunded to the complainant and remaining principle amount of Rs 4,87,500/- is still payable by the respondents.
During the course of argument, Ld counsel for the respondents has argued that only the relief of compensation can be granted in the present complaint under form “N” as refund of principle amount of Rs. 4,87,500/- cannot be granted by the Adjudicating Officer and relied upon the recent judgment of Hon’ble Supreme Court in M/s Newtech Promoter and Developers Pvt Ltd. Vs State of UP & Ors etc 2021 SCC Online SC 1044.
Ld. Counsel for the complainant has also filed the written arguments, submitting that there is a deficiency in service on the part of respondents, as they have failed to adhere to their own commitments and committed unfair trade practices and caused mental agony to the complainant and as such he is liable to be compensated by the respondents.
Section 71 of the Act confers power upon an Adjudicating Officer to adjudge compensation under section 12, 14, 18, & 19. Sub Section (3) of Section 71 of the Act provides that if AO is satisfied that the person has failed to comply with the provisions of any of the sections specified in Sub- Section (1), he may direct to pay such compensation or interest, as the case may be, as he thinks fit in accordance with the provisions of any of those sections.
As per Section 72 of Act of 2016, following factors are to be taken in account by the Adjudicating Officer, while adjudging the quantum of compensation:
a. The amount of disproportionate gain or unfair advantage, wherever quantifiable, made as a result of the default;
b. The amount of loss caused as a result of the default;
c. The repetitive nature of the default;
d. Such other factors which the Adjudicating Officer considers necessary to the case in furtherance of justice.
In the instant matter, so far as the monetary loss and mental agony caused to the complainant in not getting the flat due to the non-performance by the respondents. It is an undisputed fact that a flat was booked by the complainant with the respondents and a sum of Rs. 9,00,000/ was paid towards total sale consideration amount and subsequently a settlement agreement dated 09.05.2019 was executed between the parties and only a sum of Rs. 4,12,500/- was refunded to the complainant; and remaining principle amount of Rs. 4,87,500/- is still due & payable by the respondents. It is worthwhile to mention here that despite the notice dated 07.10.2020 issued by complainant to the respondents, they have not refunded/paid the remaining principle amount of Rs. 4,87,500/- and present complaint was filed.
The Real Estate Regulation and Development Act, 2016 makes it clear that an application before AO is only for adjudging compensation or interest as the case may be. Reliance has also been placed upon the judgment of M/s Newtech Promoter and Developers Pvt Ltd. Vs State of UP & Ors etc 2021 SCC Online SC 1044 and relevant paras of the said judgment are reproduce here as under:
75.The legislature in its wisdom has made a specific provision delineating power to be exercised by the regulatory Authority/Adjudicating Officer. “ Refund of the amount”and “compensation” are two distinct components which the allottee or the person aggrieved is entitled to claim if the promoter has not been able to hand over possession with a nature of enquiry and mechanism provided under the Act. So far as the claim with respect to refund of amount on demand under Sections 18(1) and 19(4) of the Act is concerned, it vests within the jurisdiction of the regulatory Authority. Section 71 carves out the jurisdiction of the Adjudicating Officer to adjudge compensation under Sections 12, 14, 18 and 19 after holding enquiry under Section 71(3) of the Act keeping in view the broad contours referred to under Section 72 of the Act.
86.From the scheme of the Act of which a detailed reference has been made and taking note of power of adjudication delineated with the regulatory Authority and adjudicating officer, what finally culls out is that although the Act indicates the distinct expressions like ‘ refund’, ‘interest’, ‘penalty’ and ‘ compensation’, a conjoint reading of Sections 18 and 19 clearly manifests that when it comes to refund of the amount, and interest on the refund amount, or directing payment of interest for delayed delivery of possession, or penalty and interest thereon, it is the regulatory Authority which has the power to examine and determine the outcome of a complaint. At the same time, when it comes to a question of seeking the relief of adjudging compensation and interest thereon under Sections 12, 14, 18 and 19, the Adjudicating Officer exclusively has the power to determine, keeping in view the collective reading of Section 71 read with section 72 of the Act. If the adjudication under Sections 12, 14, 18 and 19 other than compensation as envisaged, if extended to the Adjudicating Officer as prayed that, in our view, may intend to expand the ambit scope of the powers and functions of the Adjudicating Officer under Section 71 and that would be against the mandate of the Act 2016.
In view of the discussion made above, it can be said that refund of the principle amount with interest cannot be granted by the Adjudicating Officer in the present complaint under form ‘N’. However, compensation can be granted to the complainant towards mental agony, harassment and monetary loss caused to him due to the non-performance & non compliance of agreements by the respondents. A plain reading of the provisions of the RERD Act, 2016 clearly shows that the legislative intent was to protect the affected allottees/homebuyers from the incorrect, false or misleading statements made by the promoters/builders.
It is well settled that the amount given by way of compensation is for the loss suffered by the complainant and the aggrieved party is entitled to receive reasonable compensation from the party, who has breached the terms & conditions of agreement. It is also well settled that reasonable compensation can be granted even in a case where extent of actual loss is incapable of proof or not proved, that is why Section-74 of the Indian Contract Act deliberately states that what is to be awarded is a reasonable compensation.
It is worthwhile to mention here that an amount of Rs. 9,00,000/- paid by the complainant to respondents in the particular year of 2015 was not spent on construction of the project, rather it was utilized by them to their unfair advantage. It is also worthwhile to note here that a sum of Rs. 4,12,500/- was refunded to the complainant in terms of the settlement agreement dated 09.05.2019 arrived at between them and remaining principle amount of Rs. 4,87,500/- is still payable to the complainant by the respondents.
In the facts & circumstances of the present matter, this forum is of the view that amount of Rs. 4,87,500/- payable to the complainant can be termed as disproportionate gain to the respondents. This forum is also of the view that complainant was deprived of his right for all those years, which has caused mental agony, harassment and monetary loss to him and deserves to be compensated for the same.
It is a matter of common sense and judicial notice can be taken in this regard that value of rupees is declining every year, due to inflation. It is a matter of record that part payment of Rs. 9,00,000/- towards sale consideration was given by the complainant in the year 2015, and only Rs. 4,12,500/- has been refunded by the respondents in lieu of settlement agreement dated 09.05.2019 and Rs. 4,87,500/-is still due and payable to the complainant.
In the instant matter, compensation is not quantifiable, however this forum consider that it would be appropriate, if an amount of Rs. 2,00,000/-( Two Lacs only) is awarded as compensation to the complainant to be paid by the respondents. Although, the complainant has not filed any receipt of payment as litigation fees paid to his counsel, however, it is evident from the record that complainant is being represented by an advocate. Therefore, complainant is entitled to the costs of litigation and a sum of Rs. 25,000/- is also awarded towards the litigation expenses.
Respondents are hereby directed to pay the compensation amount of Rs. 2,00,000/-(Two lacs only) along with interest @ 7% p.a from the date of this order till the realization of amount along with litigation expenses of Rs. 25,000/- within 45 days. Complaint stands disposed of accordingly. After uploading this order, file be consigned to the Record Room as per rules.