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Judgment
Dr. Inder Jit Singh, Presiding Member
The present First Appeal (FA) has been filed by the Appellant against Respondent as detailed above, under section 51 of Consumer Protection Act 1986, against the order dated 16.01.2019 of the State Consumer Disputes Redressal Commission, Punjab, Chandigarh (hereinafter referred to as the ‘State Commission’), in Consumer Complaint (CC) no. 604/2018 inter alia praying to modify the order by grant of interest @ 18% p.a. from 31.03.2006 to 14.07.2014 for delay in making construction and handing over the possession to the complainant.
Notice was issued to the Respondent. On account of non-appearance of the respondent despite notice, respondent was proceeded ex-parte. Appellant was heard through a counsel.
Brief facts of the case, as emerged from the FA, Order of the State Commission and other case records are that:-
The OP/Respondent initiated a cooperative housing scheme in Sector 79, SAS Nagar, Mohali, providing various types of flats. The Complainant/Appellant secured an allocation letter on 24.03.2004 but encountered potential construction delays due to court proceedings on 27.06.2006. Despite no court order causing delays as of 21.10.2009, the OP incorrectly attributed the delay to legal issues and presented the Complainant with the option to either withdraw the earnest money or accept the flat at an elevated cost. The Complainant opted for the latter. Construction commenced only in late 2010 following concerns raised by allottees. A demand notice on 14.07.2014 requested a final cost of Rs.41,86,000/-, significantly surpassing the initial allotment price of Rs.12 Lacs. The sale deed, originally due within three years, was delayed until 01.06.2015, with the conveyance deed executed in 2018. Acknowledging negligence, the OP refunded Rs. 3,34,000/- to the Complainant on 20.10.2015. The Complainant alleges deficiency of service on OP’s part, intentional construction delays, and an unjust financial burden. The State Commission partially allowed the complaint. Seeking a modification of the order, the Complainant has filed this appeal.
Top of FormVide Order dated 16.01.2019, The State Commission, in its partial allowance of the complaint, has directed the OP to pay the amount of Rs. 3,34,000/- along with an interest rate of 12% per annum. This interest accrues from the date of charging until the refund of the said amount to the complainant.
Appellant has challenged the Order dated 16.01.2019 of the State Commission mainly on following grounds:
(i) The order dated 16.01.2019 issued by the State Commission is incorrect and unlawful in its denial of interest on the sum deposited during the delay in transferring possession of the flat to the appellant/complainant. It is imperative to modify the order to incorporate interest from 31.06.2006 to 14.07.2014 on 60% of the previously deposited amount. The State Commission failed to adequately recognize that, as per the payment schedule, eight quarterly installments were stipulated to be collectible during the construction phase. Notably, the construction was slated to commence by 30.06.2004, as per the agreement. However, the OP remained silent on this matter, continuing to collect installments despite the absence of construction activity. This constitutes an unfair trade practice, and the OP was not justified in collecting the specified amount without commencing construction, as explicitly promised in the promotional brochure.
(ii) The State Commission acknowledged the absence of a specific/exact date for handing over possession of the flats to the allottees, categorizing it as an unfair trade practice. Despite this acknowledgment, the Commission did not grant interest on the deposited amount. Furthermore, the Commission's observation regarding a stay by the Hon'ble High Court, asserting that no specific order restrained the OP from constructing on the allotted land for Complex No.1, has been duly acknowledged. The OP bears sole responsibility for the delay in construction; following the possession of the allotted land on 22.01.2010, the OP should have proactively sought an alternative piece of land from PUDA GMADA to expedite the project's completion. The failure to take such corrective action amounts to deficiency in service and an unfair trade practice. Negligent officers in this regard are liable to pay interest on 60% of the amount paid by the allottees from their own resources.
(iii)The State Commission's observations, that no specific period for the delivery of possession was mutually agreed upon by the parties and that there is no condition in the allotment letter or any other document specifying possession, are incorrect. The brochure explicitly outlines the collection of installments until 31.03.2006, during the construction period, implying that possession should have been handed over by March 2006. Consequently, there has been a delay of approximately 8 years. The State Commission's error is further evident in its observation that the increased and exact/final cost was determined after the completion of the flat, rendering the prayer for interest on the deposited amount unattainable. This observation lacks logical reason.
(iv)The State Commission's observation suggesting that the OP could not complete the project due to the operation of a stay order issued by the Hon'ble High Court is erroneous. No such order restraining the OP from construction has been presented, and this observation lacks evidential support. It is essential to note the principle articulated by the Hon'ble Supreme Court in M/s. Shantistar Builders v. Narayan Khimalal Totame & Ors., AIR 1990 SC 630, emphasizing that there can be no indefinite delay in the construction of flats. The Court recognized that a reasonable residence is crucial for fulfilling the Constitutional goal in the matter of development. Given the absence of a valid reason for the delay and the fact that the allottees' funds remain unused with the OP, it is justifiable for interest to be paid to the allottees on the money deposited, which has not been utilized in the construction process.
Heard counsel for Appellant.
During the hearing on 24.11.2023, the Appellant stated that vide impugned order dated 16.01.2019, nine Consumer Complaints were disposed of together. Appellant states that out of 9 Consumer Complaints, 7 Consumer Complaints Nos. viz. 602/2018, 605/2018, 606/2018. 607/2018, 608/2018, 609/2018, 610/2018 arising out of common order in FA/519/2019, 520/2019, 521/2019, 522/2019, 523/2019, 524/2019 and 525/2019 were disposed of by this Commission’s order dated 25.02.2020. He prays that this First Appeal may also be disposed in terms of same order.
This Commission, vide order dated 25.02.2020 in FA 1642 of 2018 and related cases, which covered FAs 519/2019, 520/2019, 521/2019, 522/2019, 523/2019, 524/2019 and 525/2019 which were against 7 CCs viz 602/2018, 605/2018, 606/2018, 607/2018, 608/2018, 609/2018 and 610/2018 covered under the same impugned order dated 16.01.2019 of State Commission, has decided as follows:-
i. Respondent/OP to pay Interest @ 9% to the Appellant/Complainant on the excess amount of Stamp duty (Interest of 12% awarded by State Commission).
ii. Compensation by way of Interest @4% p.a. to be paid by Respondent/OP on the amount which the Appellant/Complainant had paid to the Respondent/OP till the date on which possession of the land was received by it.
iii. Payments to be made within 8 weeks of the date of order.
Accordingly the present FA is also decided in terms of said order dated 25.02.2020 of this Commission.
The pending IAs in the case, if any, also stand disposed off.