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Judgment
Dinesh Singh, Presiding Member
This appeal has been filed under section 19 of the Act 1986 in challenge to the Order dated 01.11.2018 of the State Commission in complaint no. 250 of 2018.
Repeatedly called out, intermittently. No one appears.
It is seen that on the previous occasion i.e. on 25.05.2022 also no one had appeared.
Perused the record, including inter alia the State Commission’s impugned Order dated 01.11.2018 and the memorandum of appeal.
The case relates to a builder-buyer dispute.
In paragraph 6 of its Order the State Commission has dismissed the preliminary objection that the complainants (the respondents herein) were not ‘consumer’ under the Act 1986. The same is reproduced below:
From hearing the respective submissions of counsel for the parties and from perusal of record, the first point emerging for adjudication in this case is as to whether the complainants are proved to be consumers of OP or not. The complainants are husband and wife and they are members of the same family and the The Imperial Golf Estate project developed by OP is purely residential township only. It is residential plot, which was allotted by OP to complainants for the above referred price. The onus, thus, shifts upon OP to prove that complainants purchased the residential plot for investment purposes to earn profits only and not for their genuine residential requirement. There is nothing on the record that complainants are property dealers or habitual in sale and purchase of the plots and flats business. In the absence of these averments and evidence on the record in support of them, we can safely syllogize from the allotment of the plot in residential project to complainants that it was purchased for residential purposes only by them. The contention of OP on this point is not accepted by us.
In paragraph 7 its Order the State Commission has dismissed another preliminary objection that because there was an arbitration clause in the agreement the complaint was not maintainable. The same is reproduced below:
The next submission of counsel for OP is that there is an arbitration clause in the buyers agreement and such the consumer complaint is not maintainable at all. The matter has been settled by larger bench of Hon'ble National Commission in consumer complaint no.701 of 2015, decided on 13.07.2017 titled as "Aftab Singh Vs. EMAAR MGF Land Limited and another". The National Commission has held in this authority that an arbitration clause in the afore-stated kind of Agreements between the complainants and the builder cannot circumscribe the jurisdiction of a Consumer Forum, notwithstanding the amendments made to Section 8 of the Arbitration Act, 1996. Against this order of the National Commission, Civil Appeal nos.23512-23513 of 2017 titled as EMAAR MGF Land Limited and another Vs. Aftab Singh" was filed by OP before the Top Court, which has been recently dismissed by the Apex Court, vide order dated 13.02.2018. Consequently, the existence of an arbitration clause is not a bar to resolution of this dispute by the Consumer Forum. Even otherwise, the Apex Court has also so held in “National Seeds Corporation Limited Vs. M. Madhusudhan Reddy and another” 2012(2)CLT-382/383 and in Fair Air Engineers (P) Ltd. vs. N. K. Modi (1996) 6 SCC 385 that Section 3 of C.P. Act gives additional remedy to consumers to avail of his remedy as per his choice. In view of Section 3 of C.P. Act conferring the additional remedy on the consumers, we find no force in this submission of OP and repel the submission of OP.
In paragraph 8 of its Order the State Commission has dealt with the substance of the dispute on merits and determined that there was deficiency in service on the part of the builder co. (the appellant herein). The same is reproduced below:
Now, we touch this point as to whether OP has been deficient in service in not developing the project and to deliver the possession of the allotted plot to complainants within scheduled time. This fact is not in much controversy in this case is that the total sale price of the plot is Rs.42,54,450/-. The complainants have paid nearly about 90% of total sale consideration amount to OP. It is requirement of law that buyers agreement be executed by promoter/builder after receipt of 25% of the sale amount from the allottee. Herein in this case, the OP received major amounts of sale consideration from complainants, but failed to execute the buyers agreement even after receipt of 25% of the amount out of sale consideration amount in their favour. This is unfair trade practice on the part of OP, as OP has give a complete go by to statutory provision of law on this point. The OP executed buyers agreement on 18.02.2014 after receipt of almost substantial amounts of sale consideration, which is unfair on its part. The OP has not deposited this amount received from complainants in any scheduled bank as mandated by law in a separate account. The OP utilized the received amounts from complainants without caring to bother about opening the separate account in the scheduled bank of this amounts to keep proper account thereof. The complainants asserted in the complaint and also in affidavit Ex.C-A that OP has not completed the basic amenities in the project, as referred to above till the filing of the complaint. The OP denied this assertion of the complainants by contending that it has completed the development work. The OP has not placed on record the completion certificate from the concerned competent authorities, as to on which dated it was completed. The OP only relied upon partial completion certificate Ex.OP-1 dated 25.05.2017. It is only partial completion certificate and not completion certificate of the project. A partial completion certificate cannot take the place of completion certificate, as contemplated by law. Some time on partial completion of some facilities, the partial completion certificate is granted by the competent authorities which does not indicate the completion of the project as mandated by law. It is conditional in nature only. The OP relied upon photographs Ex.OP-4 on the record regarding development of the project in question, but these photographs are clicked after three months from the date of filing this complaint only. As per clause 12(1)(a) of the buyers agreement Ex.C-5, which mandates OP to complete the project and to offer the possession of said unit to buyers after a period of 24 months with extended period of six months from the date of execution of this agreement. The buyers agreement is executed in violation of law by OP and is dated 18.02.2014. The scheduled period of two years and six months expired on 18.08.2016 in this case for delivery. The OP wrote letter of possession to complainants on 15.09.2017 after one year period therefrom. Even this letter of offer of possession is on the basis of partial completion certificate dated 25.07.2017 and not a completion certificate. We have already observed that a partial completion certificate cannot supplant the completion certificate to be issued by competent authority under law. Even if OP is exempted from the provisions of PAPRA Act, 1995, it does not mean that OP can deliver the undeveloped plot to complainants without developing it. The complainants/allottees can refuse to receive the possession, if the promoter has not delivered the possession to them within scheduled period of time after developing it. The allottee is not under any obligation to receive the possession with delay of one year from the scheduled date of delivery of possession, more so when there was no completion certificate at the time of offer of above possession by OP. Consequently, the complainants have proved that OP received the substantial amounts of sale consideration from them, but failed to deliver the possession of the plot by developing it within scheduled time by August 2016. Even no completion certificate has been shown to us by counsel for OP during arguments of this appeal to the effect that the project has been fully completed and the offer of possession was actual and legal one. Even partial completion certificate Ex.OP-1 has been issued on compliance of certain conditions by OP only meaning thereby it has yet to complete the remaining part of the project. In this view of the matter, we have come to this conclusion that OP is deficient in service in not executing the buyers agreement promptly in favour of complainants after receiving 25% of the sale amount. The OP has also not kept the money received from complainant in a separate account in some scheduled bank and flouted it. There is no completion certificate with OP as yet and partial completion certificate cannot take the place of completion certificate. The OP failed the deliver the possession within scheduled time and did not execute the buyers' agreement despite receipt of substantial amount of sale consideration from complainants within time. The OP is deficient in service for the reasons recorded above. The contention of OP that as per clause 13(b) of buyers agreement, the refund could be given by OP with 90 days notice given to it, only after deducting 10% of the amount. The OP cannot get benefit of this clause 13(b), because OP has been found deficient in not developing the project within scheduled time and not delivering the allotted plot to complainants within scheduled time. This contention of OP is repelled by us. The counsel for OP relied upon law laid down in "Baljit Singh Sandhu Vs. Jalandhar Improvement Trust" 2016(4)CPR-202. This authority is distinguishable from the facts of the case. In the cited authority, the complainant did not pay 25% of the sale price of the plot within aforesaid period as per terms and conditions of allotment. This authority was handed down due to default of complainant/allottee himself in not making the payment. Reference was also made to law laid down by the Apex Court in "H.U.D.A. Vs. Kewal Krishan Goel & others" 1996 SCC (4)-249. This authority pertains to the point of earnest money being part of purchase price when the transaction fails and money is forfeited by reason of default on the part of vendee. This authority is not attracted to the fact situation of the case in any way and is distinguishable in this case.
In paragraph 9 of its Order the State Commission has firmed up its award. The same is reproduced below:
As a result of our above discussion, the complaint of complainants is accepted and OP is directed to refund the entire deposited amounts of complainants Rs.38,28,550/- with interest @12% per annum from the date of their respective deposits till actual payment. The OP is further directed to pay Rs.60,000/- for mental harassment and Rs.20,000/- as costs of litigation to the complainants. These amounts shall be payable by OP to complainants within 45 days from the date of receipt of certified copy of the order.
A plain reading shows that the State Commission has passed a well-appraised and reasoned Order, and has aptly dealt with the issues germane to the matter. The preliminary objections have been dismissed with valid reasons. The evidence has been weighed in the right perspective, and deficiency on the part of the builder co. has been duly determined. There appears to be no misappreciation of the evidence or misapplication of the law in the State Commission’s appraisal.
Having been well established that the builder co. had failed to complete the project and legitimately deliver possession of the subject unit to the complainants within the promised time-frame, the State Commission has ordered for refund of the amount of Rs. 38,28,550/- deposited by the complainants with interest at the rate of 12% per annum along with lumpsum compensation of Rs. 60,000/- for the mental harassment and Rs. 20,000/- as the cost of litigation.
There can be no two opinions that the amount deposited by the complainants has necessarily to be refunded by the builder co. since it failed in its promise to deliver possession of the subject unit within the assured time-frame. There can also be no two opinions that just and equitable interest on the deposited amount ought to be paid by the builder co.
In respect of the rate of interest, considering the overall facts and circumstances of the case, the manifest deficiency on the part of the builder co. in not completing the project and delivering possession of the subject unit within the committed time-frame, considering the continuous and continuing troubles and travails being faced by the complainant, it is felt that the rate of interest of 12% per annum awarded by the State Commission is just and equitable, commensurate with the loss and injury suffered by the complainants.
On the face of it no good ground is forthcoming as may warrant interference in the State Commission’s impugned Order.
As such no miscarriage of justice would be occasioned if the appeal is dismissed in default in the absence of the appellant builder co. today.
The present appeal no. 147 of 2019 stands dismissed in default for lack of prosecution.
The amount if any deposited by the builder co. with the State Commission in compliance of this Commission’s Order dated 13.02.2019 along with interest if any accrued thereon shall be forthwith released by the State Commission to the complainants as per the due procedure. The balance awarded amount shall be made good by the builder co. within six weeks from today, failing which the State Commission shall undertake execution, for ‘enforcement’ and for ‘penalty’, as per the law.
The Registry is requested to send a copy each of this Order to the parties in the appeal and to their learned counsel as well as to the State Commission immediately. The stenographer is also requested to upload this Order on the website of this Commission immediately.