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Judgment
Sudip Ahluwalia, Member
This Complaint has been filed under Section 21 of the Consumer Protection Act, alleging deficiency in service and unfair trade practice on the part of the Opposite Parties and seeking allotment of the Flat, or in the alternative, refund of the amount paid along with ancillary reliefs.
The factual background is that in the year 2008, the Opposite Party No. 1 initiated the construction of a housing society named Sarva Mangal at Building No. 15, Plot CTS no. 19(Pt.), Tilak Nagar, MHADA Colony Chembur, Mumbai. In July 2013, the Complainants expressed interest in purchasing a 3 BHK Flat in the society and were allotted Flat No. 1503 on the 15th Floor of Wing B, with an approximate carpet area of 880 sq.ft. The Complainants requested copies of relevant documents, including permissions from authorities and the approved layout plan, but the Opposite Parties failed to provide the same. Relying on assurance that all necessary permissions were in place, the Complainants agreed to purchase the Flat for Rs. 1 crore. They executed an Agreement to Sale on 10.07.2013 and paid an advance of Rs. 10,00,000/-. The remaining balance was settled through cheques/RTGS in July 2013. As per Clause 12(a) of the Agreement, possession was to be granted by December 2014. However, the Opposite Parties offered only "symbolic possession" in a letter dated 17.11.2015, requiring the Complainants to pay maintenance charges and taxes from that date. Despite requests, the Opposite Parties did not provide a Completion/Occupancy Certificate for the building. In November 2016, Opposite Party No. 2 announced that they would cease maintaining the Society from 01.01.2017, prompting the Flat owners to form an ad hoc committee for maintenance. The Complainants incurred additional expenses of Rs. 42,500/- towards maintenance charges. Upon taking symbolic possession, the Complainants received a property tax bill dated 23.01.2018 revealing that the Flat was partially built on a 'refuge area' of 268.13 Sq. Ft. This led to the realization that the Flat was sold illegally by the Opposite Parties, who also failed to provide the promised amenities such as power backup and fire safety systems. Feeling aggrieved by these deficiencies in service and unfair trade practices, the Complainants have filed this Complaint.
In view of the aforesaid facts, the Complainants have prayed for the following reliefs
a. Allow the Complaint and hold the Opposite Parties liable for deficiency in service and unfair trade practice;
b. Direct the Opposite Parties to allot another flat to the Complainant in the same society/neighbourhood, that is having a carpet area of at least 880 sq. fts. approx. and that is acceptable to the Complainants;
Or in the alternative;
To pay/refund the amount of Rs. 72,00,795/- towards the market value of the additional carpet area of 285.18 sq. ft. (268.13 sq. ft. of refuge area + 17.05 sq. ft. area increased on paper)sold illegally along with interest @ 18% p.a.;
c. Direct the Opposite Parties to forthwith refund an amount of Rs. 1,79,550/- illegally collected by them on account of maintenance charges from the Complainants along with interest@l8% p.a.;
d. Direct the Opposite Parties to reimburse the additional maintenance charges to the tune of Rs. 42,500/- that had to be paid by the Complainants to the ad hoc committee towards maintenance charges along with interest @18% p.a.;
e. Direct the Opposite Parties to reimburse the property tax of Rs. 34,554/- that had to be paid by the Complainants in respect of the said Flat despite the fact that no proper possession of the said Flat has been given to the Complainant till date, along with interest @ 18% p.a.;
f. Direct the Opposite Parties to bear all future costs, taxes and charges in respect of the said Society, including maintenance charges, till expiry of 24 months from the date of receipt of occupation certificate in respect of the said Society;
g. Direct the Opposite Parties to pay compensation to the Complainants to the tune of Rs. 25,00,000/- for mental harassment and agony caused to the Complainant due to deficiency of service, unfair trade practice and illegal activities of the Opposite Parties;
h. Direct the Opposite Parties to pay Rs. 1,00,000/- to the Complainants towards cost of litigation.
Ld. Counsel for Complainants has argued that according to the terms of the Agreement, the Complainants were slated to take possession of the Flat by December 2014. However, a fundamental prerequisite for the valid transfer of possession of a Flat is the receipt of an Occupancy Certificate pertaining to the tower where the flat is situated, which, in this instance, has not been obtained till date. Consequently, the Opposite Parties only tendered a "symbolic possession," falling short of legal possession requirements; That according to the Order of this Commission in Chaya Pradeep Bavadekar & Ors. v. M/s Kamla Ankur Developers, 2016 SCC OnLine NCDRC 1890," it was held that a builder is accountable for delay compensation until the issuance of the Occupancy Certificate;
That Clause 3(a) of the Agreement stipulates that the Opposite Parties are obligated to cover the maintenance expenses of the entire society and are liable for all associated taxes and charges until 24 months subsequent to the offer of possession. However, the Opposite Parties ceased maintenance of the society from January 1, 2017, constituting a severe deficiency in service; That the Opposite Parties unlawfully diverted Rs. 1,79,550/- collected from the Complainants as advance maintenance charges but failed to fulfill their maintenance obligations; That the Flat sold to the Complainants is unlawful, as evidenced by the Property Tax bill from the Mumbai Municipal Corporation dated January 23, 2018, indicating that construction was carried out on a designated 'refuge area.' Copies of the Fire NOC and approved Site Plan of the Society reveal that the area size of the Flat was intended to be only 594.825 Sq. Ft, yet the opposing parties illicitly amalgamated the 'refuge area,' measuring approximately 268.13 Sq. Ft., in an attempt to extract additional funds from the Complainants.
Heard the Ld. Counsel for the Complainants and perused the material available on record.
This Commission vide the Order dated 20.11.2019 had proceeded ex-parte against the Opposite Parties as they did not appear despite being served Notices.
The records indicate that according to the Agreement, particularly as outlined in Clause (a) on Page 44 (Pg. 87 of Paperbook), the Opposite Parties were obligated to provide possession of the Flat to the Complainants by December 2014. However, there was a delay in meeting this possession deadline. The belated possession offer, communicated through the Opposite Parties' letter dated 17.11.2015, was also deemed 'symbolic,' lacking the requisite Completion/Occupancy Certificate. Consequently, the delay persists unabated up to the present date. It is relevant to refer to the Order of the Honble Apex Court in Samruddhi Coop. Housing Society Ltd. v. Mumbai Mahalaxmi Construction (P) Ltd., (2022) 4 SCC 103, the relevant extract is set out as below
25. In the present case, the respondent was responsible for transferring the title to the flats to the society along with the occupancy certificate. The failure of the respondent to obtain the occupancy certificate is a deficiency in service for which the respondent is liable. Thus, the members of the appellant Society are well within their rights as consumers to pray for compensation as a recompense for the consequent liability (such as payment of higher taxes and water charges by the owners) arising from the lack of an occupancy certificate.
The purported 'symbolic' offer of possession appears to have been made solely to evade the payment of any delay charges, and extending possession without the requisite Occupancy Certificate undoubtedly constitutes a deficiency in service on the part of the Opposite Parties. The Complainants have asserted that delivery of the Flats allocated to them is partially illegal or irregular, citing the Property Tax Bill as evidence. However, the absence of any copy of those bills in the record hinders the corroboration of this claim. Furthermore, no Affidavit in Evidence has been submitted on their behalf, rendering it difficult for this Commission to affirm this contention without a thorough examination of the pertinent documents. Nevertheless, the Complainants' argument regarding the deficiency in services concerning maintenance would appear to have merit. Clause 3(a) of the Agreement inter alia provides
(a) After, the expiry of two years of offer of possession to the purchasers during the period which the Developers have agreed to maintain at their own cost the said unit subject to payment of statutory and other charges as specified in these presents by the Purchaser/s for the said period of 24 months and further if any society or company or association of the purchasers of units (herein after referred to as the said Society) is not formed and the Developers are required to maintain the said building, the Purchaser/s shall be liable to pay the maintenance charges in advance and other charges of the said unit as demanded by the Developers and the Purchaser/s from time to time shall be liable to bear and pay all outgoings and maintenance charges
In the present matter, the Opposite Parties have provided only a symbolic possession without furnishing the requisite Occupancy Certificate. Such an offer does not constitute a proper transfer of possession, and it remains incumbent upon the Builder to maintain the Society until the Occupancy Certificate is acquired. However, the Opposite Parties prematurely ceased maintenance in 2017, apparently on the pretext that there was a valid transfer of possession to the Flat Owners, which is incorrect. The Order of this Commission in Madhusudhan Reddy R. v. VDB Whitefield Development (P) Ltd., 2022 SCC OnLine NCDRC 13 is pertinent in this regard. The relevant extracts are set out as below
27. Regarding the issue of maintenance charges, it is fact that, the Complainants have taken physical possession of their respective units. It would be logical that, there would be expense on the maintenance of certain common services. It is also a fact that, the Occupancy Certificate has not been obtained yet. It means that the project is not yet fully complete and that not all services. promised are being provided. As per the Order of this Commission in Kamal Kishore v. Supertech Limited (Supra), No maintenance charge should be levied before obtaining the Occupancy Certificate. In this case, even if some of the allottees including the Complainants, have taken possession of their respective Units, it would be considered as paper possession only. So, the question of charging maintenance charge is in our considered view not proper and therefore should not have been collected and should not be collected till receipt of the Occupancy Certificate. The Complainants will be liable to pay maintenance charge only after the Occupancy Certificate-is received.
(Emphasis supplied)
The Complainants are therefore entitled to the refund of the advance maintenance charges.
The Complainants have prayed for allotment of another Flat within the same Society with a minimum area of 880 sq.ft. or in alternate refund for the purported illegal or additional carpet area. However, in the light of the absence of the valid Occupancy Certificate for the Society, it would be imprudent to issue directives for the allotment of any Flat within the same Society. Moreover, there is a lack of conclusive evidence on record to substantiate the claim regarding the illegality of the additional area. Given that only a symbolic possession offer was made and the Opposite Parties have failed to adhere to their maintenance obligations as per the Agreement, both the contentions are found to be valid.
In view of the aforesaid discussion, the Complaint is partly allowed with directions as under
a. The Opposite Parties shall duly obtain the Completion Certificate and Occupancy Certificate at its own cost within 6 months from the date of this Order;
b. The Opposite Parties shall pay to the Complainants delay compensation @ 6% p.a. on the total consideration amount, i.e. Rs. 1,00,00,000/- (Rupees One Crore) from the promised date of possession (01.01.2015) till obtaining the Occupancy Certificate;
c. The Opposite Parties shall refund to the Complainants the maintenance amount of Rs. 1,79,550/- alongwith interest @ 9 % p.a. from the date of deposit till the date of realization within 2 months from the date of this Order;
d. The Opposite Parties shall pay to the Complainants an amount of Rs. 25,000/- towards litigation costs within 2 months from the date of this Order;
e. Failure to comply with the above directions within the specified time, shall result in the interest to be enhanced to 9% p.a. under respective heads.
f. No TDS shall be deducted by the Opposite Party(ies) in making payment to the Complainant(s) as it is well-settled that the interest awarded to them is compensation, not liable to be taxed.
Pending application(s), if any, stand disposed off as having been rendered infructuous.