Neerja vs ATS Township Private Limited

Sudip Ahluwalia, Member

This Consumer Complaint has been filed under Section 21(a)(i) of the Consumer Protection Act, 1986 alleging deficiency in service and unfair trade practice on the part of the Opposite Party, and seeking possession of the apartment, or in the alternative, refund of the deposited amounts along with ancillary reliefs.

The factual background in brief is that, in the year 2012, the Complainant became aware of a project by the Opposite Party known as "ATS One Hemlet," located at Plot No. GH-01, Sector 104, Noida, Uttar Pradesh. The project boasted various amenities such as a luxurious clubhouse, swimming pool, tennis, squash, basketball courts, jogging track, gym, and shopping arcade. Subsequently, the Complainant booked Unit Reference No. 09064, with a super built-up area of 1636 Sq. Ft. in the project, and paid Rs. 5,00,000/- on 19.06.2012. The Opposite Party issued a Provisional Allotment Letter dated 13.07.2012, containing completely arbitrary and one-sided Terms & Conditions. Opting for the down payment plan, the Complainant made the entire payment of Rs. 97,78,212/-, except for Rs. 5,50,000/- which was to be paid at the time of possession. According to the Provisional Allotment Letter and Clause 7.1 of the Terms and Conditions, possession of the apartment was to be handed over to the Complainant by May 2013 (plus 90 days grace period), i.e., by August 2013. However, the Opposite Party failed to deliver possession of the Apartment within the timeline promised in the Provisional Allotment Letter. On 27.08.2013, the Complainant received a letter from the Opposite Party stating that the structure of all the towers had been completed, and the finishing work was in an advanced stage. It was further mentioned that there had been an upward revision in the super area of all the apartments, with the area of the Complainant’s apartment being changed from 1636 Sq. Ft. to 1783 Sq. Ft. Consequently, the Complainant was informed that she was liable to pay extra money for the increased area at the time of possession. Subsequently, on 09.09.2013, the Complainant requested the Opposite Party to provide a copy of the site plan of her apartment showing the 'original' and 'increased' revised area with precise dimensions of covered and common area. However, in response, the Complainant received the 'revised layout plan,' which was identical to the original plan. In this backdrop, the Complainant informed the Opposite Party via email dated 14.09.2013 that she was not liable to pay anything further, as the change in the area without the consent of the apartment purchasers contravened the provisions of the Uttar Pradesh Apartment (Promotion of Construction, Ownership, and Maintenance) Act, 2010. Aggrieved by the deficient service and unfair trade practices of the Opposite Party, she filed the present complaint.

In view of the aforesaid facts, the Complainant has prayed as following -

“i. Direct the Respondent to handover possession of Apartment, to the Complainant, complete in all respects and in conformity with the Provisional Allotment Letter and for the consideration mentioned therein (without any additional amount for alleged increase in super area), with all additional facilities and as per quality standards promised, and execute all the necessary and required documents and provide an affidavit along with an appropriate certificate of an independent architect towards the internal area and finishing of the subject apartment being as per promised standards in respect of the said apartment in favour of the Complainant;

ii. Direct the Respondent, to pay interest @ 12% per annum on the amount deposited by the Complainant with the Respondent, with effect from Ist September, 2013 till the date actual physical possession as per clause (i) above is handed over by the Respondent, along with all necessary documents and common areas and facilities;

iii. Direct the Respondent to withdraw its demand of Rs. 40,37,040/-, unfairly demanded from the Complainant on account of alleged increase in super area, holding charges etc.

iv. Direct the Respondent to bear the increase in the service tax with effect from 1 June, 2015;

In the alternate, if the Respondent is not amenable to the above, direct the Respondent to refund the entire amount of Rs. 97,78,212/- paid by the Complainant to the Respondent, alongwith interest @ 18% per annum, on the amount deposited by the Complainant with the Respondent from the date of payment till the actual refund;

v. Direct the Respondent to pay Rs. 5,00,000/- (Rupees Five Lakh), as compensation for disruption to living arrangements, mental torture, agony and harassment caused to the Complainant on account of the deficient and unfair practices of the Respondent;

vi. Direct the Respondent to pay a sum of Rs.3,00,000/- (Rupees Three Lakh) to the Complainants, towards litigation costs and miscellaneous expenses…”

Ld. Counsel for Complainant has argued that that despite receiving the full consideration of Rs. 97,78,212/- for the apartment, the Opposite Party insisted on demanding additional funds due to an alleged increase in area, without obtaining the mandatory consent from the Complainant, as required under the Proviso to Section 4(4) of the UP Apartment (Promotion of Construction, Ownership & Maintenance) Act, 2010. This Commission's Order in "Pawan Gupta v. Experion Developers Ltd., I (2021) CPJ 72 (NC)" has laid down that such attempts to extract extra money from Allottees through an increase in area constitute unfair trade practices, a view affirmed by the Hon’ble Apex Court; That the offers of possession made by the Opposite Party were legally invalid as they lacked a Completion Certificate (CC) or even an Occupancy Certificate (OC), which were only brought to light on 13.03.2023, four years after the filing of the complaint, despite allegedly being obtained on 26.08.2015. The Opposite Party's withholding of the OC for over seven years is an attempt to avoid compensating the Allottees for two years, as required by law. It is essential to note that while an OC certifies a project's suitability for occupation and basic civic amenities, only a CC assures compliance with sanctioned plans, specifications, and building bylaws. Without a CC, a structure may be habitable yet illegal; That the deliberate delay by the Opposite Party in providing a legally valid possession to the Complainant has resulted in undue inconvenience and disadvantage, despite having received full consideration. The Opposite Party's utilization of the deposited amounts for over 11 years without delivering possession justifies the grant of 18% interest as compensation, as per the precedent set by the Hon’ble Apex Court in "GDA v. Balbir Singh, (2004) 5 SCC 65" which allows such rate of interest for cases indicative of gross deficiency of service; That there is very less possibility of possession due to the Noida Authority's refusal to register transfer deeds for flats due to substantial unpaid land dues by the Opposite Party. According to Section 13 of the UP Apartment (PCOM) Act, possession cannot be handed over without registering the transfer deed, which further complicates the matter.

Ld. Counsel for Opposite Party has argued that that the complaint is time-barred, as the alleged cause of action arose in 2013, and the complaint was filed in 2019, rendering it non-maintainable and subject to dismissal on this ground; That the project is nearly fully occupied, with other unit owners having paid charges for increased area, establishing no exception for the Complainant. Out of 1006 units, 979 are occupied; That they have only demanded payment for the actual increase in area, along with the pending maintenance charges, maintenance deposit, and holding charges, as per the agreed terms.  Clause 7.1 of the Agreement obliges them to make best efforts to complete construction and apply for an Occupancy Certificate (OC) within the period stipulated in the Allotment Letter, subject to a grace period of 90 days and force majeure events; That regarding the letter dated 27.08.2013, the revised plan differed from the original plan provided at the time of booking the apartment and they offered to arrange meetings with the Complainant and their technical experts to clarify the revisions but received no response. The Opposite Party organized a joint meeting in their office with their technical experts for clarifications regarding the increased area, yet the Complainant did not take the possession and clear the dues. There are Approved Plans, Area Statements, and Completion Drawings of the project on the record; That the Clause 6.6 of the Terms and Conditions stipulates that any increase in Super Area/Plot Area is payable by the Complainant without objection; That the Opposite Party offered compensation for the delay in possession up to 31.01.2014, contingent upon the Complainant's compliance with the Agreement's terms and clearance of pending dues.

This Commission has heard both the Ld. Counsel for Complainants and the Opposite Party, and perused the material available on record.

The basic grievance of the complainant is that there was an unfairness on the part of the Opposite Party, by way of charging an additional amount for the supposed increase in the super area of the Flat, which according to the Complainant, was neither factually correct, nor permissible even according to Law. In this regard she has relied upon Section 4(4) of the Uttar Pradesh Apartment (Promotion of Construction, Ownership & Maintenance) Act, 2010, the proviso to which prevents a promoter from making "any alterations in the plans, specifications and other particulars without the previous consent of the intending purchaser, project Architect, Project Engineer and obtaining the required permission of the prescribed sanctioning Authority, and in no case he shall make such alterations as are not permissible in the building bylaws."

To counter the above contention, Ld. Counsel has firstly relied upon Clause 6.6 of the Terms & Conditions for Allotment of the apartment which provides as follows –

“6.6 The Applicant has seen the (provisional) Plans and has been made aware of and accepts that the Plans, Super Area, specifications as more particularly described in the Application Form, brochures etc. are tentative and that there may be variations, deletions, additions, alterations made either by the Developer as it may in its sole discretion deem fit and proper, or by or pursuant to requirements of a Government Authority, which alterations may involve changes, including change in the position/location of the said Unit, change in the number of Units, change in its dimensions, change in the height of the building, chance in its Super area/plot area, and the Applicant shall have no right to object to such variations, additions, deletions, alterations and modifications as aforesaid (the “Alterations”).  The Super Area of the said Unit and consequently the Consideration amount may be increased on account of such Alterations and the Applicant shall pay without demur such increased amount of Consideration at such times as may be required by Developer.  In the event that the Consideration amount is decreased pursuant to such Alterations, the excess amounts, if any, paid by the Applicant shall be refunded by the Developer without interest.

Provided further that any changes as a result of the Alterations or otherwise shall not be construed to give rise to any claims, monetary or otherwise.  Any increase or decrease in the Super Area/ Plot Area (based on “As-Built” plans) of the said Unit pursuant to Alterations or otherwise shall be payable or refundable without any interest on a pro rata basis or at the agreed rate per sq. meter as may be more specifically described in the Provisional Allotment Letter and that the other charges as specified herein will be applicable for the changed area at the same rate as indicated in the Provisional Allotment Letter.”

The Opposite Party has in this regard also relied upon an earlier decision of this Commission in “Capital Greens Flat Buyer Association & Others Vs. DLF Universal Ltd & Anr. (Consumer Case No. 351 of 2015)” and other connected complaints, in which the same controversy arose regarding the demand by Promoter/Builder for additional payment in view of the subsequent increase in the Super Area for the concerned Apartments, which was resisted by the Complainants/Flat Buyers. This Commission, in those particular Complaints held that the Developers/Opposite Parties were justified in making such demand, since there was an actual increase in the Super Area subsequently, and such increase was limited within 15% of the area as originally allotted, which was within the agreed Terms and Conditions of the Apartment buyers Agreements. The relevant extracts from the aforesaid decision of this Commission or set out as below –

“SUPER AREA

In terms of Annexure-II of the Agreements executed between the developer and the allottees, the price of the apartments was to be calculated on the basis of its super area. It was also noted in the above referred clause that the super area mentioned in clause 1.1 was only tentative and could change. The allottees had agreed not to object to the change of the super area. However, if the super area was to increase/decrease by more than 15% on account of any alteration/modification/change, the allottees were required to be intimated in writing before carrying out the proposed change and had an option to take refund of the payment which they had made to the developer alongwith interest.

The super area in terms of Annexure-II of the Agreements was to consist of the apartment area, pro-rata share of the common areas of the building and pro-rata share of other common areas outside the building, as defined therein.

In the project subject matter of these complaints, the developer has not sought additional payment for increase in the super area beyond 15%. Therefore, no prior notice to the allottees was required before increasing the super area and to the extent there has been actual increase in the super area, as defined in Annexure-II of the Agreements, the allottees are required to pay for such an increase. The allottees had also agreed that not only the super area but even the percentage of the apartment area to the super area could change and they would have no objection to change of the said ratio, though the case of the OP is that the ratio has not changed and the same continues to be 78.5% of the super area. The developer has filed the affidavit of its Additional Chief Architect Mr. Mukul Gupta who has stated on oath that the final super area based on the approved completion drawings which includes floor plans, unit area plans, elevation and sections of the building was verified and quantified by external experts M/s. GAA Advisory, who also determined the common area and pro-rata share of the apartment in the common areas. The detailed report of GAA Advisory in respect of all the three phases has been filed with the Convenience Compilation filed by the developer. It is stated in the affidavit that the super area so determined by GAA Advisory was rechecked and verified by the School of Planning and Architecture, Delhi and the reports of the said School have been filed with the Convenience Compilation.

Though, the affidavits of the experts from GAA Advisory and the School of Planning and Architect have not been filed, I see no reason to disbelieve their respective report supported by an affidavit of the Architect, when no material to the contrary has been field by the allottees. Therefore, I have no hesitation in holding that the additional demand on account of increase in the super area, which has been restricted to 15% of the super area stated in the agreements, is justified. Though, the ratio of the apartment area to the super area could also change, it is stated in the affidavit of Mr. Mukul Gupta that the final percentage of the apartment area to the super area of the apartment is not less than 78.5% and there is no material to the contrary filed by the allottees. Therefore, I find no justification in the grievance with respect to the demand on account of increase in the super area of the apartments.”

This Commission however does not find the aforesaid decision in "Capital Greens Flat Buyer Association" (supra) to be altogether applicable to the facts and circumstances of the present Complaint. This is so because, as can be seen from Clause 6.6 reproduced above, no specific limit for increase or decrease in the Super Area at a subsequent stage was fixed therein, which is an altogether different situation from the relevant clause in the Apartment Buyers Agreements in the earlier complaints, in which a specific limit of 15% for such subsequent difference in the Super Area had been fixed. Secondly, in those Agreements, the Flat Buyers also had the option to seek refund of the amounts delivered by them to Builders/Promoters with interest, if they were not agreeable to such increase in the area. But, in the present case, as can be seen from Clause 6.6 of the Terms & Conditions for Allotment, the buyers have not been given any such option to seek refund in such a scenario. To that extent, the Terms & Conditions would certainly appear to be one-sided and unfair considering that firstly the same are not in accordance with the relevant provision of Section 4(4) of the Uttar Pradesh Apartment (Promotion of Construction, Ownership & Maintenance) Act, 2010, and secondly because, the buyers have no scope to seek refund of the money delivered by them to Developer/Promoter, and is therefore constrained to make such payment and comply with the onerous demand for additional payment, since virtually the entire payment has already been delivered to the Developer/Promoter, before such demand is raised. It may be mentioned that in the present case, the Complainant had already paid a huge amount of Rs.97,78,212/– towards purchase of her apartment within a period of 2 months between 19.06.2012 to 18.08.2012, whereas the demand for additional payment ostensibly due to increase in the Super Area was made more than an year later on 27th August 2013.

But when the Complainant, disputed such demand and asked the Opposite Party to provide her with the revised Sanction Plan, the Opposite Party’s attitude was evasive, and instead of directly supplying her the Revised Sanction Plan, it requested the Complainant to visit its office, ‘to clear her doubts.’ But when the Complainant insisted on seeing the Revised Sanction Plan, the Opposite Party E-mailed it to her, which she however found to be ‘exactly the same plan’ which had already been shared with her in the beginning. It is noteworthy, that when the evidence of the parties had already been closed in the present Complaint, the Opposite Party at that stage as Late as on 19th March 2024, filed an authenticated the Approved Plan Superimposed over the Brochure Plan. There Is nothing on record anything in the nature of an Affidavit of any Architect, or report of any expert verifying and quantifying the final common area and pro-rata share of the apartment in the common areas,, the availability of which documentary evidence from the side of the Builders/Promoters had been placed on record, in the earlier decision of this Commission in "Capital Greens Flat Buyer Association" (supra), which had gone in their favour. For all these reasons, this Commission is of the considered view that the demand Of the Opposite Party for additional payment by Complainant, for the ostensible increase in the Super Area is not justified.

The Complainant has also disputed the authenticity of the “Occupancy Certificate” filed on behalf of the Opposite Party, since it is contention that the apartment in question was actually not very for possession, when the same was offered to her on 28th August 2015. Such Occupancy Certificate dated 26 August 2015, issued by New Okhla Industrial Development Authority was placed on record by the opposite party along with its original written submissions filed previously on 13 March 2023.

Perusal of the said Occupancy Certificate which was filed on behalf of the Opposite Party alongwith its earlier Written Submissions on 16.3.2023 goes to show that it was issued by the NOIDA Authority from the office of its Chief Executive Officer 26.8.2015, and it certifies that the Group Housing in question is fit for residence and occupation.  Ex facie this Commission finds no reason to doubt the contents of such document/ Occupancy Certificate issued by the Competent Authority in its official capacity nor can it be said to have been “manipulated” by the Opposite Party, merely because it was filed at a late stage.  The other contention of the Complainant that it could not have been granted without first issuing the “Completion Certificate” is also not convincing. The Complainant was unable to cite any provision from Uttar Pradesh Apartment (Promotion of Construction, Ownership, and Maintenance) Act, 2010 or from any other Statute which would go to indicate that there is a concept of a “Completion Certificate” as distinct from a “Occupancy Certificate”, since issuance of an Occupancy Certificate by the Competent Authority in itself pre-supposes that completion of the construction and fitness for its occupation has been verified.  In any case, the Complainant has not placed any documentary evidence such as photos etc. in support of her contention that the construction had not been completed by the Opposite party as personally seen by her, even after issuance of the offer of possession from its side on 28.8.2015.

The final hearing in the matter was conducted by the Complainant personally in support of her case.  It may be mentioned that she herself happens to be an Advocate on Record in the Hon’ble Supreme Court of India.  At the outset, her stress was on the  alternate relief sought for by her in the complaint i.e. refund of the amount paid by her alongwith interest @ 18% thereupon on account of the delay in possession as well as well as the  ‘illegal demand’ for extra payment as made by the Opposite Party in its letter alongwith possession dated 28.8.2015.  The Complainant argued that the stipulated date for delivery of possession according to the terms and conditions of the Provisional Allotment Letter issued in her favour by the Opposite Party was  the month of May, 2013 alongwith a grace period of 90 days, on account of which the Opposite Party was obligated to deliver possession to the Complainant latest by the end of August, 2013.

However, when such offer of possession was made to the Complainant two years later, at no point she showed any inclination to refuse accepting the same, but insisted that the demand for extra payment on account of the alleged increase in the super area was not justified, and that the Flat in question was in any case not completed or in a habitable condition.  It may be mentioned that the Complaint itself was filed on 20.3.2019, which was almost 3 ½ years after the offer of possession was made by the Opposite Party.  Even in the Complaint, the primary prayer of the Complainant was for a direction upon the Opposite Party to hand over possession of the Apartment completed in all respects, and in conformity with the Provisional Allotment Letter, without any additional amount for the alleged increase in super area, but with all additional facilities as per quality standard promised etc.  Had the Complainant directly sought refund of the consideration amount paid by her to the Opposite Party on account of the delay in offering of possession to her, she could have been entitled to such relief but with compensation by way of interest not exceeding 9% p.a. in view of the decision of the Hon’ble Supreme Court in "Experion Developers (P) Ltd. v. Sushma Ashok Shiroor, (2022) 15 SCC 286".  The relevant extracts of the said Order are set out as below –

“32. We are of the opinion that for the interest payable on the amount deposited to be restitutionary and also compensatory, interest has to be paid from the date of the deposit of the amounts. The Commission in the order impugned has granted interest from the date of last deposit. We find that this does not amount to restitution. Following the decision in DLF Homes Panchkula (P) Ltd. v. D.S. Dhanda [DLF Homes Panchkula (P) Ltd. v. D.S. Dhanda, (2020) 16 SCC 318] and in modification of the direction issued by the Commission, we direct that the interest on the refund shall be payable from the dates of deposit. Therefore, the appeal filed by purchaser deserves to be partly allowed. The interests shall be payable from the dates of such deposits.

At the same time, we are of the opinion that the interest of 9% granted by the Commission is fair and just and we find no reason to interfere in the appeal filed by the consumer for enhancement of interest.”

But the Complainant’s primary prayer was for delivery of possession of the Apartment in question without making any extra payment as demanded by the Opposite Party on account of the supposed increase in its super area which, as already found by this Commission in Para No. 11 above, was not a just or proper demand made by the Opposite Party.

Consequently, when it was explained to her that the demand for refund alongwith interest @ 18% p.a. was not proper firstly because her primary prayer in the complaint itself was for delivery of possession and secondly because payment of compensation at such high rate would be in abject violation of the ratio of the decision of the Hon’ble Supreme Court in "Experion Developers (P) Ltd. v. Sushma Ashok Shiroor" (supra), the Complainant stated that she was agreeable to take delivery of possession provided adequate compensation for the delay was granted to her and the Opposite Party was obligated to execute the registered Deed of Conveyance in her favour within a short time thereafter, as it was her apprehension that the Opposite Party would not be in a position to do so as the NOIDA Authority has been declining to register such Transfer Deeds on accounts of the huge unpaid land revenue dues.  In the opinion of this Commission, such submission, though speculative in nature, cannot be entirely discarded in its entirety.     It is for the Opposite Party to ensure that it gets the Transfer Deed in question to be registered in favour of the Complainant within a fixed time.

It may also be mentioned that according to Clause 7.2 of the Terms and Conditions for Allotment issued by the Opposite Party, an Allottee is entitled to compensation for the delay in delivering possession of the Apartment @ 6% of the basic selling price.

Furthermore, it may be observed that since the Complainant has succeeded in establishing that demand for additional payment on the pretext of the supposed increase in the Super Area by the Opposite Party is not justified, she cannot be penalised by way of making her liable to pay any holding or maintenance charges for the period she did not accept the possession for this reason.  Even otherwise, in the case of “Capital Green Flat Buyer Association and Ors.  Vs. DLF Universal Limited and Anr. - CC No. 351 of 2015 and connected matters”, this Commission has held that maintenance charges are payable by an Allottee from the date the possession is offered to him “unless he is prevented from taking possession on account of the Opposite Party insisting upon any unreasonable demand before delivering such possession, which prevents the Allottee from accepting the same”.  The relevant extracts from the observations of this Commission in this regard are set out as below –

“48. It transpired during the course of arguments that the OP has demanded holding charges and maintenance charges from the allottees. As far as maintenance charges are concerned, the same should be paid by the allottee from the date the possession is offered to him unless he was prevented from taking possession solely on account of the OP insisting upon execution of the Indemnity-cum-Undertaking in the format prescribed by it for the purpose. If maintenance charges for a particular period have been waived by the developer, the allottee shall also be entitled to such a waiver. As far as holding charges are concerned, the developer having received the sale consideration has nothing to lose by holding possession of the allotted flat except that it would be required to maintain the apartment. Therefore, the holding charges will not be payable to the developer. Even in a case where the possession has been delayed on account of the allottee having not paid the entire sale consideration, the developer shall not be entitled to any holding charges though it would be entitled to interest for the period the payment is delayed.”

Having thus come to the conclusion that the demand of the Opposite Party for additional payment on account of the alleged increase in Super Area of the Flat was unjustified, it can be safely concluded that the Complainant was prevented from taking physical possession of her Apartment on account of such unjustified demand, the compliance of which was otherwise a condition precedent for delivery of possession.  She is, therefore, found entitled to delay compensation at the rate agreed upon in the original terms and conditions of the allotment i.e. at 6% p.a. on the amount delivered by her to the Opposite Party w.e.f. the date of each respective deposit.  Consequently, the Complaint is allowed with the following directions –

i) The Opposite Party shall deliver possession of the Apartment to the Complainant in a completed form in conformity with the Provisional Allotment Letter, within 03 months from the date of this Order;

ii) The Opposite Party shall also be bound to ensure that the Conveyance/Title Deed in favour of the Complainant is also got executed and registered  by it within 30 days from the date of such delivery of possession;

iii) The Complainant shall pay any outstanding amounts in terms of the original letter of Allotment excepting the demand for additional payment, on account of the alleged increase in Super Area, which shall be adjusted against the delay compensation payable to the Complainant from 1.9.2013 till the date of delivery of possession of her w.e.f. date of each respective payment made by him to the Opposite Party;

iv) The Complainant is also found entitled to an amount of Rs. 40,000/- as litigation costs.

The Opposite Party is accordingly directed to comply with the directions contained in the previous paragraph within 03 months from the date of this Order failing which, any delay in compliance shall result in increase of delay compensation payable to the Complainant @ 9% p.a. on any unpaid balance till the date of final payment, and in addition the Complainant would also be at liberty to proceed into execution in case the physical possession and execution of the registered Conveyance Deed are not delivered by the Opposite Party within the time as directed earlier.

Pending application(s), if any, also stand disposed off as having been rendered infructuous.