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Judgment
The present Complaint is filed under Section 21(a)(1) of the Consumer Protection Act, 1986.
The case of the Complainants is that Complainant No.l booked Flat Nos.503, 603, and 704, on 08.09.2010 for himself and his relatives in Nirala Estate situated at Plot No.GH-04 Tech Zone-IV, Greater Noida, U.P., by depositing a sum of Rs.50,000/- for each flat. Later, Complainant No.l, on behalf of Complainant No.4, booked three more flats bearing No.803, 804 and 903 by making a payment of Rs.30,000/-, vide Cheque No.590060 on 15.10.2010. Mr. Archit Bansal, on behalf of Opposite Party, assured Complainant No.1 that although booking of flats were through one cheque, the flats would be transferred to the actual buyers at the time of Allotment Letter/Tri-party Agreement. It was also assured that the builder buyer agreement cum allotment letter would be sent to the Complainants within a week as per the policy of the company. Opposite Party subsequently disclosed to Complainant No.1 that the land of project was in litigation and as soon as the litigation was over, the Complainants would be allocated flats either in the same project or in another project, depending on the outcome of the litigation. In September, 2012 the litigation qua land pertaining to the project was decided in favour of the Opposite Party. On 25.10.2013, the Opposite Party issued payment reminder, whereupon the Complainants visited office of the Builder on 03.11.2012, 04.11.2012, 27.11.2012 to collect the allotment letter, Tri-party Agreement and Builder Buyer agreement for processing the loan amount from Corporation Bank. As the allotment letter was getting delayed, Complainant No.1 applied for Home loan pre approval so that loan process could be expedited. On 05.12.2012, Complainant No.1 again visited the Office of the Opposite Party for the documents and submitted a copy of Home Loan approval.
Complainant No.2 again on 22.01.2013 and 12.02.2013 sent emails requesting the Opposite Party to provide tri-party agreement but the Opposite Party did not give any response. On 16.02.2013, the Opposite Party agreed on releasing allotment letters and tripartite agreements for the respective flats on payment of Rs.1.5 lakhs as advance towards each flat. On reaching office of Opposite Party No.1 with cheques amounting to Rs.1.50 lacs each, Complainant No.1 was asked to sign an additional document which would enable the Opposite Party to cancel the flat at their discretion. Complainant No.1 refused to sign the document, whereupon Mr. Archit Bansal, representative of the Opposite Party snatched all the documents including signed copy of allotment letters, tripartite agreements etc. from Complainant No.1.
On 24.02.2013, Complainant No.2 received a call from Mr. Archit Bansal threatening to cancel the booking of the flat unless Complainant No.2 signs the document given by the Opposite Party on 25.02.2013. Complainant No.1 reported this matter to the SSP and DM of Gautam Buddh Nagar. Thereafter, the Opposite Party arbitrarily cancelled the booking of the flats of Complainants on 06.03.2013 and sent cancellation letter to Complainant No.1 stating that the Complainant had booked five flats by paying requisite amount in violation of the norms of Greater NOIDA Industrial Development Authority. The Complainant filed an RTI applicable with Greater NOIDA Industrial Development Authority and received a reply that Greater Noida Authority does not limit or impose any rule/regulation on land/flat/house purchased from the open market.
The loan of Complainant No.2 was approved by the Bank on 11.12.2012, however due to non-delivery of tri-party agreement, the Bank cancelled the loan approval. As per the guidelines of the Bank, “the sanction facilities will lapse if not availed within a period of 3 months”. On 24.05.2013, the Opposite Party cancelled the booking of Complainant No.2 on the ground of non-payment of dues. It was stated that the Opposite Party did not release the tri-party agreement for the booked flat, despite repeated requests and follow-ups, due to which the banker was unable to release the funds. It was stated by the Complainant that the act of cancellation of the Flats allotted to Complainant No.3 & 4 was not legal, since the Opposite Party had already provided the allotment letter to them. The Opposite Party had also increased the rate for Flat No. 803, 804 from Rs.1609 to Rs.1872 unilaterally and forced the Complainant to agree to the revised rates, lest the flats would be cancelled. Under this threat, the Complainant agreed to the revised rates. The Opposite Party also revised the date of possession from 2013 to 2016. Alleging deficiency in service and unfair trade practice on the part of the Opposite Party, the Complainants approached this Commission with the following prayer:-
“(a) Direct the opposite party to execute the agreement of flat and further direct the opposite party to submit tri-party agreement in favor of the complainant as per the agreement;
(b) Set aside the order passed by the opposite party as there is and negligence and deficiency in services and unfair means adopted by opposite party;
(c) Direct the opposite party to pay a compensation of Rs. 1 lac per fiat on account of damages for mental pain and agony due to deficiency in services rendered by the opposite party;
(d) Award the cost of the litigation.
(e) Pass such further or order as this Hon'ble Commission may deem fit and proper in the facts and circumstances of the case.”
The Opposite Party resisted the Complaint by filing reply stating that the Complaint was not maintainable as the Complainant had deliberately, with mala fide intentions, concealed material facts from this Commission. The Complaints do not qualify the definition of "Consumer" as envisaged under Section 2(d) (i) & (ii) of the Consumer Protection Act, 1986, since Complainant No.1, in his own name booked 6 different residential units in the Project. The names of other Complainants had been added by Complainant No.1 merely to create dummy names and to gain tax benefits. Complainant No.1 applied for booking unit Nos.503, 603 and 704 on 09.08.2010 for a total sale consideration of Rs.27,81,220/- out of which a sum of Rs.2,78,122/- being 10% of the cost of the flat was to be paid within 10 days from the date of the booking i.e. on or before 19.08.2010. Complainant No.1 paid only Rs.50,000/- thereby leaving a balance of Rs.2,28,122/-. Since Complainant No.1 failed to make payment of the balance booking amount within the agreed time period, the Opposite Party sent a letter dated 12.09.2010 for payment of Rs.2,28,122/- due. In the meantime, further payment became due and the Opposite Party sent letter dated 21.04.2011 for payment of Rs.10,89,800/-. Despite receiving the said letters, Complainant No.1 paid a sum of Rs.2,28,122/- only on 03.05.2011 thereby breaching the terms of the agreement. Regarding delay, the Opposite Party stated that the construction of all projects was stopped, vide order dated 21.10.2011, passed by the Hon'ble Allahabad High Court. In furtherance of the order of Hon’ble High Court, the construction was resumed with effect from 25.08.2012, which was also brought to the notice of Complainant No.1 by the Opposite Party immediately. Upon resuming the construction activity, Opposite Party again sent a reminder letter dated 25.10.2012, to Complainant No.1 to clear the outstanding dues of Rs.10,48,853/- on or before expiry of 30 days, failing which the booking would stand cancelled. The Opposite Party was constrained to send a final reminder letter cum cancellation notice dated 07.02.2013 stating that in case no payment was made upon the expiry of ten days from the date of the said letter, the booking shall stand cancelled. After receipt of the above mentioned cancellation letter, Complainant No.1, vide letter dated 25.02.2013, made false and frivolous allegations against the Opposite Party, which was replied by the Opposite Party, vide letter dated 06.03.2013. The Opposite Party also refunded entire principal amount paid by Complainant No.1 for booking of the units, along with interest @ 10 %. It was under similar circumstances that the other units booked by Complainant No. 1 were cancelled and hence there was neither any deficiency in service nor any unfair trade practice as alleged by the Complainants.
Heard the Learned Counsel for the Parties and carefully perused the record. On maintainability, the Learned Counsel submitted that the Complainants were Consumers under the Act as the flats were purchased by relatives who are residing independently and paying individual taxes to government, who were not having any dwelling unit in U.P. and affidavits to that effect have already been filed before this Commission.
On merits, the Learned Counsel submitted that they had paid 10% of the total amount of flat as booking amount in accordance with initial agreement between the Parties. The Complainants never defaulted in paying any amount. They have paid the amount as per the construction scheme of the flats, which had started after the order of the High Court in September, 2012. The Complainants sought possession of respective units after making balance payment of the flats as per the original allotment agreement along with interest on payments already made by the Complainants. The Opposite Party harassed the Complainants with malafide intention and cancelled the allotments in most arbitrary manner which is clear deficiency in service.
Learned Counsel for the Opposite Party submitted that the Complaint is not maintainable as the Complaints were not "Consumers" under Section 2(d) (i) & (ii) of the Consumer Protection Act, 1986, since Complainant No.1 booked 6 flats in his name.
On merits, the Learned Counsel for the Opposite Party submitted that as per the agreed payment plan, the Complainants were to pay 10% of the Booking amount followed by First Installment within 30 days. The Complainant did not comply with their obligation to make timely payment of the installments and as such had breached the terms and conditions of the Booking/Payment plan. The Opposite Party was within its right to demand installments as per the payment plan and in case of delay, issued cancellation letter in accordance with the terms and condition of the Booking Form.
Admitted facts in this Complaint are that Complainant No.1, on 08.09.2010, booked Flat Nos. 503, 603, 704 in Nirala Estate situated at Plot No. GH-04 Tech Zone -IV, Greater Noida, U.P., on behalf of his relatives, by depositing Rs.50000/- for each flat and booked 3 more flats bearing No. 803, 804 and 903 with single cheque amounting to Rs.30,000/-. The Opposite Party accepted payment of 10% of the total cost toward booking of flat Nos. 503, 603, 704, 803, 804 and 903 in Tower 18 on 03.05.2011. The Opposite Party sent reminder letters dated 21.04.2011, 25.10.2012 to the Complainants to pay the outstanding dues of Rs.10,43,122/- on or before expiry of 30 days. The Opposite Party also sent final reminder cum cancellation notice on 07.02.2013 to clear the dues along with interest amounting to Rs.11,76,481/- within 10 days. The Opposite Party, vide letter dated 06.03.2013, cancelled 4 flats booked by the Complainants and returned the booking amount along with interest @ 10% p.a. on the principal amount. The Opposite Party after sending a reminder for payment of Rs.8,55,973/- on 09.05.2013, cancelled the booking of Flat Nos. 804 and 704 also, vide letter dated 24.05.2013 citing non-payment of dues, and sent a cheque for refund amounting to Rs.2,83,111/- for each flat.
So far as maintainability is concerned, reference can be made to the case of, Kavita Ahuja Vs. Shipra Estate Ltd. & Jai Krishna Estate Developers Pvt. Ltd., I(2016) CPJ31(NC), wherein three flats were booked by the Complainant, this Commission held the Complainant to be a Consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986 and held as follows:-
“In the case of the purchase of houses which the service provider undertakes to construct for the purchaser, the purchase can be said to be for a commercial purpose only where it is shown that the purchaser is engaged in the business of purchasing and selling houses and / or plots on a regular basis, solely with a view to make profit by sale of such houses. If however, a house to be constructed by the service provider is purchased by him purely as an investment and he is not undertaking the trading of houses on a regular basis and in the normal course of the business profession or services in which he is engaged, it would be difficult to say that he had purchased houses for a commercial purpose. A person having surplus funds available with him would not like to keep such funds idle and would seek to invest them in such a manner that he gets maximum returns on his investment. He may invest such funds in a Bank Deposits, Shares, Mutual Funds and Bonds or Debentures etc. Likewise, he may also invest his surplus funds in purchase of one or more houses, which is/are proposed to be constructed by the service provider, in the hope that he would get better return on his investment by selling the said house(s) on a future date when the market value of such house(s) is higher than the price paid or agreed to be paid by him. That by itself would not mean that he was engaged in the commerce or business of purchasing and selling the house(s).”
Generating profit by way of trading, in my view is altogether different from earning capital gains on account of appreciation in the market value of the property unless it is shown that the person acquiring the property was engaged in such acquisition on a regular basis and it was by way of a business activity.
As observed by the Hon'ble Supreme Court in Laxmi Engineering Works (supra) what is a 'commercial purpose' is a question of fact to be decided in the facts of each case and it is not the value of the goods that matters but the purpose for which the goods brought are put to. The same would be equally applicable to for hiring or availing services.
In any case, it is not appropriate to classify such acquisition as a commercial activity merely on the basis of the number of houses purchased by a person, unless it is shown that he was engaged in the business of selling and purchasing of houses on a regular basis. If, for instance, a person has two-three children in his family and he purchased three houses one for each of them, it would be difficult to say that the said houses were purchased by him for a commercial purpose. His intention in such a case is not to make profit at a future date but is to provide residential accommodation to his children on account of the love and affection he has for his children. To take another example, if a person has a house say in Delhi but he has business in other places as well and therefore, purchases one or more houses at other places where he has to live presently in connection with the business carried by him, it would be difficult to say that such acquisition is for commercial purpose. To give one more example, a person owning a house in a Metropolitan city such as Delhi, or Mumbai, may acquire a house at a hill station or a place, which is less crowded and more peaceful than a Metropolitan city, in my view, it cannot be said that such acquisition would be for commercial purpose. In yet another case, a person may be owning a house but the accommodation may not be sufficient for him and his family, if he acquires one or more additional houses, it cannot be said that he has acquired them for commercial purpose. Many more such examples can be given. Therefore, it cannot be said that merely because of the complainant had agreed to purchase three flats in the same complex the said acquisition was for a commercial purpose.”
In the present Complaint, Complainant No.1 had booked six flat for his relatives and paid booking amount to the Opposite Party. There is no evidence that the Complainants had purchased the flat to earn profit or engage in commercial activity of buying and selling of flats. The Complainant is therefore held to be a consumer under the Consumer Protection Act, 1986.
Following was the payment plan provided by the Opposite Party to the Complainants on 12.09.2010 applicable to each of the flats booked by the Complainants:-
Sl. No.
Installments
Total Amount
1.
At the time of booking
Rs. 2,78,122.00/-
2.
At start of construction/30 days of Project being bankable
Rs. 8,34,366.00/-
3.
On casting of Basement Roof
Rs. 2,78,122.00/-
4.
On casting of 3rd Floor Roof
Rs. 2,78,122.00/-
5.
On casting of 6th Floor Roof
Rs. 2,78,122.00/-
6.
On casting of 9th Floor Roof
Rs. 2,78,122.00/-
7.
On casting of 12th Floor Roof
Rs. 2,78,122.00/-
8.
On casting of 15th Floor Roof
Rs. 1,39,061.00/-
9.
On Possession
Rs. 1,39,061.00/-
Total Consideration
Rs. 27,81,220.00/-
The Complainants had paid the following amount for the flats booked by them:
Sl. No.
Flat Nos.
Amount received (inclusive of Service Tax)
1.
503
Rs. 2,78,122
2.
603
Rs. 2,76,737
3.
704
Rs. 2,75,352
4.
803
Rs. 2,89,507
5.
804
Rs. 2,89,507
6.
903
Rs. 2,58,122
The Complainants were aware that the construction started 25.08.2012 and were also aware that they were to pay the installment at the start of the Construction, however, even after repeated reminder they failed to pay the installment. The Opposite Party sent reminder dated 21.04.2011 for making payment of the installment. Upon resuming of construction work, the Opposite Party again issued reminder dated 25.10.2012 and 07.02.2013 for payment of installments flats. When the Complainants failed to make payment of the installments, the Opposite Party was constrained to cancel the allotments and refunded the amount to the Complainants with interest @ 10% p.a. Nowhere in the Complainant or in the rejoinder is it disputed by the Complainants that the Opposite Party did not refund the amount deposited by them with 10% interest.
In the view of aforesaid discussion, we find that as the Complainants failed to make payment of the instalments despite repeated reminders, the Opposite Party was justified in cancelling the allotment and refund of the amount with 10% interest. Under the circumstances, cancellation of allotment was justified. The Complainants failed to establish deficiency in service or unfair trade practice on the part of the Opposite Party. The Complaint is dismissed with no order as to costs.