Pioneer Urban Land & Infrastructure Ltd vs Surender Ruhil

Subhash Chandra, Presiding Member

First Appeal No.660 of s2021 under Section 51 of the Consumer Protection Act, 2019 (in short, the ‘Act’) is in challenge to the order dated 18.08.2021 of the State Consumer Disputes Redressal Commission, Delhi (in short, the ‘State Commission’) in Complaint Case No.979 of 2016 partly allowing the complaint.  This order will also dispose of the First Appeal No.661 of 2021 filed by the present Appellant in CC No. 980 of 2016 as both the cases relate to the same project of the Appellant and involve similar set of facts, agitate the same issues and seek the same relief.  For the purpose of convenience, the facts are taken from CC 660 of 2021 which is taken as the lead case.

Briefly put, the relevant facts of the case are that Respondent had entered into a Buyer’s Agreement with Puneet Gupta and others, who were the original allottees, on 21.10.2009 to purchase flat no. TD-2102, Tower A, “Pioneer Park”, Golf Course Extension Road, Sector 61, Gurugram admeasuring 1200 sq ft for a sale consideration of ₹39,20,000/- with one reserved parking space.  Appellant executed an endorsement to this effect and undertook to abide by the Allotment Letter dated 24.06.2009 and Builder Buyer Agreement dated 21.10.2009 executed with the original allottees.  Vide Clause 9.2 of this Agreement, Appellant undertook to take all efforts to apply for an Occupation Certificate within 36 months of the Agreement, with a grace period of 3 months (90 days) subject to delays beyond its control in Clause 10.1. Occupation Certificate (OC) was received by the appellant on 21.06.2016. An intimation for possession and payment of final instalment was issued on 03.08.2015.

Respondent approached the State Commission seeking directions to the Appellant to hand over possession, restrain it from charging holding and penal charges, pay compensation @ 24% on the amount paid from the date of promised possession till filing of complaint, pay ₹30 Lakhs towards harassment and trauma, pay 24% p.a. towards delay in handing over possession, pendent lite and future interest @ 24% till handing over of the flat, pay ₹50,000/- as litigation charges, direction to Appellant to bear additional and increased statutory charges and any other order(s) deemed appropriate.  The State Commission allowed the complaint partly on contest and directed handing of possession within 30 days of the order subject to necessary payments, including final demand of ₹4,40,965/- failing which the Appellant would be liable to payment of ₹5,000/- per day to the Respondent.  Interest for delay @ 6% p.a. on ₹34,79,035/- deposited from 20.01.2013 till the date of order (18.08.2021) by 30.09.2021 failing which @ 9% p.a. till realization in addition to the compensation payable under Clause 9.5 of the Agreement.  In addition, litigation costs of ₹50,000/- were ordered to be paid and service tax of 2% ordered to be refunded.  This order is impugned before us.

We have heard the learned counsel for the parties and carefully considered the material on record.

Learned counsel for the Appellant submitted that the complaint before the State Commission was not maintainable since the cause of action arose in Gurugram and as per Clause 39 of the Agreement dated 23.11.2009 the courts at Gurgaon alone and the Punjab and Haryana High Court at Chandigarh alone shall have the jurisdiction in all matters arising out of, touching and or concerning this Agreement regardless of the place of execution of the Agreement.  It was argued that as per Clause 10.3 of the Agreement, the Appellant reserved the right to refund the amount collected with interest @ 9% p.a. and to provide no other compensation whatsoever.  The project having been completed and possession offered to the Respondent, the Respondent, it was argued, was bound to accept possession as stipulated under the Agreement.  It was further argued that as per Clause 9.2 the tentative period of 39 months for possession was to commence from the date of the sanction of the plan by the Competent Authority which was 12.01.2010 and therefore, that period ended on 12.04.2013.  Reliance was placed on the decision of the State Commission in Neetu Goyal vs Pioneer Urban Land Infrastructure Pvt Ltd in CC 772 of 2016 pertaining to the same project wherein it had been held that the State Commission lacked territorial jurisdiction to entertain the complaint.  It was, however, admitted that this order was pending in appeal before the National Commission. Reliance was also placed on the judgement of this Commission in Rohit Kumar Sahu and Anr. vs M/s Pioneer Urban Land and Infrastructure Ltd., CC 835 of 2016 dated 16.10.2019 wherein it had been held that since the opposite party was ready to hand over possession in view of the construction of the flat being complete and occupancy certificate having been received, possession be handed over subject to the builder paying interest @ 4% per annum on the amount deposited prior to the date of possession from the date of due possession till the actual date of possession.  For amounts paid after the due date of possession, interest @ 4% per annum over and above the amount of penalty payable as per Clause 9.5 of the Agreement was directed. Refund of service tax @ 2% was also ordered.  It was contended that the respondents had themselves refused to take possession of the said flat and were now seeking to make a windfall gain for an additional period of 4 to 6 years which was not permissible as held by the Hon’ble Supreme Court in M/s Supertech Ltd. vs Rajni Goyal. Reliance was also placed on this Commission’s recent judgement in Pithamber R. Polsani and Anr. Vs. M/s Pioneer Urban Land and Infrastructure Ltd., CC No. 1627 of 2016 dated 08.11.2023 which had awarded 4% compensation based on the precedent of R.K. Sahu (supra).

Per contra, learned counsel for the Respondent submitted that the Appellant was liable for deficiency in service in having delayed the offer of possession of the flat beyond 21.01.2013 including the period of grace under the Agreement.  It was submitted that the possession intimation letter  dated 03.08.2015 was misconceived since the unit in question was not ready for possession as it was neither complete in all respects nor the appellant authorized to issue an offer of possession on that date in the absence of an occupancy certificate from the concerned authorities.  It was submitted that following the order of the State Commission dated 18.08.2021 the Appellant refused to comply with the directions vide email reply dated 21.09.2021 and it was much later that an email offering possession subject to payment of illegal dues was offered by email dated 03.08.2022.  It was stated that the Respondent was suffering undue financial hardship as it was required to pay regular EMIs on the loan of Rs 20 lakhs apart from rent for accommodation and that, as a bona fide ‘consumer’ under Section 2(1)(d) of the Consumer Protection Act, 1986 the appellant was liable for deficiency in services and unfair trade practices qua the respondent.  It was submitted that the Appellant was liable to restore the Respondent to its original position by making good the loss damage caused and therefore it was prayed that the appeal be dismissed with heavy costs in the interest of justice.

Addressing the preliminary issue of territorial jurisdiction, Appellant’s reliance on the State Commission’s order in Neetu Goyal (supra) is of no avail as that issue is under appeal. In Smt. Shanti Vs. M/s Ansal Housing & Construction Ltd., First Appeal No. 142 of 2001 dated 11.04.2022 this Commission had held that a complaint can be filed against an opposite party not only where they reside or work for gain but also where they conduct business or have a branch.  I, therefore, do not find merit in the argument of the appellant that the State Commission lacked jurisdiction.

On merits, from the foregoing, it is manifest that there was delay on part of the appellants in offering possession.  The pre-possession intimation letter dated 03.08.2015 was without a valid occupancy certificate and therefore, was not a legally valid offer.  Admittedly, the occupancy certificate was available only on 21.06.2016.  The provision in the Agreement for handing over of possession was 36 months with a grace period of 3 months.  The contention of the Appellant is that Respondent was at liberty to terminate the Agreement within 3 months under Clause 10.3 when he would have been entitled to refund with interest @ 9%.  However, this was not availed.  Appellnat submitted that it had applied for the OC and the issue of OC was delayed which delay was attributable to the competent authorities.  Delay in cojpletion was due to various other reasons attributable to force majeure circumstances.  These have been considered.  No specific evidence to establish how these circumstances impacted the project in question has also been brought on record.  Hence, these averments do not sustain.

Based on an analysis of the material on the record, it is seen that the facts and circumstances of this case are virtually identical to, save for specific details of sale consideration, amount paid, dates, etc. and the matter is squarely covered by the judgment of a coordinate Bench of this Commission in Pithambher R. Polsani & Anr. (supra) which has relied upon the judgment in Rohit Kumar Sahu (supra).  Accordingly, this First Appeal is disposed of in terms of this judgment with the following directions:

(i) The appellant/Opposite Party is directed to hand over possession of the flat in question complete in all respects as per the Builder Buyer Agreement dated 23.11.2009 within a period of 45 days from the date of receipt/service of this order. The appellant/Opposite Party is further directed to pay interest @ 4% p.a. on the deposited amount by the complainants before the due date of possession, from the date of due possession till actual date of possession. For the amounts paid after the due date of possession, the interest shall be payable from the date of completion of one year from the date of deposit till the date of physical possession. This compensation of 4% p.a. interest shall be over and above the amount of penalty payable as per Clause 9.5 of the Agreement.

(ii) The appellant/Opposite Party shall also refund the amount of service tax @ 2% to the appellants if not already refunded. The parties to bear their own costs.

Pending IAs, if any, stand disposed of with this order.