Pramod Arora vs M/s Ireo Grace Realtech Private Limited & Anr

Heard Mr. Arjun Garg, Advocate, for the complainant.

Pramod Arora has filed above complaint for setting aside letter dated 01.09.2016, issued by M/s. IREO Grace Realtech Private Limited (opposite party-1), cancelling the allotment of the complainant and forfeiture of entire amount of Rs.4093767/- and directing opposite party-1 to refund his amount with interest @18% per annum from the date of respective deposit till the date of refund or in alternative to restore his allotment with direction to the opposite party not to change building plan and complete registration of buyers agreement and directing the opposite parties to pay Rs.20/- lacs as compensation for harassment and cost of the litigation and any other relief which is deemed fit and proper in the facts and circumstances of the case.

The complainant has stated that the opposite parties were companies, registered under the Companies Act, 1956 and engaged in the business of development and construction of group housing project and selling its unit to the prospective buyers. The opposite parties launched a group housing project, in the name of “The Corridors” at villages Dhumaspur and Maidwas, Golf Course Extension Road, Sector-67-A, Gurgaon, in the year 2012 and made wide publicity of its facilities and amenities. The complainant and one Mr. Ashwani Handa booked a flat on 22.03.2013 and deposited booking amount. The developer issued Allotment Offer Letter on 07.08.2013, allotting Unit No. CD-C8-01-104, super area 1350.02 sq.ft., total cost of Rs.13315372.06 and executed Apartment Buyer’s Agreement on 25.06.2014. Annexure-IV of the agreement provides payment plan as “construction link payment plan”. Clause-13.3 of the agreement provides 42 months period from the date of approval of building plan, for offer of possession, with grace period of 180 days. Mr. Ashwani Handa surrendered his right in favour of the complainant, which was duly acknowledged by the opposite parties on 15.07.2014. The complainant diligently followed payment plan and demand letter and deposited total Rs.4093767/-. The building plan was approved on 23.07.2013. The period of 42 months had to complete on 22.01.2017. However, opposite party-2, vide letter dated 04.08.2016, sought consent of the complainant and other buyers to change layout plan. The complainant vide letter dated 05.08.2016, protested for change of layout plan and stated that in case of change of layout plan his money be returned with interest. M/s. IREO Grace Realtech Private Limited (opposite party-1), vide letter dated 01.09.2016, cancelled the allotment of the complainant and forfeited of entire amount of Rs.4093767/-. The complaint gave a notice dated 07.09.2016 to restore his allotment and not to change layout plan or refund his entire money with interest. Opposite party-1 gave a reply notice dated 07.11.2016, stating that as per payment plan, 4th instalment dated 03.03.2015, 5th instalment dated 03.02.2016, 6th instalment dated 23.03.2016, 7th instalment dated 26.04.2016, 8th instalment dated 02.06.2016 and 9th instalment dated 08.08.2016 were due and in spite of demand letters and reminders dated 13.04.2014, 29.03.2015, 34.04.2015, 29.02.2016, 28.03.2016, 19.04.2016, 11.05.2016, 24.05.2016, 17.06.2016, 29.06.2016 and 22.07.2016, the complainant did not deposit the instalments. Then Final Notice dated 28.07.2016 was issued but the complainant failed to clear his dues therefore his allotment was cancelled and money deposited by him was forfeited in terms of the agreement. The complainant then gave a legal notice dated 17.11.2016, for refund of his money with interest. The complainant also made complaint against the opposite parties to the Senior Town Planner and the Director, Town & Country Planning on 24.10.2016. The complainant filed this complaint on 03.01.2017, alleging unfair trade practice as change of layout plan after 3 years of allotment was arbitrary.

The opposite parties have filed its written reply on 17.04.2017 and contested the matter. The material facts relating to the project, allotment of the apartment to the complainant, execution of ABA in his favour and payments made by him have not been disputed. The opposite parties stated that although building plan was approved on 23.07.2013 but “No Objection Certificate” from Fire Department was delayed and issued on 27.11.2014 although it was applied on 24.10.2013. The construction was started thereafter. The opposite party raised demand for 4th instalment of “Casting Lower Basement Roof Slab” from the complainant on 03.03.2015, 5th instalment of “Casting Second Floor Roof Slab” dated 03.02.2016, 6th instalment of “Casting Fourth Floor Roof Slab” dated 23.03.2016, 7th instalment of “Casting Sixth Floor Roof Slab” dated 26.04.2016, 8th instalment of “Casting 8th Floor Roof Slab” dated 02.06.2016 and 9th instalment of “Casting Top Floor Roof Slab” dated 08.08.2016, which were due and in spite of demand letters and reminders dated 13.04.2014, 29.03.2015, 34.04.2015, 29.02.2016, 28.03.2016, 19.04.2016, 11.05.2016, 24.05.2016, 17.06.2016, 29.06.2016 and 22.07.2016, the complainant did not deposit the instalments. Then Final Notice dated 28.07.2016 was issued but the complainant failed to clear his dues therefore his allotment was cancelled and money deposited by him was forfeited in terms of the agreement. Haryana Government has framed Rules and constituted Adjudicatory Authority, under Real Estate (Regulation and Development) Act, 2016. The Act of 2016 is a special enactment on the subject as such the complainants be relegated to go before that authority for his grievances. The project “The Corridor" was registered under the Act of 2016. There was no deficiency in service or unfair trade practice on part of the opposite party and the complaint is liable to be dismissed.

The complainant filed Rejoinder Reply and Affidavit of Evidence and Affidavit of Admission/Denial of documentary evidence of Pramod Arora. The opposite parties filed Affidavit of Evidence and Affidavit of Admission/Denial of documentary evidence of Subhasis Lahiri. Both the parties have filed their short synopsis of the arguments.

We have considered the arguments of the counsel for the complainant and examined the record. Allotment Offer Letter dated 07.08.2013, contained Payment Plan as “construction link payment plan”. The complainant has not filed receipts of Rs.4093767/- but in the cancellation letter the opposite party has admitted deposit of this amount. Thus total three instalments were deposited by the complainant. The opposite parties stated that although building plan was approved on 23.07.2013 but “No Objection Certificate” from Fire Department was delayed and issued on 27.11.2014 although it was applied on 24.10.2013. The construction was started thereafter. The opposite party raised demand for 4th instalment of “Casting Lower Basement Roof Slab” from the complainant on 03.03.2015, 5th instalment of “Casting Second Floor Roof Slab” dated 03.02.2016, 6th instalment of “Casting Fourth Floor Roof Slab” dated 23.03.2016, 7th instalment of “Casting Sixth Floor Roof Slab” dated 26.04.2016, 8th instalment of “Casting 8th Floor Roof Slab” dated 02.06.2016 and 9th instalment of “Casting Top Floor Roof Slab” dated 08.08.2016, which were due and in spite of demand letters and reminders dated 13.04.2014, 29.03.2015, 34.04.2015, 29.02.2016, 28.03.2016, 19.04.2016, 11.05.2016, 24.05.2016, 17.06.2016, 29.06.2016 and 22.07.2016, the complainant did not deposit the instalments. Then Final Notice dated 28.07.2016 was issued but the complainant failed to clear his dues therefore his allotment was cancelled and money deposited by him was forfeited in terms of the agreement. These facts are proved by filing copies of the demand letters, reminders and pre-cancellation cancellation notice. The complainant has deliberately concealed all these material facts. Opposite party-2 sent letter dated 04.08.2016, seeking consent of the complainant and other buyers to change layout plan, which was after the various defaults of the complainant. The complainant cannot take any advantage of this letter. The complainant was defaulter as such cancellation of allotment cannot be said to be illegal.

Clause-6 of the agreement provides 20% as earnest money. In case of default in payment of the instalment, the opposite parties have right to cancel the allotment under clause 7.4 of the agreement. But Supreme Court, in Maula Bux Vs. Union of India, (1970) 1 SCR 928 and Sirdar K.B. Ram Chandra Raj Urs Vs. Sarah C. Urs, (2015) 4 SCC 136, held that forfeiture of the amount in case of breach of contract must be reasonable and if forfeiture is in the nature of penalty, then provisions of Section-74 of Contract Act, 1872 are attracted and the party so forfeiting must prove actual damage. After cancellation of allotment, the flat remains with the developer as such there is hardly any actual damage. This Commission in CC/438/2019 Ramesh Malhotra Vs.EMAAR MGF Land Ltd. (decided on 29.06.2020), CC/3328/2017 Mrs. Prerana Banerjee Vs. Puri Construction Ltd. (decided on 07.02.2022) and CC/730/2017 Mr. Saurav Sanyal Vs. M/s. IREO Grace Pvt. Ltd. (decided on 13.04.2022) held that 10% of basic sale price is reasonable amount to be forfeited as “earnest money”.

ORDER

ln view of aforesaid discussions, the complaint is partly allowed. The opposite parties are directed to refund entire amount deposited by the complainant with interest @9% per annum from the date of respective deposit till the date of refund after deducting 10% of basic sale price and brokerage, within two months from the date of this judgment.