Pravin Padmakar Banavalikar vs Silvex Realty Private Limited

Heard Mr. Shoeb Alam, Advocate, for the appellants and Mr. Rajesh Ved, Advocate for the respondent.

The complainant has filed above appeal against the order of Maharashtra State Consumer Disputes Redressal Commission, dated 28.09.2021, passed in CC/79/2012, dismissing the complaint and directing the parties to agitate their dispute before the Arbitrator appointed by  the High Court, in Company Petition No.386 of 2011, by order dated 19.12.2012.

Pravin Padmakar Banavalikar (the appellant) filed CC 79 of 2012 for directing the respondent to (a) handover possession of Flat No.101, 1st Floor and Flat No.201, 2nd Floor in the building “Tuscany Terraces-Lilium” at Village Dhamote, Taluka Karjat, District Raigad; (b) pay delay compensation @ Rs.1500/- per day from 01.04.2009 till handing over possession; (c) complete the work, if any, and obtain “occupation certificate” of the building “Chelone-Tuscany Terraces” from the competent authority; (d) form and register cooperative housing society of the condominium of the apartments and execute the conveyance deed in favour of the society; (e) pay Rs.10/- lacs, as compensation for mental agony and harassment etc.; (f) pay Rs.50000/-, as litigation cost; and (g) any other relief, which is deemed fit and proper in the facts and circumstances of the case. By an amendment, an alternative relief for refund of entire consideration, with interest @18% per annum from the date of respective deposit till the date of refund was claimed.

The complainant stated that Silvex Realty Private Limited (the OP) was a company, registered under the Companies Act, 1956 and engaged in the business of development and construction of group housing project. The OP launched a group housing project, in the name of “Tuscany Terraces-Lilium” at Village Dhamote, Taluka Karjat, District Raigad, in the year 2007. The complainant booked Flat No.201 admeasuring 500 sq.ft. and Flat No.201 admeasuring 830 sq. ft., 2nd Floor, “Tuscany Terraces-Lilium” and deposited Rs.301185/- and Rs.499971 on 02.04.2008. The OP executed two separate agreements for sale dated 29.05.2008 of Flat No.101, for a consideration of Rs.2007900/- and Flat No.201 for a consideration of Rs.3333114/-. The complainant took housing loan of from State Bank of India, who directly disbursed Rs.1533634/- for Flat No.101 and Rs.2545855/- for Flat No.201 to the OP. The complainant paid total amount of Rs.1834819/- and Rs.3045826/-. Clause-8 of the agreement provides that possession of the flat will to be handed over within 6 months from the date of the commencement of the construction or on or before 31.03.2009, whichever is later, subject to force majeure conditions. The OP failed to handover the possession within the stipulated period. Then the complainant sent letter dated 24.10.2011, requesting the OP to complete the incomplete work and handover the possession with compensation of Rs.1500/- per day from 01.04.2009, within 15 days. Said letter was received back on 31.10.2011 with endorsement “unclaimed”. The complainant sent a notice to the OP on 25.08.2011, demanding his arrears of the salary. Although the OP received said notice on 29.08.2011 but did not pay his dues, as such, he filed Company Petition No.386 of 2011 before the Bombay High Court, for binding up the OP. The complainant again sent a notice on 23.12.2011 to the OP, reiterating the contents of earlier notice dated 24.10.2011, which was received by the OP on 27.12.2011, but nothing was done by the OP. Therefore, the complaint was filed on 11.04.2012.

The opposite party failed to file its reply despite service of notice. Therefore, it was proceeded ex-parte, vide order dated 31.03.2012. The OP challenged the order dated 31.03.2012 before this Commission in RP/3482/2013, which was dismissed on 01.11.2013. RA/358/2013 filed by the OP was dismissed on 18.12.2013. The OP challenged these orders before Supreme Court, which was dismissed on 03.06.2014.

During the pendency of the complaint, State Bank of India (the SBI) gave a demand notice dated 18.04.2012, under Section 13(2) of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFACESI Act), to the complainant, for payment of its dues. In spite of the service of the notice, the complainant did not pay the dues of the SBI, then it gave possession notice under Section 13(4) of the Act on 14.08.2012 and took possession. After taking possession, the SBI sold Flat No.101 on 18.01.2018 and Flat No.201 on 24.10.2018. The OP filed an application for impleadment of the M/s. Assets Reconstructon Company (India) Limited as opposite party, on 03.05.2018, which was rejected by State Commission by order dated 06.02.2019. Then the complainant filed an application for amendment of the complaint, bringing on record that due to non-payment of the loan, the SBI took possession of the flat and sold the same to a third party and praying for alternative relief of refund, which was allowed by the State Commission vide order dated 09.09.2019.

Then, the OP filed its written reply stating that the complainant was appointed as ‘Chief Financial Officer’ of the OP on 13.08.2007 and promoted as ‘Group Managing Director’ on 01.05.2008. The complainant resigned from the company on 11.10.2010. The complainant filed Company Petition No.386 of 2011 in the Bombay High Court, for binding up the OP and realization of its arrears of the salary, on 21.09.2011. The OP agreed to handover possession of the Flat Nos.101 and 201 within 60 days and both parties agreed to resolve the rest of dispute by arbitration, as such, High Court, vide order dated 19.12.2012 disposed of the petition with the consent of the parties and also appointed Mr. Ashish Kamat, Advocate as an arbitrator. High Court directed the complainant to withdraw the consumer complaint filed before the State Commission. The OP, vide letter dated 28.03.2013, offered possession of Flat Nos.101 and 201 to the complainant but the complainant, vide letter dated 04.04.2013 asked for “occupation certificate” etc., which was replied by the OP vide letter dated 23.04.2013. The complainant filed Contempt Petition No. 6 of 2013 before Bombay High Court on 22.04.2013. The OP filed an application for dismissing the complaint on 01.10.2013. In view of offer of possession of the flat, vide letter dated 28.03.2013, High Court dismissed the contempt application, vide order dated 21.08.2015. State Bank of India took possession of Flat Nos.101 and 201 and sold it due to default committed by the complainant in repayment of the loan as such the complaint is liable to be dismissed.

After hearing the parties State Commission, vide order dated 28.09.2021, held that the banker of the complainant has already taken possession of Flat Nos.101 and 201 and sold it to a third party. The dispute relating to refund may be raised by the complainant before the Arbitrator as directed by the High Court. On these findings, the complaint was dismissed giving liberty to the complainant to raise his dispute before the Arbitrator. Hence the complainant has filed this appeal.

We have considered the arguments of the counsel for the parties and examined the record. The complainant filed Company Petition No.386 of 2011 on 21.09.2011, for binding up the OP and realizing his arrears of the salary in Bombay High Court,. The complainant filed CC/79/2012 on 11.04.2012, for possession of Flat Nos.101 and 201 and other consequential relives. When company petition was taken up on 19.12.2012, by the High Court, the OP agreed to handover possession of the flats within 60 days and both parties agreed to resolve the rest of disputes by arbitration. High Court disposed of the petition with the consent of the parties vide order dated 19.12.2012 and appointed Mr. Ashish Kamat, Advocate as an arbitrator. Relevant part of the order of Bombay High Court dated 19.12.2012 is as under: -

“After arguing the matter for some time, the learned counsel for the parties, after taking instructions from their respective clients who are present in the Court, stated that the petitioner can be disposed of by following directions and no reasons in support of the order be given:

(i)  The parties are agreeable to get the disputes raised in both the company petitions resolved through arbitration.

ii. Mr. Ashish Kamat, Advocate practicing in the Court will be the Sole Arbitrator to resolve the dispute in respect of both the references.

iii. The respondent will hand over the flats to the petitioner in company petition No.386 of 2011 within 60 days of receipt of NOC from his bankers or 31st March, 2013 whichever is later and to the flat of petitioner in company petition No.387 of 2011 on or before 31st March, 2013, on terms and conditions as were agreed between the parties. The letter addressed to the advocate by Mr. Shailesh Mahadik is taken on record.

iv. The petitioner shall withdraw the complaint filed by them in the Consumer Court and the claim of the petitioner in respect of damages and interest raised therein will be agitated in the arbitration proceedings.

v. The petitioner will be at liberty to move an application under Section 7 or 17 of the Arbitration and Conciliation Act, 1996, upon the statement of the respondent that the respondent are entitled to receive balance payment from the purchaser of the flats in the company’s project at Neral”

Although the complainant filed Company Petition No.386 of 2011 for binding up the OP and realizing his arrears of the salary but through oral request, the dispute relating to possession of the flats and delay compensation etc. were also brought before the High Court. In a binding up proceeding against the OP, the dispute in respect of all the assets could be resolved by the High Court as such the order dated 19.12.2012 was passed with the consent of the parties. The complainant filed Contempt Petition No.6 of 2013, alleging violation of the order dated 19.12.2012 by the OP in not obtaining “occupation certificate” and handing over possession, before 31.03.2013. High Court, vide its order dated 21.08.2015, found that possession the flats was offered in a habitable condition through letter dated 28.03.2013 to the complainant. So far as issuance of “occupation certificate”, was concerned, the OP was throughout pursuing it with the statutory authority and also gave an undertaking to make genuine effort for issue of “occupation certificate”, therefore, there was no willful disobedience. High Court further observed that withdrawal of consumer complaint was a reciprocal obligation and depended on handing over possession. On these findings, the contempt was dismissed. “Partial occupation certificate” is issued on 02.08.2017. Although the SBI gave demand notice dated 18.04.2012, under Section 13(2) of the SARFACESI Act, for payment of its dues to the complainant and in spite of the service of the notice, he did not pay the dues then the DHFCL gave possession notice under Section 13(4) of the Act on 14.08.2012 and took possession of the flats in dispute, which were later on sold on 18.01.2018 and 24.10.2018. But these facts were not brought to the notice of High Court by either of the parties on 21.08.2015.

High Court, in the order dated 21.08.2015, held that withdrawal of consumer complaint was a reciprocal obligation and depended on handing over possession. Now possession of the flats was taken by the SBI, on the basis of loan agreement dated 31.05.2008, executed by the complainant. Issue arises for consideration as to whether the OP is still under the obligation to handover possession the flat although its possession has already taken by the creditor of the complainant?. If the creditor of the complainant has taken possession of the flats booked by the complainant, then the OP is under no obligation either to give possession of the same flats or any alternate flats nor the OP can be directed to refund sale consideration as the obligation of the OP under agreement dated 29.05.2008 for possession of the flats to the complainant, stood discharged. At the most, the complainant can claim delay compensation but the consumer complainant is liable to be dismissed in terms of the order of the High Court.

It may be mentioned that after the order of High Court, the complainant submitted his statement of claim in respect of arrears of salary before the Arbitrator on 22.06.2013, which is pending before the Arbitrator. The complainant can add his claim of delay compensation before in arbitration proceeding. The counsel for the appellant relied upon the judgment of Supreme Court in Civil Appeal Nos.6500-6501 of 2023 Smt. M. Hemlatha Devi Vs. B. Udayasri (decided on 10.05.2023), in which order of High Court dismissing the application under Section 11 of the Arbitration and Conciliation Act, 1996 on the ground of pendency of consumer dispute, has been upheld. This case law is not applicable in the present as in the present case, High Court referred the dispute for arbitration on the consent of the parties. This order has not been challenged rather the complainant moved an application for contempt for disobedience of this order. The complainant cannot be permitted to approbate and reprobate at the same time. In view of aforesaid discussions, we do not find any illegality or irregularity in the impugned order of State Commission and the appeal deserves to be dismissed.

ORDER

In view of the aforesaid discussions, the appeal is dismissed.