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Judgment
A. P. Sahi, President Member
The Complainant applied and booked a flat in a project known as ‘Park View Sanskruti’ in Gurugram, Haryana developed by the Opposite Party. The proposed flat measured 1995 sq. ft. for a total sale consideration of Rs.1,35,64,255/-. The Opposite Party also admits having booked the apartment on 10.05.2013 and issued a letter of allotment on the same date. The Apartment Buyer Agreement was executed on 23.09.2013 whereafter the Complainant started making payments in respect of the other installments. The agreement period for handing over possession was 36 months + 6 months of grace period.
The Complainant alleges to have paid Rs.48,80,089/- upto 2014. According to the allegations made in the Complaint in Paragraph No. – 9, payments were received by the Opposite Party, at times even in advance and it is further alleged that in 2014 when the Complainant visited the site he made inquiries at the stage of construction and it is alleged that the project was much behind the schedule of construction. The Complainant alleges that he became suspicious as there was no likelihood of the project being completed, yet the Opposite Party was raising demands and had commenced raising a few towers. The Complainant alleges that he visited the officials of the Opposite Party / Builder who came out with stereo type answers calling upon the Complainant to make deposits under the agreement.
It is also alleged that even the basic phase of construction was not completed and some photographs downloaded from the website have been filed along with Complaint.
The Complainant then in Paragraph No. 16 and 19 states as follows:
That the complainant thereafter suffered a huge loss in his business and looking at the unfair activities of the respondent, the complainant sought a refund of the money, as the respondent was unable to deliver on his promises of fairness and compliances as promised at the time of the promotions of the project by the respondent.
That accordingly, vide e-mails dated 10/02/2017 & 14/02/2017 the Complainant requested the Respondent to cancel the Apartment and make refund of the amount deposited; however, till date no cancellation has been affected or refund has been made. E-mails are ANNEXURE – 4&5.”
Other submissions have been raised but basically the deficiency alleged against the Opposite Party is that they failed to offer possession within the stipulated time and therefore the Complainant was compelled to seek refund of the amount which he had paid. Consequently the claim of refund together with 18 % interest as well as other ancillary reliefs were prayed for.
Learned Counsel for the Complainant while advancing his submissions stated that inspite of mails having been sent to the Opposite Party for refund, no response was shown nor the refund was made and hence the Complaint deserves to allowed.
Learned Counsel has invited the attention of the Bench to the Written Synopsis filed and also placed reliance on the judgment in the case of Ireo Grace Realtech Private Limited versus Abhishek Khanna and Ors. reported in (2021) 3 SCC 241 Paragraph No. 21.2 (Chart B Allottees) to urge that in this case also refund was allowed where the flat buyers had paid part of the consideration and in most of the cases up to four installments. He submits that in the present case also the Complainant has paid four installments hence the aforesaid ratio should be applied and the Complaint deserves to be allowed.
In Paragraph No. – 9 of the Written Arguments, learned Counsel submits that the flat in question has been sold by the Opposite Party to one Col. Shamsher Singh Bijarania for a sum of Rs.1.35 crores and therefore no loss has been suffered to the Opposite Party who is enjoying the best of both worlds.
Responding to the aforesaid submissions learned Senior Counsel for the Opposite Party has urged that the Complainant is guilty of material suppression of facts, the Complaint also suffers from want of pecuniary jurisdiction before this Commission, the Complainant is himself a defaulter under the contract inasmuch as admittedly he has not made any payments after 2014 and is in clear default. It is also urged that the argument on resale of the flat cannot be confirmed as a copy of the Written Argument has not been served.
It has been vehemently contended that the suppression is with regard to the booking of the flat that was cancelled on the own request of the Complainant through an email dated 16.06.2016 and after a few communications the cancellation letter was also issued accepting his request on 25.03.2017. It is submitted that the booking was cancelled and the forfeiture clause was applied and therefore the Opposite Party is under no obligation to refund any amount at all. It has also been urged with the strength of respective clauses of the agreement to contend that all the clauses requiring timely payment have been violated and therefore the cancellation which is on the own asking of the Complainant is well within the four corners of the agreement.
It is submitted that story of non-completion of the project within time has been set up for the first time in the Complaint and had not been stated by the Complainant while seeking refund. It is urged that the Complainant had categorically stated in the mail dated 16.06.2016 that since he is unable to arrange for finances it was not possible for him to continue with the contract and it is in this background that he had requested for cancellation of the booking which was accepted and conveyed vide letter dated 25.03.2017 to the Complainant.
The story that possession was not offered is incorrect because, after the project had commenced and it was at the stage of digging of the foundation, that an objection was taken by the Gas Authority of India Limited regarding a gas pipeline passing through the said plot that was to be developed. This caused delay in seeking permission from the authorities and then a revised plan was applied on 16.06.2017 and was granted on 20.07.2017. The Occupancy Certificate was applied for on 30.06.2017 and was granted on 19.06.2018.
It is further submitted that the Complainant had himself brought on record the mail dated 16.02.2017 seeking refund even though incorrectly mentioning about the project not being completed.
Learned Counsel then submitted that in the absence of any pecuniary jurisdiction and also in view of the suppression of material facts and a clear default on the part of the Complainant in making payments no case is made out for entertaining the Complaint and deserves to be rejected.
On a perusal of the facts as brought on Record and having heard Ld. Counsel for the Parties it appears that the Complainant had voluntarily sent an e-mail on 16.06.2016 requesting for cancellation of the allotment without any complaint regarding the project. It was a simple request on the ground of the failure of the Complaint’s business. A second request was also made on 16.02.2017, where an allegation was added with regard to non-completion of the project, but the previous letter dated 16.06.2016 is clearly a voluntary request for cancellation. In the light of above, the allegations made in Paragraphs 9 to 12 and Paragraph-16 about the delay in the project being made the basis for the Complaint gets diluted. The fact remains that the cancellation was initiated and sought only on account of the own circumstances of the Complainant, the non-compliance by the Opposite Party in continuing the project with no Occupancy Certificate available, follows thereafter.
The delay has been explained by contending that the Gas Pipe Line had to pass through and this therefore called upon efforts made to overcome the said hurdle. This fact of any hurdle of a Gas Pipe Line does not seem to have been intimated to the Complainant but the fact remains that the Occupancy Certificate was obtained only on 19.06.2018. Prior to that the Opposite Party had applied for a revision of the plan, which is stated to have been sanctioned on 20.07.2017.
There is one more relevant fact which needs to be recorded namely, that the intimation of cancellation on 29.03.2017 has simply been denied as having not been intimated. The said letter is on Record and in Paragraph-19 of the Complaint what has been stated is “that till date no cancellation has been affected or refund made.” The said averment does not amount to denying the receipt of the cancellation Notice/Letter dated 29.03.2017. What Paragraph-19 purports to say is that the said cancellation was not given effect to nor refund was made. Thus, the only inference that can be drawn is that the letter of cancellation had been received by the Complainant but the refund had not been made.
Learned Sr. Counsel for the Opposite Party therefore is somewhat right in his submission that there has been some partial non-disclosure of the said fact with regard to the voluntary request of the Complainant to cancel the Plot vide mail dated 16.06.2016 and also with regard to the intimation of cancellation dated 25.03.2017.
Nonetheless, the Opposite Party had also not intimated the Complainant about any legal hurdle of a Gas Pipe Line, being a cause in the slow progress of the constructions nor had the Opposite Party informed the Complainant about the Revised Plan.
Learned Counsel for the Complainant urges that with this Revised Plan coming forth on 20.07.2017 it is established that there was a delay in the project and hence the Complainant was put to disadvantage on such relocations. The Complainant therefore had every reason to believe that the sanction Plan was not final even though Learned Sr. Counsel for the Opposite Party submits that it is only one Tower of the entire project which was affected under the Revised Plan, but so far as the premises of the Complainant and his Tower is concerned, the same remained unaltered.
In the background above, it is therefore evident that the Complainant had made a request for refund, which was subject to the terms and conditions of the Agreement in so far as they are not inconsistent with the law laid down on this subject.
It is here that the Commission puts on Record the valuable assistance given by the Ld. Sr. Counsel for the Opposite Party who invited the attention of the Bench to the Order in the Case of “DLF Limited Vs. Bhagwanti Narula reported in 2015 SCC Online NCDRC 1613”, where this Commission has recorded in Paragraph-10 as follows:-
“10. In Maula Bux Case (Supra), the Hon’ble Supreme Court took the following view with respect to forfeiture of the earnest money:-
“5. Forfeiture of earnest money under a contract for sale of property-movable or immovable--if the amount is reasonable, does not fall within s.74. That has been decided in several cases; Kunwar Chiranjit Singh v. Hat Swarup (t); Roshal Lal v. The Delhi Cloth and General Mills Company Ltd., Delhi (2); Muhammad Habibullah v. Muhammad Shafi (3); Bishan Chand v.Radha Kishan Das (4); These cases are easily explained, for forfeiture of a reasonable amount paid as earnest money does not amount to imposing a penalty. But if forfeirture is of the nature of penalty, s.74 applies.”
It would thus be seen that only a ‘reasonable amount’ can be forfeited as earnest money in the event of default on the part of the purchaser and it is not permissible in law to forfeit any amount beyond a reasonable amount, unless it is shown that the person forfeiting the said amount had actually suffered loss to the extent of the amount forfeited by him. In our opinion, 20% of the sale price cannot be said to be a reasonable amount which the Petitioner Company could have forfeited on account of default on the part of the Complainant unless it can show it had only suffered loss to the extent the amount was forfeited by it. In our opinion, in the absence of evidence of actual loss, forfeiture of any amount exceeding 10% of the sale price cannot be said to be a reasonable amount.”
Thus, the refund to the Complainant cannot be denied in the manner it has been pleaded by the Opposite Party according to whom the entire amount deposited by the Complainant has been forfeited with a further accounting indicating some more amount realisable by the Complainant. In the background above, the Complainant deserves to be refunded the amount of ₹48,80,000/- after deducting 10% as forfeiture amount together with service tax that has been deposited from the same to the Complainant without any interest as the Complainant himself had sought refund voluntarily.
The Complaint is therefore partly allowed to the aforesaid extent.