Sanjeev Agarwal vs M/s Bhasin Infotech & Infrastructure Pvt. Ltd

Subhash Chandra, Presiding Member

This appeal under section 19 of the Consumer Protection Act, 1986 impugns the order dated 11.10.2019 in complaint case no. 1649 of 2017 by the Delhi State Consumer Disputes Redressal Commission, Delhi (in short, ‘the State Commission’) and prays for modifying the order in terms of the order of this Commission in CC no.424 of 2015 dated 24.08.2017 in Singdha Singh vs M/s Bhasin Infotech and Infrastructure Pvt. Ltd.,  on the grounds that both the matters are identical  and pertain to the same project and involve identical pleadings.

The facts of the case, in brief, are that the appellant had booked a commercial space for the purpose of earning livelihood in commercial complex named ‘Grant Venezia’ at Greater Noida. The respondent had issued an allotment letter dated 20.07.2007 in respect of the commercial space no.135 having super area 576.365 sq ft for a basic price of Rs.7200 sq foot at a total sale consideration of Rs.40,99,792/- on different dates and had been promised possession within 36 months. A demand letter was issued by the respondent on 28.01.2015 for payment of Rs.70,605/- along with other charges and offer of possession. However, the appellant found that the project was still incomplete and that the completion certificate and other clearances had not been obtained. On 04.03.2015 the appellant addressed a letter to the respondent pointing out the deficiency in service and unfair trade practice. The respondent issued another demand letter dated 31.03.2015 and intimated that the allotment would be cancelled in default. The appellant then sent a legal notice on 07.04.2015 which the respondent did not reply to.

According to the appellant, as per clause 21 of the allotment letter, the allottee was liable to pay interest @ 24% per annum for the delay in payment and therefore, the respondent should be equally liable for the delay in handing over the possession. The appellant had approached the State Commission praying for possession of the commercial space no.135 with compensation for the delay @ 18% per annum on the sum of Rs.40,99,792/- paid till the date of possession or in the alternative, to refund this amount with interest at 18% along with future interest along with litigation cost of Rs.1.00 lakh.

The impugned order reads as under:

The complainant made first prayer for possession. When the same is available and OP is willing to hand over possession, there is no reason to allow the alternative prayer of refund. The OP is directed to hand over possession of allotted flat no.135 on the first floor, having super area 536.36 sq ft., in Commercial Shopping Mall, Grant Venezia. OP is also directed to pay penalty for delay in possession @ Rs.10 per sq ft per month from the date of committed possession, i.e., 20.07.2010 till date of handing over possession.

This order is impugned before us on the grounds that the State Commission did not appreciate the facts and material/ evidence on record and directed to hand over the possession of the commercial space which was not ready for occupation. It was contended that possession was not offered even during mediation while the matter was pending before the State Commission. It was submitted that the respondent has not offered possession of the allotted space and has offered an alternative location in a project which is still in complete. It is argued that the settled legal position is that a consumer has the right to seek refund with interest and damages if the possession has not handed over within the time promised. The appellant is before this Commission with the prayer to allow the appeal and (i) modify/ alter the impugned order dated 18.09.2019 directing the respondent to refund the amount deposited with it along with interest @ 10% per annum compounded annually along with compensation for mental harassment and agony of Rs.5.00 lakh; (ii) pay litigation charges of Rs.1.00 lakh; and (iii) pass any further orders as deemed fit in the facts and circumstances of the case.

We have heard the learned counsel for the appellant. Respondent had been declared ex parte vide order dated 01.04.2021.

From the material on record and submissions made it is evident that the respondent has failed to offer possession of the commercial space no.135 allotted to the appellant within 36 months of the date of booking, i.e., 24.01.2007. As per this date of booking, the possession was required to be offered by the respondent by 24.01.2010. It is also not disputed by the respondent that the possession has not been handed over. The contention of the appellant is that he has not accepted the possession as offered vide letter dated 28.01.2015 since the project was still incomplete and occupation certificate had not been obtained by the respondent. The respondent has also not provided any occupantion certificate on record either before the State Commission or in these proceedings. The appellant has relied upon the case of Snigdha Singh (supra) in CC no. 425 of 2017 and prayed for refund of the money deposited with 10% compound interest along with damages and litigation cost.

From the foregoing, it is apparent that the possession of the allotment of commercial space has not been made by the respondent with supporting occupation certificate from the appropriate competent authorities. It is also not contested that the said commercial space was required for self-employment of the appellant. The appellant is therefore, a ‘consumer’ under the Act and is entitled to relief for the deficiency in service on the part of the respondent in not handing over the possession within the assured period of 36 months from 24.01.2010. It is a settled law that in case of inordinate delay by the builder in handing over the possession to a bona fide allottee who has not defaulted on payments a full refund of the deposited amount with reasonable compensation can be paid. In the instant case it is not disputed by the respondent that the sale consideration of Rs. 41,49,792/- the appellant has already paid a sum of Rs.40,99,792/-. While the appellant had prayed for possession before the State Commission, it has also made an alternative prayer for refund. The order of the State Commission directing handing over the possession is, however, without any occupation certificate having been brought on record. The appellant cannot be faulted for not being willing to accept the possession in view of this and instead seeking refund of the amount deposited by him. For these reasons the appeal is liable to succeed.

The Hon’ble Supreme Court has, in a catena of judgments, notably Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, II (2019) CPJ 34 (SC) decided on 02.04.2019, Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra, II (2019) CPJ 29 SC decided on 25.03.2021 and Fortune Infrastructure & Anr. Vs. Trevor D’Lima & Ors. (2018) 5 SCC 442 held that an allottee/consumer cannot be expected to wait indefinitely for possession or be compelled to accept possession and is entitled to seek either refund or possession with compensation and that in case of delay, the allottee can either claim refund with compensation or possession with compensation for the delay at his discretion.

In Experion Developers Pvt. Ltd. Vs. Sushma Ashok Shiroor, Civil Appeal No. 6044 of 2019 decided on 07.04.2022, the Hon’ble Supreme Court has held that compensation by way of interest is to be both compensatory and restitutionary and held that interest @ 9% from the respective dates of deposits is fair and equitable.  The claim of the appellant that this matter be considered in terms of the judgment of this order in Singdha Singh (supra) cannot be considered since each case stands on its own facts. The rate of 10% compounded interest is not considered to be justified in view of the catena of judgments of the Hon’ble Supreme Court and this Commission on the issue of quantification of compensation for delay in handing over possession.

In the light of the foregoing discussion the appeal is allowed in part with the following directions:

i. The respondent shall refund a sum of Rs.40,99,792/- with interest @ 9% per annum from the date of respective deposits till the date of this order within eight weeks failing which the applicable rate of interest shall be 12% per annum;

ii. Respondent shall also pay the appellant litigation cost of Rs.35,000/- .

All pending IAs, if any, also stand disposed of with this order.