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Judgment
Dr. Inder Jit Singh, Presiding Member
The present Consumer Complaint (CC) has been filed by the Complainant against Opposite Parties (OPs) as detailed above, inter alia praying for directions to the OPs to refund the entire amount of Rs.29,99,682/- with interest of 18% per annum from the date of payment till the date of realization and Rs.20,00,000/- for mental agony and harassment.
Notice was issued to the OPs. Parties filed Written Statement/Reply, Rejoinder, Evidence by way of an Affidavit and Written Arguments/Synopsis etc. as per details given in the Table at Annexure-A. The details of the flat allotted to the Complainants/other relevant details, based on pleadings of the parties and other records of the case are also given in the Annexure-A.
Brief facts of the case, as emerged from the pleadings of the parties and other case records are that in May 2012, OP No.3 approached the Complainants and notified that the OP No.2 was selling flats by way of pre-launch and also stated that complainants would get an discount of 4% at the rate of Rs.5850/- per sq. ft instead of Rs.6191/- per sq. ft. if the Complainants purchases the unit immediately. The said offer was refused by the Complainants. However, after much persuation and representation and promises made by OP No.3, Complainants decided to book a unit in the Project, ‘Peaceful Homes’, Sector 70-A, Gurgaon, Haryana of OP No.2, who subsequently transferred the project to OP No.1. OP No.3 in collusion with OP No.2 told the complainants that if the Complainants make the payment immediately, then only he would be eligible for obtaining the discount. Complainants issued a cheque of Rs.10,00,000/- in favour of OP No.2 to book the flat and complainants received a confirmation letter for the same.
It is averred/stated in the Complaint that pursuant to the booking, the complainants did not receive any application form, Builder Buyer Agreement or any other documents with respect to the booking of the flat. Complainant no.1 enquired from OP No.3 as to when the project would be launched but OP No.3 did not give any proper response and rather guaranteed the Complainants that the project would be launched soon. The OP No.2 even did not provide the requisite documents as promised to the complainants and asked the complainants to deposit more money. The Complaints being sceptical about going ahead with purchasing a unit in the said project requested OP No.3 to refund their hard-earned money. OP No.3 in connivance with OP No.2 told the complainant no.1 that if they do not comply with their demands, then OP No.2 would cancel their booking and will forfeit the money paid. That on being frightened by the threat given by OP No.3, complainants issued two more cheques of Rs. 10,00,000.- and Rs.4,21,956/-. Even thereafter, OP No.2 did not provide them the application form as well as Builder Buyer Agreement. Complainant no.1 requested the officials of OP No.2 to supply him the documents but OP No.2 only supplied the payment receipts. The Complainants received a letter that OP No.2 had transferred their project to OP No.1. However, they were not informed about the said transfer before hand nor did they receive any application letter or the Builder Buyer Agreement. The Complainants tried to inquire about the same from the officials of OP No.2 who told them that they should now only address to OP No.1. Complainant visited the office of OP No.1 but OP No.1 also did not provide any suitable solutions to them. Instead of providing the documents, OP No.1 on the letter-head of OP No.2 issued another demand letter asking them to deposit more money. Complainant requested them to first provide application form and Builder Buyer Agreement. OP Nos.1 and 2 personally undertook to do the same on the condition that complainants deposit the money first. Being left with no other option, complainants issued cheque of Rs.5,77,726/- but OP No.1 & 2 did not provide the requested documents.
It is further averred / stated in the Complaint that officials of OP No.1 tried to shrug away from their responsibility by making the complainants sign on a blank format of an application form in the year 2013 which was later filled by officials of OP No.1 and 2. The officials of OP No.1 and 2 did not even incorporate the terms and conditions proposed by the complainants and made them to sign on the dotted lines. Complainants requested the officials of OP No.1 and 2 to enter into Flat Buyer Agreement so that they could avail a loan for making rest of the payment and officials of OP No.1 and 2 assured the complainants that Flat Buyer Agreement would be entered soon. That that after they received a photocopy of application form, demand letter was received mentioning therein that since allotment process had started, they had to pay Rs.7,57,880/-. Complainants requested the Customer Relationship Manager of OP No.1 to allow them to pay the said amount after they had availed a loan from the bank of financial institution which was possible once the OP No.1 and complainants enters into an Agreement. However, their request was not acceded to on the officials of OP No.1 and no Agreement was executed. According to the Complainant, they have made total payment of Rs.29,99,682/- till date. Another demand letter of Rs.22,66,13/ was issued to the complainants as the excavation of the Project had commenced. On receiving multiple demand letters, complainant no.1 sent an email to OP No.1 and OP No.2 for refund of money who informed the complainants that exit from project could only be done by selling off the unit to some third party. Even thereafter, the complainant kept on receiving demand letters. Complainants visited the office of OP No.1 and OP No.1 agreed to cancel the bookings and refund their money. Despite agreeing to cancel the bookings and refund the money, OP No.1 and 2 again sent final notice letter to complainants stating that they would be forced to cancel the allotment since they have not paid the instalments and gave also them ultimatum that their allotment would be cancelled and they would even forfeit the amount of earnest money and complainants would be refunded only the balance amount after deducting the amount of earnest money and other charges.
On 27.07.2015, complainants served a legal notice to OP No.1 and 2 but OP No.1 and 2 did not reply. On 29.05.2019 OP No.1 and 2 sent a pre termination letter to the complainants mentioned therein that they would cancel the allotment in case the complainants do not pay the requisite amount within 15 days of the pre-termination letter and also sent a termination letter on 13.06.2019. Being aggrieved by the said act of the Opposite Parties , the Complainants have filed the present Complaint.
The OP-1 and 2 in their written statement/reply jointly did not dispute the booking of flat, execution of Flat Buyer Agreement and stated that the Project was to be developed solely by OP No.1 and OP No.2 had no direct role in the development of said project. It is contended that OP No.2 has been improperly joined as a party to the complaint . The present Complaint does not fall with the pecuniary jurisdiction of the National Commission as complainants have sought a refund of Rs.29,99,682/-. It is further contended that complainants have defaulted in their obligations in making timely payments. OP No.1 & 2 further contended that completion of the said project has been delayed on account of reasons beyond their control i.e. 60% of the allottees have defaulted in their payments, during the course of construction various disputes relation to quality and delay in work on the said project arose with Civil Contractors of OP No.1, demonetization of currency notes, on account of various orders passed by National Green Tribunal. Further, it is contended by OP No.1 and 2 that they have no information or knowledge about the communication between OP No.3 and complainants and that OP No.3 is an independent entity.
OP No.3 in their written statement / reply stated that booking was done through M/s ROI Realty Private Limited and they are not liable. National Commission has no jurisdiction to entertain the present Complaint and complaint is barred by limitation. OP No.3 is not liable for the decision / act or omissions of OP Nos. 1 and 2. OP No.3 further contended that dispute is between the Complainant and OP No.1 and 2 and they have been unnecessarily dragged into it. The Complainant has unnecessarily dragged them as booking was done through ROI Realty Private Limited. Complainant on their own opted for the project of OP No.1 and 2 and that complainant till date never raised any complaint / concern to OP No.3.
Complainant in his rejoinder stated that present Complaint is maintainable and denied all the averments and allegations made by the Opposite Parties.
Heard counsels of both sides. Contentions/pleas of the parties, on various issues raised in the Complaint, based on their Complaint/Reply, Rejoinder, Evidence, Written Arguments, and Oral Arguments advanced during the hearing, are summed up below.
Counsel for the Complainant apart from repeating the points which are stated in para nos. 3 to 6 relied upon the judgment of the Hon’ble Supreme Court in Pioneer Urban Land and Infrastructure Ltd. Vs. Govindan Raghvan (2019) CPJ 34 (SC) . Counsel further argued that complainants booked the project of the respondent nos. 1 and 2 for residential purpose and as such they fall under the definition of ‘consumer’. It is further argued that National Commission has pecuniary jurisdiction to try the present Complaint as the total consideration of the unit is more than Rs.1.00 crore which is evident from the statement of accounts provided by OP No.1.
Counsel for OP No.1 and 2 repeated the points which are stated in para nos. 7 and relied upon the decision of this Commission in Baljit Singh Sandhu Vs. Jalandhar Improvement Trust 2016 SCC Online NCDRC 2576. Counsel has also relied on the judgment of the Hon’ble Supreme Court in Ireo Grace Realtech Pvt. Ltd. Vs. Abhishek Khanna 2021 3 SC 241 and order of this Commission in Sudha & Ors. Vs. Jaiprakash Associates Ltd. 2021 SCC Online NCDRC 166 . Counsel further argued that OP No.1 has right to forfeit the amounts in terms of the application form and has relied on Clause 19 and 33 of the Agreement. It is also argued that complainant shall be left with no right, interest or claim in the said flat and no compensation or interest or any charges shall be paid by OP Nos. 1 and 2 and relied upon on the findings of this Commission in Adarsh Mira Leekha Vs. Haryana Urban Development Authority 2012 SCC Online NCDRC 354.
Counsel for OP No.3 also repeated the points which are stated in para 8 and relied upon the order of this Commission in Rajnish Bhasin Vs. M/s Jaypee Ltd. & Anr. decided on 28.03.2018 and order of the Hon’ble Supreme Court in State of Tripura Vs. Arabinda Chakraborty and Ors. 2014 6 SCC 460.
We have gone through the Application dated 31.05.2013 with respect to unit in question, which is signed by both the Complainants. Alongwith application, an amount of Rs.10 lacs was paid. As per this application, BSP is Rs.6191 per sq.ft. of Super area and PLC Rs.200/- per sq. ft, EDC/IDC Rs.395/- per sq. ft. The super area is 2350 sq. ft., plus there are few other charges payable. This application has been signed by representatives of OP No.1. Schedule 1 of this application contains various terms and conditions and it specifically states that these terms and conditions are indicative in nature with a view to acquaint the applicant with terms and conditions applicable to the project and shall be more comprehensively set out in the agreement to be executed between the Applicant and the Company ( the Flat Buyers Agreement). This Application form is addressed to M/s Haamid Real Estate Pvt. Ltd. i.e. OP No.1. This Application states that allotment of unit shall be provisional till such time the Flat Buyer Agreement ( FBA) in the format prescribed by Company is executed between Company and the Applicant. As per this application, 15% of sale consideration constitute ‘Earnest Money’. Further, all payments under the application are to be made to Haamid Real Estate Pvt. Ltd. As per application, timely payment by Complainant is the essence, in the event of failure of Complainant to perform its obligations or fulfill the terms and conditions, the Company may cancel the allotment of unit and forfeit the Earnest Money and other amounts due.
As per the application, the committed date of possession was 36 months from the date of start of construction of the project, which shall mean the date of commencement of excavation work, with a further grace period of 6 months. Hence, the committed date of possession was 21.10.2017. In case of delay in handing over the possession, Complainant is entitled to compensation as detailed in the application.
Subsequently, OP No.1 issued a letter dated 29.07.2013 to Complainants titled ‘Intimation to take up Allotment’, stating that allotment process has started, demanding an amount of Rs.7,57,880/-. The amount was to be payable to OP No.1. Complainant wrote to OP No.1 on 03.08.2013 stating that they have already paid an amount of Rs.29,99,682/- and that demand of Rs.7,57,880/- shall be paid out of bank finance. We have perused various payment receipts, which have been issued by OP No.1 ( dated 03.06.2013), by OP No.2 ( dated June 2012- No TPH 153 for Rs.10.00 lacs, dated 24.09.2012-TPH 478 for Rs.10.00 lakh, and dated 24.09.12-TPH No.477 for Rs.4,21,956/-). Vide letter dated 21.04.2014, OP No1 issued another letter demanding Rs.22,66,713/- stating that excavation of the project has commenced. Hence, even if we go by OP No.1’s own statement of this letter that excavation of project has started, the committed date of possession as per application form comes to 21.10.2017 ( with grace period of 6 months). Vide communication dated 09.10.2014, the Complainant sought refund of this amount paid by them.
The Complainant wrote a mail to OPs on 27.07.2015, relevant extract of which is as follows :
“ Please refer to your letter dated 21st July,2015 requiring me to remit Rs.48,52,508/- failing which you will cancel the application and forfeit the amount. I am surprised and shocked on receipt of this letter. In this matter I draw your attention to my trailing mail and personal meetings at your office along with your seniors wherein I raised my issues and requested to cancel my application and refund my application money. During the meeting your seniors said that there is no process by which money can be refunded but assured that no demand letter will be send to me till the time issues are resolved.
Please appreciate that after paying Rs.30 Lacs ( approx..), there is no flat buyer agreement. The only documents that are with me is only an application form and that that too a photocopy. There was no clue at the time of booking of flat that there will be any PLC or separate charges for car parking etc. All of a sudden these things surfaced after I made substantial payments.
I had made payments to Advance India Projects Ltd. ( AIPL) which was also transferred to Haamid Real Estates Private Limited to which I do not understand the circumstances under which it was done. I am sure that at the time of booking in June 2012, there were no adequate approvals with the Company to run the project. In the circumstances, I am mentally disturbed and undergoing extreme stress which has a serious bearing on my health. Further, I have no faith in your Company and do not want to go along with the project and request you to please refund my entire money along with interest.
Relevant extract of letter dated 21.07.2015 from OP to Complainant is as follows:
“This is with reference to your unit booked in our upcoming residential group housing project ‘The Peaceful Homes' located at Sector 70A, Gurgaon, Haryana vide your application dated June 03, 2012, wherein you have paid an amount of Rs 29,99,682.00 (Rupees Twenty Nine Lakhs Ninety Nine Thousand Six Hundred Eighty Two Only) till date.
We would like to draw your kind attention to our Demand/Call Letter dated April 21, 2014, October 06, 2014 and June 02, 2015 and subsequent reminders Reminder 1 dated May 12, 2014, Reminder 2 dated May 27, 2014,, and Reminder 1 dated October 28, 2014, Reminder 2 dated November 24, 2014, Reminder 1 dated June 24, 2015, Reminder 2 dated July 17, 2015 and accordingly request you to kindly remit payment of Rs.47,61,423/- ( Rupees Forty Seven Lakhs Sixty One Thousand Four Hundred Twenty Three Only) immediately. Please note that delay in paying the installment amount is also hampering the progress of the entire project.
Despite the above communications, we have not received the above payment which is still due and outstanding from your end. We therefore serve upon you this ‘Final Notice’ requesting you once again to remit the sum of Rs.48,52,508.00 ( Rupees Forty Eight Lakhs Fifty Two Thousand Five Hundred Eight only) by July 28, 2015, failing which we shall be constrained to cancel your application / allotment and forfeit the amounts in terms of the application. In this regard your kind attention is drawn to clause 33 of the Application Form, which states “That due performance of all the obligations under this Application / Flat Buyers Agreement and more specifically the time payment of the Sale Consideration and other applicable dues and charges under the Payment Plan agreed by the Appellant shall be the essence of this Application / Flat Buyer Agreement. In the event of the failure, neglect, omission or ignorance of the Appellant to perform its obligations or fulfill all the terms and conditions set out in ( i) this Application, the Company may cancel the allotment of the Unit and forfeit the Earnest Money and other amounts due and payable to it on account of any interest accrued on delayed installments, late payment charges, applicable taxes and any Brokerage / Commission paid to any Broker and refund the balance amount, without any interest or any other compensation of any nature whatsoever, within three months of such cancellation”.
Please note that the balance amount will be paid to you in terms of clause 33 (b) of the Application form.
Kindly appreciate that it has never been our intention to cancel the allotment but since you have not paid the installment despite the fact that various reminders were sent to you by the Company, we hereby serve upon you this ‘Final Notice’ for remittance and we hope that you shall ensure that the above payment reaches us positively by July 28, 2015 to avoid incidence of actions as mentioned above.”
Subsequently, a pre termination notice dated 29.05.2019 was issued by OP No.1, followed by termination notice dated 13.06.2019, relevant extract of which is given below:
“Sub : Termination of unit A192 in ‘The Peaceful Homes’ at Sector 70A, Gurgaon, Haryana
This is with reference to your booking dated June 03, 2012 of Unit No.A192 in ‘The Peaceful Homes’. We regret to observe that despite of our communication vide our demand letter dated June 02, 2015, various Reminder letter (s) and Pre-Termination Letter dated May 29, 2019 to clear your outstanding dues, as per the agreed Payment Plan, the outstanding payment of Rs.4,243,250/- (Rupees Forty Two Lakhs Forty Three Thousand Two Hundred Fifty and Paise Fifty Only) has not been cleared by you.
We are now left with no other alternate but to enforce the termination of the captioned Unit as per the terms and conditions enumerated in the Application form.
Further, as per the provisions of the Application form, the details of earnest money and other forfeitable amount(s) are as stated below:
Particulars
Amount (Rs.)
Total Amount Received (Rs.)
29,99,682.00
Less
Earnest Money
24,16,453.20
GST on Earnest Money
4,34,961.58
Interest Accrued till June 13, 2019
32,02,989.00
GST on Interest
5,76,538.02
Marketing Expenses
2,34,936.00
GST on Marketing Expenses
42,288.48
Taxes
2,50,531.00
Total Deductions (B+C=D+E+F+G+H)
71,58,697.28
Amount Refundable / Recoverable (A-I) -41,59,015.28
With this, all documents relating to the Unit, including but not limited to Application Form, the Acknowledgement / Receipts issued by us for the amounts received from you also hereby stand cancelled and revoked. Hereinafter, you cease to have any rights / claims /entitlements or lien of whatsoever nature in the said Unit.”
From the foregoing, it is clear that after the submission of application / allotment/ OPs failed to sign FBA, which was an essential requirement under the terms and conditions of the application form and which was to contain comprehensive conditions. Hence this action itself on the part of OPs constitute deficiencies and unfair trade practice. Due to this, the Complainants were unable to raise loan from Bank to pay the demands raised by the OPs. Further, the OPs failed to complete the project and offer possession within the committed time frame ie. latest by 21.10.2017, which is even evident from the fact that Occupancy Certificate was obtained on 29.10.2019. Hence, failure of the OPs to hand over the possession of the unit to Complainant as per committed time frame amounts to deficiency in service. We find that termination notice dated 13.06.2019, under which, against an amount of Rs.29,99,682/- paid by the Complainant, total amount of deductions on account of cancellation / forfeiture worked out at Rs.71,58,697.28, is totally unreasonable. As per this notice, an amount of Rs.41,59,015.28 is recoverable from Complainants.
The contention of the OPs that OP No.2 is not a necessary party and has been improperly joined as party to the complaint is not valid as many payments have been made to OP No.2. The contention of OPs that this Commission lacks pecuniary jurisdiction is not valid. Under Section 21 of the Act, Commission has the jurisdiction where value of goods and services and compensation, if any, claimed exceeds Rs. one crore. Contention of OP that Complainants have defaulted in their obligations in terms of the application form is not acceptable. If timely payments were essence, timely delivery of possession has also necessarily to be the essence. If OPs have not signed the FBA, as was required as necessary obligation on their part and have not set out definite schedule of payments linked to various stages of construction, OPs cannot cancel the unit and forfeit the amount citing default in payments on the part of the Complainants. The OPs have failed to deliver the possession as per committed timeline. It was held by Hon’ble Supreme Court in Wg. Cdr. Arifur Rahman Khan and Aleya Sultana and Ors. vs DLF Southern Homes Pvt. Ltd. & Ors. (2020) 16 SCC 512, “failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within the contractually stipulated period, amount to deficiency”. In Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghvan (2019) 5 SCC 725, Hon’ble Supreme Court held that “flat purchaser could not be compelled to take possession of the flat, when it was offered almost 2 years after the grace period under the agreement expired”.
The objection that the Complaint is barred by limitation is also not accepted. The OPs have failed to deliver the possession of the unit to the complainant till date and therefore, the cause of action is continuing. . The plea of OP(s) that delay was due to force majeure circumstances is not valid as even after a gap of about 7 years from the committed date as per application form possession of flat was not affected. There is no documentary evidence to support the contention of the Opposite Parties that the reasons pleaded by them, can be construed as ‘Force Majeure. The contention of the OP(s) that the parties are bound by the agreement is also not acceptable. In Ireo Grace Realtech Pvt.Ltd. Vs. Abhishek Khanna & Anr. (2021) 3 SCC 241, Hon’ble Supreme Court held "Developer cannot compel apartment buyers to be bound by one-sided contractual terms contained in apartment buyers agreement". Moreover, in the instant case, no agreement was signed. Only application form has been signed which contains one-sided terms.
In the instant case, on account of deficiency in service and unfair trade practice on the part of OPs in not signing the FBA and on account of delay in handing over the possession of flat by the OPs, the Complainants have a legitimate right to claim refund alongwith fair delay compensation/interest from the OP(s). As the payments were made to OP No.1 and 2 only and application form, allotment letter and various other communications, including the termination letter were issued by OP No.1 and 2, we hold both OP No.1 and 2 to be jointly responsible for the deficiency in service and unfair trade practices and hence jointly and severally liable to refund the amount along with interest.
For the reasons stated hereinabove, and after giving a thoughtful consideration to the entire facts and circumstances of the case, various pleas raised by the learned Counsel for the Parties, the Consumer Complaint is allowed/disposed off with the following directions/reliefs: -
(i) The OP(s) ( OPs No.1 and 2) shall refund the entire principal amount of Rs.29,99,682/- (Rupees Twenty Nine Lacs Ninety Nine Thousand Six Hundred Eighty Two only) to the complainant, alongwith compensation in the form of simple interest @ 9% per annum from the date of each payment till the date of refund. The principal amount refundable mentioned in this para is subject to verification of actual amount paid by the complainant based on receipts etc.
(ii) The OPs ( OP Nos.1 and 2) shall pay a sum of Rs.25,000/- as cost of litigation to the Complainants.
(iii) The liability of the OP No.1 and 2 shall be joint as well as several.
(iv) The payment in terms of this order shall be paid within three months from today.
The pending IAs in the case, if any, also stand disposed off.
Annexure-A
Details of the Unit and other related details
Sr No
Particulars
1
Project Name/Location etc
Peaceful Homes, Sector 70-A, Gurgaon, Haryana
2
Apartment no
A-192, Tower/Block-A, Floor 19
3
Size (Built up/Covered/Super Area)
2350 sq. ft.
4
Date of application
31.05.2013
5
Date of allotment
29.07.2013
6
Date of signing Flat Buyer Agreement (FBA)
Not signed
7
Committed date of possession as per Application (with Grace period)
21.10.2017
8
D/o Obtaining OC by the OP
29.10.2019
9
D/o Offering Possession
Not offered
10
Amount Paid as per the Complainant
Rs.29,99,682/-
11
D/o Filing CC in NCDRC
06.01.2020
12
D/o Issue of Notice to OP(s)
09.01.2020
13
D/o Filing Reply/Written Statement by OP1 and 2
11.08.2020
14.
D/o filing Reply/Written Statement by OP3
18.09.2020
15
D/o filing Rejoinder by the Complainant(s)
22.03.2022 and 28.03.2022
16
D/o Filing Evidence by way of Affidavit by the Complainant Nos. 1 and 2
22.03.202
17
D/o filing Affidavit of admission/denial of documents filed by Complainant(s)
22.03.2022
18
D/o Filing Evidence by way of Affidavit by the OP-1and 2
14.07.2022
19.
D/o Filing Evidence by way of Affidavit by Op No.3
24.06.2022
20
D/o filing Written Synopsis by the Complainant(s)
02.01.2023
21
D/o filing Written Synopsis by the OP-1 & 2
09.01.2023
22.
D/o filing Written Synopsis by OP -3
04.11.2022