National Consumer Disputes Redressal
Prakash Vishwanath Tiwari vs M/S. Monarch & Qurwshi Builders & 2 Ors. on 22 April, 2019
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 1833 OF 2016 1. PRAKASH VISHWANATH TIWARI Flat No. C-505, Lok Vihar CHS Ltd, Paspoli Village, Powai Mumbai 87 ...........Complainant(s) Versus 1. M/S. MONARCH & QURWSHI BUILDERS & 2 ORS. 76, Laxmi Palace, Mathurdas Road, Kandivali (W) Mumbai 400067(Mr. Qureshi) 2. POA Holders Sh. Jayesh Thokershi Shah Gaurav City, Mira Bhayender Road, Village Navghar Road-Bhayender (E) 401107 3. M/s Evershine Builders Pvt. Ltd. 215, Veena Beena Shopping Centre, Guru Nanak Road, Bandra (W) (Sh. R. B. Ludhani as Co-Developers) ...........Opp.Party(s) BEFORE: HON'BLE MRS. M. SHREESHA,PRESIDING MEMBER For the Complainant : Mr. Rishi Gautam, Advocate For the Opp.Party : Ms. Vandana Sehgal and Mr. Iqram Govind Singh Advocates for OP-1 and 3 Mr. RahuL gupta Advocate for OP-2 Dated : 22 Apr 2019 ORDER MRS. M. SHREESHA, MEMBER This Complaint has been filed under Section 21 (a) (i) of the Consumer Protection Act, 1986 (in short "the Act") against the Opposite Parties seeking possession of the premises and two car parking spaces with legal occupation; Membership of the Co-operative Society; compensation interest @ 21% on reciprocal basis from 31.03.2013 i.e. the promised date of possession and ₹1,00,000/- per month as compensation for harassment and mental agony due to increased cost of operations since 31.03.2011.
2. The brief facts as set out in the Complaint are that the Complainant was a tenant of room Nos. 128 and 131 on CTS No. 578 bearing Survey No. 41 Hissa No. 3, in Oshwiara Village, Andheri (w). The said premises was adopted unjustly for Re-Development along with other properties by M/s. Monarch & Qureshi Builders (hereinafter referred to as "the Developer") and was under dispute and then the dispute was settled as per Consent terms dated 10.12.2010 agreed between the Complainant and the Developer in S.C. Suit No. 1944 of 2010 before the Bombay City Civil Court Borivali Division. Thereafter, the Agreement of sale was executed between the Complainant and the Developer on 28.03.2011 in accordance with the Consent Terms and the Complainant was allotted a flat No. 2404, "C" wing, 24th floor in building "Evershine Cosmic" with carpet area admeasuring 900 sq. ft. in lieu of his old premises Room No. 128 and 131 in addition to two car parking @ ₹50,000/- each, for which the Complainant paid ₹1,00,000/- vide two cheques No. 51283543 and 51283544 dated 27.07.2011. It is also stated that the Complainant paid Service Tax of ₹3,19,757/- vide cheque No. 430969 and ₹1,22,929/- vide cheque No. 430970. In total the Complainant paid a sum of ₹5,42,666/- to the Developer for all common amenities and facilities. On 01.10.2016, the Complainant issued Causation Notice to the Developer stating that the Developer has failed to pay the monthly promised interest @ 21% and called upon the Developer to handover the subject property with Occupation Certificate and membership with share certificate to the CHS on or before 12.10.2016. The Developer denied the allegation in their reply notice dated 06.10.2016. Vexed with their attitude, the Complainant approached this Commission seeking the aforenoted reliefs.
3. The First and the third Opposite Parties filed common reply admitting to the allotment of flat No. 2404 wing 'C' in 'Evershine Cosmic' to the Complainant. It is stated that as the flat is given free of cost, this Commission does not have the pecuniary jurisdiction to entertain this Complaint and no specific date for possession was promised but as per Clause No. 6 of the consent terms, the possession of the flat is to be handed over as and when the building was complete. It is denied that the flat was worth ₹1,22,92,900/- and that the Complainant was eligible for car parking. It is stated that the Complainant was orally informed about the delay in construction. It is further stated that as the construction is not complete, it is not possible to register a cooperative society and sought for dismissal of the Complaint.
4. The second Opposite Party M/s. Evershine Builders Pvt. Ltd. (hereinafter referred to as "Evershine") filed its Written Version stating that Evershine was not a party to the Agreement dated 28.03.2011, entered into between the Complainant and the Developer and does not know the Complainant and never had any dealings with the Complainant. It is averred that Evershine was concerned about Marketing and sale of the flats in the free sale building up to the 17th floor and sale or Agreement entered with respect to flats in free sale building above 17th floor was not their concerned and that the same was clearly evident from the Consent Terms dated 26.05.2010 agreed to between the Developer and Evershine in Suit No. 1335 of 2010 before the Hon'ble Bombay High Court.
5. It is averred that the Developer and Evershine had entered into an Agreement dated 14.08.2003 as the Developer and Co-Developer. It was agreed in the Agreement that that the Developer had to prepare revised plans in consultation with Evershine for getting approvals of SRA and MCGM, to take all necessary steps to get revised layout sanctioned from SRA for development of the said premises and to obtain all the statutory permissions from the authorities at its own cost including Occupation Certificate and Completion Certificate. As per the Agreement dated 14.08.2003 Evershine was to manage the construction of buildings, marketing and sale of the buildings, flats, garages and allotment of recreation facilities in all respects of the free saleable area. The construction was to be completed in a phased manner, after getting the revised layout and building sanctions by the MCGM/ SRA and commencement certificates were issued. Evershine filed Suit No. 1335 of 2010 before the Hon'ble Bombay High Court and the same was disposed of pursuant to the Consent Terms dated 26.05.2010. As per the consent terms Evershine was exclusively entitled on behalf of the joint venture to carry out construction works of the building for the said project for sale up to the 17th Floor. The Developer was exclusively entitled to the management, marketing and sale of flats on 18th to 21st Floor of the said building. The Developer was also solely responsible for carrying out said SRA Scheme as per the Letter of Intent (LOI) and to fulfil all the terms and conditions relating to the permissions and approvals for construction of rehabilitation building. In Clause 5 of the Consent Terms dated 26.05.2010 the Developer has to indemnify Evershine against any claim or demand or action whatever by any flat purchaser in the said scheme. On 05.02.2014, Evershine and the Developer filed Supplementary Consent Terms before the Hon'ble Bombay High Court, which were taken on record by order dated 10.02.2014 in Suit No. 1335 of 2010, wherein it was recorded and confirmed that the construction of 3 wings upto 17th floor was complete by January, 2013, the Developer is constructing 18th to 21st floors and Evershine has not right or claim in the said construction work from 18th to 21st floor. The Developer had applied for Occupation Certificate on 10.07.2013 to SRA, however, due to non-compliance by the Developer of requirements of SRA, the Developer was unable to get Occupation Certificate upto 17th floor and due to that almost 186 flat purchasers were suffering. It is averred that Evershine has complied with all its obligations in terms of the Agreement and Consent terms entered into between the Opposite Parties and Evershine is not liable to any consequences of whatsoever nature, monetary or otherwise and that the Developer was solely liable.
6. Heard both sides at length.
7. It is not in dispute that the Complainant was allotted Flat No. 2404 on the 24th floor, Wing-C, in the building called "Evershine Cosmic" having total carpet area admeasuring 900 sq. ft. in lieu of the Complainants original premises i.e. Room No. 128 and 131 on the ground floor situated at Survey No. 44/5 corresponding to CTS No. 578, which is a part of Village Oshiwara, Andheri, District Mumbai suburban. It is also an admitted fact that the new flat would be provided in the proposed building to be constructed on the same property. It is also not in dispute that the Complainant had paid an amount of ₹5,42,666/- and that nothing is due from the Complainant. It is the Complainant's case that the market value of the subject flat is ₹1,22,92,900/-; that two car parking areas were also to be provided by the Opposite Parties that though 67 months have passed as on the date of filing of the Complaint, the Opposite Parties have not given possession nor the interest accrued as agreed upon between them; that as per the Agreement in case of any delay caused by the Opposite Parties, the interest @ 21% on reciprocal basis would be paid on the corresponding value consideration received and accepted, which has also not been paid; that there is no Occupation Certificate till date; that the Opposite Parties have replied to his legal notice with all false and baseless allegations and also that the certified true copies of the documents were not provided to him till date.
8. It is also an admitted fact that the second Opposite Party M/s. Evershine Builders Private Limited and the first Opposite Party M/s Qureshi Builders, on 26.05.2010 have filed Consent Terms in Suit No. 1335 of 2010 before the Hon'ble Bombay High Court. It is the case of Evershine that they were not party to the Agreement dated 28.03.2011, which was entered into between the Complainant and the Developer and therefore is not aware of any terms and conditions of the subject Agreement. It is the main case of Evershine that it was the Developer who had to prepare the revised plan in consultation with Evershine for getting approvals of SRA and MCGM and to take all necessary steps to take the revised lay out sanctioned from SRA for Development of the said property. It is the Developer, who was obliged to obtain all statutory permissions from the concerned authorities at its own cost. Evershine was to look after and manage the construction of building, marketing and sale of the flats, garages and allotment of recreation facilities. Evershine was entitled to receive all the gross sale proceeds from all purchasers of flats, shops, garages and other premises. The residential-cum- commercial complex was to be completed in phases after getting revised layout and the sanctioned plans from the concerned authorities. In May 2010 when Evershine filed a suit bearing No. 1335 of 2010 in Hon'ble Bombay High Court against the Developer with respect to the said project. The Hon'ble High Court passed an order dated 08.06.2010 in terms of the said consent terms. It was agreed between the Opposite Parties that 2003 Agreement would stand amended by these consent terms. Evershine was exclusively entitled on behalf of the joint venture to carry out construction works of the building for the said project for sale up to the 17th Floor. The Developer was exclusively entitled to the management, marketing and sale of flats from 18th to the 21st Floor of the said building. The Developer was also solely responsible for carrying out said SRA Scheme as per the Letter of Intent (LOI) and to fulfil all the terms and conditions relating to permission and approvals for construction of rehabilitation building.
9. While, the matter stood as above, both Evershine and the Developer filed Supplementary Consent Terms dated 05.02.2014, which were taken on record by an order dated 10.02.2014, by the Hon'ble Bombay High Court in suit No. 1335 of 2010. It was inter alia declared and confirmed that Evershine had completed construction work of the three wings up to the 17th floor by 7th January, 2013 and that the Developer had started construction of the 18th to 21st floor, which was in progress. It is reiterated that Evershine had no right or claim in the said construction from the 18th to 21st floor as only the Developer has the right or claim in the said construction work from the 18th to 21st floor. The Developer had applied on 10.07.2013 for issue of Occupation Certificate of the said building to SRA, but due to non-compliance by the Developer of certain requirements of SRA they were unable to get the certificate up to the 17th floor and due to non receipt of Occupation Certificate up to the 17th floor, all mots 186 purchasers of the flats were suffering.
10. It is the contention of Evershine that in the event that the Developer does not obtain the said Occupation Certificate up to the 17th floor at the earliest, the Developer alone would be liable to meet the compensation claims demanded by the Complainant.
11. For better understanding of the case, the relevant portion of the Supplementary Consent Terms filed in Suit No. 1335 of 2010 is reproduced as hereunder:
"The Defendants have applied for the Occupation Certificate of the Building Evershine Cosmic to SRA on 10th July 2013. However due to non-compliance by the Defendants of requirements from SRA, the Defendants are unable to get the Occupation Certificate upto its 17th Floors and due to non-receipt of the Occupation Certificate, almost 186 purchasers of flats have been suffering. The Defendants undertake to obtain at their entire cost and expenses, final Occupation Certificate and Building Completion Certificate in respect of the said Building "Evershine Cosmic" and its three wings "A" ,"B" and "C" (which are completed upto its 17th Floors) from SRA and other concerned Authorities upto its 17th Floors which are constructed and completed by the Plaintiffs, at the earliest. In the event of the Defendants not obtaining the said Occupation Certificate, at the earliest in that event, if any of the Occupants/ Purchasers of Flats upto 17th floors setting up any claim for compensation/ rent or otherwise with effect from date of 07.01.2013, the Defendants alone will be liable to meet such claims and they agree to indemnify and hereby indemnify the Plaintiffs against any such claim and the consequences thereof. "
12. Learned counsel appearing for the Developer vehemently contended that the Complainant was not a Consumer as it was a case of rehabilitation and no consideration was paid. Having regard to the fact that the flat No. 2404 in Wing- "C" of Evershine Cosmic admeasuring 900 sq. ft. was being given to the Complainant in lieu of his original premises i.e. Room No. 128 and 131 in the ground floor, the building of which was given for rehabilitation, additionally, the Complainant having also paid ₹50,000/- each for two car parking space and also the service tax plus VAT of ₹5,42,666/-, I am of the view that the Complainant does fall within the ambit of the definition of 'Consumer' as defined under Section 2 (1) (d) and (o) of the Act as premises which the Complainant has given in lieu for the new flat is to be construed as consideration paid and promised to be paid. The second contention of the learned counsel was that there was no promised date of delivery in the Agreement entered into between the Complainant and the Developer. Para 17 of the said Agreement, there is a provision for giving compensation within the provisions of Section 8 of the Maharashtra Ownership Flat Act, 1963 (hereinafter referred to as "MOFA"). However, the actual date and year have been left blank. If time was not the essence of the Contract, it is not understood as to how the Developer has agreed in the same paragraph to refund the amount with simple interest @ 9% p.a. if the construction was not completed on the 'aforesaid date'. For better understanding of the Clause, the same is reproduced as hereunder:
"The Developer shall under normal circumstances give possession of the Flat/ Shop to the Flat/Shop Purchaser/s on or before ...... day of .... 200... If the Developer fail or neglect to give possession of the Flat/ Shop to the Flat/Shop Purchaser/s on account of reasons beyond their control and/or of their agents as per the provision of Section 8 of Maharashtra Ownership Flat Act, by the aforesaid date or the date prescribed in Section 8 of the Act, then the Developer shall be liable on demand to refund to the Flat/ Shop Purchaser/s the amounts already received by them in respect of the Flat/ Shop with simple interest at Nine percent, per annum form the date of Developer received the sum till the date the amounts and interest therein are repaid provided that by mutual consent it is agreed that dispute whether the stipulations specified in section 8 have been satisfied or not will act as an Arbitrator. Till the entire amount and interest thereon is refunded by the Developer to the Flat/Shop Purchaser/s they shall subject to prior encumbrances if any be a charge on the said flat as well as the construction or building in which the Flat/shop are situated or were to be situated. "
13. Therefore this contention is also unsustainable in the light of the aforenoted Clause. It is the case of the Developer that the Complainant was orally informed that the possession would be given late. It is submitted by the Developer in the Written Version that the Construction is still not complete and therefore it was not possible to register the Cooperative Society and that they are unable to give any specific date for completion of the subject flat.
14. It is pertinent to note that the Developer has not stated by way Affidavit regarding stage of construction with respect to 18th to 21st floors, agreed to as per the Supplementary Consent Terms filed before the Hon'ble Bombay High Court entered into between Evershine and the Developer in February 2015. The Developer was still in the process of construction of 18th to 21st floor. Flat No. 2404 is on the 24th floor in "C" wing of the building Evershine Cosmic and the Developer is far from completing the same. It is the case of Evershine that they have nothing to do with the concerned flat is it is in the 24th floor and their liability ends with the 17th floor. Having given my anxious consideration to the submission made by all the parties, I am of the considered view that the Complainants cannot be made to suffer for any litigation on behalf of the Opposite Parties as they are not party to the consent terms entered into between Evershine and the Developer. The delay in the construction of the project cannot be justified on the ground of disputes between the two Opposite Parties. Clause 17 of the Agreement stipulates that if it on account of reasons beyond their control as per the provision of Section 8 of the MOFA, the Developer and the Co-Developer shall refund the amount paid with simple interest @ 9% p.a. In this case, viewed from any angle, the inter-se dispute between the Developer and the Co-Developer cannot be construed as reasons beyond their control. Section 3 of the MOFA, reads as hereunder:
"g) prepare and maintain a list of flats with their numbers already taken or agreed to be taken, and the names and addresses of the parties, and the price charged or agreed to be charged therefor, and the terms and conditions if any on which the flats are taken or agreed to be taken;
(i) not allow persons to enter into possession until a completion certificate where such certificate is required to be given under any law, is duly given by the local authority (and no person shall take possession of a flat until such completion certificate has been duly given by the local authority);"
15. Clause 4 of the Agreement clearly mentions that the Developer shall handover possession of the flat/shop to the purchasers after obtaining Occupation Certificate from SRA/MCGM in respect of the said flat, therefore, any inter-se disputes and also the consent terms not being adhered to cannot be a valid ground to justify the delay in the delivery of possession.
16. In the instant case the Complainant is not concerned with the tussle between both the Opposite Parties and it is their legal right to have the requisite Occupation Certificate before they occupy the flat purchased from the Opposite Parties and it is a contractual as well as legal obligation of the Opposite Parties to obtain such Occupation Certificate at their own cost and responsibility by removing all objections that are raised by the concerned authorities. By not obtaining the requisite Occupation Certificate before the promised date of delivery of possession or even within a reasonable period of time thereafter, the Opposite Parties committed an act of deficiency of service for which act of deficiency of service, they are liable to pay suitable compensation to the Complainant as no flat can be legally offered for being occupied by the purchaser without obtaining the requisite Occupation Certificate. Keeping in view the facts and circumstances of the case, specifically the Agreement between the two Opposite Parties, the contention of the Opposite Party No. 2 that he is not liable, is totally untenable.
17. It is evident from the material on record that the Opposite Parties have violated Section 8 of MOFA as they have delayed the possession of the flat for more than 7 years; have violated Section 10 of MOFA as they have neglected to form and register the Co-operative Housing Society and have additionally violated Section 11 of MOFA as they have yet to convey the title and execute the document as per Agreement.
18. It is a fit case to place reliance on the judgement of the Hon'ble Supreme Court dated 25.03.2019 in Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra (Civil Appeal NO. 3182 of 2019), in which the Hon'ble Supreme Court has observed that the flat purchasers cannot be made to wait for inordinate period of time hoping to seek possession. The Hon'ble Supreme Court in judgement dated 02.04.2019 Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan (CIVIL APPEAL NO. 12238 OF 2018), has held that even if the offer of possession is given during the pendency of the Complaint the Complainant cannot be compelled to accept the possession.
19. The matter was posted for directions on 16.04.2019 and both sides appeared and were heard regarding the latest status of the Project. On a pointed query from the Bench, it was admitted by the Opposite Parties that the construction was still incomplete and no definite date of completion could be given at this stage. Learned counsel for the Complainant, on instructions, submitted that in the present circumstances as the possession cannot be given immediately and since the Opposite Parties are unable to commit to any date even in the near future, the Complainant seeks refund of the market value of the subject property with substantial interest and compensation.
20. Having regard to the facts and circumstances of the case and also the admitted position that the building is completed only till the 17th floor, it is considered to be a fit case to direct the Opposite Parties jointly and severally to pay ₹1,22,92,900/- which is the market value of the subject property (as given by the sub Registrar on 29.03.2011 in Document No. 3708 of 2011) along with interest @ 12% p.a. from March, 2013 till the date of realisation. I also find it a fit case to award compensation of ₹2,00,000/- keeping in view the mental agony suffered by the Complainant and also that he could not realise his hope and dream of having his own apartment together with cost of ₹25,000/-.
...................... M. SHREESHA PRESIDING MEMBER