State Consumer Disputes Redressal Commission
Mr.Ajay Arora vs M/S.Kundan And Rameshwar Joint Venture on 23 September, 2024
1
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
AT MAHARASHTRA, MUMBAI
CONSUMER COMPLAINT NO. 263 OF 2018
Ajay Arora, S/o Late Shri HansaNand Arora,
Resident of H-18/33 (Lotus Apartments),
Sector-7, Rohini, Delhi-110085, .....Complainant
Versus
M/s Kundan&Rameshwar Joint Venture,
1st Floor, Kundan Heritage,
Opposite Khadki Railway Station,
Mumbai-Pune Highway, Pune-411020, ....Opposite Party.
Coram:
Mr.Mukesh V. Sharma, Presiding Member
Dr. Satish A. Munde, Member
Appearance:
For the Complainant : Present in person.
For the Opposite Party : Adv. Dev Bhankharia i/b Parinam Law Associates
JUDGMENT
(23/09/2024)
Per: Hon'bleMr.Mukesh V. Sharma, Presiding Member
1. The present complaint is filed by the Complainant, alleging deficiency in service and unfair trade practices against M/s Kundan&Rameshwar Joint Venture, a real estate developer. The Complainant seeks the delivery of possession of Flat No. 606 in the "WHITEFIELD" project, Pune, at the originally agreed price, along with compensation for mental agony and costs.
2. The facts of the case, as presented by the Complainant, are that on October 21, 2007, he booked a 3-BHK flat, Flat No. 606 on the 6th Floor of the "B" Wing in the "WHITEFIELD" project launched by the Opposite Party at Wakad, Pune. The flat was offered at a total price of Rs. 31,21,000/- (inclusive of Rs. 1,00,000/- for MSEB & Society Formation Charges). The Complainant paid a booking 2 amount of Rs. 2,21,000/- via cheque, which was duly acknowledged by the Opposite Party through a booking receipt (No. 15). The Opposite Party assured the Complainant that all necessary approvals from the Pimpri Chinchwad Municipal Corporation (PCMC) for the construction of the flat were in place and that possession would be handed over within a reasonable time.
3. Despite repeated requests through emails and letters, the Opposite Party failed to provide copies of the PCMC approvals or the Completion Certificate, which delayed the possession of the flat. Certain important emails and correspondences between the Complainant and the Opposite Party show that the Complainant initially demanded his money back due to the delay, but the Opposite Party neither refunded the amount nor resolved the matter. Instead, they asked the Complainant to wait for approvals. Later, in 2016, the Opposite Party demanded a significantly increased price of Rs. 95,88,320/- for the flat, citing escalations in costs due to delays that were allegedly beyond their control.
4. The Complainant alleged that this demand was arbitrary and baseless, contending that the Opposite Party's actions constituted a clear deficiency in service and unfair trade practices under the Consumer Protection Act, 1986. The Complainant submits that the Opposite Party has also violated the provisions of the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management, and Transfer) Act, 1963 (MOFA), which mandates that no promoter shall advertise or agree to sell a flat without obtaining prior approval and commencing the construction. By failing to obtain the necessary approvals and causing undue delay, the Opposite Party has breached statutory obligations, causing considerable hardship and mental agony to the Complainant.
5. The Opposite Party, in their written statement, denied the allegations and contended that the Complainant is not a consumer under the Consumer Protection Act, 1986, as no concluded contract exists. They argued that the Complainant's 3 request for a refund in 2009 indicated a waiver of his right to purchase the flat and that the complaint is barred by limitation. They further submitted that delays in constructing the 5th and 6th floors were due to procedural difficulties, including obtaining revised permissions from the PCMC and resolving contradictory orders from the Urban Land Ceiling (ULC) department.
6. The Opposite Party maintained that they were always ready to refund the booking amount, as evidenced by letters dated June 2, 2010, and February 25, 2011. However, they claim that the Complainant did not encash the refund cheque, thereby negating the cause of action for the complaint.
7. On 17/04/2018, the complaint was admitted by this Commission, notice were issued to the opposite party and on 28/06/2018, interim relief was granted to the Complainant, restraining the Opposite Party from creating any third-party interest in respect of the subject flat.
8. On 11/01/2019, this Commission passed an order stating that the complaint would proceed without the affidavit of evidence from the Opposite Party, as they failed to file the same despite the Complainant having submitted his evidence affidavit. The Opposite Party did not submit any evidence affidavit, and hence their written statement lacks evidentiary value, as it is not supported by any admissible evidence. Only facts that are admitted by the Opposite Party can be considered, and they are permitted to raise only legal points.
9. The matter was heard on 21/09/2022, and both parties were given an opportunity to present their case. The complaint was thereafter adjourned for order on 11/10/2022. However, due to a change in the bench that initially heard the matter, the case was further adjourned for rehearing on 05/12/2023. The final rehearing took place on 16/06/2024, and the matter was reserved for judgment.
410. After perusing the complaint, attached documents, including the complaint, written statement, and written notes of arguments, and considering the submissions made by both parties, the following issues arise for determination:
Issue Issue Finding
No.
1 Whether the Complainant is a consumer under the Yes.
Consumer Protection Act, 1986?
2 Whether the complaint is within the jurisdiction of this Yes.
Commission?
3 Whether the complaint is barred by limitation? No.
4 Whether there is a deficiency in service or unfair trade Yes.
practice by the Opposite Party?
5 Whether the Complainant is entitled to the reliefs Yes, with claimed, including possession, compensation, and modifications costs? as detailed below 6 What Order? As per final order.
:Reasoning on Issues:
1. Whether the Complainant is a consumer under the Consumer Protection Act, 1986?
The Complainant paid a booking amount of Rs. 2,21,000/- for Flat No. 606 in the "WHITEFIELD" project, which was duly acknowledged by the Opposite Party. As per Section 2(1)(d) of the Consumer Protection Act, 1986, a consumer is defined as any person who buys goods or avails services for consideration. The payment made by the Complainant towards the purchase of a flat clearly falls within the ambit of this definition, establishing a consumer relationship. The Opposite Party's contention that the Complainant is not a consumer due to the absence of a formal agreement is unsustainable. The Opposite Party received the booking amount and acknowledged the transaction, thereby creating a valid 5 contractual relationship under the Act. Therefore, Issue No. 1 is answered in the affirmative.
2. Whether the complaint is within the jurisdiction of this Commission?
This Commission has both territorial and pecuniary jurisdiction over the complaint. The total consideration for the flat is Rs. 31,21,000/-, and the compensation claimed falls within the pecuniary jurisdiction of this Commission as stipulated under Section 17 of the Consumer Protection Act, 1986. Furthermore, the Opposite Party's business operations are located in Pune, which is within the territorial jurisdiction of this Commission. Hence, Issue No. 2 is answered in the affirmative.
3. Whether the complaint is barred by limitation?
The Opposite Party argued that the complaint is barred by limitation, asserting that the Complainant sought a refund in 2009, effectively waiving his rights. However, the record shows that the Complainant continued his engagement with the Opposite Party concerning the possession of the flat and received multiple assurances. The Opposite Party did not refund the amount and instead continued to request the Complainant to wait until they secured the necessary permissions and sanctions. The Opposite Party's demand for an increased price in 2016, followed by their letter dated February 16, 2018, where they threatened to cancel the booking unless the increased price was paid, constitutes a fresh cause of action. The complaint, filed on March 22, 2018, is within the limitation period prescribed under Section 24A of the Consumer Protection Act, 1986. Therefore, Issue No. 3 is answered in the negative.
4. Whether there is a deficiency in service or unfair trade practice by the Opposite Party?
The Opposite Party has clearly violated the provisions of Section 4 of the Maharashtra Ownership Flats Act (MOFA) by failing to entering into agreements 6 with the Complainant. The Opposite Party's conduct in making the Complainant wait until they received the required approvals and subsequently demanding an increased price demonstrates a clear deficiency in service. Additionally, the demand for an increased rate constitutes an unfair trade practice under Section 2(1)(r) of the Consumer Protection Act, 1986. The Opposite Party's actions have caused financial loss and mental agony to the Complainant, who has acted in good faith throughout. Therefore, Issue No. 4 is answered in the affirmative.
5. Whether the Complainant is entitled to the reliefs claimed, including possession, compensation, and costs?
The Complainant is entitled to relief considering the deficiency in service and unfair trade practices established above. The Opposite Party's failure to provide the necessary approvals, coupled with their arbitrary demand for a higher price, is unjustifiable. The Complainant is entitled to the possession of Flat No. 606 at the originally agreed price of Rs. 31,21,000/-. Further, considering the mental agony, inconvenience, and financial loss caused to the Complainant, he is entitled to compensation. Additionally, the Opposite Party is liable to pay cost of litigation. Therefore, Issue No. 5 is answered in the affirmative.
6. What Order?
In view of the above findings, we proceed to pass the following order on Issue No. 6:
: Final Order :
a) The complaint is partly allowed.
b) The Opposite Party is directed to provide the Complainant with a standard format of the Agreement for Sale in advance. Thereafter, the Opposite Party shall render the assistance to the complainant and further execute and register the Agreement for Sale in favor of the Complainant for Flat No. 606, located on the 6 th Floor of "B" Wing in 7 the "WHITEFIELD" project, at Survey No. 125/1/2, Opposite Chandramauli Garden, Wakad, Pune, Maharashtra. The Opposite Party is further directed to hand over vacant and peaceful possession of the said flat to the Complainant at the originally agreed price of Rs. 31,21,000/- within 45 days from the date of this order.
c) The Opposite Party shall pay compensation of Rs. 2,00,000/- to the Complainant for mental agony, hardship, and financial loss within 45 days from the date of this order.
d) The Opposite Party is also directed to pay Rs. 50,000/- towards the cost of litigation to the Complainant within 45 days from the date of this order.
e) The Complainant shall bear the statutory charges and taxes and to pay the balance consideration, after the execution of the Agreement for Sale, and at the time of handing over the possession of the flat. The awarded compensation and costs totaling of Rs. 2,50,000/- be adjusted against the balance consideration payable by the Complainant.
f) In the event of any delay in execution, registration and handing over possession of the flat to the Complainant by the opposite party, the Opposite Party shall be liable to pay a penalty of Rs. 1,000/- per day for each day of delay, commencing after the expiry of 45 days from the date of this order.
g) A copy of this order be supplied to both parties.
[Mukesh V. Sharma] Presiding Member [Dr. Satish V. Munde] Member MVK/aj