State Consumer Disputes Redressal Commission
Rakesh Garg vs M/S Parsvnath Developers Ltd. on 22 December, 2021
CC/1650/2018 D.O.D: 22.12.2021
RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Date of Institution: 27.12.2018
Date of Final Hearing: 03.12.2021
Date of Decision: 22.12.2021
COMPLAINT CASE NO.- 1650/2018
IN THE MATTER OF
MS. RAKESH GARG
w/o Sh. Rakesh Kumar Garg,
r/o AK-23, Shalimar Bagh,
New Delhi-110088.
(Through: Ravi Shankar Garg & Associates, Advocate)
...Complainant
VERSUS
M/S PARSVNATH DEVELOPERS LTD.
6th Floor, Arunachal Building,
19, Barakhamba Road,
New Delhi - 110 001.
(Through: Mr. Rakesh Bhardwaj & Mr. T.P.S. Chauhan, Advocate)
...Opposite Party
ALLOWED PAGE 1 OF 14
CC/1650/2018 D.O.D: 22.12.2021
RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
CORAM:
HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL,
(PRESIDENT)
HON'BLE SH. ANIL SRIVASTAVA, (MEMBER)
Present: Mr. Gaurav Gupta, Counsel for the Complainant.
Mr. T.P.S. Chauhan, Counsel for the Opposite Party.
PER: HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL,
PRESIDENT
JUDGMENT
1. The present Consumer Complaint has been filed before this Commission under Section 17 of the Consumer Protection Act, 1986, by Ms. Rakesh Garg (hereinafter referred to as "Complainant") against M/s Parsvnath Developers Ltd. (hereinafter referred to as "Opposite Party") seeking the following reliefs: -
a) To opposite party to immediately allot the booked plot measuring 500 sq. yard @ Rs. 3700/- per sq. yard to present complainant in the residential township project of opposite party namely PARSVNATH CITY at Sonepat, Haryana and also intimate the complainant about the balance sale consideration of the plot (as booking rate was Rs. 3700/- per sq. yard) and further after receiving the balance sale consideration, possession be given to the complainant after executing the necessary sale documents.
b) To opposite party to pay the penalty/compensation to complainant for in ordinate delay in allotment of the plot to be calculated as interest @ 18% on the deposited amount of Rs. 9,25,000/- (50% of the total cost of plot) from March 2009 (period of 4 years has excluded for development of project from the date of booking i.e. ALLOWED PAGE 2 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
01.09.2004) till the allotment as well as possession of the plot.
c) To opposite part to pay the compensation of Rs. 5,00,000/- for harassment and mental agony suffered by the complainant due to deficiency of service on the part of opposite part.
d) Award cost of litigation of Rs. 50,000/- being Advocate's fee & Misc. Expenses. "
2. Brief facts necessary for the adjudication of the present complaint are that the Opposite Party widely publicized their project by the name and style of "Parsvnath-City", persuaded by which, one Smt. Rekha Garg w/o Sh. Ashok Garg booked a residential plot measuring 500 sq. yard @ Rs. 3700/- per sq. yard, by paying an amount of Rs. 2,75,000/- as booking amount, which was duly acknowledged by the Opposite Party vide receipt no. PC000946 dated 01.09.2004.
3. However, Smt. Rekha Garg assigned all her rights in the aforesaid plot in favour of Smt. Rakesh Garg and an endorsement to that effect was made in the records maintained by the Company. Thereafter, the Complainant made a payment of Rs. 6,50,000/- to the Opposite Party, which was duly acknowledged by it vide receipt no. PC003468 dated 10.02.2006.
4. On 31.03.2006, vide a letter of even date, the substitution of the name of the present Complainant in place of the original applicant was confirmed by the Opposite Party.
5. Till the time of filing of the present complaint, the Opposite Party had received an amount of Rs. 9,25,000/- out of the total basic cost of Rs. 18,50,000/- on behalf of the Complainant. However, despite ALLOWED PAGE 3 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
the same, the Opposite Party had failed to allot a plot to the Complainant, let alone the handing over of the possession.
6. On a regular basis, the Complainant tried to enquire from the Opposite Party as to the progress of the aforesaid project by calling on the telephone number of the Registered Office as well as the Branch office of the Opposite Party but never got a satisfactory response from the executives of the Opposite Party.
7. Alleging deficiency of service and unfair trade practice on the part of Opposite Party, the Complainant approached this commission.
8. The Opposite Party contested the present case and raised some preliminary objections as to the maintainability of the present complaint and contended
(a) that the said plot has been purchased solely for the purpose of investment, merely for "Commercial Purpose", hence, the complainant is not a Consumer within the provisions of the Consumer Protection Act, 1986;
(b) that the global recession hit the economies worldwide and the real estate sector also took a major hit, which is the major cause of delay in construction;
(c) that the present complaint involves complicated question of facts and law which need to be proved by leading detailed evidence, which could only be done before a Civil Court;
(d) That the Complainant has failed to establish any kind of deficiency in providing services by the Opposite Party.
9. The Complainant filed her Rejoinder rebutting the written statement filed by the Opposite Party. Both the parties filed their Evidence by ALLOWED PAGE 4 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
way of Affidavit in order to prove their averments on record. After the completion of the pleadings, the Final Arguments were heard.
10. We have heard the counsel for both the parties and perused through the material on record. The fact that the Complainant had booked a plot with the Opposite Party is not in dispute from the evidence on record. Even the payment to the tune of Rs. 9,25,000/- is not denied by the Opposite Party.
11. Before delving into the merits of the case, we deem it appropriate to adjudicate preliminary issues as to the maintainability of the Consumer Complaint.
COMPLAINANT- A CONSUMER OR NOT?
12. The Opposite Party has contended that the Complainant is not a Consumer as defined under the Consumer Protection Act, 1986 since the flat was purchased for investment, which constitutes commercial purpose.
13. It is imperative to refer to the dicta of the Hon'ble National Commission in CC-1122/2018 titled Narinder Kumar Bairwal and Ors. Vs. Ramprastha Promoters and Developers Pvt. Ltd. and Ors. decided on 01.11.2019, wherein, the Hon'ble National Commission has held as under:
"19. The contention of the Learned Counsel that the said Apartments were purchased for commercial purpose is not supported by any documentary evidence as the onus shifts to the Opposite Parties to establish that the Complainants have purchased the same to indulge in 'purchase and sale of flats' as was held by this Commission in Kavit Ahuja vs. Shipra Estates I (2016) CPJ 31. The Opposite Parties failed to discharge their onus and we hence hold that the Complainants are 'Consumers' as defined under Section 2(1)(d) of the Act."
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RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
14. From the aforesaid dicta of the Hon'ble National Commission, it flows that it is for the Opposite Party to prove that the plot purchased was for commercial purpose, by way of some documentary proof and a bald statement is not sufficient to raise adverse inference against the Complainant.
15. In the present case also, the Opposite Party has merely made a statement that the Complainant purchased the plot for commercial purpose and on perusal of the record before us, we fail to find any material which shows that the Complainant is engaged in the business of purchasing and selling houses and/or plots on a regular basis, solely with a view to make profit by sale of such houses. Mere allegation, that the purchase of the property is for commercial purpose, cannot be the ground to reject the present consumer complaint. Consequently, the objection raised on behalf of the Opposite Party in answered in the negative.
GLOBAL RECESSION-GROUND FOR DELAY?
16. The Opposite Party has also contended that the delay is attributable to the global recession which hit the economies worldwide and the real estate sector also took a major hit. The present issue is no more res Integra and has been discussed by the Hon'ble National Commission in plethora of judgments. We tend to rely on CC-1328/2017 titled Pratima Rajpal and Ors. vs. Parsvnath Developers Limited decided on 30.05.2019, wherein, a similar stand was taken by the present developer before the Hon'ble National Commission, which was finally adjudicated as under:
"9. .........The stand taken by the Opposite Party that the period of delivery of possession is 36 months as defined in clause 10 (a) is not sacrosanct as it is stated in the said ALLOWED PAGE 6 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
clause that "Construction of the Flat is 'likely' to be completed within a period of thirty six months" and therefore 'Time is not the essence of the contract' and the delay is attributable to Force Majeure Events, and therefore no deficiency of service can be attributed to them is totally unsustainable as the Opposite Party could not substantiate by means of any documentary evidence that the project was delayed by Force Majeure Events. Except for stating that there was global recession in the year 2009, which affected the real estate sector and there was financial crunch experienced by the Developer which led to the delay, which submission, viewed from any angle, cannot be said to be a "Force Majeure Event". The Opposite Party has not filed any material on record to prove that the reasons were beyond their control."
17. Even in the present case also, the Opposite Party has not brought forth any documentary evidence to prove that the project in question was directly impacted by the Global Recession. Having regard to the aforesaid binding dicta of the Hon'ble National Commission, we are of the view that the contention of the Opposite Party holds no concrete ground and is answered in the negative. WHETHER THE CIVIL COURT HAS JURISDICTION -
JURISDICTION OF CONSUMER COMMMISSION BARRED?
18. The Opposite Party has also contended that the jurisdiction of this Commission would be barred in view of the fact that complicated question of facts and law have been raised in the present complaint which can only be decided before the Civil Court.
19. The Consumer Protection Act, 1986, came into being in order to protect the interests of Consumers who are affected by the acts of the service providers, who in order to attract the Consumers, tend to ALLOWED PAGE 7 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
make lucrative offers but when it comes to actually providing the offered services, they take a step back.
20. The Consumer Protection Act, 1986 defines a Consumer as follows:
"(2)
(d) "Consumer" means any person who--
(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who 'hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purposes;
Explanation.-- For the purposes of this clause, "commercial purpose" does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment;"
21. Deficiency has been defined under section 2 sub-clause (g) which reads as follows:
"(2) (g)"deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service;"
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RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
22. Returning to the facts of the present complaint, the perusal of the record shows that the Complainant entered into an agreement to avail the services of the Opposite Party for a consideration. However, the Opposite Party failed to honour the terms of the agreement, aggrieved by which, the Complainant has sought certain reliefs against the Opposite Party. Hence, the Complainant is entitled to file the present complaint before this commission since the Complainant is aggrieved by the deficient services of the Opposite Party i.e. the failure of the Opposite Party to handover the possession within the prescribed, which this Commission is authorised to adjudicated.
23. Our view is further fortified by the dicta of Hon'ble Supreme Court in Narne Construction P. Ltd., etc. v. Union of India and Ors. Etc., reported at AIR 2012 SC 2369, wherein it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression 'service' of any description. Housing construction or building activity carried on by a private or statutory body constitutes 'service' within the ambit of Section 2(1)(o) of the Act and any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers.
24. Moreover, nothing cogent has been brought on record by the Opposite Party which would reflect that there are such complicated questions involved which could not be settled on the basis of the pleadings filed on behalf of the contesting parties.
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25. Consequently, we are of the view that the complaint is well within his right to file the complaint before this commission as there is nothing restraining this commission from finally adjudicating the present complaint.
DEFICIENCY OF SERVICE
26. Having discussed the maintainability of the present complaint, the question left to adjudicate is whether the Opposite Party is actually deficient in providing its services to the Complainant. The expression Deficiency of Service has been dealt with by the Hon'ble Apex Court in Arifur Rahman Khan and Ors. vs. DLF Southern Homes Pvt. Ltd. and Ors. reported at 2020 (3) RCR (Civil) 544, wherein it has been held as follows:
"24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression 'service' in Section 2(1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfilment of a contractual obligation."
ALLOWED PAGE 10 OF 14 CC/1650/2018 D.O.D: 22.12.2021
RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
27. The perusal of the records of the present case reflect that no specific time period for handing over the possession of the plot has been provided by the Opposite Party. Even though the Booking Form states that in the event the residential plot is allotted after nine months, the Opposite Party shall be liable to pay an interest @ 9% p.a., however, that cannot be deemed to be the time period for handing over the possession.
28. In order to settle this issue, we deem it appropriate to refer to the dicta of the Hon'ble National Commission in Ajay Enterprises Pvt. Ltd. and Ors. vs. Shobha Arora and Ors. reported at 2019 (2) CPR 828, wherein it has been held as under:
"18. So far as the issue of non-mentioning of the period for completion of construction and for handing over the possession is concerned, it is seen that the Real Estate (Regulation and Development) Act, 2016 provides for obligation on the part of the builder to give a date for completion of construction and handing over the possession. Under section 13 (2) of the Real Estate (Regulation and Development) Act, 2016, it is mandatory to provide "the date on which the possession of the apartment, plot or building is to be handed over". Though this Act came into existence only in the year 2006, however, this implies that such an obligation is essential on the part of the builder so that the consumers do not suffer. Though the present complaint case is of prior to 2016, therefore, this provision of Real Estate (Regulation and Development) Act, 2016 may not be directly applicable but the spirit is to be kept in mind that the builder is obliged to give a date for handing over the possession. Moreover, under Section 46 of the Indian Contract Act, 1872, the following provision is there:
46. Time for performance of promise, where no application is to be made and no time is specified -
Where, by the contract, a promisor is to perform his promise without application by the promisee, and no ALLOWED PAGE 11 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
time for performance is specified, the engagement must be performed within a reasonable time.
Explanation - The question "what is a reasonable time" is, in each particular case, a question of fact".
19. From the above provision it is clear that if there is no time limit for the performance of a particular promise given by one party, it is to be performed within a reasonable time. In most of the builder buyer agreements, the period ranges from 24 to 48 months and the most common agreement seems to be for 36 months plus grace period of six months for completion of construction and delivery of possession. If the possession is delivered beyond 42 months or beyond 48 months, the deficiency in service on the part of the opposite party shall stand proved."
29. Returning to the facts of the case, the receipt of the advance received by the Opposite Party at the time of the filling of the Booking Form is dated 01.09.2004. In terms of the aforesaid settled provision of law, the Opposite Party was duty bound to handover the possession of the plot on or before 31.03.2008, i.e. 42 months from the signing of the Booking Form. However, the Opposite Party failed to deliver the possession of the plot even till the time of filing the present complaint. It is settled law that the Complainant cannot be expected to wait for an indefinite time period to get the benefits of the hard earned money which they have spent in order to purchase the property in question. (Ref: Fortune Infrastructure v. Trevor D'Lima reported at (2018) 5 SCC 442).
30. Consequently, we hold that the Opposite Party is deficient in providing its services to the Complainant since it has failed to handover the possession of the plot within a reasonable time period ALLOWED PAGE 12 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
and the Complainant is entitled for the immediate possession of the plot on the payment of the necessary dues.
31. Keeping in view the facts of the present, we allow the following reliefs as prayed for by the Complainant:
I. The Opposite Party shall allot a plot ad-measuring 500/- sq. yards. to the Complainant in the project "Parsvnath City" at Sonepat, Haryana before 06.02.2022; II. On the Complainant being satisfied that the plot being allotted is as per the terms and conditions as already settled by the contesting parties, the remaining balance amount calculated @ Rs. 3700/- per sq. yards, shall be paid by the Complainant to the Opposite Party, as per the original agreement and no other charges, beyond what has been already agreed, shall be payable by the Complainant to the Opposite Party on or before 06.03.2022;
III. Subject to the Complainant complying with the directions as provided in (II), the Opposite Party shall get the Conveyance Deed/Sale Deed executed in the name of the Complainant and also handover the peaceful, vacant possession of the plot before 06.03.2022; IV. The Opposite Party is also directed to pay compensation to the Complainant on account of delay in handing over the possession @ 9% p.a. simple interest (as per the booking form) calculated on Rs. 9,25,000/- from 01.09.2004 (as prayed by the Complainant) till 22.12.2021, payable before 06.02.2022, however, in case the Opposite Party fails to pay the said amount before 06.02.2022, the Opposite Party ALLOWED PAGE 13 OF 14 CC/1650/2018 D.O.D: 22.12.2021 RAKESH GARG VS. M/S PARSVNATH DEVELOPERS LTD.
shall be liable to pay an interest @ 12% p.a. instead of the 9 % p.a. calculated on Rs. 9,25,000/- from 01.09.2004 till the actual realization of the amount;
V. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party is also directed to pay to the Complainant A. A sum of Rs. 1,00,000/- as cost for mental agony and harassment;
B. And the litigation cost to the extent of Rs. 50,000/-.
32. The Opposite Party is also directed not to deduct any TDS on the amount being paid/refunded.
33. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.
34. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
35. File be consigned to record room along with a copy of this Judgment.
(DR. JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (ANIL SRIVASTAVA) MEMBER Pronounced On:
22.12.2021 ALLOWED PAGE 14 OF 14