State Consumer Disputes Redressal Commission
Bimla Dalmia & Anr. vs M/S Spaza Towers Pvt. Ltd. on 2 March, 2017
Daily Order IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL, COMMISSION : DELHI (Constituted under Section 9 of the Consumer Protection Act, 1986) Date of Arguments : 02.03.2017 Date of Decision : 20 .03.2017 Complaint No. 103/2017 IN THE MATTER OF: Mrs. Bimla Dalmia, (Power of Attorney Holder for Complainant No.2) W/o Mr. Vijay Dalmia, R/o C-158, Suncity Gold Course Road, Sector-54. Gurgaon, Haryana Mrs. Geeti Bhojnagarwala, D/o Mr. Bishwanath Maskara, R/o 52-A, Ballygunj Circular Road, Ballygunj Apartment, 2nd Floor, Kolkata, ........Complainants VERSUS M/s. Spaze Towers Pvt. Ltd., Registered office at: A-307, Ansal Chambers-1,2 Bhikaji Cama Place, New Delhi-110066. ..........Opp. Party CORAM SH. O. P. GUPTA, MEMBER (JUDICIAL) SH. ANIL SRIVASTAVA, MEMBER
1. Whether reporters of local newspaper be allowed to see the judgment? Yes/No
2. To be referred to the reporter or not? Yes/No Present : Mrs. Reena Kumari with Ms. Smriti Jain, Counsel for the Complainant.
PER : SHRI ANIL SRIVASTAVA, MEMBER Alleging unfair trade practices and deficiency in service Smt. Bimla Dalmia & Ans. have filed this complaint, hereinafter referred to as Complainants, under Section 12(1)(a) read with Section 17 of the Consumer Protection Act 1986 against M/s. Spaze Towers Pvt. Ltd. , hereinafter referred to as opposite party, praying for relief as under :
allow the present complaint and declare the conduct of the opposite party to be an 'unfair trade practices' and declare that they have rendered 'deficient services'.
allow the complainants to exit the said project without forfeiture of the earnest money and refund of the entire amount paid by the complainants to the opposite party together with the interest calculated at 18% per annum commencing from the date of first payment made to the opposite party.
direct the opposite party pay interest @18% per annum or any other rate deemed appropriate by this Commission, for the delay in completing the project, on the total consideration amount paid by the complainants that is to be calculated from the date of their first payment to the date of handing over of possession after completing the project in entirely to make it habitable.
direct the opposite party to compensate for the Service Tax charged from the Complainants.
direct the opposite party not to raise any further demand with respect to the payment required to be paid by the complainant.
award compensation for mental agony and harassment.
pass any other order as this Hon'ble Commission may deem fit in the interest of justice, equity and good conscience.
Facts of the case are these.
The opposite party representing itself to be one of the key players in retail and residential real estate development in Northern India with an unshakable reputation for quality, efficiency and handing over possession on time, launched its commercial project, namely 'Spaze Arrow' located in Sector-78, Gurgaon, Haryana and started taking bookings.
Induced through the brokers the complainants, solely with the intention of self-employment and for earning their livelihood, booked a retail space in the aforesaid project by making an initial payment of Rs.5,00,000/- on 25.10.2012. Thereafter the complainant made further payment of an amount of Rs.6,75,226/- on 22.01.2013. An application form was also signed.
Subsequently, the opposite party issued an "Allotment Letter" on 30.01.2013 to the complainants allotting Unit No. Shop-080, Ground Floor in the said project having a tentative super area of 570 sq.ft. for a total sale consideration of Rs.62,32,802/-. The opposite party all through maintained the said project would be completed and possession of the shop would be handed over by April 2016. Amenities and facilities projected were also of a very high standards. The complainants after making an initial payment towards the booking amount were allotted a Unit bearing Shop No.080 located on the Ground Floor in the aforementioned project. After a lapse of almost 8 months from the date of booking the complainants allege that they were forced to sign one sided agreement with the threat that if the complainants would not sign the agreement, the amount paid till date would be forfeited and the allotment shall stand cancelled. Besides at the stage of insurance of 'Allotment Letter' the detailed terms and conditions were not communicated to the complainants with a view to keep them under dark. It was further averred by the complainant that after payment of an amount of Rs.20,56,647/- an agreement was executed between them on 03.06.2013 which contained arbitrary one sided clauses. Some of the terms of the agreement arbitrary in character as printed out by the complainants are indicated as under :
that as per Clause 5.1 of the ABA the Developer shall have the unhindered right to terminate this contract, to reduce/increase the size/dimensions of the allotted area and to change the location. The Allottes(s) undertakes to accept the decision of the Developer in this regard.
that as per Clause 6 of the ABA, 15% failure to comply with the terms of payment and/or other terms and conditions of the agreement by the allottee, the developer shall be at a liberty to forfeit the entire amount of earnest money, brokerage and expenses incurred by the Developer as well as interest over unpaid installments (calculated at the rate of 18% per annum from the date the installment became due) and whereupon this agreement shall stand cancelled and the allottees shall be left with no lien, right, title, interest or claim of whatsoever nature in the said premises.
that per Clause 10 of the ABA, the Developer may waive delayed payment interest on the condition that the allottees shall pay interest at the rate of 18% per annum for the period of delay and any other penalties that the developer may impose.
that as per Clause 14 of the ABA, he Developer does not require consent of the Allottees for any additions, alterations, deletions and modifications in the layout and building plan including the number of floor while sanctioning the building plan or anytime thereafter.
The complainants thereafter on various occasions inquired about the progress of the project but did not receive any satisfactory reply. It was further submitted that as per the ABA dated 03.06.2013, the opposite party was awaiting the approval. Consequently all the demands raised by the opposite party prior to signing of the ABA were illegal. Furthermore, License granted to the opposite party also expired on 05.06.2016. Despite that the complainants continued making payments in the hope that the possession of the said Unit shall be handed over in time but till date and after a lapse of almost 09 months, the completion of construction of the said project has not seen the light of the day. The act of the opposite party is aggravated when a letter threatening to cancel the allotment of the said Unit was sent if all the payments due towards the Unit are not paid. An amount of Rs.44,02,835/- towards the total sale consideration of the said Unit was also made with no progress in the construction of the project The complainant has enumerated the details of the further cheques issued towards the payment of the total sale consideration after execution of the ABA.
S. No. Cheque Amount Cheques No.540735 and 602885 dated 04.06.2013 Rs.2,95,568/-
Cheque No. 000001 dated 09.12.2014 Rs.10,24,000/-
Cheque No.579935 dated 16.06.2015 Rs.5,85,876/-
Cheque No.000010 dated 13.10.2015 Rs.4,40,744/-
to which receipts were issued.
The complainant has further averred that the opposite party has not offered any compensation for delay in construction while they are forced to pay interest @18% per annum in case the complainant defaults in making the payment. The complainant alleged that the said Act of the opposite party is clearly an 'Unfair Trade Practice'. Protest letters dated 06.12.2014 and 13.10.2015 against the arbitrary demands raised by the opposite party alongwith the charge of delayed interest being levied considering the fact that all along the complainants had made timely payments of all their dues were issued.
The complainant's further allegation is that the demand for service tax raised in the case is arbitrary and uncalled for as per the judgement of the Hon'ble Delhi High Court in the case of Suresh Kumar Bansal Vs. Union of India [WP (C) 2235/2011] wherein the Court held that no service tax shall be applicable in the case of composite contracts. Furthermore, as per the said judgement, the amount already deposited with the concerned authorities has to be returned to the complainants therefore levy of any kind of service tax by the opposite party is clearly against the law laid down in the said judgement.
We have heard the arguments advanced by the ld. Counsel for the complainant on admission. We have also examined the documents as available on record. We notice that the cause of action in the case arose in the State other than Delhi. To put it differently this Commission is stopped from trying this case for want of territorial jurisdiction.
For this purpose we may advert to provisions of Section 17 of the Consumer Protection Act 1986. The said provision of the statute posits as under :
(2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction,-
the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or any of the opposite parties, where these are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the State Commission is given or the opposite parties who do not reside or carry on business or have a branch office or personally works for gain, as the case may be, acquiesce in such institution, or the cause of action, wholly or in part, arises] On a plain reading of the afore-extracted provision it becomes clear to us that a complaint under the Act can be instituted in a State Commission within the limits of whose jurisdiction any one of the three situations contemplated in the provision is shown to exist. The use of the word 'of' at the end of sub-clauses (a) & (b) of the said Sub-section is significant and reflects the object of the legislation, leading to the conclusion that each of the three contingencies enumerated therein is independent of each other and not cumulative.
The expression 'cause of action' is neither defined in the Act nor in the Code of Civil Procedure. However, by virtue of a catena of decisions of the Supreme Court, wherein the meaning of the said expression in legal parlance has been explained, the expression has been held to be of wide import. Generally, the expression 'cause of action' is described as 'bundle of facts' which the petitioner must prove, if traversed, to entitle him to the relief prayed for.
It would be manifestly clear from bare reading of the afore mentioned provision of the Act that the complaint can be filed before the fora where the cause of action arose. In the subject the agreement having been executed at Noida, the cause of action would be deemed to have arisen at Noida, Uttar Pradesh.
Again in Navinchnadra N. Majithia s. State of Maharashtra & Ors. (2007) 7 SCC 640, explaining the import of the said expression, in his concurring judgement, K.T. Thomas J. observed as under:
"The collection of the words "cause of action, wholly or in part, arises" seems to have been lifted from Section 20 of the Code of Civil Procedure, which section also deals with the jurisdictional aspects of the courts. As per that section the suit could be instituted in a court within the legal limits of whose jurisdiction the "cause of action wholly or in part arises". Judicial pronouncements have accorded almost a uniform interpretation of the said compendious expression even prior to Fifteenth Amendment of the Constitution as to mean "the bundle of facts which would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgement of the court".
In Read V. Brown Lord Esher, M.R. [(1988) 22 QBD 125:58 LJOB 120:60LT 250 (CA)], adopted the definition for the phrase "cause of action" that it meat "every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgement of the court. It does not comprise every piece of evidence which is necessary to prove each fact, but every fact which is necessary to be proved".
In Kandimalla Raghavaiah & Co. Vs. National Insurance Co. Ltd. & Anr., (2009) 7 SCC 768, the Hon'ble Supreme Court has held that "cause of action" is cause of action which gives occasion for and forms the foundation of the suit.
Having regard to this we are of the considered view that this State Commission does not enjoy the territorial jurisdiction to entertain this complaint and accordingly order to return this complaint to file before the State Commission enjoying territorial jurisdiction to entertain this complaint.
Copy of this order be sent to both the parties free of cost as contemplated under the Consumer Protection Rules 1987 read with Consumer Protection Regulations 2005.
(ANIL SRIVASTAVA) (O.P. GUPTA) MEMBER MEMBER (JUDICIAL)