National Consumer Disputes Redressal
Rajesh Mehta & Anr. vs M/S. Pioneer Urban Land & ... on 30 October, 2019
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 94 OF 2017 1. RAJESH MEHTA & ANR. S/o Sh. R. K. Mehta R/o E-21, Green Park Main, New Delhi 16 2. Mrs. Nidhi Mehta W/o Mr. Rajesh Mehta R/o E-21, Green Park Main, New Delhi 16 ...........Complainant(s) Versus 1. M/S. PIONEER URBAN LAND & INFRASTRUCTURE LTD. Paras Down Town Center, Floor 5 & 7 Golf Course Road, Sector 53 Gurgaon Haryana 122002 ...........Opp.Party(s) BEFORE: HON'BLE MR. JUSTICE V.K. JAIN,PRESIDING MEMBER
For the Complainant : Mr. Aditya Parolia, Advocate Mr. Zahid Hussain, Advocate For the Opp.Party : Mr. T.V.S. Raghavendra Sreyas, Adv. Ms. Sneh Dhillon, Advocate Dated : 30 Oct 2019 ORDER JUSTICE V.K.JAIN, PRESIDING MEMBER (ORAL)
One Mrs. Alka Vachani booked a residential flat with the OP in a project namely 'Araya' which the OP was to develop in Sector-62 of Gurgaon. Unit No. C-802 in Tower-C of the project was allotted to Mrs. Alka Vachani vide letter of allotment dated 28.08.2012. Later on, the allotment was purchased by the complainants from Mrs. Alka Vachani and it was endorsed in their favour on 20.12.2012. Mrs. Alka Vachani had executed an agreement with the OP on 18.10.2012 which contained the respective obligations of the parties in respect of the booking made by her. As per Clause 11.2 of the Buyers Agreement, the developer was to make all efforts to apply for the Occupancy Certificate within 39 months from the date of excavation though it was also entitled to a grace period of 180 days. As per Clause 11.5 of the Agreement, the possession was to be delivered to the complainant within 45 months from the date of excavation. The construction, therefore, was expected to be completed within 45 months from the start of the excavation. Admittedly, excavation of the tower in which the flat allotted to the complainants was located, started on 4.6.2012. The construction, therefore, should have been completed by 4.3.2016.
2. Since the possession of the allotted flat was not offered to the complainants despite as much as Rs.4,42,31,375.32/- having already been paid to the OP, they are before this Commission with the following prayers:
Direct the opposite party to complete and hand over vacant, legal, peaceful and actual possession, in a fit and habitable conditions, after obtaining of certificates of safety, etc., of the Flat Bearing No.C-802 to the complainant by executing conveyance deeds at the earliest, alongwith Occupation Certificate, on the basis of executed Builders Buyer's Agreement and not the altered conditions of the opposite party;
Restrain the opposite party from taking any adverse steps against the complainant, such as cancellation of the allotment, charging of penal and holding charges for the possession offered, etc.;
Direct the opposite party to accept the balance dues through a proper mechanism ordered by this Hon'ble Court rather than demanding directly, for offering valid possession as per the Buyer's Agreement, and the same may be considered for inclusion;
Direct the opposite party to pay to the Complainant Interest @ 21% per annum on the total paid amount by the complainant from the date of expiry of committed date of possession (when possession was supposed to be handed over in terms of the Buyer's Agreement) till the filing of the complaint;
Direct the opposite party to pay the interest @ .......... upon _Rs.- ........ amount incurred by the complainant to pay the loan amount for the flat which was supposed to be handed over to the complainant;
Director the opposite party to pay to the complainant the sum of Rs.50,00,000/- (Fifty lakhs), on account of the physical and mental trauma, mental agony, inconvenience, and hardship suffered by the complainant due to the delay in the handing over of the possession, due to the deficiency in services rendered by the opposite party and due to the unfair trade practices;
Pass necessary ad interim relief orders and directions for the opposite party to pay the complainant delay charges as per buyer's agreement alongwith interest @ 21% per annum on the total paid amount by the complainant from the date of expiry of committed date of possession (when possession was supposed to be handed over in terms of the Buyer's Agreement) till the filing of the complaint;
Award pendent lite and future interest at the rate of 24% on the above compensation from the date of filing of the complaint till the handing over of the possession of the date of refund of payment, as claimed in the present complaint, to the complainant;
Direct the opposite party to pay the cost of this complaint including the legal fees of Rs.50,000/- and expensed incurred for the travelling, etc.; and Direct the opposite party to bear all the additional and increased charges on account of VAT/Service Tax/Service Charges/Stamp Duty/Other statutory payments, from the committed date of possession (when possession was supposed to be handed over in terms of the Buyer's Agreement).
3. The complaint has been resisted by the OP on several grounds. However, neither the booking made by Mrs. Alka Vachani nor the allotment made to her has been disputed. The endorsement of the allotment in favour of the complainants has also not been disputed. There is no dispute even as regards the amount paid to the OP in respect of the allotted flat.
4. The learned counsel for the complainants has submitted that the grounds on which the complaint has been contested have already been considered by this Commission and rejected in CC No.1238 of 2017 Vishal Malik & Anr. Vs. Pioneer Urban Land and Infrastructure Ltd. decided on 29.03.2019 which pertains to the allotment made in this very Tower of the same project. This is his submission that in view of the above referred decision of this Commission taken by the OP in its written version need not be examined again. It is not in dispute that the complaint has been contested on the grounds on which CC No.1238 of 2017 was contested.
5. The decision of this Commission in CC No.1238 of 2017 to the extent it is relevant, reads as under:
4. It is not disputed before me that the delay in completion of construction is sought to be justified on the grounds which this Commission has already rejected in CC/239/2017 - Govindran Raghavan Vs. Pioneer Urban Land & Infrastructure Ltd., decided on 23.10.2018. The said grounds, therefore, need not be revisited in this complaint.
5. The decision of this Commission in Govindran Raghavan (supra) to the extent it is relevant for the purpose of this complaint, reads as under:-
"3. The complaints have been resisted by the OP which had admitted the allotment made to the complainants as well as the payment received from them. It is inter-alia stated in the written version filed by the OP that the construction could not be completed within the stipulated time on account of reasons beyond its control. The said reasons, according to the OP, are as under:
(a) The delay on the part of several flat buyers in making timely payment, (b) the dispute of the developer with the contractor, (c) shortage of water, (d) Lack of infrastructural support from the State Government, (e) Shortage of raw material, (f) Delay in approvals, (g) Jat reservation agitation, (h) NGT order stopping construction and (i) Demonetization of the currency.
4. As far as the delay on the part of the several flat buyers is concerned, admittedly, the OP had a right to cancel the allotment due to the alleged non-payments. After cancelling the allotments made to the defaulting customers, the OP could have sold those flats in the open market to other willing buyers. Having not exercised the right available to it, to cancel the allotment on account of the alleged non-payment, the OP, in my view, cannot deny refund and compensation to the flat buyers who have been making payments in time or from whom interest for delay in payment has been charged. Therefore, I find no merit in the aforesaid ground.
6. As far as the alleged dispute with the contractor is concerned, the case of the OP is that initially, the work was awarded to M/s Urban Eco Infra Pvt. Ltd. which did not maintain the assured timeline and therefore, the OP took over the construction work from the said contactor and awarded the same to another contractor M/s Leighton Contractors Pvt. Ltd. In my view, the dispute if any, between OP and the contractor engaged by it, cannot justify the delay in completion of the construction. If the OP suffers any loss or has to pay compensation/damages on account of the delay committed by the contractor engaged by it, it will be entitled to avail such remedy as may be available to it in law against the contractor responsible for the delay, but it cannot deny refund and a fair compensation to a flat buyer who does not wish to wait any more for the possession of the alleged flat and wants refund of the money paid by him alongwith compensation.
7. As far as the alleged water shortage and labour shortage is concerned, there is no evidence on record to prove that no water or labour was actually available in the market at the relevant time to carry out construction. The delay cannot be justified on such bald allegations without substantiating the same by hard evidence showing actual non-availability of water and labour in the market.
8. As far as the alleged delay on the part of the Government agencies in laying infrastructure is concerned, there is no evidence of any particular timeline having been committed by such agencies to the developer for laying infrastructure and having not maintained the said timeline. As far as the alleged shortage of raw material is concerned, the case of the OP is that sand was not available in the vicinity of the complex due to restriction on mining imposed in Aravali region and therefore, they had to procure sand from the neighbouring city of Rajasthan. In its written version, the OP has referred to an order dated 08.05.2009 stated to have been passed by the Hon'ble Supreme Court stopping the mining operations in Aravali range. The agreement with the complainant having been executed much much later on 04.06.2012, the said order was already in the knowledge of the developer and therefore, it knew that it will have to procure sand from other places, on account of mining having been stopped in Aravali region. Therefore, shortage of sand in Aravali region cannot be a good ground for delaying the construction.
9. As regards the delay in grant of approvals from the State Government is concerned, neither any particulars of the alleged delay have been given nor any evidence has been led to prove that there was abnormal delay on the part of Government Authorities in granting approval and the said delay had contributed to the delay in completion of the construction.
10. As regards the Jat reservation agitation, there is no evidence of the said agitation having actually resulted in stoppage of work at the site of the project. More importantly, the aforesaid protest is stated to have started in February 2016 whereas the construction was required to be completed by September 2015, much before the said agitation started in Gurgaon.
11. As regards NGT having stopped construction in April 2015 and November 2016, no order of NGT passed in April 2015 and stopping construction on the project in question has been placed on record. As far as the order of NGT dated 08.11.2016 is concerned, that came to be passed much later than the last date stipulated in the Buyers Agreement for completion of the construction. Moreover, the said order was operative only for a period of one week.
12. As far as demonetization is concerned, I fail to appreciate how it could have affected the construction since there was no restriction on payment by means of cheques/demand drafts and through other modes of banking transactions. Moreover, the demonetization came to force on 08.11.2016, much after the last date stipulated for completion of the construction had already expired.
13. The learned counsel for the OP has drawn my attention to clause 11.5 (ii) & (iv) and clause 20 of the agreement which read as under:
11.5. (ii) In the event of further delay by the Developer in handing over of the possession of the Unit even after 12 months from the end of grace period, then in such case, the intending Allottee shall have an additional option to terminate this Agreement by giving termination notice of 90 days to the Developer and refund of the actual installment paid by him against the Unit after adjusting the taxes paid/interest/penalty on delayed payments.
(iv) Developer shall, within ninety (90) days from the date of receipt of termination notice of said Unit, refund to the intending Allottee, all the monies received excluding the service tax collected on various remittances, till the date of refund, from the intending Allottee under this Agreement. In case the Developer fails to refund the Sale Price, the Developer shall pay interest to the intending Allottee @ 9% per annum for any period beyond the said period of ninety (90) days. The intending Allottee shall have no other claim against the Developer in respect of the said Unit alongwith the parking space. The intending Allottee in this event shall have no right to seek any compensation apartment from the interest as stipulated herein.
20. RIGHT OF CANCELLATION BY THE ALLOTTEE Except to the extent specifically and expressly stated elsewhere in this Agreement, the intending Allottee shall have the right to cancel this Agreement solely in the event of the clear and unambiguous failure of the warranties of the Developer that leads to frustration of the contract on that account. In such case, the Allottee shall be entitled to a refund of the installments actually paid by it alongwith interest thereon @ 6% per annum, within a period of 90 days from the date of communication to the Developer in this regard less any payments made towards taxes paid by the Developer or interest paid, due or payable, any other amount of a non-refundable nature. No other claim, whatsoever, monetary or otherwise shall lie against the Developer nor shall be raised otherwise or in any manner whatsoever by the Allottee. Save and except to this limited extent, the Allottee shall not have any right to cancel this Agreement on any ground whatsoever.
Relying upon the aforesaid clauses contained in the agreement, it is contended by the learned counsel for the OP that though the complainants did not exercise the option to terminate the agreement despite delay of more than 12 months from the end of the grace period, had they exercised the said option, they would have been entitled only to refund with interest @ 9% per annum after deduction of the service tax or in any case they had exercised the option available in clause 20, they would have been entitled to refund that interest @ 6% per annum, after deduction of taxes and other amount of a non-refundable nature paid by them. Somewhat similar clauses came up for consideration of this Commission in CC No. 2000 of 2016 Geeta Bansal Vs. M/s Ireo Grace Realtech Pvt. Ltd. & Ors. decided on 24.09.2018. The clauses relied upon in Geeta Bansal (supra), read as under:
43. Subject to Force Majeure, as defined herein and further subject to the applicant having complied with all its obligations under the terms and conditions of this Agreement and the applicant not having defaulted under any provision(s) of this Agreement including but not limited to the timely payment of the total Sale Consideration, stamp duty and other charges prescribed by the Company, the Company proposes to offer the possession of the said Apartment to the applicant within a period of 42 months from the date of approval of the building plans and/or fulfillment of the pre-conditions imposed thereunder ("Commitment Period"). The applicant further agrees and understands that the Company shall additionally be entitled to a period of 180 (6 months) days ("Grace Period"), after the expiry of the said commitment period to allow for unforeseen delays beyond the reasonable control of the Company. Subject to the condition contained herein, if the Company fails to offer possession of the said apartment to the applicant by the end of the Grace Period, it shall be liable to pay to the applicant compensation calculated at the rate of Rs. 7.5/- (Rupees Seven and Fifty Paisa only) per sq. ft. of Super Area ("Delay Compensation") for every month of delay thereafter until the actual date fixed by the Company for offering the possession of the said such 'Delay Compensation' only at the time of 'Notice of Possession' or at the time of payment of the final installment, whichever is earlier.
44. Subject to the above, in the event of delay by the Company in offering the possession of the said Apartment beyond a period of 12 months from the end of the Grace Period (such month period hereinafter referred to as the 'Extended Delay Period' then the applicant shall become entitled to opt for termination of the Agreement and refund of the actual paid up installment paid by it against the said Apartment. It is clarified that the delay compensation calculated for the fixed period of 12 months only shall be paid by the Company alongwith the installments refundable under this Clause without any interest. This option may be exercised by the applicant only up till dispatch of the Notice of Possession by the Company to the Applicant. No other claim, whatsoever, monetary or otherwise shall lie against the Company nor be raised otherwise or in any other manner by the Applicant.
49. Notwithstanding anything contained in this Agreement, timely performance by the applicant of all its obligations under this Agreement, including without limitation, its obligations to make timely payment of the Sale Consideration, maintenance charges and other deposits and amounts, including any interest, in accordance with this agreement shall be of essence under this Agreement. If the applicant neglects, omits, ignores, or fails in the timely performance of its obligations agreed or stipulated herein for any reason whatsoever or to pay in time to the Company any of the installments or other amounts and charges due and payable by the Applicant by respective due dates, the Company shall be entitled to cancel the allotment and terminate this Agreement in the manner described hereunder.
Clause 21.3 of the Buyers Agreement on which reliance was placed by the learned counsel for the OPs, reads as under:
21.3 The allottee understands, agrees and consents that upon such termination, the Company shall be under no obligation save and except to refund the amounts already paid by the Allottee to the Company, without any interest, and after forfeiting and deducting the Earnest Money, interest on delayed payments, brokerage/commission/charges, service tax and other amounts due and payable to it, only after resale of the said Apartment. Upon termination of this Agreement by the Company, save for the right to refund, if any to the extent agreed hereinabove, the Allottee shall have no further right or claim against the Company and/or the Confirming Parties which, if any, shall be deemed to have been waived off by the Allottee and the Allottee hereby expressly consents thereto. The Company shall thenceforth be free to deal with the said Apartment in any manner whatsoever, in its sole and absolute discretion and in the event that the Allottee has taken possession of the said Apartment and everything whatsoever contained therein and in such event, the Allottee and/or any other person/occupant of the said Apartment shall immediately vacate the said Apartment and otherwise be liable to immediate ejectment as an unlawful occupant/trespasser. This is without prejudice to any other rights available to the Company against the Allottee.
Rejecting the contentions based upon the aforesaid clauses of the Buyers Agreement, this Commission inter-alia held as under:
11. As far as clause 44 of the indicators from the terms and conditions of the Apartment Buyers Agreement is concerned, this Commission has vide its order dated 18.09.2018 passed in CC No.190/2017 and connected matters, has already held that the said clause is wholly unfair besides being one sided and therefore, refund of the principal amount with appropriate compensation can be directed by this Commission despite the said clause The decision of this Commission in CC No.190/2017, to the extent it is relevant, reads as under:
7. The learned senior counsel for the OP has drawn my attention to clause 44 of the terms and conditions, extracted hereinabove and he submits that the aforesaid clause gives only a limited right to the complainants to terminate the agreement and seek refund of the amount paid by them. He also submits that in terms of the aforesaid clause, the contract could be terminated after a delay of at least 12 months, and only the delay compensation in terms of the agreement, for twelve months, is payable alongwith installments refundable to the allottee without any interest. However, in my view, since the OP failed to deliver possession of the allotted flats to the aforesaid complainants, it amounted to a deficiency in rendering service to them and therefore, this Commission is entitled to direct refund of the amount paid by them to the OP alongwith appropriate compensation. In my view, clause 44 which postpones the right of the flat buyer to terminate the agreement and seek compensation even after the grace period has expired, is wholly unfair besides being one sided and therefore, refund of the principal amount with appropriate compensation can be directed by this Commission despite clause 44 extracted hereinabove.
12. As far as clause 21.3 of the Buyers Agreement extracted hereinabove is concerned, the said clause, when read in conjunction with the other clauses of the agreement extracted hereinabove, is patently unfair, besides being one sided. If these clauses are given effect, it would result in a situation where a flat buyer, despite the failure of the builder to offer possession within the time stipulated in this regard and without there being any justification for doing so, will be practically remediless for 1½ years from the date of the default, no interest or compensation will be paid to him for the period his money is utilized by the builder, and even the principal amount will be repaid to him in an uncertain future, when the builder has already sold the apartment which was allotted to him. Such a term in the contract would be wholly one sided, unfair and unjust particularly when examined in the light of the fact that as far as the builder is concerned, he has a right to terminate the transaction in the event of even a single default on the part of the flat buyer and not only forfeit the earnest money but also deduct the other charges specified in clause 21.3 of the Buyers Agreement.
14. The learned counsel for the OPs submits that the parties having agreed to all the above referred stipulations, are bound by the same and cannot be allowed to have a grievance at a later date claiming the same to be unfair or one sided. No doubt the parties are ordinarily bound by the terms and conditions agreed between them in respect of a particular transaction, but the position would be altogether different where such terms are found to be wholly one sided and unfair, operating only to the detriment of the flat buyers without any corresponding detriment to the builder.
15. If a builder fails to deliver possession of the flat/plot booked with him, within the time period committed for this purpose and is unable to justify the said delay, this, in my opinion, would constitute a defect or deficiency in the services rendered by him to the buyer and in such a case, this Commission, in exercise of the powers conferred upon it by Section 14(1)(c)&(d) of the Consumer Protection Act would be competent to direct refund of the amount paid by the buyer to the builder, alongwith appropriate compensation for the loss or injury suffered by the buyer due to the defect/deficiency in the services rendered to him by the builder.
14. Therefore, the clauses on which reliance is placed by the learned counsel for the OP being wholly one sided and unfair, the complainants would not be bound by the same and if the developer is unable to justify the delay, this Commission would be competent to direct refund of the amount payable by them to the developer alongwith appropriate compensation."
6. It would thus be seen that the possession of this Commission in CC No.1238 of 2017 Vishal Malik & Anr. (supra) was based primarily upon the decision of this Commission in Govindan Raghavan (supra).
7. An appeal was preferred by the appellant against the decision of this Commission in Govindan Raghavan (supra) and was dismissed by the Hon'ble Supreme Court on 02.04.2019. As a result, the said decision became final and binding upon the parties.
8. The learned counsel for the OP also informs that they have also preferred Civil Appeal No.7003 of 2019 against the decision of this Commission in Vishal Malik & Anr. (supra) and the execution of the order passed by this Commission has been stayed by the Hon'ble Supreme Court subject to deposit of the entire decretal amount within three weeks from the date of the order and the said condition imposed by the Hon'ble Supreme Court stands complied.
9. The learned counsel for the OP submits that since in prayer (d), the complainant has claimed interest for delay only till the institution of the complaint, he should not be awarded interest for the period post institution of the complaint. However in view of prayers (f) and (h) in the complaint, I find no merit in the submission.
10. Admittedly, the possession of the allotted flat was offered to the complainant during the pendency of this complaint on 17.06.2019. The possession however, has not been taken till date since according to the complainant, there are several deficiencies on account of which it is not possible for the complainant to enjoy the flat. The learned counsel for the complainant, on instructions from the complainant who is present in the Court states that the complainant is restricting his prayer to payment of compensation for the delay in offering possession till 17.06.2019. He also states that the complainant will take possession of the allotted flat on 'as is where is' basis but will avail such remedy as may be available to him in law for the redressal of his grievances with respect to the defects and deficiencies found in the flat.
11. For the reasons stated hereinabove, the complaint is disposed of with the following directions:
(i) The OP shall pay compensation in the form of simple interest @ 8% per annum to the complainant for the period from 04.03.2016 to 16.06.2019, on the entire amount which has been paid to it in respect of the subject flat.
(ii) The complainant shall be entitled to take possession of the allotted flat on 'as is where is' basis but he shall also be entitled to avail such remedy as may be available to him in law with respect to the defects and deficiencies if any found by him in the allotted flat. If and when any such remedy is availed by the complainant, it shall be open to the OP to resist the same on such grounds as may be open to them in law.
(iii) If the order passed by this Commission in Vishal Malik & Anr. (supra) is set aside or modified by the Hon'ble Supreme Court in Civil Appeal No.7003 of 2019, the order so passed by the Hon'ble Supreme Court shall ipso facto apply to this complaint as well.
(iv) The OP shall also pay a sum of Rs.25,000/- as the cost of litigation to the complainants.
......................J V.K. JAIN PRESIDING MEMBER