State Consumer Disputes Redressal Commission
Karamjit Singh vs Jalandhar Improvement Trust on 4 December, 2015
2nd Additional Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH
Consumer Complaint No. 59 of 2014
Date of institution: 26.3.2014
Date of Decision: 4.12.2015
Karamjit Singh son of Sh. Narata Singh, resident of Village Bugra, Post
Office Rajomajra, Tehsil Dhuri, District Sangrur.
.....Complainant
Versus
1. Jalandhar Improvement Trust, Jalandhar (Residential plot in Surya
Enclave Extension) through its Executive Officer
2. Executive Officer, Jalandhar Improvement Trust, Jalandhar.
.....Opposite Parties
Quorum:-
Shri Gurcharan Singh Saran, Presiding Judicial Member
Shri Jasbir Singh Gill, Member
Mrs. Surinder Pal Kaur, Member
Present:-
For the complainant : Sh. Sanjeev Goyal, Advocate
For Opsposite parties : Sh. Sandeep Khunger, Advocate
Gurcharan Singh Saran, Presiding Judicial Member
ORDER
The complainant has filed this complaint under Section 17 of the Consumer Protection Act, 1986(in short the 'Act') against Opsposite parties(hereinafter referred as 'Ops') on the averments that Ops had floated a scheme, Development Scheme 94.97 Acres for allotment of residential plot in Surya Enclave Extension, Jalandhar Improvement Trust, Jalandhar. Ops circulated the advertisement through various channels for allotment of free hold residential plots, which commenced from 8.8.2011. After reading that advertisement, Consumer Complaint No. 59 of 2014 2 the complainant also moved application form No. 091453 and applied for a plot of 200 sq. yards. The price of the plot was Rs. 17,000/- per sq. yard. Complainant paid Rs. 3,40,000/- i.e. earnest money as per the advertisement alongwith the application form. Thereafter, the draw was conducted by Ops in which applicant was successful and was allotted Plot No. 238-D. Ops sent an allotment letter dated 2.4.2012. As per the terms and conditions of the allotment letter, Ops had asked the complainant to deposit the entire price of the plot i.e. Rs. 30,69,450/- within 30 days after deducting earnest money of Rs. 3,40,000/- and after adding 4% cess as per the Government instructions and Rs. 950/- for site plan. In case he wanted to deposit the payment in instalments then 1/4th amount of the plot + cess charges + site plan charges + agreement fees was to be deposited within 30 days i.e. Rs. 6,46,950/- and remaining 75% was to be deposited in following instalments:-
Inst. No. Date Fixed Installment Interest Total Amount Amount
1. 1.10.2012 5,10,000/- 1,27,500/- 6,37,500/-
2. 1.4.2013 5,10,000/- 1,02,000/- 6,12,000/-
3. 1.10.2013 5,10,000/- 76,500/- 5,86,500/-
4. 1.4.2014 5,10,000/- 51,000/- 5,61,000/-
5. 1.10.2014 5,10,000/- 25,500/- 5,35,500/-
2. In case the allottee failed to deposit the instalments in time then Ops would receive the interest, in case there is delay of 1 month interest @ 11%, in case delay of 2 months interest @ 12%, in case delay of 3 months interest @ 13%, in case delay of 4 months interest @ 14%, in case delay of 5 months interest @ 15% and in Consumer Complaint No. 59 of 2014 3 case delay of 6 months interest @ 16%. In case the allottee failed to pay the instalments within six months from the date of instalments then it will be deemed that the plot of the allottee has been forfeited and the same will be restored within three months only if penal interest, 20% restoration charges and 6% penal interest is paid. In case the allottee failed to deposit 1/4th amount within 30 days then plot allotted will be cancelled and earnest money shall stand forfeited.
The development facility will be completed within 2½ years and possession of the plot by the allottee can be taken from Ops after entering into agreement to sell within 30 days from the date of allotment. Allottee was to complete the construction within three years from the date of allotment after getting the site plan sanctioned. In case construction is not completed within the stipulated period then period can be extended after paying non-construction fee fixed by the Government from time to time. Ops were to complete the development work within a period of 2½ years. For entering into agreement with Ops, complainant visited the office of Ops on 19.4.2012 and executed agreement as envisaged in the allotment letter and Ops were under obligation to immediately deliver the possession of the residential plot. However, Ops did not perform their part of the agreement. Thereafter complainant approached Ops number of times for delivery of the possession and to complete the development work as promised but Ops put off the matter on one pretext or the other. Thereafter, complainant did not deposit the next instalment due as on 1.4.2013. As per the directions issued by the State of Punjab, no amount of interest was to be charged till the Consumer Complaint No. 59 of 2014 4 delivery of possession. The complainant wrote a letter dated 25.6.2012 to Ops to waive the interest but Ops did not listen then he wrote another letter dated 24.6.2013 for giving possession of the plot. But Ops neither waive the interest nor give the possession. The complainant on 5.8.2013 deposited a sum of Rs. 8,28,432/- including late payment fee as well as restoration charges. Ops have failed to deliver the possession despite the fact that the complainant has paid a sum of Rs. 18,15,382/- to Ops. Ops have not taken any steps to develop the area in which the plot is situated. In the month of October, 2013, the complainant visited the office of Ops to deposit the 3rd instalment but he was shocked to know that Ops were not in a possession to deliver the property due to litigation as six petitioners, namely, Arjan Singh s/o Mangal Singh, Jagdish Singh S/o Gurbachan Singh, Devinder Kumar S/o Khushpal Chand, Kewal Singh S/o Ganga Singh, Amrik Singh S/o Dalip Singh and Bhajan Singh S/o Meja Singh. They filed six separate writ petitions i.e. No. 3559, 8618, 8619, 4114, 10785, 8534, 11234 and 16324 of 2011 seeking quashing of notification under Section 36 of the Punjab Town Improvement Trust Act, 1922 dated 7.6.2010. In the abovesaid writ petitions, the Hon'ble High Court vide interim order dated 8.3.2011 had ordered to maintain status-quo regarding possession. Lateron their writ petitions were also admitted for regular hearing with further direction that dispossession shall remain stayed. These writ petitions have not been fixed for final hearing before the Hon'ble High Court. Therefore, Ops are not in a position to develop the scheme. Before floating the scheme, it was the duty of Ops to verify that there was no Consumer Complaint No. 59 of 2014 5 encumbrance on the land and that the possession of the land was away from any litigation. The act of Ops amounts to unfair trade practice and deficiency in service. Hence, the complaint with a direction to Ops to refund a sum of Rs. 18,15,382/-, compensation of Rs. 5 lacs and litigation expenses of Rs. 55,000/-.
3. The complaint was contested by Ops, who filed written reply taking preliminary objections that the complainant has not approached the Commission with clean hands and has suppressed the material facts. In case the complainant was allotted Plot No. 230- D measuring 200 Sq. Yds. Vide allotment letter dated 2.4.2012. In terms of the said allotment letter, the complainant was required to make payment of instalments mentioned therein. The complainant failed to make the payments with regard to 2nd, 3rd, 4th and 5th instalments. Complainant had raised grievance that there is no development at the site but according to the terms and conditions of the allotment letter, complete development work was to be done within a period of 2½ years from the date of allotment and during that period, the complainant was simply required to make the payment of the sale consideration. However, as stated above, the complainant has deposited only 1 installment and he is defaulter of 2nd, 3rd, 4th and 5th instalment. Still Ops have provided the basic facilities at the spot. The low lying area has been filled with the earth, katcha roads have been raised. Roads will be metalled after completion of some houses in the area. With regard to possession, it was submitted that the possession of the plot is with the Trust, which was handed over by the Trust to the Land Acquisition Collector but he failed to turn up to Consumer Complaint No. 59 of 2014 6 obtain the possession. The complainant can visit the office of Ops on any working day to obtain the possession. The possession shall be delivered to the complainant on deposit of due amount of instalments alongwith interest. On merits, floating of 94.97 acres Surya Enclave Extension Scheme was admitted. The complainant had applied for 200 sq. yards plot @ price of Rs. 17,000/- per sq. with 10% earnest money i.e. Rs. 3,40,000/- and Plot No. 230-D measuring 200 sq. yards was allotted to the complainant. It was further admitted that the complainant had executed the agreement on 19.4.2012. However, the complainant was to receive copy of the said agreement from the office but he did not turn up to collect the same. It was denied that the complainant had approached Ops for obtaining the possession. He did not refer any date on which he had visited the office of Ops. In fact he has failed to deposit the instalments as mentioned in the preliminary objections. The interest cannot be waived off on the basis of any letter written by Improvement Trust, Malerkotla especially when the Trust was having possession of the plot in question. It was further denied that complainant had visited the site on 5.8.2013 or that there was no sign of any development. Low lying area has been filled with the earth, katcha roads has been constructed. The roads will be metalled when some houses come. In fact the complainant himself is defaulter. In case the complainant himself is a defaulter, he cannot say that there is deficiency in service on the part of Ops. Complaint is without merit, it be dismissed.
4. The parties were allowed to lead their evidence. Consumer Complaint No. 59 of 2014 7
5. In support of his allegations, the complainant had tendered into evidence his affidavit Ex. C-A, allotment letter Ex. C-1, earnest money receipt Ex. C-2, instalment receipt Ex. C-3, receipt dt. 5.8.13 Ex. C-4, letter Ex. C-5, complaint dt. 25.6.12 Ex. C-6, receipt Ex. C-7, news items Exs. C-8 to 10, cause list of Hon'ble High Court Ex. C-11, application dt. 23.4.12 Ex. C-12, complaint No. 82/13 Ex. C-13, scheme broucher Ex. C-14, notification Ex.C-15, list of land holding Ex. C-16, orders Exs. C-17 to 20, original photographs Exs. C-21 to 24. On the other hand, Ops had tendered into evidence affidavit of D.C. Garg, EO Ex. Op/A, letter dt. 21.11.12 Ex. Op-1, detail of estimated cost Ex. Op-2, detail of payments made Ex. Op-3.
6. We have heard the counsel for the parties, carefully gone through the complaint, written version of Ops, evidence and documents brought on the record by the parties.
7. From the pleadings of the parties, some of the facts are admitted that Ops had launched a scheme for allotment of the free hold residential plots in Surya Enclave Extension, Jalandhar Improvement Trust, Jalandhar from 8.8.2011. The complainant had applied for a plot of 200 sq. yards @ Rs. 17,000/- per sq. yard vide application form No. 091453 alongwith application fee and deposited a sum of Rs. 3,40,000/- i.e. 10% as earnest money. When the draw was held, the complainant was one of the successful applicant and accordingly, allotment letter was issued vide letter No. 4622 dated 2.4.2012 Ex. C-1. According to the terms and conditions of this allotment letter, in case the applicant wanted to deposit the entire sale consideration amount minus earnest money, the same could be Consumer Complaint No. 59 of 2014 8 deposited within 30 days otherwise in case it was to be deposited in the instalments then the complainant was required to deposit 25% + cess charges + site plan charges + agreement fee minus the earnest money, which come to Rs. 6,46,950/- that amount was also deposited by the complainant and the remaining amount was to be paid by the complainant in instalments as under:-
Inst. No. Date Fixed Installment Interest Total Amount Amount
1. 1.10.2012 5,10,000/- 1,27,500/- 6,37,500/-
2. 1.4.2013 5,10,000/- 1,02,000/- 6,12,000/-
3. 1.10.2013 5,10,000/- 76,500/- 5,86,500/-
4. 1.4.2014 5,10,000/- 51,000/- 5,61,000/-
5. 1.10.2014 5,10,000/- 25,500/- 5,35,500/-
Out of that, first instalment was paid by the complainant but the remaining instalments have not been paid.
8. As per other terms, the complainant was to execute the agreement within 30 days from the date of issuance of the allotment letter on the stamp paper of Rs. 500/- that was also executed by the complainant as per the averments in the complaint admitted by Ops. As per Clause 7, the basic amenities were to be completed within a period of 2½ years from the date of allotment i.e. by the end of October, 2014. It has been alleged by the counsel for the complainant that no development work has been done by Ops at the site. He has placed on the record some photographs of the land Exs. C-21 to C-
24. Whereas Ops have placed on the record detailed estimate cost of the development work done in the site in 94.97 acres Surya Enclave, which reads as under:-
Consumer Complaint No. 59 of 2014 9
Sr. No. Name of Work Estimated Work Done
Cost
(Amount
in Lacs)
1. Construction of 60' wide Road along 98.15 86.52 Lacs
northern boundry of 94.97 acre scheme upto (work
boundry of Maharaja Ranjit Singh Avenue completed)
2. Construction of Roads from Plot No. 16-D to 98.33 work not
159-D (60' wide Road) 94.97 Acre Scheme started
3. Construction of different Roads between Plot 98.07 20.39 Lacs
No. 86-D to 159-D in 94.97 Acre Scheme
4. Construction of Roads from Plot No. 1-D to 71.18 10.59 Lacs
80-D in 94.97 Acre Scheme
5. Construction of Roads between Plot No. 53.32 work not
251-D to 348-D in 94.97 Acre Scheme started
6. Construction of Roads between Plot No. 58.85 5.81 Lacs
160-D to Area reserved for special
purposes/multiplex area in 94.97 Acre
Scheme
7. Construction of Boundry wall along 94.97 20.90 work not
Acre Scheme started
8. Construction of Divider/Central Verge in 60' 22.77 work not
wide Road for 94.97 Acre to Maharaja Ranjit started
Singh Avenue
9. Construction of Roads between Plot No. 1-C 94.60 81.16 Lacs
to 37-C, 46-C to 49-C and 61-C to 64-C in
94.97 Acre Scheme
10. Construction of Park opposite Plot No. 102- 46.81 49.80 Lacs
D, 14-D and 238-D in 94.97 Acre Scheme (work
completed)
11. Construction of 30' wide Road between Plot 54.42 Work
No. 90-C to 198-C in 94.97 Acre Scheme started
payment
not made
TOTAL 717.40 254.27
9. The photographs produced on the record were not got admitted from Ops, therefore, it cannot be said that no development work was done at the site in view of the document Ex. Op-2 on the record, which shows some of the works done at the site. Consumer Complaint No. 59 of 2014 10
10. Another plea has been taken by the counsel for the complainant that the development work was not done at the site because the possession of the property of 94.97 acres is not with the complainant. He has stated that some of the owners have filed writ petitions before the Hon'ble High Court challenging the acquisition proceedings in which the Hon'ble High Court was pleased to maintain status quo with regard to the possession. He has placed on the record the notification under Section 36 of the Punjab Town Improvement Trust Act, 1922, Ex. C-15 and C-16 is list of holdings. Ex. C-17 is the order in CWP No. 3559 of 2011 wherein vide order dated 8.3.2011, it was ordered "status quo regarding possession shall be maintained". Ex. C-18 is the order passed by the Hon'ble High Court of Punjab & Haryana in CWP No. 4114 of 2011 titled as "Ajit Singh and others Versus State of Punjab and others" in which vide order dated 8.3.2011, the parties were directed to maintain status quo regarding possession till further orders. On 26.9.2012 in civil writ petition Nos. 3559, 8618, 8619, 8759, 4114, 10785, 8534, 11234 and 16324 of 2011 were admitted and it was ordered "dispossession shall remain stayed". However, the counsel for Ops has stated that alongwith this order, copies of the writ petition have not been attached, therefore, without copies of writ petition and showing the Khasra Number for which the writ petitions were filed to challenge the acquisition proceedings it cannot be said that the entire property acquired by Ops was under the order of status quo passed by the Hon'ble High Court. No doubt that detail of the property against which the Hon'ble High Court had passed the order of status quo against Consumer Complaint No. 59 of 2014 11 them was notified but a part of the property, the possession is with Ops and the possession of the plot can be given to the complainant from that property, which is further corroborated from the fact that the complainant himself has placed on the record, the report of Deepkamal Kaur, Tribune News Service about the Surya Enclave Extension Scheme, which shows the construction of the road in Surya Enclave Extension Scheme, Jalandhar. It has been further mentioned in it that out of 450 plots carved out, nearly 250 have been auctioned and then there is a reference of litigation raised by various persons, who have knocked the door of Hon'ble High Court. Therefore, it is clear that a part of the possession is with Ops and remaining is under litigation.
11. The next question arises that in case the complainant has failed to make payment of 2nd, 3rd, 4th and 5th instalments whether he is entitled to refund of the money paid by him or not?
12. It has been contended by the counsel for the complainant that he paid the first 25% of the amount then he paid first instalment alongwith other documents. He had executed the agreement to sell in favour of Ops on 19.4.2012. According to the terms and conditions of the allotment letter, after execution of the agreement, the possession was to be delivered but no such possession was delivered by Ops in favour of the complainant. The plea of the counsel for the complainant is that since the land acquired by Ops had gone in litigation in view of the CWP filed by various land owners against Ops with regard to the acquisition of the land and the litigation is still pending before the Hon'ble High Court. No doubt that one document Consumer Complaint No. 59 of 2014 12 Ex. Op-2 has been placed on the record, which shows only the estimate but on number of items work has not been started. The development at the site is different preposition. The basic question is whether Ops are in possession of the property or whether the plots were carved at the site so that the possession can be delivered or the plots were only on the site plan. No document has been placed on the record by Ops showing the demarcation of the plots or giving possession of any plot in favour of any person. In case the possession of the acquired property is not with Ops then it is an unfair trade practice on the part of Ops to launch the scheme and to collect the money from various applicants. The Government had issued letters to various Improvement Trusts in the State of Punjab i.e. Memo No. 6/44/05-4LG2/16729-90 dated 21.10.2005 wherein after giving a reference of the instructions issued vide letter No. 66-I-30II- 83/7070-7090 dated 23.2.1983 directions were given to all the Trusts to allot/sell only such plot/land, the site which is available with the Trust free from all encumbrances and it was further mentioned that before the process of allotment/auction of the site is commenced, Chairman and Executive Officers will certify on the record that physical possession of the site of proposed allotment/auction free from all encumbrances/obstructions is readily available for onwards transfer to the prospective allottee/buyer and that there is no physical obstruction to start the construction activities. The counsel for the complainant has placed on the record one letter No. 1834 dated 4.8.2014 issued by Jalandhar Improvement Trust, Jalandhar wherein it was intimated that the Trust has taken the possession of 518.13 Consumer Complaint No. 59 of 2014 13 marlas whereas the area of 94.97 acres comes to 759.07 Kanals, therefore, major portion of the land, the possession was not taken by Ops before they floated the scheme, therefore, Ops themselves had violated the instructions of the Government before floating the scheme. The counsel for the complainant has further referred to the site plan of Surya Enclave wherein there is provision of 120 ft. road and as per Op No. 2 no road of 120 ft. has been carved out. The complainant had opted to get a plot under the scheme of Op because all the other facilities which were to be provided under the scheme in the shape of parks, clubs etc. and in case the possession of the major portion of the land has not been taken by Ops then it may not be feasible for Ops to execute its plan as given to the Public, therefore, there were reasons for the complainant not to pay the balance instalments because possession was not given perhaps due to non-availability of the land. It has been stated by the counsel for Ops that the complainant did not come forward to get back the copy of the agreement as well as to take the possession. Once the agreement has been executed as per the terms and conditions of the allotment letter then it was the duty of Ops to send its copy by Post to the complainant. In case the plots were demarcated and its possession was to be delivered by Ops to the complainant, no letter has been placed on the record by Ops asking the complainant to come present and to take the possession otherwise there are averments on behalf of the complainant in the complaint that he had approached Ops to deliver the possession but they were unable to deliver the possession. Perhaps due to these reasons these plots Consumer Complaint No. 59 of 2014 14 were not demarcated as the possession of the entire property was not with Ops. It is just a hoarse cry to get the balance payment from the complainant without delivering the possession. Therefore, on the basis of pleadings and evidence on the record, it is made out that Ops indulged in unfair trade practice by calling for the applications when the possession of major portion was not with them at the time of floating the scheme and then after getting the agreement executed from the complainant, the possession was not delivered. Therefore, there were valid reasons for the complainant not to pay further instalments. However, the counsel for Ops has relied upon the judgment passed by the Principal Bench of this Commission in Consumer Complaint No. 150 of 2014 "Joginder Singh versus Jalandhar Improvement Trust, Jalandhar & Anr." decided on 20.7.2015 vide which the complaint filed by the complainant was dismissed as complainant himself committed the breach of terms. However, the same Bench in Consumer Complaint No. 81 of 2013 "Munish Dev Sharma versus Jalandhar Improvement Trust, Jalandhar & Anr." decided on 30.7.2014 under the same scheme, the complainant had deposited a sum of Rs. 28,22,950/- out of the total amount and Ops had failed to develop the site had passed the order for refund of the amount deposited by the complainant with Ops alongwith interest @ 9%, compensation of Rs. 2 lacs and litigation expenses of Rs. 5,000/-. However, this Bench in Consumer Complaint No. 11 of 2014 "Sanjeev Sharma versus Chairman, Improvement Trust, Jalandhar & Anr." decided on 16.1.2015 under the same scheme in which the complainant had deposited a sum of Consumer Complaint No. 59 of 2014 15 Rs. 24,45,950/- for a plot of 500 sq. yards had ordered for the refund of that amount alongwith interest, compensation and litigation expenses.
13. Jalandhar Improvement Trust had filed an appeal before the Hon'ble National Commission i.e. Appeal No. 1215 of 2014 i.e. "Jalandhar Improvement Trust, Jalandhar & Anr. Versus Munish Dev Sharma" alongwith F.A. No. 1261 of 2014 i.e. "Jalandhar Improvement Trust, Jalandhar & Anr. Versus Sanjay Gupta" against the order passed by the Principal Bench in CC No. 81 of 2013. In that judgment, the Hon'ble National Commission observed that Ops had invited the applications from the general public and after taking the substantial amount of money issued the allotment letter, however, they had failed to deliver the possession for a period of more than 3 years. A reference was also given to the writ petitions filed by the land owners before the Hon'ble High Court in which order of status quo regarding possession was ordered and it was observed that at the time of launching the scheme, Ops were not in possession of entire land, which amounted to unfair trade practice as defined under Section 2(1)(r) of the Act. After relying upon the judgments in "Bangalore Development Authority Vs. Syndicate Bank" (2007) 6 Supreme Court Cases 711 and "Ghaziabad Development Authority Vs. Balbir Singh", (2004) 5 Supreme Court Cases 65, "Bikaner Urban Improvement Trust Vs. Mohan Lal" 2010 CTJ 121 (Supreme Court) (CP) and "Dilbagh Rai Jarry V. Union of India", 1973 (3) SCC 554 upheld the order passed by the State Commission. It was observed that the appeal is nothing but a gross abuse of process of Consumer Complaint No. 59 of 2014 16 law and same was dismissed with punitive cost of Rs. 5 lacs and its SLP No. 23471 of 2015 in Civil Appeal No. 9294 of 2015 "Jalandhar Improvement Trust & Anr. Versus Munish Dev" was also dismissed by the Hon'ble Supreme Court. Therefore, the view of this State Commission has been upheld upto the Hon'ble Supreme Court that in case Ops had indulged in unfair trade practice then the refund of the amount taken by Ops is a valid order.
14. In view of the above, we find merit in the complaint. The same is hereby accepted with following directions:-
(i) Op is directed to refund a sum of Rs. 18,15,382/-
alongwith interest @ 9% from the date of deposit till the date of payments;
(ii) to pay a sum of Rs. 1 lac as compensation on account of unfair trade practice and deficiency in service;
(iii) pay Rs. 11,000/- as litigation expenses.
15. The arguments in this consumer complaint were heard on 30.11.2015 and the order was reserved. Now the order be communicated to the parties as per rules.
16. The consumer complaint could not be decided within the statutory period due to heavy pendency of Court cases.
(Gurcharan Singh Saran) Presiding Judicial Member (Jasbir Singh Gill) Member December 4, 2015. (Surinder Pal Kaur) as Member Consumer Complaint No. 59 of 2014 17