State Consumer Disputes Redressal Commission
Nidhi Sharma vs Ansal Properties & Infra. Ltd. on 4 May, 2021
IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL COMMISSION
JUDGMENT RESERVED ON: 12.03.2021
JUDGMENT PRONOUNCED ON: 04.05.2021
COMPLAINT NO. 460/2012
IN THE MATTER OF
NIDHI SHARMA ......COMPLAINANT
VERSUS
ANSAL PROPERTIES & INFRA LTD. ....OPPOSITE PARTY
CORAM:
HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
HON'BLE SH. ANIL SRIVASTAVA, (MEMBER)
Present: Sh. Sakai Bhardwaj, Counsel for the Complainant.
None for the Opposite Party.
PER: HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL,
PRESIDENT
JUDGMENT
[Via Video Conferencing]
1. Brief Facts necessary for adjudication of the present complaint are that after the representations made by the marketing agents of the Opposite Party regarding delivery of possession in January, 2010, the complainant, on 24.03.2008, filed two applications for allotment of two separate commercial units in the Opposite Party's project namely "Palam Corporate Plaza" located in Palam Vihar, Gurgaon.
CC 460/2012 Page 1 of 182. The Complainant was issued two allotment letters dated 25.03.2008 and 02.04.2008 for commercial units bearing no. T-409 and T-408 respectively. The basic price for the aforesaid commercial units were agreed at Rs. 36,70,100/- each. The complainant opted for a construction linked payment plan. Pursuant to which the complainant made a payment of Rs. 3,67,010/- for each commercial unit as first installment.
3. The complainant made timely payments to meet her liability for the aforesaid booked commercial units. Subsequently, she was informed that she would get a rebate of Rs. 1,00,000/- if she paid the entire amount in one go. The complainant then deposited the entire amount for T-408 on 25.11.2008.
4. On a visit to the project site, the complainant observed that there was no progress in the construction and thereafter wrote two letters dated 26.08.2009 and 15.10.2009 to the Opposite Party inquiring about the delivery of possession as promised to her. The Opposite Party replied through a letter dated 07.12.2009 which manifested that the construction work commenced in June, 2008 and a construction project usually takes at least 3 years for completion. Vide the same letter the Opposite party also drew attention towards clause 6 of the Allotment letter which does not guarantee delivery of possession within a stipulated time period.
5. Vide letter dated 12.02.2010, the Complainant further spelled out the irregularities in the correspondence between the Opposite party's representative one Mr. Sunil Singh and the complainant regarding the due delivery of possession. Vide the aforesaid letter the Complainant also demanded proof of license and the sanctions obtained for the construction of the project. To this, the Opposite CC 460/2012 Page 2 of 18 party sent a letter dated 25.02.2010, wherein the Opposite Party furnished the proof of the license and the sanctions obtained. Dissatisfied with the proof furnished by the Opposite party, the complainant again inquired regarding the "commercial license" if obtained by the Opposite Party. The Opposite Party again furnished the proof of the same however, kept the complainant in the dark regarding date of the delivery of the possession
6. The Complainant time and again inquired regarding the delivery of possession, however, the Opposite Party failed to revert to the queries of the Complainant.
7. Aggrieved by the aforesaid, the Complainant then got served a legal notice dated 17.09.2012 upon the Opposite party requiring them to award compensation for the delay caused. The Opposite failed to revert to the aforesaid notice.
8. Aggrieved by the laxity on part of the Opposite Party, alleging deficiency of service and unfair trade practice on the part of the Opposite Party, the Complainant approached this commission.
9. After the filing of the complaint, the complainant sought time to amend their complaint, which was allowed vide order dated 01.05.2013 by this commission. However, shortly after the institution of the complaint, the Opposite party offered possession of the aforesaid flat on 23.08.2013. The Opposite party raised further demands for payment which has been reproduced for ready reference reflected as per the tabular representation 1 and 2:-
CC 460/2012 Page 3 of 18Tabular Representation No. 1 : Amount due with respect to payment of T-408 T-408 Basic Sale Price Rs. 2,92,265/-
(Rs.2,83,505/- as amount due along with service tax of Rs. 8,760.30/-) Electric Meter Rs. 42,079/-
charges (Rs. 37,450/- as amount due along with
service tax of Rs. 4628.82/-)
Interest on account Rs. 14,117.32/-
of delayed
payments
Misc. Charges Rs. 30,000/-
(towards
registration and
legal
documentation)
Total Rs. 3,78,461/-
Tabular Representation No. 2 : Amount due with respect to payment of T-409 T-409 Basic Sale Price Rs. 1,64,819/-
(Rs.1,59,878.72/- as amount due along with service tax of Rs. 4,940.25/-) Electric Meter Rs. 42,079/-
CC 460/2012 Page 4 of 18
charges (Rs. 37,450/- as amount due along with
service tax of Rs. 4628.82/-)
Interest on account Rs. 1,33,234/-
of delayed
payments
Misc. Charges Rs. 30,000/-
(towards
registration and
legal
documentation)
Total Rs. 3,70,132/-
10. Subject to the aforesaid amounts, the complainant was also required pay an additional amount of Rs. 74,900/- for each commercial unit in lieu of the Interest free Security Deposit.
11. Subsequently, the Complainant filed an IA dated 17.04.2015 wherein the complainant submitted that the complainant has deposited the due amount as per the Demand letter in Offer for possession/statement of account sent by the Opposite Party on 23.08.2013.
12. However, even after receiving the entire consideration, still, the Opposite Party has failed to handover the actual physical possession of the commercial units booked by the Complainant.
13. After the notice was issued, the Opposite Party filed their written statement and has raised some preliminary objections as to the maintainability of the complaint case. The Opposite Party has contended (a) that the complainant is not " Consumer" as defined under the Consumer Protection Act, 1986 as the complainant has CC 460/2012 Page 5 of 18 booked the said flat to earn profits on investment and therefore, the same amounts to commercial purpose; b) that the Complainant has failed to establish any kind of deficiency in providing services by the Opposite Party. Pressing the aforesaid preliminary objections, the Opposite Party prayed that the present Consumer Complaint should be dismissed.
14. The complainant filed her Rejoinder rebutting the written statement filed by the Opposite Party. Both the parties filed their Evidence by way of Affidavit in order to prove their averments on record. After the completion of the pleadings, the parties filed their written arguments.
15. We have perused through the written arguments filed by the counsel for both the parties.
16. The only question which comes up for consideration is whether the Opposite Party was deficient in handing over the possession of the commercial units to the complainant.
17. 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?
18. The counsel for Opposite Party has contended that the Complainant is not a consumer within the meaning of the Consumer Protection Act, 1986 and cannot invoke the provisions of the Act. The counsel for Opposite Party has alleged that the Complainant have booked the said units for Commercial Purpose.
19. This aspect as to what constitutes "Commercial Purpose" has been CC 460/2012 Page 6 of 18 elaborately dealt with by the Hon'ble Apex Court in Lilavati Kirtilal Mehta Medical Trust vs. Unique Shanti Developers and Ors. reported at (2020) 2 SCC 265. The relevant portion has been reproduced as under:
12. In Laxmi Engg. [Laxmi Engg. Works v. PSG Industrial Institute, (1995) 3 SCC 583] , which is one of the leading authorities on this point, a two-Judge Bench of this Court elucidated upon the meaning of "commercial purpose" as follows: (SCC pp. 591-92, paras 10-11) "10. A review of the provisions of the Act discloses that the quasi-judicial bodies/authorities/agencies created by the Act known as District Forums, State Commissions and the National Commission are not courts though invested with some of the powers of a civil court. They are quasi-judicial tribunals brought into existence to render inexpensive and speedy remedies to consumers. ... The idea was to help the consumers get justice and fair treatment in the matter of goods and services purchased and availed by them in a market dominated by large trading and manufacturing bodies. Indeed, the entire Act revolves round the consumer and is designed to protect his interest. The Act provides for "business-to-
consumer" disputes and not for "business-to- business" disputes. This scheme of the Act, in our opinion, is relevant to and helps in interpreting the words that fall for consideration in this appeal.
11. ... Controversy has, however, arisen with respect to meaning of the expression "commercial purpose". It is also not defined in the Act. In the absence of a definition, we have to go by its ordinary meaning. "Commercial" denotes "pertaining to commerce" (Chamber's Twentieth Century Dictionary); it means "connected with, or engaged in commerce; mercantile; having profit as the main aim"
CC 460/2012 Page 7 of 18(Collins English Dictionary) whereas the word "commerce" means "financial transactions especially buying and selling of merchandise, on a large scale" (Concise Oxford Dictionary). The National Commission appears to have been taking a consistent view that where a person purchases goods 'with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit' he will not be a "consumer"
within the meaning of Section 2(1)(d)(i) of the Act. ... The Explanation reduces the question, what is a "commercial purpose", to a question of fact to be decided in the facts of each case. It is not the value of the goods that matters but the purpose to which the goods bought are put to. The several words employed in the Explanation viz. "uses them by himself", "exclusively for the purpose of earning his livelihood" and "by means of self-
employment" make the intention of Parliament abundantly clear, that the goods bought must be used by the buyer himself, by employing himself for earning his livelihood."
(emphasis supplied)
13. In the aforementioned discussion in Laxmi Engg. [Laxmi Engg. Works v. PSG Industrial Institute, (1995) 3 SCC 583] , this Court relied upon Synco Textiles (P) Ltd. v. Greaves Cotton and Co. Ltd. [Synco Textiles (P) Ltd. v. Greaves Cotton and Co. Ltd., 1990 SCC OnLine NCDRC 3 : (1991) 1 CPJ 499] In Synco Textiles [Synco Textiles (P) Ltd. v. Greaves Cotton and Co. Ltd., 1990 SCC OnLine NCDRC 3 : (1991) 1 CPJ 499] , a four-Member Bench of the National Commission headed by V. Balakrishna Eradi, J., expounded upon the meaning of the term "commercial purpose", prior to the insertion of the Explanation clause to Section 2(1)(d) of the 1986 Act: (Synco Textiles case [Synco Textiles (P) Ltd. v. Greaves Cotton and Co. Ltd., 1990 SCC OnLine NCDRC 3 :
CC 460/2012 Page 8 of 18(1991) 1 CPJ 499] , SCC OnLine NCDRC paras 5-6 &
8) "5. ...The words "for any commercial purpose" are wide enough to take in all cases where goods are purchased for being used in any activity directly intended to generate profit....
6. Going by the plain dictionary meaning of the words used in the definition section the intention of Parliament must be understood to be to exclude from the scope of the expression "consumer" any person who buys goods for the purpose of their being used in any activity engaged on a large scale for the purpose of making profit. ... It is obvious that Parliament intended to restrict the benefits of the Act to ordinary consumers purchasing goods either for their own consumption or even for use in some small venture which they may have embarked upon in order to make a living as distinct from large scale manufacturing or processing activity carried on for profit. In order that exclusion clause should apply it is however necessary that there should be a close nexus between the transaction of purchase of goods and the large scale activity carried on for earning profit.
8. There is a close and direct nexus between the purpose of purchase of the generating sets and the commercial activity of manufacturing of edible oils for trade carried on by the appellant company, since the generating sets were intended to be used, as and when the need arose, for generating electric current for manufacture of edible oils for the purpose of trade. We do not, therefore, find any reason to interfere with the view taken by the State Commission that the appellant is not a "consumer"."
(emphasis supplied) CC 460/2012 Page 9 of 18
14. Recently, a two-Judge Bench of this Court, comprising of one of us, in Paramount Digital Colour Lab [Paramount Digital Colour Lab v. AGFA (India) (P) Ltd., (2018) 14 SCC 81 : (2018) 4 SCC (Civ) 467] has re-emphasised the importance of there being a "close nexus" between the purpose for which the good or service is availed of and a large-scale profit activity in order to classify such a transaction as commercial in nature, as illustrated below: (Paramount Digital Colour Lab case [Paramount Digital Colour Lab v. AGFA (India) (P) Ltd., (2018) 14 SCC 81 : (2018) 4 SCC (Civ) 467] , SCC pp. 85 & 87, paras 12 & 17) "12. ... It is therefore clear, that despite "commercial activity", whether a person would fall within the definition of "consumer" or not would be a question of fact in every case. Such question of fact ought to be decided in the facts and circumstances of each case.
17. ... Since there is nothing on record to show that they wanted the machine to be installed for a commercial purpose and not exclusively for the purposes of earning their livelihood by means of self-employment, the National Commission was not justified in concluding that the appellants have utilised the services of an operator or a helper to run a commercial venture. One machine does not need many operators or helpers to complete the work entrusted. Since the appellants were two partners, they must have been doing the work on their own, of course, may be with the aid of a helper or an operator. The machine would not have been used in a large-scale profit- making activity but, on the contrary, the appellants purchased the machine for their own utility, personal handling and for their small venture which they had embarked upon to make a livelihood. The same is distinct from large-scale manufacturing or processing activity carried on for huge profits. There is no close nexus between the transaction of CC 460/2012 Page 10 of 18 purchase of the machine and the alleged large- scale activity carried on for earning profit. Since the appellants had got no employment and they were unemployed graduates, that too without finances, it is but natural for them to raise a loan to start the business of photography on a small scale for earning their livelihood."
(emphasis supplied) Therefore this Court in Paramount Digital Colour Lab [Paramount Digital Colour Lab v. AGFA (India) (P) Ltd., (2018) 14 SCC 81 : (2018) 4 SCC (Civ) 467] held that the purchase of a machine for the appellants' photography business, which was a small-scale business meant for earning their livelihood, would not be interpreted as being for a "commercial purpose".
15. It is true that the aforementioned decisions were rendered in the context of deciding whether the goods or services availed of in the facts of those cases were for a commercial purpose or exclusively for the purpose of self-employment. This does not mean, however, that in every case a negative test has to be adopted wherein any activity that does not fall within the ambit of "earning livelihood by means of self- employment" would necessarily be for a commercial purpose. We reject Respondent 1's argument in this regard. The Explanation clause to Section 2(1)(d) of the 1986 Act is only clarificatory in nature, as was highlighted by this Court in Laxmi Engg. [Laxmi Engg. Works v. PSG Industrial Institute, (1995) 3 SCC 583] :
(SCC p. 594, para 14) "14. Yet another clarification; the Explanation, in our opinion is only explanatory; it is more in the nature of a clarification--a fact which would become evident if one examines the definition (minus the Explanation) in the context and scheme of the enactment. As indicated earlier, the Explanation broadly affirms the decisions of the National Commission. It merely makes explicit what was CC 460/2012 Page 11 of 18 implicit in the Act. It is not as if the law is changed by the said Explanation; it has been merely made clearer."
Therefore the Explanation clause only re-affirms the definition of "consumer" as it already exists.
16. Ultimately, whether or not a person is a consumer or whether an activity is meant for a commercial purpose will depend upon the facts and circumstances of each case. It may be the case that a person who engages in commercial activities has purchased a good or availed of a service for their personal use and consumption, or for the personal use of a beneficiary, and such purchase is not linked to their ordinary profit-generating activities or for creation of self- employment. Such a person may still claim to be a "consumer." For example, a large corporation may hire the services of a caterer or a 5-star hotel for hosting a function for its employees and their families. If there is any deficiency in service, the service- provider cannot claim that merely because the person availing of the service is a profit-generating entity, and because such transaction does not relate to generation of livelihood through self-employment, they do not fall under the definition of a "consumer". A commercial entity may also be a consumer depending upon the facts of the case. It is not the identity of the person but the purpose for which the transaction is made which is relevant.
***
19. To summarize from the above discussion, though a straight-jacket formula cannot be adopted in every case, the following broad principles can be culled out for determining whether an activity or transaction is 'for a commercial purpose':
(19.1) The question of whether a transaction is for a commercial purpose would depend upon the facts and circumstances of each case. However, ordinarily, 'commercial purpose' is understood to include manufacturing/industrial activity or business-to- business transactions between commercial entities.CC 460/2012 Page 12 of 18
(19.2) The purchase of the good or service should have a close and direct nexus with a profit-generating activity. (19.3) The identity of the person making the purchase or the value of the transaction is not conclusive to the question of whether it is for a commercial purpose. It has to be seen whether the dominant intention or dominant purpose for the transaction was to facilitate some kind of profit generation for the purchaser and/or their beneficiary. (19.4) If it is found that the dominant purpose behind purchasing the good or service was for the personal use and consumption of the purchaser and/or their beneficiary, or is otherwise not linked to any commercial activity, the question of whether such a purchase was for the purpose of 'generating livelihood by means of self- employment' need not be looked into.
(emphasis supplied)"
20. We also tend to rely on 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."
21. From the aforesaid dicta of the Hon'ble Supreme Court and the Hon'ble National Commission, it flows that it is for the Opposite CC 460/2012 Page 13 of 18 Party to prove that the flat 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.
22. Returning to the facts of the present case, the Complainant in her rejoinder has submitted that the Complainant had booked the commercial unit for earning livelihood. A mere bald statement has been made by the Opposite Party that the Complainant purchased the units for a commercial purpose and on perusal of record before us, we fail to find any material which shows that the Complainant is engaged in the business of purchasing and selling shops/commercial units 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. Whereas, in fact it has been well established that the office space purchased was purchased for self consumption. Consequently the objection raised on behalf of the Opposite Party is answered in negative.
DEFICIENCY OF SERVICE
23. Having discussed the maintainability of the present complaint, the next issue to be adjudicated 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) 16 SCC 512, wherein it has been held as follows:
CC 460/2012 Page 14 of 18"28. 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."
24. Returning to the facts of the present case, we deem it appropriate to refer to Clause 6 of the Allotment letter, which reads as follows:
"6. The promoter shall complete the project "Palam Corporate Plaza" and hand over the possession of the flat to the flat buyer as early as possible subject always to various making timely payment. , force majeure causes, availability of items for construction , change of policy by the Government agency and local authorities and any cause beyond the control of the Promoter. However the company shall endevour to complete the CC 460/2012 Page 15 of 18 construction within reasonable time from the date of commencement of construction. The company on obtaining certificate of occupation and the use, shall offer in writing to handover the flat space to the flat buyer/allottee. "
25. Clause 6 of the Allotment letter stipulates no specific time as to the delivery of possession. 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).
26. Perusal of the record reflects that the Complainant booked the flat on 24.03.2008 and the Possession was only offered by the Opposite Party on 23.08.2013. The Opposite party failed to handover the possession of the flat within a reasonable time period and thus the Opposite Party is deficient in providing its services to the Complainant.
CONCLUSION
27. The record reflects that the Complainant has made payments to the extent of Rs. 38,39,956/- and Rs. 39,55,253.28/- towards the commercial units no. T-408 and T-409 totaling to an amount of Rs. 77,95,209.28/-
28. Keeping in view the facts of the present, we allow the following reliefs as prayed for by the Complainant:
CC 460/2012 Page 16 of 18I. We direct the Opposite Party to pay an amount of Rs. 77, 95, 209 . 28/- along with interest as per the following arrangement:
A. An interest @ 6% p.a. calculated from the date on which each installment/payment was received by the Opposite Party till 04.05.2021 (being the date of the present judgment);
B. The rate of interest payable as per the aforesaid clause (A) is subject to the condition that the Opposite Party pays the entire amount on or before 30.06.2021;
C. Being guided by the principles as discussed above, in case the Opposite Party fails to refund the amount as per the aforesaid clause (A) on or before 30.06.2021, the entire amount is to be refunded with an interest @ 9% p.a. calculated from the date on which each installment/payment was received by the Opposite Party till the actual realization of the amount. II. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party is also directed to A. Pay the complainant a sum of Rs. 4,00,000/- as cost for mental agony and harassment to the complainant; B. Pay the complainant a sum of Rs. 50,000/- towards the litigation costs of pursuing the present complaint.
29. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.
30. 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 CC 460/2012 Page 17 of 18 uploaded forthwith on the website of the commission for the perusal of the parties.
31. File be consigned to record room along with a copy of this Judgment.
(DR. JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (ANIL SRIVASTAVA) MEMBER Pronounced On:
04.05.2021 CC 460/2012 Page 18 of 18