State Consumer Disputes Redressal Commission
Sanjeev Seth vs Emaar Mgf Land Ltd, on 11 April, 2016
1
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
Complaint case No. : 12 of 2016
Date of Institution : 04.01.2016
Date of Decision : 11.04.2016
Sanjeev Seth son of Lt. Shri O.P.Seth, resident of House
No.47/3, East Patel Nagar, New Delhi.
......Complainant
Versus
1. M/s Emaar MGF Land Limited through its Branch Head,
Sh.Vikas Gupta, SCO No.120-122, 1st Floor, Sector 17-C,
Chandigarh.
2. M/s Emaar MGF Land Limited through its MD, Sh.Shravan
Gupta, ECE House, 28, Kasturba Gandhi Marg, New Delhi.
.... Opposite Parties
BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT
MR. DEV RAJ, MEMBER.
MRS. PADMA PANDEY, MEMBER Argued by: Sh. Saurabh Gautam, Advocate for the complainant.
Sh. Sanjeev Sharma, Advocate for the Opposite Parties.
PER PADMA PANDEY, MEMBER The facts, in brief, are that the complainant, who was looking for a decent residential accommodation at Mohali, got allured by the advertisements and promotions of the Opposite Parties and approached them to inquire about their project. At the project site, the Opposite Parties assured that the development activities are going on at full swing and possession would be handed over to the complainant within two years. On the basis of the representation and assurances given by the Opposite Parties, the complainant had agreed to purchase a residential unit in their project and deposited booking amount of Rs.10,35,000/- vide cheque dated 01.09.2006 in respect of residential unit bearing No.108-PP-317-300 at Sector 108, 2 Mohali Hills, Mohali. Copy of the receipt dated 23.09.2006 as well as cheque issued by the complainant is Annexure C-1 (Colly.). It was stated that the Opposite Parties vide their letter dated 05.05.2007 (Annexure C-2) informed the complainant for allotment of the said unit, measuring 300 sq. yards and the price of the unit, in question, was disclosed as Rs.35,97,249/- including basic sale price + Preferential Location Charges (PLC) + EDC. After receipt of the said letter, the complainant further made payments of Rs.1,72,500/- on 13.06.2007 vide receipt Annexure C-3. It was further stated that the Opposite Parties also executed Plot Buyer's Agreement with the complainant on 30.06.2007 (Annexure C-4). Thereafter, the complainant made further payments of Rs.1,72,500/- on 14.09.2007, Rs.3,45,000/- on 15.12.2007, Rs.3,45,000/- on 15.03.2008, Rs. 3,45,000/- on 13.06.2008, Rs.4,18,625/- on 15.09.2008, Rs.4,18,625/- on 15.12.2008 and Rs.1,72,500/- on 15.03.2009 vide cheques and receipts (Annexure C-5 to C-18). It was further stated that in all, the complainant made the payment of Rs.34,24,750/-, however, the total price of the unit i.e. Rs.35,97,249/- stood paid by the complainant, as the last payment of Rs.1,72,500/- had been waived by the Opposite Parties. It was averred that the complainant had paid all the payments on time, as such, he qualified for waiver of 5% incentive and under the said waiver, he was exempted from paying the last installment of Rs.1,72,500/- towards the price of the unit. Copies of the letters dated 04.02.2009 and 06.07.2009 are Annexure C-20 (Colly.).
2. It was further averred that at the time of execution of the Buyers Agreement, the Opposite Parties assured the complainant to deliver possession of the allotted unit within a period of 36 months from 30.06.2007 i.e. by 29.06.2010, as per Clause 8 of the Agreement. It was further stated that the Opposite Parties also committed to its customers for payment i.e. Rs.50/- per sq. yard per month for any delay beyond the 3 period of 36 months from the date of execution of the Agreement. It was further stated that after the lapse of 36 months, the Opposite Parties neither delivered possession of the unit, in question, nor paid the delayed compensation to the complainant. Therefore, the complainant visited the site, in question, and found that there was no sign of development, as such, he sought refund of his money, as the Opposite Parties were not in a position to handover possession of the unit even in December, 2015, whereas, they were to handover the possession of the unit in June, 2010 but the Opposite Parties refused to refund the same and threatened him to forfeit the amount. It was further stated that the complainant had duly performed all conditions and duties on his part but till date the Opposite Parties failed to fulfill their part of the Agreement and failed to develop the infrastructure alongwith other amenities and has not given possession of the unit, in question, to the complainant. It was further stated that the aforesaid acts, on the part of the Opposite Parties, amounted to deficiency, in rendering service, and indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (in short the 'Act' only), was filed.
3. The Opposite Parties, in their joint written version, though have not taken objection regarding arbitration clause in the Agreement, however, they separately, moved an application u/s 8 of Arbitration and Conciliation Act, 1996 taking a specific objection in this regard. It was next pleaded that this Commission has got no territorial jurisdiction as well as pecuniary jurisdiction to entertain and decide the complaint as the Agreement, which was executed between the parties, was signed at Delhi. It was stated that the Company provisionally allotted the above unit to the complainant vide letter dated 05.05.2007 and received the booking amount of Rs.10,35,000/- from him. It was further pleaded that the total cost of the unit was mentioned as Rs.35,97,249/- which included 4 Rs.34,50,000/- as BSP and Rs.1,47,249/- as EDC. It was further stated that the complainant delayed in remittance of the installments and, as such, interest had accrued upon him on account of delay. It was further stated that the letter dated 04.02.2009 clearly stated that the last 5% amount would be waived off subject to remittance of the future installments on the due date. However, the installment payable on 15.03.2009 was paid by the complainant on 18.03.2009, the Company agreed to waive the last 5% as an exception and confirmed the same vide letter dated 06.07.2009. It was further stated that the Company was to offer possession of the unit within 36 months from the date of execution of the Agreement and in case, the possession was delayed beyond 36 months, the Company is liable to pay the agreed compensation at the time of registration of the above unit, as per the terms and conditions of the Agreement. It was further stated that the Company is trying to complete all amenities in the area, where, unit is located, so that possession can be offered at the earliest to the complainant. It was averred that the complainant is a speculator and had purchased the plot for speculation purposes, as he has not got the desired appreciation due to slump in reality market. So, he is seeking refund of money. It was further stated that in case of seeking of refund by the complainant, Agreement has to be cancelled and forfeiture clause would come into operation and money can be forfeited only after deduction of amount, as per the agreed terms and conditions of the Agreement. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice.
4. The complainant, filed rejoinder to the written statement of the Opposite Parties, wherein he reiterated all the averments, contained in the complaint, and refuted those, contained in the written version of the Opposite Parties.
5. The Parties led evidence, in support of their case.
6. We have heard the Counsel for the parties, and have gone through the evidence and record of the case, carefully.
57. Admittedly, the complainant booked a plot in the project of the Opposite Parties, which was provisionally allotted plot No.317 having approximate area of 300 Sq. yds. in Pinewood Park, Sector 108, SAS Nagar, Mohali, vide provisional allotment letter dated 05.05.2007 (Annexure C-2). It is also an admitted fact that the complainant paid the total amount of Rs.34,24,750/-, out of the amount of Rs.35,97,249/- to the Opposite Parties, as is evident from Annexure C-19. It is also the admitted fact that Plot Buyer's Agreement was also executed between the parties at New Delhi on 30.06.2007 and as per the Agreement, possession of the said unit was to be delivered to the complainant within a period of 36 months from the date of Agreement i.e. by 29.06.2010 but the Opposite Parties failed to deliver the physical possession of the unit, in question, to the complainant, even till the filing of the complaint and when he sought refund of the amount, they refused to pay the same.
8. The principal question, that falls for consideration, is, as to whether, in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint. It may be stated here that under similar circumstances, in a case titled as Abha Arora Vs. Puma Realtors Pvt. Ltd. and another, consumer complaint No.170 of 2015, decided on 01.04.2016, this Commission, brushed aside the argument, raised on behalf of the builder, while holding as under:-
"24 Before dealing with the legal issues, it is necessary to note down amended and unamended provisions of Section 8 of 1996 Act and other provisions, which were added in the 1996 Act (principal Act), by the Arbitration and Conciliation 6 Amendment Act, 2015, which was signed by the Hon`ble President of India on 31.12.2015.
Unamended provisions of Section 8 of 1996 Act, reads thus:-
"8. Power to refer parties to arbitration where there is an arbitration agreement.-- (1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.
(2) The application referred to in sub-
section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. (3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made."
25. After amendment, Section 8 of 1996 Act, reads as under:-
"8. Power to refer parties to arbitration where there is an arbitration agreement.--
(1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the 7 substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists."
26. The provisions which needs interpretation/ explanation, as added in the principal Act, have been underlined, in the above extracted paragraph. Vide the 2015 Act, in principal Act, Fourth Schedule was added with it, scale of fee, to be charged by an Arbitrator has been prescribed. Besides as above, by making amendment in Section 11 of 1996 Act, it is provided that any application of the contesting parties to appoint an Arbitrator is to be decided by the High Court/its nominee expeditiously as possible and an effort be made to dispose of the same, within 60 days, from the date of service of notice upon the opposite party. Further, by making an amendment in the principal Act, Section 29 A has been added providing that an Arbitrator is supposed to make an award within 6 months from the date the Arbitral Tribunal enters upon the reference. There is a provision for extending the time period for 6 months more, with consent of the parties. Thereafter, the Court has been given power to extend it, in case of need. As per Section 34 of 1996 Act, the award so passed, can be challenged before the Court. As per amended provisions added in the principal Act, the Court is supposed to dispose of the said dispute within a period of one year, from the date, on which the notice is served upon the opposite party. As per law, the matter can further be challenged in the High Court 8 and may be, thereafter, it will go to the Hon`ble Supreme Court of India.
27. Now, we would like to deal with applicability of Section 8 (amended) of the principal Act, to the proceedings before this Commission. It is to be decided, as to whether, in the face of existence of an arbitration clause in the Agreement, it is open to this Commission, to entertain a consumer complaint, in terms of provisions of Section 3 of 1986 Act or not.
Here, it is necessary to reproduce the provisions of Section 3 of 1986 Act, for consideration:-
"3. Act not in derogation of any other law.--The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force."
28 Such issue was also raised, when unamended provisions of Section 8 of 1996 Act, was in existence. Similar argument was raised that when settlement of disputes is provided through arbitration in the Agreement, the consumer complaint is not maintainable. In umpteen number of cases, it is held by the Hon`ble Supreme Court of India, National Commission and various State Commissions, that Section 3 of 1986 Act provides additional remedy and existence of arbitration clause, in the Agreement, to settle disputes between the parties, is not a bar to entertain a complaint filed by the consumer, alleging deficiency in providing service etc. A similar issue came up before this Commission in Sh.Dharam Pal Gupta Vs. M/s Emaar MGF Land Limited and another, Consumer Complaint No.147 of 2015, decided on 13.10.2015. After noting the ratio of judgments of the Hon`ble Supreme Court 9 of India, in various cases, and also of the National Commission, it was observed as under:-
It was next vehemently argued by Counsel for Opposite Parties No.1 and 2 that the complaint filed under Section 17 of the Act, was not maintainable, before this Commission, on account of existence of an arbitration Clause in the Buyer's Agreement. To say so, reference was made to Clause 42 of the Buyer's Agreement, which reads thus:-
"42. In the event of any dispute arising out of or touching upon or in relation to the terms of this Agreement or its termination, including the interpretation and validity thereof and the respective rights and obligations of the Parties shall be settled amicably by mutual discussion, failing which the same shall be settled through arbitration of an Arbitrator to be appointed(by?)the Company. The arbitration proceedings shall be governed by the Arbitration and Conciliation Act, 1996, or any statutory amendments, modifications or re-enactment thereof for the time being in force and shall be held at New Delhi. The Courts at Mohali alone shall have the territorial jurisdictions in all matters arising out of/touching and/or concerning this Agreement"
It is stated that in case of dispute, an attempt will be made to settle the same, in an amicable manner, failing which, the same shall be referred to an Arbitrator in terms of Arbitration and Conciliation Act, 1996 (in short the 1996 Act).
10Heavy reliance has been placed on judgment of Calcutta High Court titled as Sudarshan Vyapar Pvt. Ltd. and another`s case (supra). Further reliance was placed on a judgment rendered by the State Consumer Disputes Redressal Commission, Punjab, at Chandigarh, titled as Raj Kumar Singal Vs. M/s Puma Realtors Private Limited and another, Miscellaneous Application Nos.1226 and 1227 of 2014, in Consumer Complaint No.60 of 2014 and also upon a case titled as M/s S.B.P. and Co. Vs. M/s Patel Engineering Limited and another, AIR 2006 SC
450. On the other hand, it is stated by Counsel for the complainant that in terms of Section 3 of the 1986 Act, above plea supported by the said judgments, needs to be rejected.
In the case of M/s S.B.P. and Co.`s case (supra), the Hon`ble Supreme Court dealt with altogether a different issue i.e. what is the nature of function of the Chief Justice or his designate, under Section 11 of the 1996 Act. Whether it is purely an administrative function or the Chief Justice or his designate, has the power to adjudicate upon the issues like existence of Arbitration clause in the Agreement/its validity. None of the provisions of 1986 Act were under consideration. The Hon`ble Supreme Court in M/s S.B.P. and Co.`s case (supra) discussed in detail, the provisions of the 1996 Act, and then gave a finding that powers of the Chief Justice of India or the High Court, under Section 11 (6) is not an administrative power but it is a judicial power. When discussing the question, as to who 11 would fall within the definition of Judicial Authority, in terms of Section (8) of the 1996 Act, by making reference to ratio of judgment in the case Fair Air Engineers Pvt. Ltd. & anr. Vs. N.K. Modi, III (1996) CPJ 1 (SC) = (1996 (6) SCC 385, it was only said that judicial authority will include the Courts, and also specific Tribunals like Consumer Fora. Whether the Consumer Fora is bound to refer the matter to the Arbitrator, was not under consideration, in the above case.
The part of ratio of judgment in case Fair Air Engineers Pvt. Ltd. & anr.`s case(supra) dealing with above aspect, was not discussed in M/s S.B.P. and Co.s case (supra). In the former judgment besides opining that Consumer Fora have all the trappings of the judicial authority, further, by making reference to the provisions of Section 34 of the Arbitration Act,1940 viz a viz Section 3 of 1986 Act, in Fair Air Engineers Pvt. Ltd. & anr.`s case (supra),it was observed as under:-
"It would, therefore, be clear that the Legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the CPC. Thereby, as seen, Section 34 of the Act does not confer an automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act. It is a matter of discretion. Considered from this perspective, we hold that though 12 the District Forum, State Commission and National Commission are judicial authorities, for the purpose of Section 34 of the Arbitration Act, in view of the object of the Act and by operation of Section 3 thereof, we are of the considered view that it would be appropriate that these forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that Act intends to relieve the consumers of the cumbersome arbitration proceedings or civil action unless the forums on their own and on their own and on the peculiar facts and circumstances of the particular case, come to the conclusion that the appropriate forum for adjudication of the disputes would be otherwise those given in the Act."
It was specifically opined that the remedy under Section 3 of the 1986 Act, is in addition to and not in derogation to any other remedy available to an individual.
The above question was again dealt with, by the Hon`ble Supreme Court of India, in National Seeds Corporation Ltd. Vs. M. Madhusudhan Reddy & anr., I (2012) CPJ 1 (SC). Taking note of the provisions of 1996 Act and Section 3 of the 1986 Act, it was observed as under:-
"29. The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to 13 an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996. Moreover, the plain language of Section 3 of the Consumer Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force. In Fair Air Engineers (P) Ltd. v. N.K. Modi (supra), the 2-Judge Bench interpreted that section and held as under:
"the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that Section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. It is true, as rightly contended by Mr. Suri, that the words 'in derogation of the provisions of any other law for the time being in force' would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act. Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well 14 founded. Parliament is aware of the provisions of the Arbitration Act and the Contract Act, 1872 and the consequential remedy available under Section 9 of the Code of Civil Procedure, i.e., to avail of right of civil action in a competent Court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.
30. In Skypak Couriers Limited v. Tata Chemicals Limited (supra), this Court observed:
"Even if there exists an arbitration clause in an agreement and a complaint is made by the consumer, in relation to a certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal Agency, constituted under the Consumer Protection Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force."
31. In Trans Mediterranean Airways v.
Universal Exports (supra), it was observed:
"In our view, the protection provided under the CP Act to consumers is in addition to the remedies available under any other statute. It does not extinguish the remedies under another statute but provides an additional or alternative remedy".
Ratio of the judgments have left nothing to chance. It was mandated that even in the case of special 15 legislation, it is permissible for an individual to avail remedy, under the 1986 Act. The National Commission, in a case titled as DLF Limited Vs Mridul Estate (Pvt.) Ltd., Revision Petition No.412 of 2011 (alongwith other 11 connected cases), decided on 13.05.2013 after taking ratio of judgment in the case of M/s S.B.P. and Co.`s case (supra), came to a specific conclusion that remedy provided under Section 3 of the 1986 Act is in addition to and not in derogation of the provisions of any other law, for the time being in force. It was specifically stated that ratio of judgment passed in M/s S.B.P. and Co.`s case (supra), will not debar a Consumer Fora from entertaining the complaint, even in cases where an alternative remedy of Arbitration is provided. Vide that judgment many Revision-Petitions were decided. Feeling aggrieved against the order dated 13.05.2013, passed by the National Commission, Rosedale Developers Private Limited/Opposite Party challenged above order in the Hon`ble Supreme Court. In the case of Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, (Civil Appeal No.20923 of 2013), the Hon`ble Supreme Court of India, by making reference to the ratio of judgment in the case M/s S.B.P. and Co.`s case (supra), observed that the judgment has no bearing on the issue, as to whether in the face of an Arbitration Clause, Jurisdiction can be exercised by the Consumer Fora or not. In that judgment, the Supreme Court had not interpreted the provisions of 1996 Act in the light of the provisions contained in 1986 Act. It was further observed that the observation made in that judgment that Section 8 of the 1996 Act is mandatory, cannot lead to an inference that the Consumer Fora is bound 16 to make a reference to the Arbitral Tribunal. As such, the facts of Sudarshan Vyapar Pvt. Ltd. and another`s and Raj Kumar Singal`s cases (supra) relied upon by Counsel for Opposite Parties No.1 and 2, cannot be applied to the facts of the present case.
The position has further been clarified by the National Commission, in the latest Judgment titled as Shri Satish Kumar Pandey and another Vs. M/s Unitech Limited, Consumer Complaint No.427 of 2014 (alongwith other 23 connected cases), decided on 08.06.2015. It was observed as under:-
"It was also contended by the learned counsel for the opposite party that since the agreements between the parties contains arbitration clause, arbitration and not a complaint before this Commission is the appropriate remedy. I, however, find no merit in this contention. As provided in Section 3 of the Consumer Protection Act, the provision of this Act are in addition to the other remedies available to a consumer. Therefore, the availability of arbitration as a remedy does not debar the complainant from approaching a consumer forum in a case of deficiency in the services rendered to him by the service provider or adoption of unfair trade practices by him. This issue came up for consideration of the Hon'ble Supreme Court in National Seeds Corporation Vs. M. Madhusudhan Reddy & anr. (2012)2 SCC 506 and after taking into consideration the provisions of the Section 8 of the Arbitration Act of 1996 and the Section 3 of the C.P. Act it was held 17 that the plain language of Section 3 of the C.P. Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force. The Hon'ble Supreme Court has also held that the complaint filed by a consumer before the consumer fora would be maintainable despite their being an arbitration clause in the agreement to refer the dispute to the Arbitrator. In view of the above referred authoritative pronouncement of the Hon'ble Supreme Court which was later followed by a Three Members Bench of this Commission in DLF Ltd. Vs. Mridul Estate Pvt. Ltd., R.P. No.412 of 2011 decided on 13-05-2013, the aforesaid contention advanced by the learned counsel for the opposite party is liable to be rejected."
Reading of ratio of the judgments referred to above, make it clear that in case of M/s S.B.P. and Co.`s case (supra), the issue before the Supreme Court of India was altogether different. The provisions of 1986 Act were not under consideration viz. a viz. the provisions of 1996 Act. As such, the ratio of judgments referred to above, makes it very clear that the judgments in Sudarshan Vyapar Pvt. Ltd. and another`s and Raj Kumar Singal`s cases (supra), were given by wrongly interpreting the ratio of M/s S.B.P. and Co.`s case (supra).
In view of the above, it is held that the submission of Counsel for Opposite Parties 18 No.1 and 2, that the complaint filed under Section 17 of the Act, was not maintainable, before this Commission, on account of existence of an arbitration Clause in the Buyer's Agreement, being devoid of merit, stands rejected.
29. Not only this, in the latest judgment titled as Mahindra Holidays & Resorts India Ltd. Vs. Adnan Samoon Rassiawala & 6 Ors., First Appeal No. 127 of 2016, decided on 18.03.2016, the National Commission observed as under:-
"The short question for consideration in this Appeal is as to whether the Maharashtra State Consumer Disputes Redressal Commission at Mumbai (for short "the State Commission") was justified in dismissing the application filed by the Appellant, the Opposite Party in the Complaint, under Section-8 of the Arbitration and Conciliation Act, 1996, seeking stay of the proceedings in the Complaint and for referring the matter to arbitration, in view of the fact that there was an Arbitration Agreement between the parties.
Though Mr. Pattjoshi, learned Senior Counsel, has made valiant attempt to convince us that in the light of the decision of the Hon'ble Delhi High Court in HDFC Bank Ltd. v. Satpal Singh Bakshi, 2013 (134) DRJ 566 (FB), the parties were bound by the Arbitration Agreement and in view of the clear provision of Section-8 of the said Act, the dispute, subject matter of 19 the Complaint, ought to have been referred to arbitration, yet we are unable to persuade ourselves to agree with the learned Senior Counsel. The issue sought to be raised is no more res integra as stands concluded by a number of authoritative pronouncements by the Hon'ble Supreme Court (see Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (dead) through LRs & Ors., (2004) 1 SCC 305; Skypak Couriers Ltd. v. Tata Chemicals Ltd., (2000) 5 SCC 294; and National Seeds Corporation Ltd. v. Madusudan Reddy, (2012) 2 SCC
506).
In light of the said decisions of the Hon'ble Supreme Court, directly on the point, decision of the High Court cannot be relied upon, particularly when none of the afore- noted decisions have been noticed in the High Court's decision, on which reliance has been placed by the learned Senior Counsel.
We do not find any illegality in the
impugned order, warranting our
interference.
Consequently, the Appeal fails and is
dismissed in limine".
30. Now it is to be seen, whether, after making amendment in Section 8 of the principal Act, any additional rights have accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling disputes through 20 an Arbitrator, this Commission is not empowered to entertain a consumer complaint.
As has been held by Hon`ble Supreme Court of India, in various cases, and also of the National Commission, in large number of judgments, Section 3 of the 1986 Act, provides additional remedy, notwithstanding any other remedy available to a consumer. The said remedy is also not in derogation to any other Act.
31. Now, we will have to see what difference has been made by effecting amendment, in the provisions of Section 8 of 1996 Act. After amendment, it reads that a Judicial Authority is supposed to refer the matter to an Arbitrator, if there exists an arbitration clause in the agreement, notwithstanding any judgment, decree, order of the Hon`ble Supreme Court of India, or any other Court, unless it finds that prima facie, no valid arbitration agreement exists. The legislation was alive to the ratio of the judgments, as referred to above, in earlier part of this order. Vide those judgments, it is specifically mandated that under Section 3 of 1986 Act, an additional remedy is available to the consumer(s), which is not in derogation to any other Act. As and when any argument was raised, the Hon`ble Supreme Court of India and the National Commission in the judgments, referred to above, have made it very clear that in the face of Section 8 of 1996 Act and existence of arbitration agreement, it is still opened to Consumer Foras to entertain the consumer complaints. None of the judgments ever conferred any jurisdiction upon the Consumer Foras to entertain such like complaints. Only the legal issues, as existed in the Statute Book, were explained vide different 21 judgments. If we look into amended provisions of Section 8 of the principal Act, it explains that judicial Authority needs to refer dispute, in which arbitration agreement exist for arbitrator, notwithstanding any judgment/decree or order of any Court. That may be true where in a case, some order has been passed by any Court, making arbitration Agreement non- applicable to a dispute/parties. However, in the present case, the above said argument is not available. The jurisdiction of Consumer Foras to entertain consumer complaints, in the face of arbitration clause in the Agreement, is in-built in 1986 Act. It was not given to these Foras, by any judgment ever. The provisions of Section 3 of 1986 Act interpreted vide judgments vis a vis Section 8 of un- amended 1996 Act, were known to the legislature, when the amended Act 2015 was passed. If there was any intention on the part of the legislature then it would have been very conveniently provided that notwithstanding any remedy available in 1986 Act, it would be binding upon the judicial Authority to refer the matter to an Arbitrator, in case of existence of arbitration agreement, however, it was not so said. Otherwise also, as has been stated in the earlier part of this order, where there is any ambiguity in understanding meaning of provision of law, or where two interpretations are possible, one beneficial to the consumer would be accepted.
32. We can deal with this issue, from another angle also. If this contention raised is accepted, it will go against the basic spirit of 1986 Act. The said Act (1986) was enacted to protect poor consumers against might of the service providers/multinational companies/ traders. As in the present cases, the 22 consumers/ complainants have spent their entire life savings to get a plot, so that they can construct a house thereon. Their hopes were shattered. Litigation in the Consumer Fora is cost effective. It does not involve huge expenses and further it is very quick. A complaint in the State Commission can be filed, by making payment between Rs.2000/- to Rs.4000/- (in the present case Rs.4000/-). As per the mandate of 1986 Act, the complaint is supposed to be decided within three months, from the date of service of the opposite party. In cases involving ticklish issues (like the present one, maximum not more than six months to seven months time can be consumed), whereas, to the contrary, as per the principal Act, the consumer will be forced to (as in the present case) pay huge expenses. As in the present case, the complainant is claiming refund of Rs.65,56,513/- alongwith interest, compensation and litigation costs, aggregate value whereof, if added may be near about Rs.1 crore. In that event, the complainant will be forced to pay an amount of Rs.1,68,750/- towards her share of Arbitrator fees. Not only as above, it is admissible to an Arbitrator, to decide the dispute within one year. Thereafter, the Court wherever it is challenged may also take upto one year and then there is likelihood that the matter will go to the High Court or the Hon`ble Supreme Court of India. Such an effort will be a time consuming and costly one. Taking note of fee component and time consumed in arbitration, it can safely be said that if the matter is referred to an Arbitrator, as prayed, in the present case, it will defeat the very purpose of General Assembly Resolution No.39/248 and the provisions of 1986 Act.
23In view of above, the ground raised by Counsel for opposite party no.1, stands rejected."
9. Similar view has been reiterated by this Commission in Praveen Kumar Arora & Anr. Vs. Emaar MGF Land Limited, Complaint case No.198 of 2015, decided on 04.04.2016 alongwith other connected cases, in which, it was further held as under :-
"20. The 1986 Act provides for better protection of interests and rights of the consumers. For the said purpose, the Consumer Foras were created under the Act. In Section 3 of 1986 Act, it is clearly provided that the said provision is in addition to and not in derogation of any provisions of any other law, for the time being in force. The 1986 Act is special legislation qua the consumers. The poor consumers are not expected to fight the might of multinational companies/traders, as those entities have lot of resources at their command. In the present case, the complainants have spent their entire life earnings to purchase a plot, in a housing project, launched by the opposite party. It was their hope that they will construct a house on the said plot and live therein. However, their hopes were shattered, when despite making payment of entire amount towards price, they failed to get possession of a plot, in a developed project. As per established ratio of the judgment in Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and also in the judgment of United India Insurance Co. Ltd. Vs. M/s Pushpalaya Printers, I (2004) CPJ 22 (SC), and LIC of India and another Vs. Hira Lal, IV (2011) CPJ 4 (SC), it was said that the consumers are always in a weak position, and in cases where two interpretations are possible, the one beneficial to the consumer be 24 accepted. The opinion expressed above, qua applicability of Section 8 (amended) of 1996 Act, has been given keeping in mind the above said principle.
21. In view of the above, the argument raised by Senior Counsel for the opposite party that in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint, being devoid of merit, is rejected."
In view of the ratio of judgments, referred to above, the plea of the Opposite Parties is not sustainable and is, thus, rejected.
10. The next question, that falls for consideration, is, as to whether, this Commission has got pecuniary Jurisdiction, to entertain and decide the complaint or not. It may be stated here, that the complainant has sought refund of an amount of Rs.34,24,750/- paid by him, alongwith interest @24% per annum from the respective dates of deposits; compensation to the tune of Rs.10 lacs, mental agony/torture and physical harassment and cost of litigation, to the tune of Rs.55,000/-, the aggregate value whereof, if clubbed together, fell above Rs.20 lacs and below Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction, to entertain and decide the complaint. The objection, taken by the Opposite Parties, in their written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.
11. The next question, that falls for consideration, is, as to whether, this Commission has got territorial Jurisdiction, to entertain and decide the complaint or not. According to Section 17 of the Act, a Consumer Complaint, could be filed, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to 25 them. According to the Counsel for the Opposite Parties, this Commission has no territorial jurisdiction to entertain and decide the complaint because the Agreement was executed between the parties at New Delhi. According to the Counsel for the complainant, the application form as well as registration amount were signed and paid at Chandigarh. It is, no doubt, true that Plot Buyer's Agreement dated 30.06.2007 (Annexure C-
4), was executed between the parties at New Delhi, in respect of the unit, in question. It is pertinent to mention here that at the bottom of some of the receipts, which were issued by the Opposite Parties, bears their Chandigarh address as 'Emaar MGF Land Private Limited, SCO 120-122, 1st Floor, Sector 17-C, Chandigarh 160 017, India' and some of the bottom of receipts, the same Chandigarh address, as mentioned above, under the name of 'Emaar MGF Land Limited'. Even otherwise, the receipt dated 19.03.2008 in the sum of Rs.3,45,000/- (Annexure C-10), receipt dated 16.06.2008 in the sum of Rs.3,45,000/- (Annexure C-12), receipt dated 19.09.2008 in the sum of Rs.4,18,625/- (Annexure C-14), receipt dated 18.12.2008 in the sum of Rs.4,18,625/- (Annexure C-16), in respect of the said unit, was received by the Opposite Parties, at Chandigarh, as all the aforesaid receipts bears the round stamp on the revenue stamp 'EMMAR MGF LAND LTD., CHANDIGARH'. Since, as per the documents, referred to above, it is clearly proved that a part of cause of action, arose to the complainant, at Chandigarh, this Commission has got territorial Jurisdiction, to entertain and decide the complaint. The objection, taken by the Opposite Parties, in their written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.
12. The next question, that falls for consideration is, as to whether, the complainant is a speculator and purchased the said plot for speculation purposes? The Counsel for the Opposite Parties submitted that the complainant is a speculator and purchased the plot for speculation purposes because he has not 26 got the desired appreciation due to slump in the reality market, so he is seeking refund of money. After going through the record, we are not agreeing with the contention of the Counsel for the Opposite Parties because the unit, which was purchased by the complainant, is a residential one and no evidence was produced by the Opposite Parties, that the complainant is property dealer, who deal in the sale and purchase of the property, and, as such, he purchased the unit, in question, for the purpose of speculation, with a view to resell the same, as and when, there is escalation, in the prices of real estate. So, the submission of the Counsel for the Opposite Parties, therefore, being without merit must fail and the same stands rejected.
13. The next question, that falls for consideration, is, as to within which period, the delivery of possession of the unit, was to be given to the complainant. As stated above, according to Clause 8 of the Plot Buyer's Agreement dated 30.06.2007 (Annexure C-4), subject to force majeure conditions and reasons, beyond the control of the Opposite Parties, they were to deliver physical possession of the unit, in question, within a period of 2 (two) years, from the date of execution of the Agreement, but not later than 3 (Three) years. It is, thus, evident, from this Clause, that the Opposite Parties were required to deliver possession of the unit, in question, in favour of the complainant, within the maximum period of three years, from the date of execution of the Plot Buyer's Agreement dated 30.06.2007, i.e. latest by 29.06.2010. As held above, physical possession of the unit, in question, was not delivered to the complainant, despite lapse of eight years from the date of execution of Plot Buyer's Agreement. On the other hand, the Opposite Parties have already received a sum of Rs.34,24,750/-, towards the said unit, as is evident from the Customer Confirmation Request dated 13.04.2012 (Annexure C-19). By making a misleading statement, that possession of the unit, was to be delivered within a maximum period of three years, from 27 the date of execution of the Plot Buyer's Agreement dated 30.06.2007, and by not abiding by the commitments, made by the Opposite Parties, they (Opposite Parties) were not only deficient, in rendering service, but also indulged into unfair trade practice.
14. The next question, that falls for consideration, is, as to whether, the complainant is entitled to refund of the amount of Rs.34,24,750/-, deposited by him, towards the part price of unit, in question. The complainant, in the complaint has sought refund of the amount, deposited by him, towards the same. Under these circumstances, the complainant is entitled to refund of the amount, deposited by him, towards the said unit. By not refunding the amount to the complainant, the Opposite Parties were deficient, in rendering service.
15. In a similar case relating to delayed possession, titled as Guninder Jeet Singh Salh Vs M/s Emaar MGF Land Limited and another, Consumer Complaint No. 113 of 2015, decided by this Commission on 23.09.2015, noting ratio of the judgment of the National Commission, in the case of Emaar MGF Land Limited and another Vs. Dilshad Gill, III (2015) CPJ 329 (NC), it was said that the consumer can claim refund. The National Commission was dealing with a similar situation, in the above case. In that case also, possession was not offered within the stipulated period. The consumer complaint was filed by the complainant, before this Commission, claiming refund of the amount paid by him. This Commission took it as a case of rescinding of contract and allowed the Opposite Parties to forfeit 10% of the deposited amount. The above named builder went in appeal, which was dismissed, by the Hon'ble National Consumer Disputes Redressal Commission, New Delhi, holding as under:-
"It is apparent from the above clause, that possession of the apartment was to be handed over within a period of 36 months from the date of allotment, with grace period of 3 months. Admittedly, no possession was offered to the 28 original allottee or to the respondent, till 26.11.2011 when she stepped into the shoes of original allottee. Thus, on the date of accepting the present respondent as allottee on 26.11.2011, the apartment in question was not complete.
23. As appellants did not offer possession within the period prescribed under Clause 21 of the 'Apartment Buyer Agreement', the deficiency on the part of appellants, started right from that very moment. It is an admitted fact, that while offering the possession even in the year 2013, appellants sent letter dated 13.5.2013 and respondent was asked to deposit sum of Rs.3,05,969.70, within 30 days. When payment of the instalments is construction linked, then we fail to understand as to how before completing the construction appellants demanded the aforesaid amount. This act of appellants goes on to show, that even on 13.5.2013 construction of apartment was not complete. It was only vide letter dated 16.8.2013, appellants offered possession of the apartment, subject to certain payments.
24. Thus, appellants themselves have violated the material conditions with regard to handing over of the possession, now it does not lie in their mouth to demand further payment from the respondent. Even assuming for arguments sake, that payment as demanded vide letter dated 16.8.2013 was due, but the respondent was fully justified in not making the payment, when appellants failed to complete the construction and handover the possession, within the agreed period. Appellants could not force the respondent, after having accepting money from the original allottee in the year 2006 and part payment from present respondent in the year 2011, to accept possession of the apartment in the year 2013, which was against the terms of the Agreement. The above facts clearly goes on to show, that appellants have been enjoying the substantial amount of money received by them in the year 2006, till 2013. Therefore, this plea of appellants, that they have done their part of the duty and it is the respondent who is defaulter, does not hold any water.
2925. The deficiency on the part of appellants is writ large in this case. We may note, that under such circumstances there was no occasion for the State Commission to have deducted 10% of the deposited amount as respondent was not at fault at all. On the other hand, appellants were deficient when they themselves have violated the terms and conditions of 'Apartment Buyer Agreement', The case law relied by ld. counsel for appellants are not applicable at all to the facts of the present case."
It was clearly stated by the National Commission, in Emaar MGF Land Limited and another Vs. Dilshad Gill's case (supra), that when the promoter has violated material condition, in not handing over possession of the unit, in time, it is not obligatory for a purchaser to accept possession after that date. In the present case, after the lapse of about 6-8 years, the Opposite Parties failed to deliver physical possession of the unit, in question, to the complainant. It is pertinent to mention here that the Opposite Parties have not fulfilled their part of the Agreement and failed to develop the infrastructure alongwith other amenities and nor given possession of the unit to the complainant. Moreover, in para No.7 of their written statement, the Opposite Parties themselves admitted that the amenities are not completed so the possession has not been offered to the complainant. So, it is clearly proved that there was no fault on the part of the complainant and the Opposite Parties are, thus, in breach of their part of the obligation and are deficient in providing services even after receipt of the huge amount and, as such, the Opposite Parties are not entitled to forfeit any amount, as alleged by them and refund the deposited amount, as prayed for by the complainant.
16. The next question, that falls for consideration, is, as to whether, the complainant is entitled to interest, on the amount of Rs.34,24,750/-, if so, at what rate. The complainant was deprived of his hard earned money, to the tune of Rs.34,24,750/-, on the basis of misleading information, given 30 by the Opposite Parties, that he would be handed over legal physical possession of the plot, in question, on or before 29.06.2010, but they failed to do so. The complainant was, thus, caused financial loss. Hard earned money, deposited by the complainant, towards price of unit, in question, was utilized by the Opposite Parties, for a number of years. Had this amount been deposited by the complainant, in some bank, or had he invested the same, in some business, he would have earned handsome returns thereon. It is therefore, held that the Opposite Parties, by neither delivering possession of the unit, by the stipulated date, nor refunding the amount to the complainant, were not only deficient, in rendering service, but also indulged into unfair trade practice. No doubt, as per Clause 3 of the Plot Buyer's Agreement, the Opposite Parties were charging interest @15% per annum compounded from the complainant. Under these circumstances, in our considered opinion, if interest at the same rate i.e. @15% per annum compounded, on the amount deposited by the complainant, from the respective dates of deposits, is granted, that will serve the ends of justice.
17. The next question, that falls for consideration, is, as to whether, the complainant is entitled to compensation, under Section 14(1)(d) of the Act, on account of mental agony and physical harassment caused to him. It may be stated here, that according to Section 14(d) of the Act, the Consumer Foras can grant compensation, to the complainant. The word 'compensation' is again of very wide connotation. It has not been defined, in the Act. According to the dictionary, it means compensating or being compensated, thing given as recompense. In legal sense, it may constitute actual loss or expected loss and may extend to physical, mental or even emotional suffering, insult or injury or loss. Therefore, when the Consumer Foras have been vested with the Jurisdiction to award the value of goods or services and compensation, it has to be construed 31 widely enabling them (Consumer Foras), to determine compensation, for any loss or damage suffered by the consumers, which in law is otherwise, the wide meaning of 'compensation'. The provision, in our considered opinion, enables the consumers to claim and empowers the Consumer Foras to redress any injustice done to the complainant. The Commission or the Forum in the Act, is, thus, entitled to award not only the value of the goods or services, but also to compensate the consumers, for injustice suffered by them. Similar principle of law was laid down, in Ghaziabad Development Authority v. Balbir Singh, II (2004) CPJ 12 (SC)=III (2004) SLT 161=(2004) 5 SCC 65. In the instant case, the complainant suffered a lot of mental agony and physical harassment, at the hands of the Opposite Parties, for a long number years, as they failed to deliver the physical possession of unit, in question, to him, by the promised date i.e. 29.06.2010. The complainant purchased the unit, with the hope to have a roof over his head, by raising construction thereon, but his hopes were dashed to the ground. Till date, i.e. even after the expiry of a period of about 6 years, from the promised date, i.e. 29.06.2010, physical possession of the unit, has not yet been offered, to the complainant, by the Opposite Parties. The complainant, thus, underwent a lot of mental agony and physical harassment, on account of the acts of omission and commission of the Opposite Parties. Compensation to the tune of Rs.3,00,000/- if granted, shall be reasonable, adequate and fair. The complainant, is, thus, held entitled to compensation, in the sum of Rs.3,00,000/-.
18. No other point, was urged, by the Counsel for the parties.
19. For the reasons recorded above, the complaint is partly accepted, with costs. The Opposite Parties are jointly and severally directed, as under:-
32i. To refund the amount Rs.34,24,750/-, to the complainant, alongwith interest @ 15% per annum compounded, from the respective dates of deposits onwards, within 45 days, from the date of receipt of a certified copy of this order.
ii. To pay compensation, in the sum of Rs.3,00,000/- for causing mental agony and physical harassment, to the complainant, within 45 days, from the date of receipt of a certified copy of this order.
iii. To pay cost of litigation, to the tune of Rs.50,000/- to the complainant.
iv. In case, the payment of amounts, mentioned in Clauses (i) and (ii), is not made, within the stipulated period, then the Opposite Parties shall be liable to pay the amount mentioned in Clause
(i) with interest @18 % P.A. compounded, instead of 15% P.A. compounded, from the respective dates of deposits, till realization, and interest @15% P.A. compounded, on the amount of compensation, mentioned in Clause (ii), from the date of filing the complaint, till realization, besides payment of litigation costs.
20. Certified Copies of this order be sent to the parties, free of charge.
21. The file be consigned to Record Room, after completion.
Pronounced.
April 11, 2015.
[JUSTICE JASBIR SINGH (RETD.)] [PRESIDENT] [DEV RAJ] MEMBER 33 (PADMA PANDEY) MEMBER rb 34 STATE COMMISSION (Complaint Case No.12 of 2016) [Sanjeev Seth Vs. Emaar MGF Land Ltd. & Anr.] Argued by: Sh. Saurabh Gautam, Advocate for the complainant.
Sh. Sanjeev Sharma, Advocate for the Opposite Parties.
Dated the 11th day of April, 2016 ORDER Vide our detailed order of the even date, recorded separately, this complaint has been partly accepted, with costs.
(DEV RAJ) (JUSTICE JASBIR SINGH (RETD.)) (PADMA PANDEY)
MEMBER PRESIDENT MEMBER
rb