State Consumer Disputes Redressal Commission
Vicky Lakhina vs Avalon Infrastructure Pvt. Ltd. & Anr. on 28 March, 2023
C/1051/2017 D.O.D.: 28.03.2023
MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
IN THE DELHI STATE CONSUMER DISPUTES
REDRESSAL COMMISSION
Date of Institution: 09.06.2017
Date of hearing: 21.02.2023
Date of Decision: 28.03.2023
COMPLAINT CASE NO.-1051/2017
IN THE MATTER OF
MR. VICKY LAKHIMA,
S/O LATE MR. HARISH LAKHIMA,
R/O E-23 SAKET FIRST FLOOR,
NEW DELHI.
(Through: Ms. Charu Sachdev, Advocate)
...Complainant
VERSUS
1. AVALON INFRASTRUCTURES PVT. LTD.,
9th FLOOR, SAS TOWERS,
MEDICITY, SECTOR-38,
GURGAON, HARYANA.
(THROUGH ITS MANAGING DIRECTOR/DIRECTOR)
2. MR. AJAY KUMAR GUPTA,
DIRECTOR,
M/S AVALON INFRASTRUCTURES PVT. LTD.,
AT D-2 PUSPANJALI ENCLAVE,
PITAMPURA, DELHI-110034.
3. AJAY SINGHAL (DIRECTOR),
M/S AVALON INFRASTRUCTURES PVT. LTD.,
AT PLOT NO. 16, ROAD NO. J-1,
PUNJABI BAGH WEST,
NEW DELHI-110026.
(Through: Mr. Lokesh Kumar Yadav, Advocate)
...Opposite Parties
ALLOWED PAGE 1 OF 12
C/1051/2017 D.O.D.: 28.03.2023
MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
HON'BLE MR. J.P. AGRAWAL, MEMBER (GENERAL)
Present: Ms. Charu Sachdev, Counsel for the Complainant.
Mr. Lokesh Kumar Yadav, Counsel for the Opposite
Party.
PER: HON'BLE JUSTICE SANGITA DHINGRA SEHGAL,
PRESIDENT
JUDGMENT
1. The present complaint has been filed by the Complainant before this Commission alleging deficiency of service and unfair trade practice on the Opposite Parties and has prayed following reliefs: -
i. "That the OP1, 2 & 3 be directed to refund the total amount deposited i.e. Rs.6,56,000/- (Rupees six Lacs and Fifty six thousand only) alongwith 18% interest from the date of deposits respectively to the complainant which amounts to Rs.4,75,736/- till the date of filing and further interest till the date of payment.
ii. OP 1, OP 2 & OP 3 should be directed to pay Rs.5 Lacs to the complainant as the costs of mental harassment and mental agony.
iii. OP 1, OP 2 & OP 3 should be directed to pay Rs.45,000/-
to the complainant as the cost of litigation and other connected litigation expenses.
iv. That the complainant is ready to comply with the directions of the Hon'ble Commission. v. Any other or further order(s) which this Hon'ble Commission may pass keeping in view the facts and circumstances of the case."
2. Brief facts necessary for the adjudication of the present complaint are that on 30.04.2013, Complainant booked an apartment with the ALLOWED PAGE 2 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
Opposite Parties in the project 'Avalon Rosewood', situated at Alwar, Bhiwadi, Rajasthan.
3. The Complainant paid a total sum of Rs. 6,56,000/- to the Opposite Parties with respect to the said booking of the aforesaid apartment as and when demanded by the Opposite Parties. Thereafter, the Complainant asked the Opposite Parties to provide the copy of license, site plan and status report of the construction for the apartment in question however, no satisfactory reply was given by the Opposite Parties. However, the Opposite Parties failed to handover the possession to the Complainant till date. Thereafter, the Complainant requested the Opposite Parties to give the date of delivery of the said apartment but no satisfactory reply was received by the Opposite Party. On visiting the site by the Complainant, they found that it is impossible to complete the construction anytime soon. Thus alleging, deficiency in service and unfair trade practice on the part of the Opposite Parties the Complainant approached this Commission.
4. The Opposite Parties have contested the present case and has raised preliminary objections as to the maintainability of the complaint case. The counsel of the Opposite Parties submitted that the jurisdiction of this commission is barred as there is an arbitration clause under the Arbitration & Conciliation Act, 1996. The counsel for the Opposite Parties further submitted that the said project is registered under Rajasthan RERA and therefore, the present complaint cannot be adjudicated by this Commission. The Opposite Parties also contended that the Complainant is not consumer under the Consumer Protection Act, 1986 as the Complainant invested the money to earn profit, which amounts to commercial purpose. Lastly, the counsel for the Opposite Parties submitted that the ALLOWED PAGE 3 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
construction is in full swing and the Complainant never signed the cancellation kit to process the refund for the said apartment. Pressing the aforesaid objections, the counsel appearing on behalf of the Opposite Parties prayed that the present complaint should be dismissed.
5. The Complainant has filed the Rejoinder rebutting the written statement filed by the Opposite Parties. Both the parties have filed their Evidence by way of Affidavit in order to prove their averments on record.
6. We have perused the material available on record and heard the counsel for the parties.
7. The first issue which needs our adjudication is whether the Complainant falls in the category of „consumer‟ provided by the Consumer Protection Act, 1986. The Opposite Parties contended that the Complainant is not Consumer as defined under the Consumer Protection Act, 1986 as it invested the money to earn profit, which amounts to commercial purpose. It is imperative to refer to the 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 Flats were purchased for commercial purpose is not supported by any documentary evidence as the onus shifts to the Opposite Parties to establish that the Complainant 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) ALLOWED PAGE 4 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
CPJ 31. The Opposite Parties failed to discharge their onus and we hence hold that the Complainant are 'Consumers' as defined under Section 2(1)(d) of the Act."
8. From the aforesaid dicta of the Hon'ble National Commission, it flows that it is for the Opposite Party to prove that the apartment purchased was for commercial purpose, by way of some documentary proof and a mere bald statement is not sufficient to raise adverse inference against the Complainant.
9. In the present case, the Opposite Parties have merely made a statement that the Complainant purchased the apartment for commercial purpose and on perusal of the record before us, we fail to find any material which shows that the Complainant is engaged in the business of purchasing and selling houses and/or plots on a regular basis, solely with a view to make profit by sale of such apartment. Mere allegation, that the purchase of the property is for commercial purpose, cannot be the ground to reject the present consumer complaint. Consequently, the objection raised on behalf of the Opposite Parties is answered in the negative.
10. The second question for consideration before us is whether the jurisdiction of this Commission is barred under the Arbitration & Conciliation Act, 1996.
11. The next preliminary objection raised by the Opposite Party is that since there exist an Arbitration Clause under the Arbitration & Conciliation Act, 1996, the parties should be referred to Arbitration and this Commission is barred from exercising its jurisdiction. To deal with this issue, we deem it appropriate to refer to Emaar MGF Land Limited vs. Aftab Singh reported at I (2019) CPJ 5 (SC), wherein the Apex court has held as under:-
"55. We may, however, hasten to add that in the event a person entitled to seek an additional special remedy ALLOWED PAGE 5 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
provided under the statutes does not opt for the additional/special remedy and he is a party to an arbitration agreement, there is no inhibition in disputes being proceeded in arbitration. It is only the case where specific/special remedies are provided for and which are opted by an aggrieved person that judicial authority can refuse to relegate the parties to the arbitration."
12. The Hon'ble Apex Court has put to rest the controversy relating to the existence of Arbitration Clauses in the Allotment Letter/Apartment Buyer Agreement etc. as is evident from the relevant paragraph of Emaar MGF Land Limited (supra). In the present case also, the Complainant has opted for the special remedies provided under the Consumer Protection Act, 1986 therefore, this Commission can refuse to relegate the present case to the Arbitration. Hence, this Commission is authorized to adjudicate the case and the existence of an Arbitration Clause under the Arbitration & Conciliation Act, 1996 does not affect the jurisdiction of this Commission.
13. The counsel for the Opposite Party further contended that the project in question is registered under Rajasthan RERA and therefore, this Commission cannot adjudicate the present complaint. The law is no more res integra on this issue and is well settled by the dicta in Ireo Grace Realtech Pvt. Ltd. Vs. Abhishek Khanna & Ors." reported in (2021) 3 SCC 241, wherein the Apex Court has held as under:
"42. In a recent judgment delivered by this Court in Imperia Structures Ltd. Vs. Anil Patni, it was held that remedies under the Consumer Protection Act were in addition to the remedies available under specials statutes. The absence of a bar under Section 79 of the RERA Act to the initiation of proceedings before a fora ALLOWED PAGE 6 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
which is not a civil court, read with Section 88 of the RERA Act makes the position clear. Section 18 of the RERA Act specifies that the remedies are "without prejudice to any other remedy available". We place reliance on this judgment, wherein it has been held that:
(SCC p.811, paras 31-32).
"31. Proviso to Section 71(1) of the RERA Act entitles a complainant who had initiated proceedings under the CP Act before the RERA Act came into force, to withdraw the proceedings under the CP Act with the permission of the Forum or Commission and file RCA No.3/2020 Smt. Manju Gupta & Anr. Vs. M/s Parsvnath Developers Ltd.
Page No.10 of 14 an appropriate application before the adjudicating officer under the RERA Act. The proviso thus gives a right or an option to the complainant concerned but does not statutorily force him to withdraw such complaint nor do the provisions of the RERA Act create any mechanism for transfer of such pending proceedings to authorities under the RERA Act. As against that the mandate in Section 12(4) of the CP Act to the contrary is quite significant.
32. Again, insofar as cases where such proceedings under the CP Act are initiated after the provisions of the RERA Act came into force, there is nothing in the RERA Act which bars such initiation. The absence of bar under Section 79 to the initiation of proceedings before a fora which cannot be called a civil court and express saving under Section 88 of the RERA Act, make the position quite clear. Further, Section 18 itself ALLOWED PAGE 7 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
specifies that the remedy under the said section is "without prejudice to any other remedy available". Thus, the parliamentary intent is clear that a choice or discretion is given to the allottee whether he wishes to initiate appropriate proceedings under the CP Act or file an application under the RERA Act".
14. It is clear from the above dicta that the remedies available under the Consumer Protection Act are in addition to the remedies provided under the special statutes and if the proceedings under the Consumer Protection Act are initiated after RERA Act came into force, there is nothing in the RERA Act which bars such initiation. Relying on the above settled law, the contention of the Opposite Parties that this Commission cannot adjudicate the present complaint Complainant on the ground that the project is registered under RERA is devoid of any merit and dismissed.
15. The last issue which is to be adjudicated is whether the Opposite Parties are 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 (3) RCR (Civil) 544, wherein it has been discussed as follows:
"23. .......The expression deficiency of services is defined in Section 2 (1) (g) of the CP Act 1986 as:
(g) "deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service.
24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat ALLOWED PAGE 8 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
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.
16. Returning to the facts of the present case, it is noted that though the Complainant submitted that the Opposite Parties assured him to hand over the possession of the said apartment within stipulated time period but we fail to find any document/provision which shows us the time period within which the Opposite Parties had to handover the possession of the said apartment to the Complainant.
17. It is appropriate to refer to the First Appeal no. 348/2016 tiled as "Ajay Enterprises Pvt. Ltd. and Ors. vs. Shobha Arora and Ors."
ALLOWED PAGE 9 OF 12 C/1051/2017 D.O.D.: 28.03.2023
MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
decided on 10.05.2019, wherein the Hon'ble NCDRC has held as under:
"......under Section 46 of the Indian Contract Act, 1872, the following provision is there:
46.Time for performance of promise, where no application is to be made and no time is specified -
Where, by the contract, a promisor is to perform his promise without application by the promisee, and no time for performance is specified, the engagement must be performed within a reasonable time.
Explanation - The question "what is a reasonable time"
is, in each particular case, a question of fact".
19. from the above provision it is clear that if there is no time limit for the performance of a particular promise given by one party, it is to be performed within a reasonable time. In most of the builder buyer agreements, the period ranges from 24 to 48 months and the most common agreement seems to be for 36 months plus grace period of six months for completion of construction and delivery of possession. If the possession is delivered beyond 42 months or beyond 48 months, the deficiency in service on the part of the Opposite Party shall stand proved."
18. A perusal of the above settled law makes it clear that if the possession is delivered beyond 42 months or beyond 48 months, the deficiency in service on the part of the Opposite Party shall stand proved. It is evident from the record that that the Opposite Parties failed to handover the possession of the said apartment till date and more than nine years have been passed from the date of booking. Therefore, the deficiency on the part of Opposite Party stands proved.
19. The Opposite Parties further submitted that the the Complainant never signed the cancellation kit to process the refund for the said apartment however; it is the duty of the Opposite Parties to execute ALLOWED PAGE 10 OF 12 C/1051/2017 D.O.D.: 28.03.2023 MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
the said cancellation. Moreover, the Opposite Parties fail to file an cogent proof or substantiated evidence regarding the said contention.The Complainant cannot be tormented due to the faults of the Opposite Parties. Therefore, this contention of the Opposite Parties is devoid of any merit and is dismissed.
20. Keeping in view the facts of the present case and the extensive law as discussed above, we direct the Opposite Parties to refund the entire amount paid by the Complainant i.e., Rs. 6,56,000/- along with interest as per the following arrangement:
A. A simple interest @ 6% p.a. calculated from the date on which each installment/payment was received by the Opposite Parties till 28.03.2023 (being the date of the present judgment);
B. The rate of simple interest payable as per the aforesaid clause (A) is subject to the condition that the Opposite Parties pays the entire amount on or before 28.05.2023; C. Being guided by the principles as discussed above, in case the Opposite Parties fails to refund the amount as per the aforesaid clause (A) on or before 28.05.2023, the entire amount is to be refunded along with a simple interest @ 9% p.a. calculated from the date on which each installment/payment was received by the Opposite Parties till the actual realization of the amount.
21. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Parties are directed to pay a sum of A. Rs. 1,00,000/- as cost for mental agony and harassment to the Complainant; and B. The litigation cost to the extent of Rs. 45,000/-.
ALLOWED PAGE 11 OF 12 C/1051/2017 D.O.D.: 28.03.2023
MR. VICKY LAKHINA VS AVALON INFRASTRUCTURES PVT. LTD. & ORS.
22. Applications pending, if any, stand disposed of in terms of the aforesaid judgment.
23. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Regulations, 2005. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
24. File be consigned to record room along with a copy of this Judgment.
(JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (PINKI) MEMBER (JUDICIAL) (J.P. AGRAWAL) MEMBER (GENERAL) Pronounced On:
28.03.2023 ALLOWED PAGE 12 OF 12