State Consumer Disputes Redressal Commission
Rajesh Maggu vs M/S Parsvnath Dev. Ltd. on 18 August, 2021
IN THE STATE COMMISSION: DELHI
(Constituted under section 9 of the Consumer Protection Act, 1986)
Date of Hearing:09.08.2021
Date of Decision:18.08.2021
Complaint No.530/2016
IN THE MATTER OF
RAJESH MAGGU
S/o Late Sh. H.L. Maggu
R/o S-78,
Greater Kailash-1,
New Delhi ....Complainant
VERSUS
M/S PARSVNATH DEVELOPERS LIMITED
Through its Managing Director and CEO
6th Floor, Arunachal Building
19, Barakhamba Road,
New Delhi
ALSO AT
REGISTERED OFFICE:-
Parsvnath Tower,
Near Shahdara Metro Station,
Shahdara, Delhi ....Opposite Party
HON'BLE SMT. JUSTICE SANGITA DHINGRA SEHGAL (PRESIDENT)
HON'BLE SH. ANIL SRIVASTAVA, MEMBER
1. Whether reporters of local newspaper be allowed to see the judgment? Yes
2. To be referred to the reporter or not? Yes
Present: None for the complainant
Sh. Rakesh Bhardwaj, Counsel for the OPs
1
PER: ANIL SRIVASTAVA, MEMBER
JUDGEMENT
1. This complaint under Section 17 of the Consumer Protection Act 1986, the Act, has been filed by Sh. Rajesh Maggu, resident of Delhi, for short complainant against the M/s Parsvnath Developers Limited, hereinafter referred to as OPs, alleging that the OPs have been deficient in the discharge of their obligation inasmuch as they have not been able to hand over the possession of the residential unit booked by him despite agreed period having elapsed and praying for the relief as under:-
In view of the above it is therefore most respectfully prayed that this Hon'ble Commission may graciously be pleased to:-
a) Allow the present complaint;
b) Direct the respondent to refund the principal amount of sum of Rs.
1898593/- along with the interest and costs computed in para 5 of the complaint and thereby pay a combined sum of Rs. 6605780/- only to the complainant with interest @ 18% till the date of realisation;
c) Pass such other order/orders as are deemed fit and proper in the facts and circumstances of the present case.
2. Facts of the case necessary for the adjudication of the complaint are these.
3. The complainant a consumer in terms of Section 2(d) of the Consumer Protection Act, 1986 having booked a flat for his end use, was allotted Flat No. T3-701 in Tower T3 having 1855 sq. ft. of super area consisting of 3 bedroom, 3 toilets, drawing/dining, kitchen with utilities, balconies, servant room with toilet in Parsvnath Privilege' on Plot No. 11, Chorsia Estate, Sector Pi, Greter Noida in re-sale from Sh. Jaspal Singh. This was developed by the OPs. The endorsement of transfer from Jaspal Singh to the Complainant was made in the Flat Buyer Agreement on 26.09.2007. The complainant agreed for the construction linked payment plan where the basic price of flat as per Flat Buyer Agreement is Rs. 5286750/-only calculated at the rate of Rs. 2850/- only per sq. ft. The complainant has tendered total payment of Rs. 1898593/- only including Rs. 10 Lakhs tendered by original allottee. The clause 10(a) of Flat Buyer Agreement dated 30th day of August, 2007 lays down that the OP would hand over the possession of the Flat within a period of 36 months from the date of commencement of construction of 2 the particular block. In terms of the Flat Buyer Agreement complainant was to be handed over the possession of the property by 1st day of September, 2010. The clause 10(a) of the Flat Buyer Agreement dated 30th day of August, 2007 is reproduced below:-
"10(a) construction of the flat is likely to be completed within a period of 36 months from the date of commencement of construction of the particular block in which the flat is located on receipt of all requisite approvals including sanction of building plan environmental clearance etc. subject to force majeure and restraints/restrictions from any courts/authorities, non-availability of building materials and any circumstances beyond the control of the developer and subject to timely payments by the Buyer. No claim by way of damages/compensation shall lie against the developer in case of delay in handing over possession of the flat on account of the said reasons. The flat shall be deemed to be competed for the purpose of this clause/agreement when the developer submits application/completion plans to authorities for obtaining completion certificate, which may be for the complex as a whole or in parts. Possession of that flat would be given only on clearance of the entire dues payable by the buyer to the developer in terms of this agreement and after execution of the tripartite sub-lease deed."
The clause 10 (c) of Flat Buyer Agreement lays down that in the event of delay in handing over possession, compensation for delay in construction would be paid and the said clause is reproduced as under:-
"10(c) In case of delay in construction of the Flat beyond the period as stipulated subject to force majeure and other circumstances as aforesaid under clause 10(a), the Developer shall pay to the Buyer compensation @ Rs. 53.82 per sq. mtr. or @ Rs. 5/- per sq. ft. of the super area of the flat per month for the period of delay. Likewise, if the buyer fails to settle the final account of the flat within 30 days from the date of issue of the final call notice, the buyer shall be liable to pay to the developer holding charges @ Rs. 53.82 per sq. mtr. or Rs. 5/- sq. ft. of the super area of the flat per month on expiry of 30days notice."
There being delay in finishing construction the OP assured the complainant vide letter dated 10.06.2010, that he would be compensated in terms of clause 10(c) of Flat Buyers Agreement. Relevant extract of the letter is indicated below:-
3"We hereby re-assure you that you would be duly compensated for delay by way of penalty as per clause no. 10 (c) of the Flat Buyer Agreement, which will be settled at the time of possession."
Later the construction at the site has been abandoned evident from the photographs, and the fact that remained un-controverted by OP. As complainant had opted for construction-linked plan, any ongoing construction would have resulted in OP raising a demand for the same. Secondly the OP vide their letter dated 28.06.2017 during the pendency of the matter before this Commission unilaterally, without the consent of the complainant, changed the allotment from T3-701 to T20-1502, leading to a conclusion that the construction in the house booked by him is not complete. This act on the part of the OP amounts to deficiency in providing service to the complainant and in these circumstances he sought for the refund of the payment made under the Flat Buyers Agreement which refund not having been done, this complaint has been filed for the redressal of his grievances.
4. OPs were noticed and in response thereto they have filed the reply resisting the complaint both on merit and on technical grounds stating that the present complaint is not maintainable in view of the fact that the complainant being investor having transacted for commercial purpose, is not a consumer within the meaning of Section 2(1)(d) of Consumer Protection Act 1986. Secondly the present complaint ought to be instituted in the Civil Court as the complainant is seeking recovery of the amount, which amounts to the claim to be made under the civil suit. Thirdly, the complaint has been filed without any cause of action. The complainant has not been able to establish any deficiency of service or consumer dispute as contemplated under the Consumer Protection Act, 1986 which could be attributable to the OP. Fourth, the subject matter involves complicated questions of facts and law which need to be proved by leading detailed oral as well as documentary evidence. It is pertinent to mention here that the proceedings before the Consumer Courts are essentially summary in nature. Therefore, in the light of the complex factual matrix it is essentially required that the matter be examined by an appropriate Court of law. Fifth, the present complaint is not maintainable in the eyes of law the complainant having suppressed the true and correct facts. Sixth, the complainant keeping in view the terms of the Flat Buyer Agreement 4 executed between the complainant and the OP, in the event of any delay in construction, is entitled to a compensation @ Rs. 5/- per sq. ft. of the super area for the period of delay and if that be the case the complainant is not entitled anything more than that. Seventh, the complainant not being the Original Allottee cannot be in the same footing as in the original allotte. Eighth, the Forum in terms of Section 3 of the Interest Act 1978 is competent to award the interest as per the terms agreed to between the parties and not beyond and secondly not from a date prior to the institution of the present proceeding or from the date of demand notice. In these circumstances the complaint being not maintainable, the complainant is not entitled for the relief claimed.
5. The complainant has thereafter filed the rejoinder rebutting the contentions raised in the reply and reiterating the averments contained in the complaint. Both sides have also filed their evidence by way of affidavit in support of their pleadings. Their written arguments are also on record.
6. This complaint was listed before this Commission for final hearing on 09.08.2021 when the counsel OPs sides appeared and advanced their arguments in support of their pleading. No appearance was made on behalf of the complainant but their written arguments are on record. The argument of the complainant is for the refund of the deposited amount the OPs having failed to complete the project within the agreed period. The OPs sought for the dismissal of the complaint, no case for deficiency as against them having been established. We have perused the records of the case and considered the rival contentions involved.
7. Short question for adjudication in the complaint is whether the complainants are entitled for the refund of the amount as prayed for in the facts and circumstances of the case.
8. It is a statement of fact that the possession of the flat booked by the complainant was not handed over within the agreed period. The fact that the payment has been made by the complainant as per the demand has also not been controverted except for the fact that there has been delay in making payment. But the payment has been accepted
9. We may in the first instance deal with the objections of OPs. Their first objection that the transaction has been done for investment purpose cannot be accepted since 5 there appears to be nothing on record to establish the factum. The second objection that the complainant since seeking recovery has to approach Civil Court is overruled since the complainant before this Commission is for deficiency of service and the compensation as a consequence thereof which issues are adjudicable by the Consumer Commission. Their next objection that the complainant has been defaulter is not substantially borne out from the evidence led and accordingly is overruled. Their objection that there exists no cause of action as against them as they have committed no deficiency of service does not hold water. The complainant has deposited the amount as per the demand raised by the OP. for the purpose of owning a flat. This fact is undisputed. OPs have not delivered the unit giving rise to the cause of action in favour of the complainant and against the OPs. In fact cause of action, gives occasion for and forms the foundation of the suit, relying on the judgement of the Hon'ble NCDRC in the matter of Santa Banta Com Ltd. Vs Parsche Cars as reported in I [2014] CPJ 516 (NC). The cause of action is dealt with in detail by The Hon'ble Supreme Court in Kandimalla Raghavaiah and Co versus National Insurance Company Ltd. and another reported in 2009 CTJ 951 (SC) holding as under:
"The terms cause of action is neither defined in the Act nor in the CPC but is of wide import. It has different meanings in different contexts that is when used in the context of territorial jurisdiction or limitation or accrual of right to due. Generally it is described as bundle of facts which if proved a admitted entitled the plaintiff to the relief prayed for. Pithily stated, cause of action means the cause of action for which the suit is brought. Cause of action is cause of action which gives occasion for and forms the foundation of the suit."
10. Their objection about interest to be levied under the Interest Act cannot be accepted as the remedy available under the provisions of the Consumer Protection Act 1986 is in addition to and not in derogation of any other law.
11. Their objection to the effect that issues in the subject matter since involved are of complicated nature cannot be adjudicated by the Consumer Commission is overruled, relying on the judgment of Hon'ble Supreme Court in the matter of Indian Medical Assn versus V.P. Shantha as reported in (1995) 6 SCC 651 holding as under:-
6In the case of Indian Medical Assn. versus V.D. Shartha as reported in (1995) 6 SCC 651 the Hon'ble Supreme Court noticed the powers conferred on the several fora under the Act, the procedure applicable (including the exercise of powers of the civil court under the Code of Civil Procedure having been made available to the fora under the Act) and held that the nature of averments made in the complaint is not by itself enough to arrive at a conclusion that the complainant raised such complicated questions as cannot be determined by NCDRC. It is only when the dispute arising for adjudication is such as would require recording of lengthy evidence not permissible within the scope of a summary enquiry that a forum under the Act may ask the complainant to approach the civil court.
The fora made available under the Act are in addition to, and not in derogation of the provisions of any other law for the time being in force and the jurisdiction of the conventional courts over such matters as are now cognizable under the Act has not been taken away.
12. The Hon'ble Supreme Court of India is pleased to observe in the matter of CCI Chambers Coop. HSG. Society Ltd. versus Development Credit Bank Ltd. as reported in (2003)7 SCC 233 as under:
"It cannot be denied that fora at the national level, the State level and at the district level have been constituted under the Act with the avowed object of providing summary and speedy remedy in conformity with the principles of natural justice, taking care of such grievances as are amenable to the jurisdiction of the fora established under the Act. These fora have been established and conferred with the jurisdiction in addition to the conventional courts. The principal object sought to be achieved by establishing such fora is to relieve the conventional courts of their burden which is ever-increasing with the mounting arrears and whereat the disposal is delayed because of the complicated and detailed procedure which at times is accompanied by technicalities. Merely because recording of evidence is required, or some questions of fact and law arise which would need to be investigated and determined, cannot be a ground for shutting the doors of any forum under the Act to the person aggrieved."
13. Having dealt with the submissions made by the OPs and their objection having been sequentially rejected, we proceed to adjudicate the matter on merit. Payment to the extent demand was made having been made by the complainant more or less on time and the OPs not having handed over possession of the flat amounts to deficiency as 7 contemplated under Section 2(1)(g) of the Act. It is a trite law that where possession of the property is not delivered within the stipulated period, the delay so caused is not only deficiency in rendering of service, such deficiencies or omissions tantamount to unfair trade as defined under Section 2(r)(ii) of the Act, as well. For reference Lucknow Development Authority versus M.K. Gupta [(1994) 1 SCC 243].
14. Having bestowed our anxious consideration to the facts at hand, we are of the opinion, that the complaint deserves to be accepted.
15. Having arrived at the said conclusion, the core question for consideration is as to how the complainants are to be compensated for the monetary loss, mental and physical harassment they have suffered at the hands of OP on account of non-delivery of the allotted flat.
16. The provisions of the act enable a consumer to claim and empower the Commission/Forum to redress any injustice done to a consumer. The Commission or the Forum is entitled to award not only value of goods or services but also to compensate a consumer for injustice suffered by him. The word compensation is of very wide connotation. It may constitute actual loss or expected loss and may extend the compensation for physical, mental, or even emotional suffering, insult or injury or loss. Therefore, for the purpose of determining the amount of compensation, the Commission/Forum must determine the extent of sufferance by the consumer due to action on the part of the part of the OP. In Ghaziabad Development Authority vs. Balbir Singh-(2004) 5 SCC 65, while observing that the power and duty to award compensation does not mean that irrespective of facts of the case, compensation can be awarded in all matters on a uniform basis, the Hon'ble Supreme Court gave certain instances and indicated the factors, which could be kept in view while determining adequate compensation. One of the illustrations, given in the said decision was between the cases, where possession of a booked/ allotted property was directed to be delivered and the cases where only monies paid as sale consideration, are directed to be refunded. The Hon'ble Court observed, in this behalf, that in cases where possession is directed to be delivered to the complainant, the compensation for harassment will necessarily have to be less because in a way that party is being compensated by increase in the value of the property he is getting. But in cases where monies are being 8 simply refunded, then the party is suffering a loss inasmuch as he had deposited the money in the hope of getting a flat/plot. He is not only deprived of the flat/plot, he has been deprived of the benefit of escalation of the price of the flat/plot. Additionally, in our view, in such a situation, he also suffers substantial monetary loss on account of payment of interest on the loans raised; depreciation in the money value and escalation in the cost of construction etc., if it happens to be a flat of land, like in the present case.
17. The Hon'ble NCDRC in the matter of Puneet Malhotra vs. Parsvnath Developers Ltd.
CC 232/2014 decided on 29.01.2015 is pleased to hold as under:
"The opposite party has already taken almost entire sale consideration from the complainants. However, despite making almost entire payment, the complainants have not been able to get the shelters they had sought to acquire and considering the steep increase in the value of land and the cost of construction in last 7-8 years, it is not possible for them to acquire another similar accommodation even after adding the amount of interest @ 18% per annum to the amount they had deposited with the opposite party. Therefore , the facts of these cases are really gross and justify grant of interest @ 18% per annum, inclusive of appreciation in the value of land and in the cost of construction in last about 7-8 years. For the reasons stated hereinabove, the complaints are disposed of with a direction to the opposite party to refund the amount which the complainants had deposited with it, along with interest on the said amount @ 18% per annum from the date the deposit was made till the date the refund is made. This comprises 8% per annum on account of appreciation in the land value and increase in cost of construction and 10% on account of interest. However, considering that compensation is included in grant of interest @ 18% per annum, we do not grant any separate compensation to the complainants over and above interest @ 18% per annum."
18. The Hon'ble NCDRC in yet another, in the matter of Swarn Talwar and two ors vs Unitech Ltd. passed in CC 347/2014 decided on 14.08.2015 has held as under:
For the reasons stated hereinabove, we direct the opposite party to refund the amount paid to it by the complainants, along with compensation in the form of simple interest on that amount, at the rate of 18% per annum from the date of deposit til the date of payment. The payment shall be made within six weeks from today. In 9 the facts and circumstances of the case there shall be no order as to cost. The complaints stand disposed of.
19. We have given our careful consideration to the subject matter, as also the law laid down by their Lordship. The complainant has prayed for the refund, physical possession of the flat at this stage being out of question.
20. Keeping overall view of the facts and circumstances of the case, the OPs are directed to refund the principal amount with simple interest @ 6% per annum from the date of deposit till realisation. This refund and the interest be paid to the complainant by the OP within a period of three months from the date of receipt of this order, failing which 9% interest would be imposed.
21. In addition to the aforesaid and taking into consideration the facts of the present case, the OPs are also directed to pay to the complainant
a) A sum of Rs. 1,00,000/- as cost for mental agony and harassment;
b) And the litigation cost to the extent of Rs. 50,000/-
22. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.
23. Ordered accordingly
24. A copy of this order be forwarded to the parties to the case free of cost as is statutorily required.
25. File be consigned to records.
(Dr. JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (ANIL SRIVASTAVA) MEMBER PRONOUNCED ON 18.08.2021 sl 10