State Consumer Disputes Redressal Commission
Anubhav Kumar vs M/S Sobha Limited And Others on 13 May, 2024
ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.29 of 2022
Date of Institution : 27.04.2022
Reserved on : 26.04.2024
Date of Decision : 13.05.2024
Anubhav Kumar son of Shri Darshan Kumar, resident of
H.No.98B/2, Opposite Polo Ground, Near Lal Bagh Colony, Patiala,
District Patiala (Aadhar No.9442 9403 3688).
....Complainant
Versus
1. M/s Sobha Limited, 5th Floor, Rider House, Plot No.136P,
Sector-44, Gurugram-122003, Haryana.
2. M/s Chintels India Limited, A-11, Kailash Colony, New
Delhi.
3. M/s Vidhu Properties Pvt. Ltd., A-11, Kailash Colony, New
Delhi-110048.
4. M/s Chintels India Limited, A-11, Kailash Colony, New
Delhi.
5. M/s Madhyanchal Leasing Ltd. A-11, Kailash Colony, New
Delhi-110048.
6. M/s Prashant Solomon son of Sh. Ashok Kumar Solomon
resident of 44, Golf Links, New Delhi-110003.
7. Mr. Rohan Solomon son of Sh. Ashok Kumar Soloman
resident of 44, Gold Links, New Delhi-110003.
8. Mr. Ramesh Solomon Son of Sh. E.H. Solomon resident of
44, Golf Links, New Delhi-110003.
9. Mrs. Chanderlekha Solomon Wife of Shri Ashok Kumar
Solomon resident of 44, Golf Links, New Delhi-110003.
10.HDFC Bank Ltd., 251, 2nd Floor, Tower-B, Aggarwal Cyber
Plaza, Netaji Subhash Place, New Delhi-110034.
.....Opposite Parties
Complaint U/s 47 of the Consumer
Protection Act, 2019.
Quorum:-
Mr. H.P.S. Mahal, Presiding Judicial Member
Mrs. Kiran Sibal, Member Consumer Complaint No.29 of 2022 2 Present:-
For the complainant : Sh. Sandeep Khungar, Advocate For opposite parties No.1 to 9 : Sh. Shekhar Verma, Advocate For opposite party No.10 : Ms.Neetu Singh KIRAN SIBAL, MEMBER:-
The Complainant has filed the present complaint under Section 47 of the Consumer Protection Act, 2019 (in short, "the Act") for issuance of following directions:-
i) to OPs No.1 to 9 to refund an amount of Rs.24,95,000/- paid by the complainant from his own resources along with interest @18 % p.a. from the respective dates of payment till realization;
ii) to OPs No.1 to 9 to return/refund an amount of Rs.79,79,586/- granted by OP No.10 as loan and released in favour of OP No.1 to 9 along with interest and other charges, if any, and to obtain NOC from OP No.10 and to get the CIBIL status of the complainant restored/rectified;
iii) to OP No.10 not to take any action against the complainant for recovery of the loan amount against the complainant, during the pendency of the present complaint;
iv) to grant compensation to the tune of Rs.10 Lacs for inconvenience, mental harassment and damages suffered by the complainant due to deficiency in service on the part of OPs No.1 to 9;
v) to grant compensation to the tune of Rs.1 Lac towards cost of litigation, documentation charges, representation and numerous visits.
vi) Any other relief which may deem fit and proper in the facts and circumstances of the case.
2. Brief facts as stated in the complaint are that the complainant, after going through the tall claims made by OPs No.1 to 9 in their brochure, submitted an application dated 24.03.2018 for allotment of an apartment in 'Sobha City, Sector 108, Babupur, Gurugram, Haryana' and also deposited a sum of Rs.5,60,000/- as expression of interest through two cheques. Thereafter, an Consumer Complaint No.29 of 2022 3 agreement for sale dated 16.05.2018 was executed and at the time of agreement, the names of OPs No. 1 to 9 were also added in the first party as its promoters. According to the provisions of 'para 4.1' of the agreement to sale, OPs No.1 to 9 were required to hand over the possession of apartment alongwith one parking to the complainant on or before 31.10.2021. It was also stipulated in para No.4.2 that the possession of the apartment shall be offered after obtaining the occupation certificate from the competent authority. The complainant also paid a sum of Rs.19,35,000/- on 29.05.2018 as per the payment schedule-1 attached with the agreement to sell. The complainant further obtained a home loan facility to the tune of Rs.1,35,00,000/- from OP No.10 as it was having tie-up with OPs No.1 to 9. Accordingly, a tripartite agreement dated 20.11.2018 was executed between the complainant, OP No.1 and OP No.10 and as per the terms and conditions of the said tripartite agreement, the builder was required to make the payment of the Pre-EMI upto 31.10.2021 or offer of possession, whichever is earlier. The complainant further stated that OPs No.1 to 9 were required to pay the Pre-EMI upto the date of handing over the possession of the apartment and as the same was allotted under subvention scheme, the EMI was to be started only after handing over the possession of the apartment to the complainant. OP No.10 was required to release the payments keeping in view the stages of the construction but it was not regular in making the payment to OP No.1 to 9 according to the schedule of payment, due to which they have charged interest over the due amount. After execution of the tripartite agreement, OP Consumer Complaint No.29 of 2022 4 No.10 paid an amount of Rs.39,06,997/- on 28.03.2019 and another sum of Rs.40,72,589/- was paid on 30.04.2020. Accordingly, a total sum of Rs.1,04,74,586/- have been paid to OPs No.1 to 9 for the apartment in question. As per the terms and conditions of the tripartite agreement, the builder was required to make the payment of the Pre-EMI upto 31.10.2021, which was the promised date of delivery of the apartment. However, the builder failed to complete the project within the stipulated period and accordingly, was under
obligation to make the payment of Pre-Emi upto the date of delivery of the possession of the apartment. But vide email dated 15.09.2021, the builder informed the complainant that the subvention period was going to expire on 30.10.2021 and from 01.11.2021 the complainant would pay the amount of EMI. The complainant vide email dated 15.10.2021 informed the builder that according to the contract under subvention plan, the builder was required to make the payment of the Pre-EMI upto the date of delivery of the possession of the apartment. Thereafter, the builder vide email dated 18.10.2021, informed the complainant that they are working towards the completion of the construction and RERA has granted six months extension due to force-majeure and the builder is hoping to deliver the possession of the apartment by April 2022. However, when the complainant personally visited the site, it was realized that the work is going at a very slow pace and there was no chance of delivery of the possession in near further. The complainant thereafter, also informed the builder vide email dated 01.02.2022 that he is a salaried employee and due to Covid-19, there had been cut in the Consumer Complaint No.29 of 2022 5 salaries for the last two years and he expressed his inability to pay the EMI before handing over the possession of the apartment to him.
As the builder failed to make the payment of pre-EMI/EMI from 01.11.2021, OP No.10 served a legal notice upon the complainant, whereby he was directed to make the payment of Rs.1,70,563/- within a period of 7 days, Thereafter, OP No.10 served a notice dated 14.03.2022 upon the builder to cancel the allotment in favour of complainant and to refund the amount due towards it and total outstanding amount was mentioned as Rs.82,06,995/- payable by 28.02.2022. Thereafter, on 02.04.2022 OP No.10 informed the complainant through email that it would release the rest of sanctioned loan amount subject to payment of Rs.20,00,000/- to be paid by the complainant. The complainant further stated that the builder and the financial institution in collusion with each other try to usurp the amount paid by the complainant by cancelling the apartment inspite of the fact that the fault lies with the builder, who has failed to complete the construction in a time bound manner. Alleging deficiency in service on the part of the OPs, the complainant has filed the present complaint and sought relief as prayed for.
3. The OPs appeared through counsel and contested the complaint. OPs No.1 to 9 filed joint written reply, wherein they raised certain preliminary objections, inter alia, that the present complaint is liable to be dismissed for want of pecuniary jurisdiction as the total value of the apartment, which is subject matter of the complaint, is Rs.2,08,59,927/-, which is beyond the jurisdiction of this Commission, whereas the complainant has wrongly pleaded as Consumer Complaint No.29 of 2022 6 Rs.1,04,74,586/-; the present complaint is misconceived and premature and liable to be dismissed. OPs No.1 to 9 further stated that the complainant paid only an amount of Rs.24,95,000/- out of the total sale consideration of Rs.2,08,59,927/- and for the remaining amount, he had got sanctioned a credit facility of Rs.1,35,00,000/- from HDFC Ltd. (OP No.10). The complainant executed a loan agreement with OP No.10 and it also executed a Tripartite Agreement dated 20.11.2018 with OP No.1 and OP No10. As per the relevant clause No.3 & 4 of the said Tripartite Agreement, OP No.1 discharge its liability to pay Pre-EMI interest till 31.10.2021 and in this regard it paid an amount of Rs.13,82,582/- which is not in dispute. In this regard, on 15.09.2021, a written communication had been served upon the complainant making it clear that the 'assumed liability period' would come to an end on 31.10.2021. It has also been stated in the reply that OP No.1 being bound by the terms of the Tripartite Agreement dated 20.11.2018, received a notice dated 14.03.2022 from OP No.10. In the said notice, default on the part of the complainant has been pointed out and OP No.1 was called upon to cancel the unit allotted in favour of the complainant and refund the entire amount in the account of OP No10. Accordingly, the allotment in favour of the complainant stands cancelled on 14.03.2022 and the complainant has not challenged the cancellation letter. As agreed by the parties, the residential unit was to be handed over on or before 31.10.2021 subject to further grace period until 31.10.2021 unless, there is delay due to force majeure events. However, in acknowledgement of unprecedented circumstances due to Covid-19, Consumer Complaint No.29 of 2022 7 the Haryana Real Estate Regulatory Authority was further pleased to grant extension by 6 months, therefore, considering the effect of order dated 26.05.2020, OPs No. 1 to 9 are entitled to complete Sobha City, Phase-1, part-2 project comprising of towers A-2, B-2 and C-2 of the Real Estate Project by 31.10.2022. Hence, there was no delay and the present complaint is premature. After denying the other averments made in the complaint, OP No.1 to 9 prayed for dismissal of the present complaint.
4. Upon notice, OP No.10 appeared through counsel, however, no written reply has been filed by OP No.10 to the present complaint.
5. Rejoinder to the written reply of OPs No.1 to 9 was also filed by the complainant, wherein the version of the OPs taken in written reply, was denied.
6. In order to substantiate the allegations made in the complaint, the complainant annexed with the complaint his affidavit along with copies of documents i.e. brochure Ex. C-1, application form Ex. C-2, agreement of sale dated 16.05.2018 Ex. C-3, House loan sanction letter dated 06.11.2018, Ex.C-4, tripartite agreement dated 20.11.2018 Ex. C-5, schedule of payment under subvention plain Ex. C-6, client ledger summary Ex.C-7, communication between parties through emails Ex. C-8 to C-11, legal notice dated 27.02.2022 Ex. C-12, notice dated 14.03.2022 served by OP No.10 upon builder Ex.C-13, Email dated 02.04.2022 sent by OP No.10 Ex. C-14, order dated 31.01.2022 passed by Hon'ble Delhi High Court, Consumer Complaint No.29 of 2022 8 Ex.C-15, Email dated 26.02.2022 Ex.C-16, news item regarding restraining the Chintels Group from selling apartments under its seven projects Ex.C-17 and photographs of tower B-1 and B-2, Ex.C-18. Aadhar card of complainant Ex.C-19, latest photograph dated 11.07.2022 of tower-B, Ex.C-20, communications between OPs No.1 to 9 and OP No.10 Ex. C-21 and cancellation notice dated 12.07.2022 Ex.C-22.
7. On the other hand, OPs No.1 to 9 have filed affidavit of Sh. Nitin Kohli, authorized signatory along with copies of documents i.e. order dated 26.05.2020 passed by Haryana Real Estate Regulatory Authority, Ex. R-1, latest photographs of Tower B-2 including the unit of the complainant Annexure R-2 & R-3, renewal of license No.107 of 2008 annexure R-4, sanction letter of revalidated Building plans Ex. R-5 and renewed RERA-Registration Certificate annexure R-6, NOC for release of HDFC's charge on property annexure R-7 and occupation certificate dated 02.11.2022 annexure R-8.
8. We have heard learned counsel for the parties and have gone through the record carefully.
9. The learned counsel for the complainant has vehemently contended that as per terms and conditions of the agreement as contained in Clause 4.1, the possession of the apartment was required to be delivered on or before 31.10.2021, complete in all respects alongwith completion and Occupation Certificate. The learned counsel further argued that as per the terms and conditions Consumer Complaint No.29 of 2022 9 of the Tripartite Agreement, OPs No.1 to 9-Builder was required to make the payment of Pre-EMI upto 31.10.2021, which was the promised date of delivery of the apartment. However, the builder failed to complete the project within the stipulated period, thus, was under obligation to make the payment of Pre-EMI upto the actual date of delivery of the possession. The OPs No.1 to 9 have filed an application for placing of record occupation certificate dated 02.11.2022, thus, it is clear that the project was not complete before the said date and the occupation certificate has been granted to them much after the filing of the present complaint. The learned counsel further argued that the complainant could not be made to wait indefinitely for delivering of the possession of the apartment and he is entitled to refund of the amount paid by him along with interest and compensation. In support of his contentions, the learned counsel placed reliance on the judgments of Hon'ble Supreme Court of India in the case of 'Pioneer Urban Land and Infrastructure Ltd. Vs. Govindan Raghavan', reported in 2019 SCC 725 and 'Air Force Naval Housing Board Vs. Air Cmde B.K. Gandhi', in FA No.2073 of 2019 decided on 07.01.2020. The learned counsel further argued on the similar lines and prayed for acceptance of the present complaint as prayed for.
10. On the other hand, the learned counsel for OPs No. 1 to 9 has submitted that the commitment period to handover the Residential Unit to the complainant was upto 01.05.2022, which includes the grace period. Further during the Covid-19 period and for the reason that nationwide lockdown had been imposed by the Consumer Complaint No.29 of 2022 10 Government of India and as per the notification issued by Haryana Real Estate Regulatory Authority dated 26.05.2020, the commitment period would be up to 31.10.2022. The present complaint has been filed on 25.04.2022, and as such, the same is premature. The learned counsel further argued that as per terms of clause 3 & 4 of the Tripartite Agreement, the agreed amount of Pre-EMI interest has been paid by the OPs to the tune of Rs.13,82,582/- upto 31.10.2021 and the same has been paid strictly as per the written understanding between the parties. The complainant is in default in repayment of the loan amount availed from HDFC Bank, from which a notice dated 14.03.2022 has been received with a request for cancellation of the Unit in question. Thus, the allotment in favour of the complainant stands cancelled on 12.07.2022 and the same is not under challenge. The learned counsel further argued that despite repeated reminders, the complainant did not pay the demand and he has violated the terms and conditions of the agreement of sale as well as tripartite agreement. The learned counsel further argued on the similar lines as stated in the written reply and prayed for dismissal of the present complaint.
11. The learned counsel for OP No.10 has argued that the complainant had approached HDFC Ltd. for loan facility after having been satisfied with his choice of builder and property in question. The grievance of the complainant is against the developer-promoter and nothing substantial has been stated or claimed against HDFC Ltd. The complainant is a borrower of HDFC Ltd. and their inter-se obligations are governed by loan agreement. The learned counsel Consumer Complaint No.29 of 2022 11 further argued that in tripartite agreement, it is specifically agreed amongst the parties that in case of default on the part of the developer-promoter of its obligations towards the allotee/borrower/complainant, the liability of the complainant as borrower would continue towards HDFC limited and the complainant alone shall be liable to repay the loan. The terms of the loan agreement signed independently with the complainant-borrower cannot be re-written. In support of his contention, the learned counsel relied upon the judgment of Hon'ble Supreme Court in the case of "LIC of India and another Vs. S. Sindhu" (2006) 5 SCC 258. The learned counsel further argued that in case the developer is ordered to refund the amount, the same may be refunded to OP No.10 as per the terms and conditions of the tripartite agreement and in the meantime, the borrower/complainant be directed to keep the loan account regular until his loan liability is completed/settled/repaid. Any default in the repayment of the regular EMIs would affect the CIBIL of the borrower, who has availed the loan from HDFC Ltd. in his/her individual capacity. The learned counsel prayed for dismissal of the complaint qua OP No.10.
12. We have given our thoughtful consideration to the contentions raised before us by the learned counsel for the parties.
13. First of all we would like to deal with the preliminary objection raised by OPs No.1 to 9 that this Commission has got no pecuniary jurisdiction to try and decide the present complaint as the total value of the unit/apartment in question is Rs.2,08,59,927/- Consumer Complaint No.29 of 2022 12 which exceeds the limit of Rs.2 crores. No doubt the total value of the unit/apartment in question exceeds Rs.2 crores, but as per the provisions of the Consumer Protection Act, 2019, under which the present complaint has been filed, the total consideration paid for goods and services is to be considered instead of total value of the goods and services. In the present case, the total consideration paid to OPs is Rs.1,04,74,586/-, which is within the pecuniary jurisdiction of this Commission. Hence, we do not find any force in the contention raised by OPs No.1 to 9 and the same is hereby declined.
14. Another objection raised by OPs No.1 to 9 in their written reply is that the complaint is premature as the possession of the unit/apartment was not due at the time of filing the present complaint. The counsel for the complainant has vehemently argued that the possession of the unit/apartment was required to be delivered on or before 31.10.2021, complete in all respects alongwith completion and occupation certificate, whereas the present complaint was filed by the complainant on 27.04.2022. It has also been submitted that OPs No.1 to 9 are working under "The Chintels Group" and in one of its project the roof of apartment on 6th Floor came down till the first floor and two women were killed in the said incidence, due to which District Administration had restrained the 'Chintels Group' from selling apartments under its seven Projects. Therefore, the complainant was no longer interested in waiting for an indefinite period. Further, Tower B-2 in which the unit/apartment of the complainant was situated, was still not completed as has been shown in the latest photographs dated 11.07.2022, Ex.C-20. The Consumer Complaint No.29 of 2022 13 learned counsel further placed reliance on occupation certificate dated 02.11.2022 placed on record by the builder, which shows that Tower B-2 was incomplete at the time of filing the complaint and even at the time of cancellation of the allotment of the unit/apartment. As the OPs No.1 to 9 were not ready to deliver the possession of the apartment within the stipulated period, we do not find any force in the contention raised by OPs No.1 to 9 that the present complaint is premature.
15. Now, we proceed to decide the complaint on merits. The factual matrix of the complaint is that the complainant booked an apartment No.B-2-144, Tower-B-2, 13th floor, Phase-1, Part-II, Sobha City Sector 108, Babupur, Gurugram, Haryana, with OPs No.1 to 9 and had executed an agreement to sell dated 16.05.2018, Ex.C-3. The complainant paid a total sum of Rs.24,95,000/- and for payment of remaining amount, he has obtained the house loan facility under the subvention scheme by entering into a tripartite agreement dated 20.11.2018, Ex.C-5, with OP No.1 to 9-Developers and OP No.10-Bank. As per the said agreement, the builder was required to make the payment of the Pre-EMI upto 31.10.2021, which was the agreed date of delivery of possession as per agreement to sell. The primary grievance of the complainant is that OPs No. 1 to 9 have failed to deliver the possession of the apartment as per the terms and conditions of agreement to sell and had not obtained the completion and occupation certificate within the stipulated period. Accordingly, they were under obligation to make the payment of Pre-EMI upto the date of delivery of possession of Consumer Complaint No.29 of 2022 14 the apartment, but they have failed to do the same and have arbitrarily, in connivance with OP No.10-Bank, cancelled the allotted unit of the complainant.
16. To address the grievance of the complainant, we have perused the evidence placed on record as well as pleadings of the parties. Clause 4.1 and 4.2 of the agreement to sell dated 16.05.2018, Ex.C-3, are relevant which is reproduced as under:-
"4. Possession of the Unit/Apartment for Residential Usage:
4.1 Schedule for possession of the said Unit/Apartment for Residential Usage:- The Promoter agrees and understands that timely delivery of possession of the Unit/Apartment for Residential usage along with parking to the Allottee(s) and the common areas to the Association of Allottees or the competent authority, as the case may be, as provided under Rule 2(1)(f) of Rules, 2017, is the essence of the Agreement.
The Promoter assures to hand over possession of the Unit/Apartment for Residential usage along with parking as agreed terms and conditions on or before 31/10/2021, subject to further grace period until 01/05/2022 unless there is delay due to 'Force Majeure Events' Court orders, Government policy/guidelines, decisions, affecting the regular development of the Phase-1, Part-2 of the Project. If, the completion of the Phase-1, Part-2 of the Project is delayed due to the above conditions, then the allottee(s) agrees that the Promoter shall be entitled to the extension of time for delivery of possession of the Unit/Apartment for residential usage along with parking.
......................................................." 4.2 Procedure for taking Possession of Built UP Unit/Apartment: The Promoter, upon obtaining the occupation certificate or part thereof of the Building blocks in respect of the Phase-1, Part-2 of the Project along with parking shall offer in writing the possession of the Unit/Apartment within 3 (three) months from the date of above approval, to the allottee(s) as per terms of this Agreement..............
...................................................." Consumer Complaint No.29 of 2022 15 According to the provisions of clause 4.1 of the agreement to sell dated 16.05.2018, OPs No.1 to 9 were required to hand over the possession of the Unit/Apartment for residential usage along with parking as per agreed terms and conditions on or before 31.10.2021 subject to further grace period until 01.05.2022 unless there is delay due to 'Force Majeure Events', Court orders, Government policy/guidelines, decisions, affecting the regular development. As per clause 4.2 of the said agreement, the possession of the unit/apartment shall be offered in writing after obtaining the occupation certificate or part thereof of the building blocks from the competent authority. On the other hand, the case of OPs No.1 to 9 is that the committed period to handover the Residential Unit to the complainant is upto 01.05.2022, which includes the grace period and further due to imposition of lockdown on account of Covid-19 pandemic, the Haryana Real Estate Regulatory Authority extended the committed period upto 31.10.2022.
17. Be that as it may, we are of the considered opinion that no doubt due to the outbreak of Covid-19 Pandemic, the situation was beyond the control of the opposite parties No.1 to 9 to deliver the possession of the apartment in question within the stipulated period, however, it is also an admitted fact and not disputed by OPs No.1 to 9 that they have not offered the possession of the apartment to the complainant even until the expiry of grace period due to force majeure i.e. 01.05.2022 and even after filing of the present complaint. Moreover, it is widely known by one and all that Covid period had considerably improved from October 2021 onwards and Consumer Complaint No.29 of 2022 16 things had nearly returned to near normalcy. In such like situations, time is the essence of the contract. The builder is liable to hand over the possession of the apartment within the stipulated time period and if due to any force majeure reason, the same could not be offered, then the grace period for handing over the possession comes into play. But OPs No. 1 to 9 have failed to hand over the possession of the apartment even within the grace period i.e. 01.05.2022. Moreover, during the pendency of the complaint, the opposite parties have placed on record Occupation Certificate dated 02.11.2022, meaning thereby that the project was incomplete even after expiry of the grace period i.e. 01.05.2022. So the plea of the opposite parties-builder that their project could not be completed just because of COVID pandemic is not accepted.
18. Now, we proceed to decide the root cause of present dispute between the parties regarding liability of paying Pre-EMI to OP No.10-Bank as also the role of Bank qua recovery of the Pre EMI Interest. It is not in dispute that OP No.1 to 9 had paid the Pre-EMI Interest to OP No.10-Bank till 31.10.2021. It is also not in dispute that OP No.1 to 9 have not offered the possession of the unit/apartment in question to the complainant till 31.10.2021 and even by 01.05.2022 i.e. till expiry of grace period. The complainant alleged in his complaint that OPs No.1 to 9 are under obligation to make the payment of Pre-EMI interest upto the date of delivery of possession of the apartment and he is not liable to suffer due to the fault on the part of the builder for delivering the possession of the apartment within the stipulated period. It is pertinent to mention here Consumer Complaint No.29 of 2022 17 that OPs No.1 to 9, vide email dated 15.09.2021, Ex.C-8, informed the complainant that 'Subvention Scheme' was going to expire on 30.10.2021 and after that period, the complainant would pay the Pre- EMI interest to OP No.10. In reply to the said email, the complainant also sent an email dated 15.10.2021, Ex.C-9, to the Builder and informed that in the absence of possession of the flat, he would not be in a position to pay the EMIs. Thereafter, vide email dated 18.10.2021, Ex.C-10, OPs No. 1 to 9 informed the complainant that they were working towards the completion of the construction and hoping of delivery of possession by April 2022 but they expressed their inability to extend the subvention time period. Thereafter, the complainant, vide email dated 01.02.2022, again expressed his inability to pay the EMI before handing over the possession of the Apartment to him. OP No.10-Bank, due to non-receipt of Pre-EMI interest, served notice dated 14.03.2022, Ex.C-13, upon the builder to cancel the allotment and to refund the amount due. The complainant, vide email dated 02.04.2022, Ex.C-14, was also called upon by OP No.10 to make the payment of Rs.20,00,000/- for releasing the rest of amount. Aggrieved by the said act of the OPs, the complainant approached this Commission and filed the present Complaint on 27.04.2022. However, during the pendency of the complaint, OPs No. 1 to 9, vide cancellation notice dated 12.07.2022, Ex. C-22, placed on record by the complainant along with rejoinder, cancelled the allotted unit No.B-2-144 in question. It seems that OP No.1 to 9 were in a hurry to cancel the allotted unit in question to the complainant, in connivance with OP No.10-Bank. The Consumer Complaint No.29 of 2022 18 said act of OP No.10 by issuing notice dated 14.03.2022 requesting the Builder to cancel the allotment of the apartment and further, the act of OPs No.1 to 9 to cancel the said allotment, vide letter dated 12.07.2022, is unethical and beyond any law. We are also fortified by the order dated 31.01.2022 passed by the Hon'ble Delhi High Court in CM APPL.5399/2022 in W.P.(C) 14828/2021, which has also been relied upon by the Learned counsel for the complainant in support of his contentions. To have a clear prospective of the said order, the facts are relevant, which are reproduced as under:-
"4. The present batch of petitions preferred under Articles 226 and 227 of the Constitution of India, brings into light the well-known sorry state of affairs which has been recently going on in the construction industry. The petitioners, who are all home buyers, having booked their flats by giving the initial advance instalments from their hard earned income, have approached this Court with a grievance that despite the Circulars issued by the Reserve Bank of India (hereinafter referred to as RBI), and the National Housing Bank (hereinafter referred to as NHB), which clearly mandate that the banks and other financial institutions should desist from offering loans in subvention schemes offered by the developer, and should disburse the loan only on the basis of the stages of construction, the banks, as also the various housing finance institutions, have been disbursing the loan amount to the developers without even examining the fact as to whether the developers are in a position to complete the construction.
5. The petitioners herein, booked their flats with the respondent developers and took home loans under the subvention scheme by entering into a tripartite agreement with the developers and the bank/Housing Finance Companies (hereinafter referred to as HFCs).
The scheme provided for the banks/HFCs to disburse the sanctioned amount directly to the accounts of the developers, who were to then pay the pre-EMIs or the full EMIs on the sanctioned loan amount, until such a time that the possession of the booked residential units would be handed over to the home buyers. In most cases, it was also provided that if the possession of the residential flats could not be delivered in the time stipulated by the developers, it would be up to the developers to continue Consumer Complaint No.29 of 2022 19 payment of the pre-EMIs, till the finally handing over possession of the home buyers."
After having appreciated the pleadings of the parties, evidence led by them as well as after going through the various circulars of the RBI and Judgments of Hon'ble Apex Court, the Hon'ble Delhi High Court has passed the interim order, wherein the respondents were restrained from taking any coercive steps against the petitioners, the relevant part of the order is reproduced as under:-
"27. In my view, the balance of convenience at this interim stage lies in favour of the beleaguered home buyers, keeping in view that they are being penalized despite not being at fault. The respondents' plea that the petitioners are obliged to pay the amount in the pre-EMIs and the EMIs, despite the admitted position that under the terms of the tri-partite agreement, it was incumbent upon the developers to pay the amount of EMIs until the possession of the flats was transferred to them, will need to be examined. However, at this interim stage, grave and irreparable loss will be caused to the petitioners if they are not granted any interim protection."
19. The facts of the present case are securely covered by the above said case. Moreover, it would be relevant to point out that the Subvention Scheme, which has been floated by the builders and financial institutions jointly, to allure the gullible customers, is a legal agreement made between the buyer, the seller, and the finance company providing home loans and under this scheme, the buyer has to pay any amount in the form of interest until an agreed period of time, which is mentioned under the contract terms. The mere definition of subvention scheme itself shows that time is essence of agreement because as per this scheme, the builder has invited the buyer through Bank with the undertaking that it will pay the EMI till the possession deliver or the time period fixed for delivery of possession. As per clause 3 of the Tripartite agreement dated Consumer Complaint No.29 of 2022 20 20.11.2018, Ex.C-5, the builder assumes the liability of Pre EMI Interest payments under the loan agreement as payable by the borrower to HDFC Bank till 31.10.2021 or offer of possession, whichever is earlier. However, the words "31.10.2021 or offer of possession, whichever is earlier" are handwritten and are itself contradictory to the terms of agreement to sell, Ex.C-3, wherein as per clause 4.1 'the Promoter assures to hand over possession of the Unit/Apartment for Residential usage along with parking as per agreed terms and conditions on or before 31.10.2021, subject to further grace period until 01.05.2022'. But OPs No.1 to 9 have failed to hand over the possession of the Unit/apartment with in the stipulated time period, as already discussed above. Accordingly, the contention of opposite parties No.1 to 9 that they have only to pay the pre-EMI till 31.10.2021, is hereby rejected. Since, the allotment of apartment has already been cancelled and OP No.1 to 9 has also refunded the disbursed amount to OP No.10- Bank i.e. Rs.79,79,586/- and OP No.10-Bank has also issued NOC, Annexure R-7, for release of HDFC's charge on property, interest of justice would be met if the amount deposited by the complainant i.e. Rs.24,95,000/- be refunded to him by OPs No.1 to 9 along with interest at the rate of 9% p.a. from the respective date of deposit till its realization. The complainant is also entitled for composite amount of compensation as well as litigation expenses to the tune of Rs.40,000/-.
20. So far as the payment of Pre-EMI interest is concerned, as discussed above, there is no fault on the part of the complainant, Consumer Complaint No.29 of 2022 21 as such, the he is not liable to pay the Pre-EMI interest to OP-10- Bank. Since, the possession of the apartment has not been offered by OP-1 to 9- Builder within the stipulated period, therefore they are liable to pay the Pre-EMI interest, if any to OP No.10-Bank, who is at liberty to recover the same from OP-1 to 9-Builder.
21. In view of above, the complaint is partly allowed against OPs No.1 to 9 only and the following directions are issued to them.
i) to refund the entire amount deposited by the complainant i.e. 24,95,000/- along with interest @ 9% per annum from the respective dates of deposit till realization;
ii) to pay composite amount of compensation Rs.40,000/- on account of mental agony and harassment suffered by the complainant and litigation expenses.
22. The appeal could not be decided within the stipulated period due to heavy pendency of Court cases.
(H.P.S.MAHAL) PRESIDING JUDICIAL MEMBER (KIRAN SIBAL) MEMBER May 13th, 2024 dv