National Consumer Disputes Redressal
Flora Welfare Association vs M/S. Shree Vardhman Infrahomes Pvt. ... on 10 October, 2023
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 20 OF 2019 1. FLORA WELFARE ASSOCIATION ...........Complainant(s) Versus 1. M/S. SHREE VARDHMAN INFRAHOMES PVT. LTD. Through its Managing Directors, office at; 301, 3rd Floor, Indraprakash Building, 21- Barakhamba Road, NEW DELHI-110001 ...........Opp.Party(s)
BEFORE: HON'BLE MR. JUSTICE RAM SURAT RAM MAURYA,PRESIDING MEMBER HON'BLE DR. INDER JIT SINGH,MEMBER
FOR THE COMPLAINANT : MR. MADHURENDRA KUMAR, ADVOCATE
MR. PRAKASH KUMAR VIRMANI (MEMBER)
MR. NARESH KUMAR
MR. NAVEEN JAIN (EXECUTIVE MEMBER) FOR THE OPP. PARTY : MR. AAMIR AFROZ, PROXY COUNSEL
Dated : 10 October 2023 ORDER
(PER MR. JUSTICE RAM SURAT RAM (MAURYA), PRESIDING MEMBER)
1. Heard Mr. Madhurendra Kumar, Advocate for the complainant and Mr. Aamir Afroz, Proxy Counsel for the opposite party.
2. Flora Welfare Association has filed above complaint for directing the opposite party to (a) handover possession of the apartments, complete in all respect and execute all necessary required documents in respect of the flats in favour of the buyers; (b) pay delay compensation in the form of interests @12% per annum on the deposit of the home buyers, from due date of possession till the date of handing over possession, with occupancy certificate; (c) grant immunity from charging escalation cost including service tax, registration amount and other incidental and unwarranted cost; (d) pay Rs.5 lakhs to each buyer towards cost for harassment and mental agony; and (e) grant any other relief as may be deemed fit and appropriate. The complaint was filed on behalf of 16 sets of home buyers of the project "Shree Vardhman Flora". During pendency of the complaint, various home buyers have settled their dispute with the opposite party and their names were deleted.
3. It is relevant to mention that opposite party has filed IA/511/2023 and IA/512/2023 for dismissing the complaint as not maintainable on the ground that in view of Section 2 (1) (o) of the Haryana Registration and Regulation of Societies Act, 2012, the society has become defunct. This Court, vide order dated 26.09.2023 dismissed the above applications with the observation that the District Registrar, Firms and Societies, Gurgaon vide order dated 13.02.2020 had issued direction to appoint ad-hoc committee and hold the election. It was brought to the notice of the Court that the ad-hoc committee had held the election and submitted the result which was approved by the District Registrar and the elected body had taken charge of the society. Therefore, the above interim applications were rejected.
4. The complainant stated that it was a voluntary association of the home buyers of the project "Shree Vardhman Flora", registered under Haryana Registration and Regulation of Societies Act, 2012, having Registration No.2650 of 2016 and is filing the complaint on behalf of its 27 sets of home buyers/members. The opposite party was a company, registered under the Companies Act, 1956 and engaged in the business of development and construction of group housing project and selling its unit to the prospective buyers. The opposite party launched a group housing project, in the name of "Shree Vardhman Flora" at village Hayatpur, Sector-90, Gurgaon, in the year 2011 and made wide publicity of its facilities and amenities. Believing on the representations of the opposite party, the members of the association booked the flats from 2011 to 2014. Annexure-1 of the agreement provides payment plans. The members of the association opted for "construction link payment plan". Clause-14(a) of the agreement provides that the construction of the flat is likely to be completed within a period of 36 months of commencement of construction with a grace period of six months. The buyers have paid about 95% of the total consideration. In spite of that the opposite party has not fulfilled its promise to handover possession of the respective flats within the stipulated time. As per Clause-14(b) of the agreement, possession of the flats was to be given within 36 months from the date of commencement of construction and in case of delay in handing over possession, the opposite party was also liable to pay delay compensation. Name of the tower, date of commencement of construction and the due date of possession is given below:-
Tower
Commencement date
(As ascertained from the date of payment of instalment due on "commencement of excavation")
Possession Date
(Including grace period)
B1
January, 2012
July, 2015
B2
January, 2012
July, 2015
B3
January, 2012
July, 2015
B4
January, 2012
July, 2015
B5
February, 2012
August, 2015
C1
February, 2012
August, 2015
C2
January, 2012
July, 2015
A1
March, 2013
September, 2016
In December, 2015, the opposite party raised demands under the heads of "Fire Fighting Charge" and "External Electrification Charge" @Rs.200/- per sq.ft. of super area from the home buyers. The members of the association asked for the actual bills of the aforesaid works and requested to adjust delay compensation for payment of those bills. In the meantime, demands in the head of VAT and increased super area were also raised. Then this complaint was filed on 04.12.2017.
5. The opposite party filed its written reply on 19.03.2019 with an application for condonation of delay. This Court, vide order dated 27.03.2019 condoned the delay and took the written reply on record, in which, material facts relating to the booking of the flats, allotments, execution agreements and payments made by the members of the complainant, have not been denied. The opposite party stated that the complainant has already filed CC/1893/2017 and CC/3587/2017 and cannot be permitted to file multiple complaints. The complainant was neither a voluntary nor a recognized association and the complaint under Section 12(1)(b) of Consumer Protection Act, 1986, filed by it, was not maintainable. The buyers on whose behalf the complaint has been filed were investors and not consumers. Value of one flat is much less than the pecuniary jurisdiction of this Commission. The complaint is barred by limitation. The members of complainant signed the agreement after reading and understanding the terms and conditions and there is no unfair trade practice. Relief of possession is of the nature of specific performance of the contract, which cannot be granted by this Commission. Complicated issues of facts are involved in the complaint, which requires adjudication by civil court. The period of 36 months as mentioned in Clause-14(a) of the agreement was tentative and subject to force majeure. The construction of the project was delayed due to force majeure reasons and the opposite party was entitled for extension of that period. Initially the construction was delayed as Punjab and Haryana High Court, vide order dated 21.08.2012 passed in CWP No.20032 of 2008, prohibited all the builders in district Gurgaon, from using ground water in construction work. The opposite party had to arrange water from alternate sources from Haryana Urban Development Authority and the water had been carried in tankers due to which, the work had become slow. The opposite party engaged M/s. Mahalakshmi Infra-Engineers Private Limited and DSA Buildtech Private Limited as the contractors for civil construction works. Despite timely payments, the contractors delayed the work. Large numbers of the home buyers including members of the association committed defaults/delay in payment of instalments, which created paucity of fund. Some of the members of the association are not original allottee but transferees from original allottee and the time line as mentioned in the agreement with original allottee, cannot be followed for all of them. The opposite party is proceeding with construction with full spring and reached to the stage of flooring work and the project is likely to be completed in near future. Super area as mentioned in clause-2 of the agreement was tentative and the buyers have agreed to pay if super area is increased. The charges for car parking space, club membership, EEC & FFC and taxes are as per the agreement. The opposite party has not committed any unfair trade practice.
6. The complainant filed Rejoinder Reply, Affidavit of Evidence, Affidavit of Admission/Denial of the documents of Neeaj Mathur and documentary evidence. The opposite party filed Affidavit of Evidence of V.K. Srivastava and documentary evidence. Both the parties have filed written submission.
7. During the pendency of the complaint, the opposite party issued demand letter dated 05.01.2020. On 05.09.2022, the opposite party filed additional documents attaching "occupation certificate" dated 02.02.2022. A perusal of "occupation certificate" shows that the opposite party applied for issue of "occupation certificate" on 20.07.2021. As such letters dated 05.01.2020, offering possession and raising final demand was illegal.
8. We have considered the arguments of the counsel for parties and examined the record. The opposite party raised a preliminary issue that the complaint has been filed without proper authorization in favour of Sh. Neeraj Mathur as no meeting of Governing Body of the Society took place and no resolution in this regard was passed. The argument raised in this respect is not liable to be accepted. The complainant association is registered under Haryana Registration and Regulation of Societies Act, 2012. There is nothing on record that association has been dissolved subsequently as per provision of the aforesaid Act. A recognised association has been permitted to espouse the grievance of a consumer under Section 12(1)(b) of the Consumer Protection Act, 1986. All the home buyers, whose grievance have been raised in this complaint, have filed their affidavits in the complaint and also filed their papers. At this stage, the complaint cannot be dismissed only on the ground that along with interim application, affidavit of the member has been filed.
9. Clause-14(a) of the agreement provides that the construction of the flat is likely to be completed within a period of 36 months of "commencement of construction" with a grace period of six months. It is admitted that "commencement of excavation work" was due on 03.10.2012. In this case the opposite party has not filed the list of the subsequent purchasers and the date of transfer of allotment. In absence of specific date of transfer, it cannot be assumed that the flats were transferred after due date of possession. Admittedly, due date of possession of some towers was in July, 2015; some towers in August, 2015; and some towers September, 2016. As such there was delay in offer of possession.
10. The opposite party took plea that the construction had been delayed due to force majeure reasons and the opposite party was entitled for extension of the period for which, the construction was delayed for force majeure reason. The force majeure periods as mentioned in written reply, are not liable to be accepted, inasmuch as payment plan was "construction link payment plan" and the opposite party had realized instalments at various level of the construction (excepted last two instalments) during that period. However, demonetization of currency notes of 500 and 1000 in November, 2016 created paucity of cash even in the banks and on that account the opposite party is entitled for six months period. Similarly pandemic Covid-19 and consequently lockdown in the country also affected the construction work for one year six month period. Total 2 years period is liable to be extended. The members of complainant are entitled for delay compensation in the form of interest @6% per annum on their deposits from due date of possession till the offer of possession as held by Supreme Court in Wg. Cdr. Arifur Rahman Khan Vs. DLF Southern Homes Pvt. Ltd., (2020) 16 SCC 512 and DLF Home Developers Limited Vs. Capital Green Flat Buyer's Association, (2021) 5 SCC 537.
11. The complainant has questioned increase of saleable area, which was increased to 1950 sq.ft. from 1875 sq.ft. No evidence has been adduced to prove demand for additional area is not justified. Supreme Court in DLF Home Developers Limited Vs. Capital Green Flat Buyers Association, (2021) 5 SCC 537, upheld the demand for increase of super area up to 10%. Demand for car parking space and club membership fee and the taxes are according to the agreement and there is no illegality in it. However, the opposite party demanded @Rs.200/- per sq.ft. for "External Electrification Charges" and "Fire Fighting Equipment Charges". The opposite party has not given what were actual expenses in these head. The opposite party is directed to realize EEC and FFC on pro-rata basis of the actual expenses.
O R D E R
In view of the aforesaid discussions, the complaint is partly allowed. The opposite party is directed issue fresh offer of possession and statement of the account to the members of the complainant (except those members, who have settled their dispute) within six weeks, duly crediting delay compensation in the form of interest @6% per annum on their deposits from July, 2017 (Tower B1, B2, B3, B4 & C2), August, 2017 (Tower B5) and September, 2018 (Tower A-1) till the offer of possession and charging EEC and FFC on pro-rata basis of the actual expenses. If any amount is payable to the home buyers, it will be paid along with statement of account. The opposite party shall handover possession to the members of the complainant, complete in all respect as per specification and execute conveyance deeds in their favour. If any amenities and facilities are incomplete, it shall be completed within six months from the date of this judgment.
..................................................J RAM SURAT RAM MAURYA PRESIDING MEMBER ................................................ DR. INDER JIT SINGH MEMBER