National Consumer Disputes Redressal
M/S. Taneja Developers And ... vs Madhvi Bhargav & Anr. on 23 November, 2022
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 609 OF 2019 (Against the Order dated 16/01/2019 in Complaint No. 720/2018 of the State Commission Punjab) 1. M/S. TANEJA DEVELOPERS AND INFRASTRUCTURE LTD. & 2 ORS. 10 SHAHEED BHAGAT SINGH MARG NEAR GOLE MARKET NEW DELHI -1 2. RAVINDER TANEJA DIRECTOR , TANEJA DEVELOPERS AND INFRASTRUCTURE LTD, TDI CITY MILESTONE 10-11, NH 21, CHANDIGARH KHARAR ROAD MOHALI 3. RENU TANEJA DIRECTOR , TANEJA DEVELOPERS AND INFRASTRUCTURE LTD, TDI CITY MILESTONE 10-11, NH 21, CHANDIGARH KHARAR ROAD MOHALI ...........Appellant(s) Versus 1. MADHVI BHARGAV & ANR. H NO 775, SECTOR 8, PANCHKULA 2. SANJAY PATHAK H NO 775, SECTOR 8, PANCHKULA ...........Respondent(s)
BEFORE: HON'BLE MR. DINESH SINGH,PRESIDING MEMBER HON'BLE MR. JUSTICE KARUNA NAND BAJPAYEE,MEMBER For the Appellant : Ms. Kanika Agnihotri, Advocate with Ms. Snehal Kaila, Advocate For the Respondent : Mr. Akul Mehandru, Advocate Dated : 23 Nov 2022 ORDER
1. This appeal has been filed under section 19 of the Act 1986 in challenge to the Order dated 16.01.2019 of the State Commission in complaint no. 720 of 2018.
2. We have heard the learned counsel for the builder co. (the appellants herein) and the learned counsel for the complainants (the respondents herein). We have also perused the material on record including inter alia the State Commission's impugned Order dated 16.01.2019 and the memorandum of appeal.
3. The appeal has been filed with self-admitted delay of 02 days.
In the interest of justice, for the reasons mentioned in the application for condonation of delay, to provide fair opportunity to the appellant builder co., to decide the matter on merit rather than dismiss it on the threshold of limitation, the short delay in filing the appeal is condoned.
4. The matter relates to a builder-buyer dispute.
Brief facts of the case, as evincing from the State Commission's appraisal, are that the complainants, who are brother and sister, booked a plot with the builder co. at a basic cost of Rs. 50,79,192/- plus certain charges. The builder co. wrote a letter dated 27.10.2010 to the complainants wherein it mentioned about providing discount of Rs. 7,00,000/-. The complainants paid a total amount of Rs. 51,75,891/- to the builder co. An allotment letter was issued by the builder co. to the complainants on 20.08.2010. An agreement was executed by the builder co. with the complainants on 02.04.2011. The builder co. issued a statement of account dated 13.07.2011 reflecting outstanding amount of Rs. 6,32,1818/- to be still paid by the complainants. Then it issued a statement of account dated 21.11.2011 reflecting outstanding amount of Rs. 5,07,919/- Thereafter it issued a "final" statement of account dated 27.01.2012 showing outstanding amount of Rs. 10,35,838.60. It also issued a "final" statement of account dated 24.03.2012 wherein an amount of Rs. 7,00,000/- was shown outstanding. The builder co. was adjusting the amounts paid to it by the complainants from time to time as per its own choices without regard to the discount offered and without intimating its accounting rationales to the complainants. The actual physical possession of the subject plot to the complainants was never made. The builder co. was not in a position to deliver possession as it had not obtained the completion certificate. The builder co. got executed a maintenance agreement with the complainants on 24.03.2012 without delivering actual physical possession. It did not execute any sale / conveyance deed.
5. The complainants went before the State Commission on 11.09.2018. The State Commission observed that no particular period of delivery of possession had been stated in the allotment letter which contained the terms and conditions of allotment. Only "reasonable time" from the date of allotment letter for delivery of possession had been mentioned therein. The State Commission took a view that a three-year period would be quite reasonable in the facts and circumstances of the case. It found that actual physical possession had not been made even till the date of disposal of the complaint i.e. till 16.01.2019. It also noted that in the absence of the completion certificate from the competent authority only a meaningless 'handover of possession' was made on paper on 09.04.2012 / 01.05.2012 which is nothing but "paper possession" signifying nothing. The State Commission ordered the builder co. to refund the complainants' deposited amount of Rs. 51,75,891/- with interest at the rate of 12% per annum from the respective dates of deposit till realization along with lumpsum Rs. 50 thousand as compensation for mental agony inclusive of litigation expenses.
6. A perusal of the State Commission's impugned Order shows that it is a well-appraised and reasoned order and has aptly dealt with the issues germane to the dispute.
7. The State Commission has considered and dismissed the preliminary objection regarding the complainants not being 'consumer' under the Act 1986 (paras 10 and 11 of its Order). It has rightly observed that "In this regard, we have carefully perused the various documents on record and a perusal of the affidavit of complainant No. 1 clearly states that the complainants are not in sale and purchase of the properties. As such, they have purchased the unit in question in order to use the same for opening a two-wheeler agency and self employ themselves in order to earn their source of livelihood and purchased the unit in dispute in the project of OPs exclusively for their personal use. Hence, they fall within the definition of "Consumers" under the Act.".
The question whether the plot was exclusively for earning livelihood by means of self-employment was essentially one of fact, and the same appears to have been correctly appraised and decided by the State Commission on the basis of the pleadings and the evidence placed before it.
And admittedly the builder co. accepted part consideration for the plot.
As such the complainants were undoubtedly 'consumer' within the meaning of section 2(1)(d)(ii) of the Act 1986 read with the Explanation thereto, with no substantial or convincing or persuasive material to hold to the contrary.
8. The State Commission has extensively dealt with the substance of the dispute in paras 12 to 15 of its Order. The same may be reproduced below for reference:
12. From appraisal of evidence on the record and hearing the respective submissions of counsel for the complainants, we proceed to settle the controversy in this case. Ex.C-4 is the allotment letter containing terms and conditions of the allotment. No particular period of delivery of possession has been stated in it and only reasonable time from the date of allotment letter for delivery of possession is recorded. We are of this view that three years period would be quite reasonable one in this case. Allotment letter was executed on 20.08.2010 and three years period would expire on 20.08.2013. So far, the complainants have not received the delivery of possession of the unit till date. OPs had imposed interest and penalties on the complainants without proving this fact that they completed the development within reasonable period of time. Undoubtedly, OPs made an offer of possession for the said Plot No.98, vide Ex.R-6 on 27.01.2012, but this document is incomplete to prove that OPs had completed the entire development work by obtaining the requisite approvals from the competent authorities at the time of offer of possession. As such, an inference can be drawn that the letter of offer of possession was only a paper possession and not an actual or physical possession of the unit. Possession cannot be delivered by the developer without obtaining completion certificate from competent authority under law. Counsel for complainants referred to law laid down in "Emaar MGF Land Limited Vs. Karnail Singh" 2014(4)RCR(Civil)-136/137 by the National Commission, wherein it has been held that act of developer was said to be deceptive act. Herein, OPs had not performed their part for completing the project within three years, the reasonable period of time from the date of allotment letter. The complainants cannot be made to cool their heels for an indefinite period. We are, thus, of this view that OPs not possessed of any completion certificate to deliver the possession of completed unit to the complainants so far.
13. OPs have raised the plea that by virtue of notification dated 18.09.2009 as Ex.R3 they are exempted from the provisions of the Punjab Apartment & Property Regulation Act, 1995 (in short "PAPRA"). However, we find that the exemption granted to the OPs vide the above said notification was subject to compliance of certain terms and conditions mentioned therein. The OPs had not led any evidence to prove that they have complied with the terms and conditions of the above said notifications by obtaining the above said documents. Hence, it is concluded that the OPs cannot derive any benefit from the above said notifications.
14. The Consumer Protection Act came into being in the year 1986. It is the benevolent piece of legislation to protect the consumers from exploitation. The spirit of the benevolent legislation cannot be overlooked and its object is not to be frustrated. The complainants had made payment of substantial amount to the opposite parties, with the hope to get the possession of the plot in a reasonable period. The circumstances clearly show that the opposite parties made false statement of facts about the goods and services i.e. allotment of plot and delivery of possession in a stipulated period. The act and conduct of the opposite parties is a clear case of misrepresentation and deception, which resulted in the injury and loss of opportunity to the complainants. There is escalation in the price of construction also. The builder is under obligation to deliver the possession of the plot/unit/flat within a reasonable period. The complainants cannot be made to wait indefinitely to get possession of the plot booked. From the facts and evidence brought on the record of the complaint, it is clearly made out that the opposite parties i.e. builder knew from the very beginning that they had not complied with the provisions of the PAPRA and Rules and would not be able to deliver the possession within the stipulated period, thus by misrepresentation induced the complainants to book the plot, due to which the complainants had suffered mental agony and harassment. It is the settled principle of law that compensation should be commensurate with the loss suffered and it should be just, fair and reasonable and not arbitrary. The amount paid by the complainants is a deposit held by the opposite parties in trust of complainants and it should be used for the purpose of building the plots, as per Section 9 of PAPRA. The builder is bound to compensate for the loss and injury suffered by the complainants for failure to deliver the possession, so has been held in catena of judgments by the Hon'ble Supreme Court and the Hon'ble National Commission. To get the relief, the complainants had to wage a long drawn and tedious legal battle. As such, the complainants were at loss of opportunities. In these circumstances, the complainants are entitled to the refund of the amount deposited by them, along with interest and compensation.
15. Perusal of statement of account/receipts Ex.C-22, Ex.24 and Ex.C-26 show that a sum of Rs.51,75,891/- was deposited by the complainants with the OPs on different dates, towards the price of the said unit. However, as mentioned above, the OPs failed to deliver the possession of the unit, in question, to the complainants within the stipulated period, without any sufficient cause and, thus, the complainants are entitled to the refund of the amount deposited by them, along with interest and compensation.
(emphasis supplied)
9. Inter alia the following palpably deficient and unfair & deceptive acts are discernible from the appraisal made by the State Commission.
(i) Making 'handover of possession' on paper, without the completion certificate being obtained and without actual physical possession being delivered.
(ii) Entering into a maintenance agreement and obtaining charges thereagainst, without actual physical possession being delivered.
(iii) Retaining the complainants' deposited amount for an inordinate period, without deliverying possession.
10. Learned counsel for the builder co. submits that the complaint is barred by limitation. According to the learned counsel handing of possession was made vide letter dated 09.04.2012 on which the complainant no. 2 signed on 01.05.2012. A partial completion certificate was thereafter obtained on 25.06.2015. The cause of action should be taken to have arisen on 01.05.2012 when the complainant no. 2 signed on the 'handover of possession' and could also be taken to have arisen on 25.06.2015 when the partial completion certificate was subsequently obtained. Even if the later date is taken, the complaint, filed on 11.09.2018, was well beyond the limitation period of two years provided in section 24A(1) of the Act 1986. Submission is that the complaint was barred by limitation.
On the other side learned counsel for the complainants submits that actual physical possession was never delivered. The completion certificate had not been obtained when the 'handover of possession' was made on paper. The concerned letter was only "received" by the complainant no. 2, and it nowhere bears the signatures in receipt or otherwise of the complainant no. 1. Neither the sale / conveyance deed was ever executed nor the amount deposited by the complainants was ever refunded. Submission is that it was a continuing cause of action.
Learned counsel for the builder co. submits that that the fact of the completion certificate not being obtained till the date of 'handover of possession' on 01.05.2012 but having been obtained subsequently on 25.06.2015 is not very material since as per memo no. 10684-10712 dated 08.08.2001 of the Director, Town & Country Planning, Haryana, Chandigarh, possession without completion certificate is compoundable. Submission is that since such infringement was compoundable, 'handover of possession' would be tantamount to delivery of physical possession even in the absence of a completion certificate on the relevant date when 'handover of possession' was made.
11. We note that the said 'handover of possession' was made on a letter dated 09.04.2012 of the builder co. The complainant no. 2 signed thereon in receipt ("Recd.") on 01.05.2012. Conspicuously, signatures of complainant no. 1 are not there, in receipt or otherwise, even though both complainants were equal co-allottees.
Admittedly a partial completion certificate was subsequently obtained only on 25.06.2015. Too obviously in the absence of a completion certificate any meaningful legitimate physical possession is not feasible.
We do not see any reason to doubt the State Commission's findings that actual physical possession was never effected. The complainants' deposited amount was kept lying with the builder co. from years 2009 and 2010 onwards. The sale / conveyance deed was itself never executed. As such the cause of action subsisted on 11.09.2018 when the complaint was filed before the State Commission.
We do not agree with the learned counsel for the builder co. that the cause of action be taken either as the date on which 'handover of possession' was made on paper i.e. 09.04.2012 / 01.05.2012 or the date on which partial completion certificate was obtained i.e. 25.06.2015. When actual physical possession was never made, the complainants' deposited amount was never refunded and the sale / conveyance deed was never executed, neither the date of 'handover of possession' on paper nor the date of obtaining partial completion certificate by the builder co. can be taken as the date on which the cause of action arose, and as such these dates are meaningless and irrelevant for computing limitation. The meaningful and relevant material facts, as already stated, were that actual physical possession was not made, the complainants' deposited amount was lying with the builder co. and the sale / conveyance deed was not executed. Therefore the cause of action was subsisting and emanating in a continuing manner including on 11.09.2018 when the complaint was filed.
We also do not agree with the argument made by the learned counsel that 'handover of possession' made on paper ought to be taken as delivery of actual physical possession just because the infringement of giving possession without obtaining completion certificate is in any case compoundable. A completion certificate inter alia duly certifies from the level of the competent authority that the requisite development of the site has been satisfactorily completed in all respects. And absence of a completion certificate points to the contrary. Without the requisite development being satisfactorily complete in all respects the consumer cannot be unilaterally forced into accepting possession on paper or act upon the same just because such infringement may be compoundable.
On a query from the bench the learned counsel could not answer whether in fact the 'handover of possession' on paper in the present case was actually got compounded from the competent authority in the due course and if so on which date.
It has also to be kept in perspective that if a breach or violation of some rule or regulation has been made compoundable, it does not go to imply that the public has been granted permission to commit the breach wilfully or that the legislation has proffered a legitimate optional scheme or choice where an act may be done either in keeping with the law or in violation of it, and the defaulting person has just to pay some extra fee or premium if he chooses to go for the second option. Wherever the provisions for compounding some breach or offence have been postulated, they ought not to be misconstrued as being a kind of legislative imprimatur for committing such violations. Also it does not mean that just because an infringement is categorised as compoundable it will necessarily and definitely be compounded by the competent authority in the due course as a matter of routine.
It may be noted further the subject project is located in district SAS Nagar(Mohali) in the State of Punjab and the memo dated 08.08.2001 on which learned counsel is making her arguments has been issued by the Director, Town & Country Planning of the State of Haryana which is a different State. Memo(s) issued by a different State in this arena are not applicable in another State. As such we do not find the need to further critique its contents.
We find that the arguments made in respect of 'handover of possession' on paper being tantamount to delivery of actual physical possession even in the absence of a completion certificate miserably fail.
We are aware that the object and purpose behind the law of limitation cannot be either swung into oblivion or be ignored with apathy. A complete disregard of the law of limitation will eventually frustrate and defeat the salutary purpose which inspires the enactment in this regard wherever provided. We are also aware that the powers which have been conferred to condone the delay in filing a complaint have got to be exercised judiciously and not arbitrarily and certainly not at will either whimsically or capriciously. The discretion to be exercised in such matters is not an exercise of some kind of privilege or prerogative, it is essentially a legal exercise and has to be lawfully harnessed with judicious discipline.
Learned counsel has also tried to show certain judgments of Hon'ble Supreme Court to support that the law of limitation cannot be blissfully disregarded by the consumer protection fora. However there appears no need to detail the same since in the matter herein we are not condoning any delay but are arriving at findings that in the facts and circumstances of the instant case the cause of action was subsisting on a continuing basis and there was no violation of the statutory period of two years provided under section 24A(1). The obligations and duties of the builder co. towards the consumer never ceased to exist. The acts and omissions on the part of the builder co. which give rise to the wrong extend beyond a single completed act or omission and were of a continuing nature concomitantly causing continual legal injury de die in diem.
We may however also observe that even the very fact that the builder co. was indefinitely retaining the complainants' deposited amount and indefinitely not making actual physical possession could in itself have been sufficient cause to justifiably condone the delay under section 24A(2) if needed, anything otherwise would have been tantamount to a travesty of justice, leaving the complainants helpless and remediless. But, as already stated, any condonation under section 24A(2) was not required in this case.
Considering all this we have no hesitation in not accepting the arguments made by learned counsel.
We note that the State Commission has not made any mention of the aspect of limitation in its Order. It appears, since it was too obvious that in the facts and circumstances of the case the question of the cause not surviving did not arise at all, the State Commission did not deem it necessary to state the obvious and directly went into the issues inherent in the matter.
12. No other point was argued by the learned counsel for the builder co.
13. The findings evincing from the State Commission's Order, of meaningless 'handover of possession' being made on paper without obtaining completion certificate and without delivering actual physical possession, maintenance agreement being got executed and charges being obtained thereagainst without making actual physical possession and the complainants' deposited amount being unduly retained for an inordinate period by the builder co. remain undisturbed as such. All these deficient and unfair & deceptive acts unarguably constitute 'deficiency in service' and 'unfair trade practice' on the part of the builder co.
14. There can be no two opinions that in such facts and situation the builder co. was dutybound to refund the amount deposited by the complainants along with just and equitable compensation, there can hardly be any reason to hold otherwise.
The State Commission has awarded compensation by way of interest on the deposited amount at the rate of 12% per annum from the respective dates of deposit till realisation.
In the given facts and circumstances of the present case the rate of interest of 12% per annum awarded by the State Commission appears to be just and equitable, commensurate with the loss and injury suffered. We do not perceive any elements of disproportion. As such we see no good ground to disturb the same.
15. Clearly the appeal is without substance, bereft of any worth. The same stands dismissed with the following observations / directions:
The impugned Order dated 16.01.2019 of the State Commission is sustained. The award made therein shall be made good by the builder co. through its chief executive (i.e. its chairman or managing director or director in-charge of its affairs or director in-charge of the subject-matter, whichever member of the board of directors he may be).
The amount if any deposited by the builder co. with the State Commission in compliance of this Commission's Order dated 26.08.2019 along with interest if any accrued thereon shall be forthwith released by the State Commission to the complainants as per the due procedure. The balance awarded amount shall be made good by the builder co. within six weeks from today.
Additionally, for the 'unfair trade practice' per se, a cost of Rs. 1 lakh is imposed on the builder co. through its chief executive which shall be deposited in the 'Consumer Legal Aid Account' of the State Commission within six weeks from today.
In case of failure or omission in compliance of the above within the stipulated period, the State Commission shall forthwith undertake execution, for 'enforcement' and for 'penalty', as per the law.
16. The Registry is requested to send a copy each of this Order to the parties in the appeal and to their learned counsel as well as to the State Commission immediately. The stenographer is also requested to upload this Order on the website of this Commission immediately.
...................... DINESH SINGH PRESIDING MEMBER ......................J KARUNA NAND BAJPAYEE MEMBER