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State Consumer Disputes Redressal Commission

Nimmi Grewal vs M/S Imperia Structure Ltd. & Anr. on 15 September, 2021

          IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL
                           COMMISSION

                                           JUDGMENT RESERVED ON: 09.09.2021
                                        JUDGMENT PRONOUNCED ON: 15.09.2021

                                 COMPLAINT NO. 187/2017

     IN THE MATTER OF

     SMT. NIMMI GREWAL                                         ...... COMPLAINANT
                                            VERSUS
     M/S IMPERIA STRUCTURES LTD. & ANR ...OPPOSITE PARTIES

     CORAM:
     HON'BLE DR. JUSTICE SANGITA DHINGRA                                  SEHGAL
     (PRESIDENT)
     HON'BLE SH. ANIL SRIVASTAVA, (MEMBER)
     Present: Mr. Amrit Pal Singh, Counsel for Complainant.
              Mr. Jatin, Proxy counsel for Opposite Party.

     PER: HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL,
                PRESIDENT
                                        JUDGMENT

[Court hearing convened via video conferencing on account of COVID-

19]

1. The present complaint being filed under Section 17 of the Consumer Protection Act, 1986 by Smt. Nimmi Grewal (hereinafter referred to as 'complainant') against M/s Imperia Structures Ltd. & Anr. (hereinafter referred to as 'opposite parties') and has prayed the following reliefs:-

a) Direct the OP No. 1 to refund a sum of Rs.20,63,185/-

(principal amount as well as interest at the rate of 12% from the date of deposit till the date of filing the present complaint);

b) Direct the OP No.1 to pay further interest @ 12% p.a. on the principal amount from the date of filing the present complaint till the date of actual payment;

c) Direct the OP No.1 to pay a sum of Rs.2,00,000/ towards compensation to the complainant being senior citizen for mental torture agony suffered from the hands of the OPs;

d) Direct the OP No.1 to pay a sum of Rs.1,00,000/ towards cost of litigation;

e) Such further and other orders as this Hon'ble Commission may deem fit and proper may pleased be passed.

2. Brief facts necessary for the adjudication of the present complaint are that the complainant in year 2013 booked a flat i.e. 701 in Tower 6 in the project of Opposite Party no. 1 named "Imperia Mirage Homes" at Greater Noida. The Flat buyer agreement was executed between the parties after 18 months on 30.06.2014. The opposite party no. 1 assured the complainant that the project would be completed within 3 years from the date of booking but no fixed time for completing the project was mentioned in the said flat buyer agreement. Also, the opposite party no. 1 also failed to complete the construction of the project till today.

The complainant over the time had paid a sum of Rs. 14,97,085/- to the Opposite Party no. 1 as and when demanded by him. The complainant also requested the opposite party no. 1 to refund the amount deposited by them with interest but was of no avail.

3. The Opposite Party has contested the present case and has raised some preliminary objections as to the maintainability of the complaint case. The counsel on behalf of the Opposite Party submitted that the complainant is not "Consumer" as defined under the Consumer Protection Act, 1986 as she purchased two flats in the said project for investment purpose in order to earn profit. The counsel for the opposite party further submitted that this commission does not have CC 187/2017 SMT. NIMMI GREWAL VS. IMPERIA STRUCTURES LTD. Page 2 of 13 the pecuniary and territorial jurisdiction as the project was situated in Greater Noida, U.P.

4. The counsel for the Opposite Party submitted that the arbitration clause in the flat buyer agreement dated 30.06.2014 bars the jurisdiction of this commission and the present complaint is the subject matter of recovery suit. The counsel for the opposite party further submitted that the delay was caused due to the Force Majeure events like NGT prohibition to use groundwater, sealing by the Yamuna Expressway Industrial Development Authority, agitation between farmers and Jaypee Infratech, demonetization, delay in approvals/sanction, labour strikes etc. Pressing the aforesaid objections, the counsel appearing on behalf of the Opposite Party prayed that the complaint should be dismissed.

5. The complainant filed their Rejoinder rebutting the written statement filed by the Opposite Party. Both the parties filed their Evidence by way of Affidavit in order to prove their averments on record.

6. We have perused the material available on record and heard the arguments of both the parties.

7. The fact that the complainant had booked a flat with the Opposite Party no. 1 is not in dispute from the evidence on record. Payment to the extent of Rs. 14,97,085/- by the complainant to the Opposite Party no. 1 is also evident from the receipts issued by the opposite party no. 1 attached with the complaint.

8. Before delving into the merits of the case, we deem it appropriate to adjudicate the preliminary objections raised on behalf of the Opposite Party no. 1.

WHETHER COMPLAINANT FALLS IN THE CATEGORY OF 'CONSUMER' UNDER THE CONSUMER PROTECTION ACT, 1986?

9. The Opposite Party has contended that the complainant is not a Consumer as defined under the Consumer Protection Act, 1986 as the complainant had purchased two flats in the said project and the same amounts to commercial purpose.

10. It is imperative to refer to "Aashish Oberai Vs Emaar MGF Land Limited reported in I (2017) CPJ 17(NC) wherein it is held as under:

"6. .......A person cannot be said to have purchased a house for a commercial purpose only by proving that he owns or had purchased more than one houses or plots. In a given case, separate houses may be purchased by a person for the individual use of his family members. A person owning a house in a city A may also purchase a house in city B for the purpose of staying in that house during short visits to that city. A person may buy two or three houses if the requirement of his family cannot be met in one house. Therefore, it would not be correct to say that in every case where a person owns more than one house, the acquisition of the house is for a commercial purpose."

11. We further deem it appropriate to refer to the dicta of the Hon'ble National Commission in CC-1122/2018 titled Narinder Kumar Bairwal and Ors. vs. Ramprastha Promoters and Developers Pvt. Ltd. and Ors. decided on 01.11.2019, wherein, the Hon'ble National Commission has held as under:

"19. The contention of the Learned Counsel that the said Apartments were purchased for commercial purpose is not supported by any documentary evidence as the onus shifts to the Opposite Parties to establish that the Complainants have purchased the same to indulge in 'purchase and sale of flats' as was held by this Commission in Kavit Ahuja vs. Shipra Estates I (2016) CPJ 31. The Opposite Parties failed to discharge their onus and we hence hold that the Complainants are 'Consumers' as defined under Section 2(1)(d) of the Act."

12. From the aforesaid dicta of the Hon'ble National Commission, it flows that it is for the Opposite Party to prove that the flat was purchased for commercial purpose, by way of some documentary proof and a mere bald statement is not sufficient to raise adverse inference against the Complainant.

13. In the present case, the Opposite Party no. 1 has merely made a statement that the Complainant has purchased two flats in the said project and on perusal of the record before us, we fail to find any material which shows that the Complainant purchased various flats in same project or is engaged in the business of purchasing and selling houses and/or plots on a regular basis, solely with a view to make profit by sale of such flats. Mere allegation, that the purchase of the property is for commercial purpose, cannot be the ground to reject the present consumer complaint. Consequently, the objection raised on behalf of the Opposite Party no. 1 is answered in the negative.

WHETHER THIS COMMISSION HAS PECUNIARY JURISDICTION TO ADJUDICATE THE PRESENT COMPLAINT?

14. The opposite party no. 1 contended that this commission does not have the pecuniary jurisdiction to adjudicate the present complaint.

We deem it appropriate to refer to Section 17 of the Consumer Protection Act, 1986 which provides as under:

"(1) Subject to the other provisions of this Act, the State Commission shall have jurisdiction--

(a) to entertain-

(i) complaints where the value of the goods or services and compensation, if any, claimed [exceeds rupees twenty lakhs but does not exceed rupees one crore]; and

(ii) appeals against the orders of any District Forum within the State; and

(b) to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Forum within the State, where it appears to the State Commission that such District Forum has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested or has acted in exercise of its jurisdiction illegally or with material irregularity. (2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction-

(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or

(b) any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the State Commission is given or the opposite parties who do not reside or carry on business or have a branch office or personally works for gain, as the case may be, acquiesce in such institution; or

(c) the cause of action, wholly or in part, arises."

15. Analysis of Section 17 of the Consumer Protection Act, 1986 leads us to the conclusion that this commission shall have the pecuniary jurisdiction in cases where the total claim including the compensation is more than twenty lakhs and less than One Crore.

16. Having discussed the statutory position, the facts of the present case reflect that the value of the flat and the compensation prayed for by the complainant is beyond Rs. 20 Lakhs but does not exceed Rs. 1 Crore, accordingly, this commission has the pecuniary jurisdiction to deal with the present complaint. WHETHER THIS COMMISSION HAS JURISDICTION TO DECIDE THE PRESENT COMPLAINT?

17. The counsel for the Opposite Party no. 1 has raised an issue relating to the jurisdiction of this commission to try the present suit. He further submitted that this commission has no territorial jurisdiction as the property in question is situated in Greater Noida, Uttar Pradesh.

18. The jurisdiction of consumer commissions to entertain cases of this nature has been settled via array of judgments. We tend to rely on the dicta of Hon'ble Supreme Court in Narne Construction P. Ltd., etc. v. Union Of India and Ors. Etc., reported at AIR 2012 SC 2369, wherein it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression 'service' of any description. Housing construction or building activity carried on by a private or statutory body constitutes 'service' within the ambit of Section 2(1)(o) of the Act and any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers.

19. The Hon'ble National Commission in the case of Rohit Srivastava v.

Paramount Villas Pvt. Ltd. reported at 2017 SCC OnLine NCDRC 1198, has held as under:

"Having heard learned Counsel for the parties at some length, we are of the opinion that the order cannot be sustained. It is not in dispute that the Registered Office of Opposite Party No. 1 Company is situated in Delhi, i.e., within the territorial jurisdiction of the State Commission at Delhi and therefore, in the light of clear provision contained in Section 17(2)(a), which stipulates that a Complaint can be instituted in a State Commission, within the limits of whose jurisdiction, the Opposite Party actually carries on business. In view of the said provision, we have no hesitation in coming to the conclusion that since the Registered Office of the first Opposite Party is situated in Delhi, the State Commission did have the territorial jurisdiction to entertain the Complaint. In the light of the said provision, in our view, it was open to the Complainant to choose the Forum to file the Complaint, which on the second occasion he decided to file before the State Commission at Delhi."

20. Relying on the above settled law, there is no iota of doubt that this commission has the jurisdiction to entertain the cases including refund of amount, as the refund is sought due to the deficient services of the opposite party no. 1 and not for any other reason. Consequently, the said contention of the opposite party no. 1 is also answered in the negative. Moreover, the Opposite Party no. 1 has a registered office at A-25, Mohan Cooperative Industrial Estate, New Delhi - 110044, till which, the jurisdiction of this commission extends. Therefore, this commission is fully empowered to adjudicate the present consumer CC 187/2017 SMT. NIMMI GREWAL VS. IMPERIA STRUCTURES LTD. Page 8 of 13 complaint and is not paralyzed due to the want of territorial jurisdiction.

EXISTENCE OF ARBITRATION CLAUSE IN THE ALLOTMENT LETTER

21. The next preliminary objection raised by the Opposite Party no. 1 is that since there exists an arbitration clause in the flat buyer agreement dated 30.06.2014, the parties should be referred to arbitration and this commission is barred from exercising its jurisdiction. To deal with this issue, we deem it appropriate to refer to Emaar MGF Land Limited vs. Aftab Singh reported at I (2019) CPJ 5 (SC), wherein the Apex court has held as under:-

"55. We may, however, hasten to add that in the event a person entitled to seek an additional special remedy provided under the statutes does not opt for the additional/special remedy and he is a party to an arbitration agreement, there is no inhibition in disputes being proceeded in arbitration. It is only the case where specific/special remedies are provided for and which are opted by an aggrieved person that judicial authority can refuse to relegate the parties to the arbitration."

22. The Hon'ble Apex Court has put to rest the controversy relating to the existence of arbitration clauses in the allotment letter/apartment buyer agreement etc. as is evident from the relevant paragraph of Emaar MGF Land Limited (supra). In the present case also, the complainant has opted for the special remedies provided under the Consumer protection Act, 1986 therefore, this commission can refuse to relegate the present case to the arbitration. Hence, this commission is authorised to adjudicate the case and the existence of an arbitration CC 187/2017 SMT. NIMMI GREWAL VS. IMPERIA STRUCTURES LTD. Page 9 of 13 clause in the agreement does not affect the jurisdiction of this commission.

DEFICIENCY OF SERVICE

23. Having discussed the preliminary objections raised on behalf of the Opposite Party no. 1, the next issue which arises is whether the Opposite Party no. 1 is actually deficient in providing its services to the complainant or not. The expression Deficiency of Service has been dealt with by the Hon'ble Apex Court in Arifur Rahman Khan and Ors. vs. DLF Southern Homes Pvt. Ltd. and Ors. reported at 2020 (3) RCR (Civil) 544, wherein it has been discussed as follows:

"23. .......The expression deficiency of services is defined in Section 2 (1) (g) of the CP Act 1986 as:

(g) "deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service.

24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression 'service' in Section 2(1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of CC 187/2017 SMT. NIMMI GREWAL VS. IMPERIA STRUCTURES LTD. Page 10 of 13 compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfilment of a contractual obligation.

24. On perusal of record before us, we find that the flat buyer agreement was executed between the parties after one year (approx.) from the date of first payment received by the opposite party no. 1 i.e. 28.01.2013. We further note that no fixed time was mentioned by the opposite party no. 1 in the said flat buyer agreement for completing the project in question. The opposite party no. 1 in para 16 of his written statement admitted that the construction of the said flat was to be completed within three and half years from the date of execution of this agreement unless delay due to reasons beyond his control.

25. It is evident from the record that the flat buyer agreement was executed on 30.06.2014 and as per the admitted time of opposite party no. 1 to complete the construction of the said flat, the said flat was to be delivered by December, 2017. However, the opposite party no. 1 failed to complete the construction of the said flat till today.

26. The opposite party no. 1 contended that the delay occurred due to the reasons beyond his control like NGT prohibition to use groundwater, sealing by the Yamuna Expressway Industrial Development Authority, agitation between farmers and Jaypee Infratech, demonetization, delay in approvals/sanction, labour strikes etc. and therefore, there is no deficiency service on the part of opposite party CC 187/2017 SMT. NIMMI GREWAL VS. IMPERIA STRUCTURES LTD. Page 11 of 13 no. 1. After perusing the reasons for the delay and documents filed by the opposite party no. 1, we find that the complainant was not at fault for any delay occurred in completing the project. Even we do not find any evidence on record to prove that no water or labour was actually available in the market at the relevant time to carry out construction.

27. In these aforesaid circumstances, we hold that there are no legitimate reasons which will justify the delay in completing the construction of the said flat and the Opposite Party no. 1 is deficient in providing its services to Complainant, due to its failure to complete the construction of the said flat within the admitted time period.

28. Keeping in view the facts of the present case and the extensive law as discussed above, we direct the Opposite party no. 1 to refund the entire amount paid by the complainant i.e. Rs. 14,97,085/- along with interest as per the following arrangement:

A. An interest @ 6% p.a. calculated from the date on which each installment/payment was received by the Opposite Party no. 1 till 15.09.2021 (being the date of the present judgment);

B. The rate of interest payable as per the aforesaid clause (A) is subject to the condition that the Opposite Party no. 1 pays the entire amount on or before 14.11.2021; C. Being guided by the principles as discussed above, in case the Opposite Party no. 1 fails to refund the amount as per the aforesaid clause (A) on or before 14.11.2021, the entire amount is to be refunded along with an interest @ 9% p.a. calculated from the date on which each installment/payment was received by the Opposite Party no. 1 till the actual realization of the amount.

29. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party no. 1 is directed to pay a sum of A. Rs. 1,00,000/- as cost for mental agony and harassment to the complainant; and B. The litigation cost to the extent of Rs. 50,000/-.

30. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.

31. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.

32. File be consigned to record room along with a copy of this Judgment.

(DR. JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (ANIL SRIVASTAVA) MEMBER Pronounced On:

15.09.2021 CC 187/2017 SMT. NIMMI GREWAL VS. IMPERIA STRUCTURES LTD. Page 13 of 13