State Consumer Disputes Redressal Commission
Md. Jamed vs M/S. Leomon Construction Pvt. Ltd. on 22 February, 2018
Cause Title/Judgement-Entry STATE CONSUMER DISPUTES REDRESSAL COMMISSION WEST BENGAL 11A, Mirza Ghalib Street, Kolkata - 700087 Complaint Case No. CC/257/2013 1. Md. Jamed S/o Md. Hafizur Rahman, 55/1, P.M. Basti, 3rd Bye Lane, P.S. Shibpur, Dist. Howrah, Pin Code no.711 102. ...........Complainant(s) Versus 1. M/s. Leomon Construction Pvt. Ltd. 29/1, Kalabagan Lane, Lemon Fresh, Block-2, 1st Floor, Room No.4, P.O. Santragachi, P.S. Shibpur, Dist. Howrah, Pin Code no.711 104. 2. M/s Jaytra Commotrade Pvt. Ltd. 12, P.K. Banerjee Lane, P.O. & P.S. Shibpur, Dist. Howrah, Pin Code no.711 102. 3. M/s. Sangini Commercial Pvt. Ltd. 12, P.K. Banerjee Lane, P.O. & P.S. Shibpur, Dist. Howrah, Pin Code no.711 102. 4. M/s. Hemvin Commotrade Pvt. Ltd. 29/1, Kalabagan Lane, "Lemon Fresh", Block-2, 1st Floor, Room no.4, P.O. Santragachi, P.S. Shibpur, Dist. Howrah, Pin Code no.711 104. 5. M/s. Rajrashi Vanijya Pvt. Ltd. 303, Shanti Pally, P.S. Kasba, City Kolkata, Pin no.700 042. 6. M/s. Rupshita Tradecom Pvt. Ltd. 29/1, Kalabagan Lane, "Lemon Fresh", Block-2, 1st Floor, Room no.4, P.O. Santragachi, P.S. Shibpur, Dist. Howrah, Pin Code no.711 104. 7. M/s. Vertex Vyapaar Pvt. Ltd. 61, Jatin Das Road, P.S. Lake, City Kolkata, Pin Code No.700 026. 8. M/s. Urmila Vanijya Pvt. Ltd. 35/1, Diamond Harbour Road, P.S. South Port, City Kolkata, Pin Code No.700 027. 9. M/s. Rajrashi Vanijya Pvt. Ltd. 303, Shanti Pally, P.S. Kasba, City Kolkata, Pin Code No.700 042. ............Opp.Party(s) BEFORE: HON'BLE MR. SAMARESH PRASAD CHOWDHURY PRESIDING MEMBER For the Complainant: Mr. Ved Sharma , Advocate For the Opp. Party: Mr. R. K. Choumal, Advocate Dated : 22 Feb 2018 Final Order / Judgement Date of filing - 10.10.2013 Date of hearing - 05.02.2018 The instant complaint under Section 17 of the Consumer Protection Act, 1986 (for brevity, 'the Act') is at the instance of an intending purchaser against the developer/builder (Opposite Party No.1) and the landowners (Opposite Party Nos. 2 to 9) and two others (Opposite Party Nos. 10 & 11) on the allegation of deficiency in services on the part of them in a consumer dispute of housing construction.
In a capsulated form, Complainant's case is that on 30.03.2012 Complainant had entered into an Agreement for Sale with the OPs to purchase of flat/apartment measuring about 1029 sq. ft. being numbered as 'A' on the 10th floor at Premises No. 52, Andul Road, P.S.- Sankrail, Howrah - 711109, Dist- Howrah, within the local limits of Ward No.45 of Howrah Municipal Corporation at a total consideration of Rs.22,07,205/-. The complainant has stated that he has paid Rs.6,81,368/- on diverse dates as part consideration amount towards the said total consideration amount. In the agreement, it was stipulated that complainant would make payment of the total consideration of the proposed flat time to time according to the works done by OP No.1. The complainant alleged that OP No.1 used to demand money from them time to time without doing any course of proposed work of construction in terms of the Schedule 'E' of the said Agreement for Sale dated 30.03.2012. On 01.12.2012 the OP No.1 claimed a further sum of Rs.2,20,720/- along with the service tax of Rs.6,820/- aggregating Rs.2,27,540/- and it was asked to pay within 15 days. The complainant visited the spot and found that no work of construction has been done. The complainant asked the OP No.1 as to the reason for such notice of demand and expressed their intention not to pay any more money to OP No.1 unless the proposed work of construction started in satisfactory form. The complainant has also stated that they visited the office of OP No.1 in the month of December, 2012 and asked OP No.1 why the construction was not started to which without clarifying the stand, the OP No.1 straightway demanded more money for starting the said proposed work. Ultimately, on 26.12.2012 complainant received a letter of cancellation dated 18.12.2012. The complainant, thereafter, have made several correspondences including legal notices with OP No.1 but all turned a deaf ear. Hence, the complainant approached this Commission with the instant complaint with prayer for several reliefs, viz. -(a) to direct the OP No.1 to withdraw the letter of cancellation dated 18.12.2012; (b) to direct OP No.1 to execute and register the Deed of Conveyance in finished condition; (c) to pay compensation of Rs.5,00,000/- on account of harassment and mental agony; (d) litigation cost etc. The Opposite Party No.1/Builder by filing a written version has admitted the existence of the Agreement for Sale dated 30.03.2012 and payment of Rs.6,81,368/- by the complainant as part consideration amount but it has been categorically stated that the complainant defaulted in payment as per terms of the Agreement for which they were compelled to cancel the Agreement on 18.12.2012 and issued a cheque of Rs.6,56,393/- to the complainant by A/C payee cheque dated 28.01.2013. The OP No.1 has submitted that the complainant was never willing to fulfil their part of obligations in terms of the Agreement for Sale dated 30.03.2012 and as such the Agreement already stand cancelled.
The OP nos. 2 to 9 (landowners) did not contest. In fact, in view of the order of Hon'ble High Court at Calcutta, the OP Nos. 2 to 9 Company has been amalgamated with OP No.1 Company named Lemon Constructions Pvt. Ltd. Therefore, the complainants' allegation regarding deficiency in services shall be confined with OP No.1 Company.
The OP Nos.10 & 11, who were added as parties later on did not contest.
On behalf of the complainants, Complainant himself has tendered evidence on affidavit. He has also given reply against the questionnaire set forth by OP No.1. On the other hand, on behalf of OP no.1 Sri Sanjay Jhunjhunwalla, Director of M/s. Lemon Constructions Pvt. Ltd. has filed evidence on affidavit. He has also given reply against the questionnaire put forward on behalf of the complainant. Besides oral evidence, parties have relied upon some documentary evidence. During final hearing of the case, a brief notes of argument has been filed on behalf of the complainant.
On perusal of pleadings and the evidence including documentary evidence led by the parties, it has come to surface that OP Nos. 2 to 9 were the lawful owners of a piece of land measuring about 58 cottahs 06 chhitaks 05 sq. ft. lying and situated at Premises No. 52, Andul Road, P.S.- Sankrail, Howrah - 711109, Dist- Howrah, within the local limits of Ward No.45 of Howrah Municipal Corporation. On 18.09.2011 the OP Nos. 2 to 9 had entered into Agreement for Development followed by a registered Power of Attorney with OP No.1 to raise a multi-storied building in the pattern of G+10th floor upon the said property. Accordingly, a sanctioned building plan was obtained from Howrah Municipal Corporation on 19.05.2012.
It is not in dispute that on 30.03.2012 the complainant had entered into an Agreement for Sale with the opposite parties to purchase of a flat/apartment measuring about 1029 sq. ft. being numbered as 'A' on the 10th floor at Premises No. 52, Andul Road, P.S.- Sankrail, Howrah - 711109, Dist- Howrah, within the local limits of Ward No.45 of Howrah Municipal Corporation at a total consideration of Rs.22,07,205/-. The complainant has paid Rs.6,81,368/- on diverse dates as part consideration amount towards the said total consideration amount.
Now, the whole dispute cropped up relating to allegation of the complainant about not raising any construction by OP No.1 and on the other hand, it is alleged by the OP No.1 that the complainant has defaulted in payment of instalments as per Schedule of the Agreement for which they cancelled the agreement and refunded the amount after deduction of service taxes through cheque.
Needless to say, the parties are bound by the terms of the agreement. Both the parties have signed the agreement with open eyes evaluating its pros and cons and therefore, nothing can be added or detracted from the terms and conditions of the contract. Therefore, the agreement between the parties towers above the rest. In AIR 1996 SC 2508 (Bharti Knitting Co. - Vs. DHL Worldwide Express Courier Division of Airfreight Ltd.) the Hon'ble Supreme Court has observed thus -
"In an appropriate case where there is acute dispute of facts necessarily the Tribunal has to refer the parties to original Civil Court establish under the CPC or appropriate State Law to have the claims decided between the parties. But when there is a specific term in the contract, the parties are bound by the terms in the contract".
When the parties are at variance with regard to payment, it would be worthwhile to have a look to Schedule 'E' to the Agreement for Sale which relates to payment. As per said schedule, the complainant was under obligation to pay -
Rs.1,00,000/- as signing amount on booking, 20% on signing of Sale Agreement (adjusting the signing amount), 10% on start of the piling work, 10% on start of sub-structure work, 7.5% on casting of 2nd floor, 7.5% on casting of 4th floor, 7.5% of casting of 6th floor, 7.5% casting on 8th floor, 7.5% on casting on 10th floor, 7.5% on roof casting, 10% on infrastructure (internal), Balance 5% before handover of the flat.
Now, the evidence on record indicates that on 01.11.2012 the builder issued a demand letter to complainant informing him that sub-structure work of the project is under way and claimed an amount of Rs.2,20,720/- + Rs.6,820/- (service tax) amounting to Rs.2,27,540/-. The complainant did not reply to the same. On 20.11.2012 the builder once again wrote a letter to the complainant and informed that as the complainant did not make payment, he must pay the same within three days from the date of that reminder otherwise an interest @ 18% p.a. will be imposed. Despite such reminder letter, complainant did not pay any amount to the builder for which by a letter dated 26.11.2012 the builder imposed an interest on due amount @ 18% p.a. for a period of 30 days and it has been made clear that in case they do not receive the payment with interest within next 30 days, they shall have no option but to refund the amount after deducting the interest and other charges and by rescinding the agreement. The complainant neither paid any amount as per demand nor issued any letter to the builder informing them the reason for non-payment of the amount as per payment schedule of the Agreement. Ultimately, by a letter dated 18.12.2012 the builder cancelled the agreement and informed the complainant that the amount to be refunded shall be handed over after deducting penalty charges and the interest, if any thereon. The said notice was duly received by the complainant on 26.12.2012. By a letter dated 21.01.2013 the builder informed the complainant that pursuant to the cancellation letter dated 18.12.2012 the cancelled cheque is ready and requested the complainant to collect the same within 7 working days in between 10 A.M and 6.30 P. M. As the complainant did not visit office of builder, by a letter dated 18.04.2013 the builder refunded the amount of Rs.6,56,393/- after deducting the service tax only.
The complainant took action only on 25.02.2013 when he issued a notice upon the builder regarding cancellation letter. The builder has replied to that letter through their Advocate on 25.03.2013. Thereafter on 25.04.2013 the complainant wrote a letter to the builder through his Advocate and raised some point informing that they were ready and willing to pay as per terms of the agreement subject to complete of construction work.
Mr. Ved Sharma, Ld. Advocate for the complainant has submitted that the bilateral agreement cannot be cancelled by a developer unilaterally. In support of his submission, he has placed reliance to a decision reported in (2014) 5 SCC 159 [Ramchandra Narayan Nayak - Vs. - Karnataka Neeravari Nigam Ltd. & Ors.[.
On the other hand, Mr. R.K. Choumal, Ld. Advocate for the OP No.1/builder has contended that a Forum constituted under the Act has no jurisdiction to pass any declaratory decree and as such the prayer (a) in the prayer clause of the petition of complaint to give a direction upon OP No.1 to withdraw the letter of cancellation dated 18.12.2012 is not entertainable. In support of such submission, Ld. Advocate for the OP No.1 has drawn my attention to a decision of Honble National Commission reported in 2012 (2) CPR 310 (NC) [Pawan Kumar Agrawal - Vs. - Assistant General Manager, Bank of Baroda[ Ld. Advocate for OP No.1 has also submitted that the complainant has failed to keep their words in making payment as per Schedule of payment as embodied in Schedule E to the petition of complaint. He has contended that it may be possible that the complainant may have booked the flat for the purpose of investment to earn from the same and due to financial slag in the property market, they did not get any prospective buyer and as a result, they are unable to pay the instalments and therefore, hatch up a story of non-commencement and/or progress of construction work. Ld. Advocate for OP No.1 placing reliance of another decision of Hon[ble National Commission reported in 2015 (2) CPR 656 [Urban Improvement Trust, Alwar & Anr. - Vs. - Niranjan Lal[ where it has been held that allotment of plot can be cancelled if allottee fails to deposit instalments within time.
I have give due consideration to the submission advanced by the Ld. Advocates appearing for the parties. Regarding the alleged non-construction of the building, the complainant did not take any pain to appoint of an Engineer Commissioner or technical person to prove that the OP No.1/builder did not take steps to raise construction or to complete the construction as per commitment and in accordance with the schedule as mentioned in the Agreement for Sale. By letter dated 01.11.2012 the developer informed the complainant that sub-structure of the project is under way and claimed that amount to that effect as per schedule of payment. The complainant did not show any courage by giving a reply to that letter refuting the contention of the builder. The complainant wake up only when the agreement itself was cancelled by the developer for non-payment of the amount and ignoring the letters dated 20.11.2012 and 26.11.2012. In fact, the cynical or indifferent attitude of the complainant compelled the OP No.1/builder to cancel the agreement by letter dated 18.12.2012 which was duly received by the complainant on 26.12.2012. The record also indicates that on 28.01.2013 OP No.1 issued a cheque of Rs.6,56,393/- in favour of complainant, however, the same was not accepted by the complainant.
After evaluation of materials on record and having heard the Ld. Advocates appearing for the parties, I think the OP No.1/builder should have refunded the amount of Rs.6,56,393/- (after deduction of service tax) along with the notice of cancellation dated 18.12.2012 and as the OP No.1/builder has failed to do so, the OP No.1 is found deficient in rendering services to that extent only. Therefore, the complainant is entitled to refund the amount of Rs.6,56,393/- along with interest thereon "9% p.a. from the date of payments till its realisation and also entitled to litigation cost which I quantify at Rs.10,000/-.
Consequently, complaint is allowed on contest. The OP No.1/builder is directed to refund Rs.6,56,393/- (after deduction of service tax) along with interest thereon @ 9% p.a. in favour of the complainant from the date of payments till its realisation. The OP No.1 is further directed to pay a litigation cost of Rs.10,000/- in favour of the complainant within 30 days from date otherwise the amount shall carry interest @ 9% p.a. from date till its recovery.
The Registrar of the Commission is directed to send a copy of the order to the complainant and OP No.1 at once free of cost for information and compliance. [HON'BLE MR. SAMARESH PRASAD CHOWDHURY] PRESIDING MEMBER