State Consumer Disputes Redressal Commission
Sanjay D Berde vs M/S Shree Sandipak Associates & Ors on 16 September, 2010
BEFORE THE HON
BEFORE
THE HON'BLE STATE CONSUMER DISPUTES REDRESSAL
COMMISSION, MAHARASHTRA, MUMBAI
Consumer
Complaint No. CC/07/6
1. MR
SANJAY D BERDE 9 UDYAM GOKHALE ROAD (SOUTH )DADAR MUMBAI 400 028
....Complainant
Versus
1.
M/S SHREE
SANDIPAK ASSOCIATES B-9
ELIZABETH
APT B MADHUKAR MARG PAREL MUMBAI 13
2.
MR.D.S.SHIRSAT, PARTNER OF M/S SHREE SANDIPAK ASSOCIATES B-9
ELIZABETH
APT B MADHUKAR MARG PAREL MUMBAI 13
3.
MR.A.G.SAWANT, PARTNER OF M/S SHREE SANDIPAK ASSOCIATES B-9
ELIZABETH
APT B MADHUKAR MARG PAREL MUMBAI 13
....Opposite parties
BEFORE :
Hon'ble Mr.Justice S.B.Mhase , PRESIDENT
Hon'ble Mr. P.N. Kashalkar , Judicial Member
Hon'ble Mrs. S.P.Lale , Member PRESENT:
Mr.U B WAVIKAR , Advocate for the complainant Mr.N.S.Parte-Advocate h/f.Mr.S.B.Prabhawalkar-Advocate for the O.Ps *JUDGEMENT/ORDER Per Mr.P.N.Kashalkar, Honble Judicial Member
1. This complaint has been filed by the complainant alleging deficiency in service on the part of O.P.no.1-firm engaged in development and construction of the building and also against two partners of the said firm.
2.
Complainant pleaded that O.P.no.1 is the partnership firm engaged in the business of building/development of land and property and O.P.nos.2 & 3 are the partners of O.P.no.1. Complainant pleaded that somewhere in September 2004, builder/developer had advertised in local newspaper that flats are available for sale in their proposed Suyog Apartments. Complainant approached O.Ps on 10/10/2004 and after due discussion complainant agreed to purchase a flat admeasuring 835 sq.ft. in the proposed project of O.Ps known as Suyog Apartments for consideration of Rs.40,50,000/-. Complainant pleaded that in furtherance of the said agreement, O.Ps. issued letter of allotment for sale of flat no.601 situated on 6th floor of proposed building Suyog Apartments. By letter dated 28/10/2004, O.Ps confirmed allotment/sale of flat no.601 for Rs.40,50,000/-. O.Ps also confirmed the manner in which complainant was required to pay balance consideration amount for flat no.601. They confirmed initial payment made by the complainant in respect of consideration of the said flat. Complainant in all paid Rs.10 lakhs towards the purchase price of the flat and O.Ps issued receipt dated 11/11/2004 acknowledging receipt of Rs.10 lakhs paid by the complainant towards the purchase of flat no.601, 6th floor of the building known as Suyog Apartments, situated at Taikal wadi road, now known as Manorama Nagarkar marg, Mahim, Mumbai 400
016.
3. The complainant pleaded that O.Ps had assured that they would execute Agreement of sale after MHADA & BMC gives Commencement Certificate to it. However, till filing of the complaint, O.Ps had not entered into an agreement of sale though had paid total amount of Rs.10 lakhs towards the part consideration of the flat. According to complainant, non execution of agreement on the part of O.Ps is per se deficiency in service and it is contrary to Maharashtra Ownership Flat Act, 1963. Complainant pleaded that after repeated assurances, O.Ps failed to execute agreement. Complainant fears that because of rise in Estate market, O.Ps are deliberately avoiding to execute an agreement of sale because presently market value of the flat would fetch around Rs.60 lakhs and O.Ps are intending to sell the same to some other person and, therefore, he filed consumer complaint praying that O.P. should be directed to hand over vacant possession of flat no.601 admeasuring 835 sq.ft. in Suyog Apartments situated at Taikal wadi road, now known as Manorama Nagarkar marg, Mahim, Mumbai 400 016 and to direct the O.Ps also to refund him the amount of Rs.60 lakhs in lieu of possession of the flat and to direct O.Ps to pay to the complainant Rs.3 lakhs as compensation for mental harassment and also claimed Rs.50,000/- towards cost of litigation. Complainant filed affidavits and documents in support of the claim in the complaint.
4. O.Ps contested the complaint by filing written statement. According to O.Ps, complaint as filed by the complainant is absolutely false and frivolous and should be dismissed with compensatory cost. O.Ps pleaded that O.P.no.1 firm was reconstituted w.e.f.19th March 2006 and original partner Mr.A.G.Sawant has retired from the said firm and Mr.Chandrakant Shankar Thakur has been appointed as partner in place of retired partner Mr.A.G.Sawant. Though complainant was aware of this fact, he has suppressed this fact with malafide intention. So according to O.Ps complaint as filed is bad in law for mis-joinder of necessary party or non-joinder of necessary party. On this ground also O.Ps pleaded that complaint should be dismissed with cost.
5. O.Ps further pleaded that the complaint is premature and in any event there is no concluded contract between the parties. According to O.Ps pursuant to the agreement dated 06/02/2003 executed in favour of O.P.no.1 by Mr.Ulhas Vithalrao Chaubal and others, O.P.no.1 was appointed as developer to redevelop property, this property being New survey no.1403(part), Cadastral Survey no.1915, Plot no.111 of Mahim division, being plot no.25 admeasuring 183.40 sq.yards equivalent to 153.38 sq.metres situated on Taikal wadi road, Mahim, Mumbai 400 016 by demolishing the existing building standing thereon known as Ganga Niwas and for reconstruction of the new building he was authorized to obtain requisite permission from the concerned authorities. Along with this development agreement, O.P.no.1 procured NOC from MHADA on 08/07/2003 and got plan sanctioned from Mumbai Municipal Corporation and IOD was issued on 31/8/2004.
As per the Development agreement, O.Ps obtained individual agreements from existing tenants of Ganga Niwas in October 2004. Complainant approached him through common acquaintance Mr.Prasanna Dattatraya Naik and inquired about the prospects of procuring flat in the said development. He agreed to give tentative booking but complainant was told clearly that it would not be possible for him to execute an agreement in his favour till Completion Certificate is issued in respect of 6th floor of the proposed building. He agreed to sell flat no.601 for Rs.40,50,000/- having built up area of 835 sq.ft. During the course of negotiation, complainant was told that there can be some delay in the project and for delay in project complainant will have to pay prevailing market value at the time of execution of agreement of sale. Complainant agreed with the same. Accordingly on 28/10/2004 allotment letter was issued to the complainant. Complainant thereafter paid total amount of Rs.10 lakhs to the O.Ps. O.Ps however pleaded that complainant was handed over draft agreement, which he has not produced before this Commission. O.Ps pleaded that Regulation no.33(7) of Development Control Regulations was challenged in Public Interest Litigation being Writ Petition no.3181 of 2004 before the Honble High Court impleading Brihanmumbai Municipal Corporation, MHADA and State of Maharashtra as respondents. In the said Writ Petition, Brihanmumbai Municipal Corporation, MHADA and State of Maharashtra were restrained to grant permission in respect of development of properties and, ultimately, matter went upto the Supreme Court, Honble Supreme Court remitted the writ petition back to Division Bench of the Honble Bombay High Court and he was granted Commencement Certificate upto second floor initially and then upto 4th floor on 09/10/2006 and till date Commencement Certificate in respect of 5th and 6th floor has not been granted by the authorities. Besides this they pleaded that they had not executed agreement for sale in favour of complainant and now complainant will have to shell out more amount since he had agreed to pay to purchase the flat at prevailing market value at the time of execution of agreement.
6. O.Ps pleaded that on 02/1/2007 the complainant approached to their office. O.Ps pointed out to him that Commencement Certificate is yet to be issued in respect of 5th and 6th floor, with the result that O.Ps. would not be able to execute agreement in his favour till Commencement Certificate is issued in respect of 5th and 6th floor by the concerned authorities.
7. O.Ps further pleaded that complainant ascertained from them the prevailing market value of the said flat and he was told that it was in the range of Rs.85 lakhs. Even as per Ready Reckoner, he was told that market price of the said flat would be around Rs.60 lakhs, therefore, he will have to shell out additional consideration. Upon this, complainant showed his willingness to cancel the booking and asked for refund of his booking amount and sought compensation at the rate of Rs.10,000/- per sq.ft. However, O.Ps offered to refund principle amount together with interest @ 9% p.a. from the date of respective payments till the said date. Complainant refused the said proposal and suppressing this material fact, he filed the complaint with malafide intention and ulterior motive to derive advantage.
8. O.Ps pleaded that complainant has failed to prove any deficiency on the part of the O.Ps and O.Ps consistent case is that along with the allotment letter they had given draft agreement and it was agreed between the parties that draft agreement would be executed only after O.Ps received Commencement Certificate from the concerned authorities. Since Commencement Certificate has not been issued till filing of the complaint, complainant cannot allege deficiency in service against the O.Ps. O.Ps pleaded that they are always ready and willing to perform their part of obligation under the allotment letter and they are prepared to execute Agreement of Sale in favour of complainant, provided complainant agrees to pay market value of the flat at the time of execution of agreement of sale. Since he is not prepared to do so, he has filed this false complaint. They therefore pleaded that by accepting remaining balance amount of Rs.30,50,000/- from the complainant they cannot hand over flat to the complainant. In the circumstances, they pleaded that complaint should be dismissed with cost.
9. We heard submissions of Mr.U.B.Wavikar-Advocate for the complainant and Mr.N.S.Parte-Advocate h/f.Mr.S.B.Prabhawalkar-Advocate for the O.Ps initially. At the fag end of the arguments Mr.Prabhawalkar-Advocate too appeared and he was extensively heard. We perused the documents placed on record by the parties. Now the following issues would arise for our determination. Issues and findings thereon are as under:-
Issue No.1:
Whether complainant proves that there was an agreement of sale in respect of flat no.601 on 6th floor admeasuring 835 sq.ft. in building known as Suyog apartment, Taikal wadi Road, now known as Manorama Nagarkar marg, Mahim, Mumbai 400 016 for lump sum price of Rs.40,50,000/- in terms of allotment letter dated 28/10/2004 between himself and O.Ps?
Finding:
YES Issue No.2:
Whether complainant proves that he had paid Rs.10 lakhs out of total consideration of Rs.40,50,000/- and is ready to pay remaining balance amount towards the purchase price of the flat he booked with the O.Ps?
Finding : YES Issue No.3 : Whether complainant proves that there has been deficiency in service on the part of the O.Ps in not giving flat and not even executing agreement of sale in favour of the complainant?
Finding : YES.
Issue No.4 : What order, if any?
Finding : As per final order passed below.
REASONS Issue No.1:
It is an admitted fact that complainant had booked flat no.601 on 6th floor in the proposed building styled as Suyog apartment being constructed by O.Ps at Mahim, Mumbai and to that effect to evidence this transaction, O.Ps had issued a letter of allotment dated 28/10/2004.
Complainant had paid in all Rs.10 lakhs to the O.Ps towards the part consideration of the flat. Receipt dated 11/11/2004 has been issued to that effect by Mr.D.S.Shirsat and Mr.A.G.Sawant partners of M/s.Shree Sandipak Associates. The allotment letter dated 28/10/2004 is signed by the said two partners. What is pertinent to note is the fact that this was the transaction of sale of flat for lump sum price agreed between the parties being Rs.40,50,000/-, out of which Rs.10 lakhs was admittedly paid by the complainant. It is an admitted fact that it was agreed between the parties that the agreement of sale would be executed by the builder in favour of complainant only after concerned local authority (BMC in the instance case) issues Commencement Certificate for construction of floor nos.5 & 6. It is the case of the complainant that he was never told by the O.Ps about having received Commencement Certificate for construction of 5th and 6th floor of the proposed building by BMC. According to complainant, building is ready. O.Ps have constructed the building as per the plan but O.Ps are not willing to execute agreement of sale of flat no.601 and also they are not ready to give possession of the said flat booked by him on 28/10/2004 in spite of the fact that six years have already lapsed in between. According to complainant when he approached O.Ps, they asked him to shell out price of the said flat at the prevailing market rate and they are not prepared to give him flat at the agreed lump sum price of Rs.40,50,000/- of which part payment of Rs.10 lakhs has already made by him to the O.Ps. This is the only bone of contention between the parties.
The complainant had agreed to pay purchase price of the flat no.601 at the prevailing market rate on the day O.Ps would execute agreement of sale in his favour and he had delayed to execute agreement of sale in favour of complainant because he wanted to claim consideration of flat booked by the complainant at the prevailing market rate which is what complainant alleged in his complaint and prevailing market rate of the said flat booked by the complainant is Rs.60 lakhs as per ready reckoner and Rs.85 lakhs as per prevailing market rate in the open market. It is for this reason, O.Ps are not prepared to execute agreement of sale in favour of the complainant.
In fact as per section 4 of Maharashtra Ownership Flats Act, 1963 ( MOFA), it is the statutory duty of the builder/developer not to accept any monies other than booking amount, unless he executes and registers agreement of sale in favour of the flat purchaser. In the instant case, he has already pocketed one fourth amount of the total consideration of the flat as per allotment letter and as per receipt executed by the O.Ps partners in favour of the complainant dated 11/11/2004.
We are of the view that the allotment letter coupled with receipts themselves establish contractual relationship between complainant on one hand and O.Ps on the other. There need not be agreement of sale executed and registered between the parties. Allotment letter itself was a binding contract between complainant and O.Ps. Allotment letter mentions all the necessary terms and conditions that were agreed to by the complainant and O.Ps and in terms of allotment letter, complainant had paid out of total Rs.40,50,000/-, Rs.10 lakhs towards price of the flat agreed to between the parties.
No doubt it is true that till filing of the complaint, it is the case of the O.Ps that they have not received Commencement Certificate for construction of 5th and 6th floor of the Suyog apartment building they were going to construct at Mahim, but in the course of arguments Mr.Parte admitted before us that his client has already constructed the building in toto and that others have already taken possession of the flat in the said building, but complainant was not taking the possession because he does not want to shell out the price at the prevailing market rate. We have seen the allotment letter and the receipt executed by the builder/developer in favour of the complainant. We are fully satisfied that the agreed price of the flat in 2004 was Rs.40,50,000/- in lump sum and when lump sum amount was mentioned in the allotment letter, the builder cannot be heard to say that he would mention some other price of the flat at the time of execution of agreement of sale which he had agreed to execute only after he got Commencement Certificate for construction of 5th and 6th floor of the said building from BMC. O.Ps cannot be heard to say that the terms and conditions between complainant and themselves were something else than what are incorporated in the allotment letter itself. Allotment letter itself evidences binding contract between complainant and O.Ps and since out of total consideration of Rs.40,50,000/- complainant has already paid an amount of Rs.10 lakhs, we are of the view that the builder/ developer/O.Ps herein has to give possession of the flat no.601 in the Suyog apartment to the complainant simply on accepting remaining amount of Rs.30,50,000/-. Complainant has shown readiness and willingness to pay the said amount to the O.Ps and is alleging deficiency in service and unfair trade practice on the part of O.Ps, because O.Ps though have completed construction of the said building, are withholding possession of flat no.601 which was to be handed over to the complainant, simply raising flimsy ground that the complainant had agreed to pay for the said flat the market rate prevailing at the time of execution of agreement of sale, which admittedly till filing of the complainant had not done for the obvious reason that they wanted to charge complainant price of flat at the prevailing market rate. It is on this greed of the O.Ps that this complainant has been denied his rightful claim of possession of flat no.601 though he was always ready and willing to pay remaining balance of Rs.30,50,000/- to the O.Ps.
What is pertinent to note is the fact that builder/O.Ps have deliberately not intimated to the complainant that they have received Commencement Certificate for 5th and 6th floors of Suyog apartment from the BMC and that they were ready to execute agreement of sale in favour of the complainant. This conduct on the part of the O.Ps exposes them fully and totally. Absolutely there is no ring of truth in the contention of the O.Ps that complainant had agreed to pay for flat no.601 the price prevailing in the market at the time of execution of agreement of sale. The very fact that O.Ps never intimated to the complainant that they had received Commencement Certificate for construction of 5th and 6th floors and that complainant should come forward to execute agreement of sale, itself shows that O.Ps are not willing to give flat to the complainant at the lump sum price of Rs.40,50,000/- agreed to between the parties in terms of allotment letter dated 28/10/2004. Thus, in the totality of the circumstances, we are finding that O.Ps are clearly guilty of deficiency in service and unfair trade practice and they cannot be permitted to deprive the complainant of the flat booked by him in the Suyog apartment way back on 28/10/2004. Since now Commencement and Completion Certificates have been obtained we will have to direct O.Ps to hand over peaceful possession of flat no.601 admeasuring 835 sq.ft. on 6th floor of Suyog apartment, Taikal wadi Road, now known as Manorama Nagarkar marg, Mahim, Mumbai 400 016 to the complainant on his tendering an amount of Rs.30,50,000/- as per allotment letter. In view of this discussion, we record our finding on issue nos.1, 2 & 3 accordingly and proceed to pass final order.
ORDER
1.
Complaint is allowed.
2. O.Ps are directed to deliver peaceful and vacant possession of flat no.601 admeasuring 835 sq.ft. on 6th floor of Suyog apartment, Taikal wadi Road, now known as Manorama Nagarkar marg, Mahim, Mumbai 400 016 to the complainant on complainant tendering remaining price of Rs.30,50,000/-. We also direct that complainant shall be paid an amount of Rs.50,000/- as compensation for mental harassment besides cost of Rs.10,000/-.
3. O.Ps are further directed to execute conveyance deed immediately on getting money from the complainant and should make him available copies of Occupation Certificate and Completion Certificate, if possessed, immediately duly issued by the Local authority or within a period of six months.
4. O.Ps are directed to comply this order within 30 days from receipt of order from this Commission.
5. Copies of the order be sent to the parties free of cost.
Pronounced Dated the 16 September 2010 [Hon'ble Mr.Justice S.B.Mhase] PRESIDENT [Hon'ble Mr. P.N. Kashalkar] Judicial Member [Hon'ble Mrs. S.P.Lale] Member