State Consumer Disputes Redressal Commission
Priyankar Banerjee vs M/S Skylark Realty Pvt. Ltd. on 12 June, 2023
Cause Title/Judgement-Entry KARNATAKA STATE CONSUMER DISPUTES REDRESSAL COMMISSION BASAVA BHAVAN, BANGALORE. Complaint Case No. CC/598/2017 ( Date of Filing : 23 Nov 2017 ) 1. Priyankar Banerjee S/o Pranab Banerjee, Aged about 34 years, R/a No.657, 2nd B Main road, Koramangala, 8th block, Bangalore-560095 2. Smt. Dipanjana Bhattacharyya, W/o Sri Priyankar Banerjee, Aged about 31 years, Aged about 34 years, R/a No.657, 2nd B Main road, Koramangala, 8th block, Bangalore-560095 ...........Complainant(s) Versus 1. M/s Skylark Realty Pvt. Ltd. Ground floor, HDIL Tower, Anant Kanekar Marg, Bandra (E), Mumbai-400051 Rep. by its Director Mr.Rajeev Sajjan Kumar Saraogi 2. G.S.Megha Construction Pvt. Ltd. Flat No.SB 407, Sylan Block, Anand Vihar, Old Mumbai High way, Shaikpet, Towlichowki, Hyderbad-560008 Rep. by its Director Mr.Alok Kumar 3. M/s Green Shapes Developers (India) Pvt. Ltd., 2nd floor, S.M.Tower, No.34, Outer ring road, Bellandur, Bangalore-560103 Rep. by its Director Mr.Alok Kumar 4. Mr.Alok Kumar S/o Late Ramachandra Singh Age 43 years, R/a Plat No.802, Block-2, Hill Ridge Springs ISB road, Gachi Bowli, Hyderabad-500032 5. Dewan Housing Finance Corporation Ltd. Warden House, 2nd floor, Sir P.M.Road, Fort, Mumbai-400001 ............Opp.Party(s) BEFORE: HON'BLE MR. Ravishankar PRESIDING MEMBER HON'BLE MRS. Smt.Sunita Channabasappa Bagewadi MEMBER PRESENT: Dated : 12 Jun 2023 Final Order / Judgement BEFORE THE KARNATAKA STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BANGALORE (ADDL. BENCH) DATED THIS THE 12th DAY OF JUNE 2023 PRESENT MR. RAVISHANKAR : JUDICIAL MEMBER MRS. SUNITA CHANNABASAPPA BAGEWADI : MEMBER CONSUMER COMPLAINT NO. 598/2017 1. Sri. Priyankar Banerjee S/o Sri Pranab Banerjee Aged about 34 Years ....... Complainant/s 2. Smt. Dipanjana Bhattacharyya, W/o Sri. Priyankar Banerjee Aged about 31 Years Represented by its GPA Holder Sri. Priyankar Banerjee, Both are residing at No.657, 2nd B Main Road, Kormangala, 8th Block Banglore-560095. (By Sri K.B. Laxmikanth) V/s 1. M/s Skylark Realty Pvt. Ltd., Ground Floor, HDIL Tower, Anant Kanekar Marg, Bandra (E), Mumbai 400 051, Represented by its Director Mr. RAJEEV SAJJANKUMAR SARAOGI. (By Sri Rangarajan) ..... Opposite Party/s 2. Sri G.S. Megha Construction Pvt. Ltd., Flat No SB 407, Sylvan Block, Anand Vihar, Old Mumbai Highway, Shaikpet, Towlichowki, Hyderabad - 560008. Mr. ALOK KUMAR 3. M/S Green Shapes Developers(India) Pvt. Ltd., 2nd Floor, Sm Tower, #34, Outer Ring Road, Bellandur, Banglore - 560103 Represented by its Director Mr. ALOK KUMAR 4. Mr. Alok Kumar S/o Later Ramachandra Singh, Age 43 Years, Residing at: Flat # 802, Block 2, Hill Ridge Springs ISB Road, Gachi Bowli Hyderabad -500032 (Ops 2 to 4 placed exparte) 5. Dewan Housing Finance Corporation Limited Warden House, 2nd Floor, Sir P.M. Road, Fort, Mumbai - 400001. (By Sri P. Mahesh) ORDER
BY SMT.SUNITA.C.BAGEWADI, MEMBER
1. This is a complaint filed by the complainant praying for a direction against the Opposite Parties to refund the amount of Rs.5,27,802/- with interest at 18% p.a. along with compensation and costs.
2. The averments in the complaint are as hereunder;
It is the case of the complainants that M/s Skylark Reality Private Limited (Opposite Party No.1) has represented to him that they are the sole and absolute owner of the property bearing Sy.No. 109 & 109/1, Singasandra Village, Begur Hobli, Hosur Main Road, Bengaluru - 560068, totally measuring 2 acres and 39 guntas and M/s G S Megha Constructions Private Limited (Opposite Party No 2) and M/s Green Shapes Developers (India) Private Limited (Opposite Party No.3) have represented that they have entered into a joint development agreement with Skylark Reality (collectively known as 'Vendors') to construct a residential building of 2B + G + 14UF ('Project Apartments') comprising of 4 blocks and a commercial building of 1B + G + 5UF. The complainants submit that the leading developers in India, known for their transparency, timely delivery and completion of projects.
3. The complainants further submit that due to Subvention scheme, buyback scheme and easy cancellation policy, on 31.10.2015 the complainants finalized the Flat No M044, on the 4th Floor in Manasarovar block of the said project Udgam/ Udgam- Green Luxury measuring 769 Sqft. Situated at. Udgam - Green Luxury, Sy.No. 109, Singasandra Village, Begur Hobli, Hosur Main Road, Banglore-560068 and paid Rs 1,00,000/- vide Cheque No.479505 dated 31.10.2015 drawn on State Bank of India. The third opposite party company sent them the booking confirmation E-mail and the payment receipt No 403 amounting to Rs 1,00,000/-. The complainants submit that the third opposite party company issued the allocation letter dated 26.11.2015 stating that it had allotted Flat No M044, on the 4th Floor in Manasarovar block in the Projects Apartments to him with a super built-up area of 982 sq. ft ('Apartment') for a composite price of Rs.52,78,018/-. The complainants submit that in the month of May 2016 the Vendors had represented that the Project was approved by leading banks/institutions like SBI, ICICI, DHFL etc., and DHFL was their preferred institution for availing a home loan under the said subvention scheme / no pre- EMI scheme. The vendor requested the complainant for KYC documents for the approval of home loan from DHFL and the same was shared by them.
4. The complainants submit that based on the assurance given by the vendors he entered into a Sale agreement and Construction agreement with the vendors. Thereafter, the vendors issued the Demand Letter asking for outstanding amount of Rs.4,27,802/- to be paid against down payment in favour of the second part company. The same has been paid by the complainants vide cheque No.479507 dated 28.12.2015 drawn on State Bank of India. The third part company acknowledged the receipt of Rs.4,27,802/- vide cheque payment. The complainants submit that they entered into Tripartite Agreement with the vendors and DHFL, where the DHFL has agreed to grant a loan of Rs.42,22,400/- to them. Further, the complainants state that on 16.12.2015 they got a loan sanction confirmation letter from DHFL and it also states that the DHFL has disbursed the initial Loan amount of Rs.15,83,405/- from his loan account No 24600000446 to the vendors. As per the Tripartite Agreement, the vendors has agreed and given undertaken to service/pay the Pre- EMI interest, on the entire amount of loan disbursed by the DHFL for 18 months from the date of the first disbursement or till the date of possession of the said flat, whichever period is earlier. In order to cheat the complainant, the vendors have deliberately didn't paid the Pre-EMI interest to the DHFL and violated the terms and conditions of the Tripartite Agreement.
5. The complainants submit that As per Clause 2 of the Sale Agreement, He has to pay the Vendors a sum of Rs.26,62,557/- towards construction of the project, but, the Opposite Party No.5 blindly disbursed the loan without any verification and violated the RBI Guidelines. The complainants further submit that in April 2017, they visited the site of the Project Apartments and were shocked to see that the vendors had not even started any work towards the construction of the project apartment. Further, there were not equipments or raw materials mobilized in the project site. The complainants have sent several emails called upon the vendors to explain the stoppage of works at the project site. None of the emails have been responded to. At the time of availing the loan from DHFL, it was informed that the loan amounts would be disbursed to the Vendors as per the payment schedule. However, the vendors colluded with the DHFL, got the home loan sanctioned, only to make illegal money. The complainants submit that Mr. Alok Kumar, the Director at Skylark Reality and Green Shapes Developers and the Managing Director at GS Megha Constructions executed the Sale Agreement, Construction Agreement and the Tripartite agreement has been absconding since March, 2017. The booking offices of the Project Agreement have been shut for more than 8 months.
6. The complainants state that the vendors have failed to register the project Udgam/ Udgam-Green Luxury under the Real Estate (Regulation and Development) Act, 2016 (RERA) and violated the section 3, 4, 9 & 10. Therefore, the vendors are liable to be punished under section 59 to 62 & 70 of The Real Estate (Regulation and Development) Act, 2016 (RERA). Hence, The complainants got issued a legal notice dated 15.07.2017 and withdrawn from the proposed project and surrender the Flat No.M044, on the 4th Floor in Manasarovar block of the said project Udgam/ Udgam-Green Luxury measuring 769 Sqft. Situated at Udgam, - Green Luxury, Sy. No. 109, Singasandra Village, Begur Hobli, Hosur Main Road, Banglore - 560068. The complainant has also prayed the vendors to refund the entire investment with interest as compensation. The legal notice issued on Opposite Party No.1 served and Opposite Party No. 2 & 3 are returned with an endorsement "left".
7. The complainants submit that the Opposite Party No.1 has sent a replied notice dated 29.09.2017, where the Opposite Party No.1 denied every statement, allegation and contention contained in our notice and washed their hands from their risk and responsibility by referring to the JDA dated 20.10.2012 entered with Opposite Party No.2. The complainants submit that on account of the deficiency in service and unfair trade practices on the part of the Opposite Parties, they put to lot of inconvenience and mental agony. Hence, the complaint.
8. After service of notice, the Opposite Party No.1 & 5 appeared through counsel and filed version. The Opposite Party Nos. 2 to 4 placed exparte. The Opposite Party No.1 contended that the JDA stipulates that all the constructions, development, marketing and sales in respect of entire property to be developed at the sole risk and responsibility of Opposite Party No.2 (Megha Construction) and Opposite Party No.3. The Answering Opposite Party submits that advertising is done by Green Shapes Developer (P) Ltd (Opposite Party No.3) Booking, allocation letter, demand letter, payment receipt and Sale Agreement are entered between the Complainant and Opposite Party No.3. Hence, Opposite Party No.1 prayed to dismiss the complaint against them.
9. The Opposite Party No.5 contended that this Opposite Party being one of the project financier is not concerned with the action of Opposite Party 1 and 2 and their interse obligations to the Complainants and this Opposite Party is acting as per the terms and conditions of finance agreements and is not at fault or in breach of any agreements and admittedly bare reading of Complaint also does not disclose any breach on part of the Opposite Party and there is no cause of action against this Opposite Party. Further, it is clearly mentioned payment of Pre-EMI interest or EMI is not connected to stage of construction and as per the loan agreement, the disbursement is not subject to stage of construction, hence the case of Complainant that this Opposite Party has disbursed the entire loan with seeing the stage of construction, does not hold any water in the eye of law and the Complaint is liable to dismissed in the limine.
10. The DHFL being in the business of Finance and has granted the Home Loan in due course of business of Complainants after verifying not only the Project and also on the basis of financial capacity of the Complainants and the Complainant has to adhere to terms and conditions of the Loan Agreement executed between this Opposite Party and the Complainants. Hence, prayed to dismiss the complaint against them.
11. The complainants have filed affidavit evidence and marked documents at Ex.C1 to C35. The Opposite Party No.5 files affidavit evidence, but, not marked any documents. The Opposite Party No.1 not filed affidavit evidence. Heard from both sides.
12. On perusal, the following points will arise for our consideration;
(i) Whether the complaint deserves to be allowed? (ii) What order? 13. The findings to the above points are; (i) Affirmative (ii) As per final order REASONS
14. Perused the contents of the complainant, objections filed by the Opposite Party No.1 & 5, evidence affidavit and documents produced by both parties, we noticed that the issuance of notice to Opposite Party Nos. 2 to 4 by way of paper publication, they are absent, hence, placed exparte. Perused the materials on record, it is not in dispute that the complainants have booked flat by paying advance amount of Rs.1,00,000/- by Cheque No.479505 dt.31.10.2015 and Opposite Party No.3 issued an allotment letter dt.26.11.2015 regarding flat No.M044, 4th Floor, Manasarovar Block with super built up area of 982 sq.ft. for consideration of Rs.52,78,018/-. It is also evident that the complainant has paid Rs.4,27,802/- towards the down payment of flat and Sale Agreement and Construction Agreement was executed on 28.04.2016. It is also evident that the DHFL Bank agreed to grant loan of Rs.42,22,400/- to the complainants.
15. The allegation of the complainants is that in April 2017 when they visited the project site, they shocked to see that the Opposite Parties had not even started any work towards the construction of the project and handover the possession of the flat. Further, there were no equipments/ raw-materials in the project site. Per contra, the Opposite Parties contended that advertising is done by M/s Green Shapes Developers (India) Pvt. Ltd., Opposite Party No.3 i.e. booking, allotment letter, payment letter, payment receipts and Sale Agreement entered between the complainants and Opposite Party No.3 only. Perused the document at Annexure A & B. We noticed that the Joint Development Agreement dt.29.11.2012 executed between the Opposite Party Nos. 1 & 2 and Opposite Party No.1 has executed power of attorney in favour of Opposite Party No.2. However, advertisement is done by Opposite Party No.3 M/s Green Shapes Developers (India) Pvt. Ltd. The allotment letter and payments are done between the complainants and Opposite Party Nos. 3 & 4. The Sale Agreement dt.28.04.2016 entered between the Opposite Party Nos. 1, 2, 3 & 5, but, as per the complainants pleading, the Opposite Party No.2 Managing Director of G.S. Megha Construction Pvt. Ltd., and Mr. Alok Kumar, the Director at Skylark Reality & Green Shapes Developers has been absconding since March 2017. Hence, in our opinion, the Opposite Party No.1 is also a necessary party to the proceedings and it is his duty to complete the project and handover the possession of the flat to the complainants.
12. Further, the Opposite Party No.5 contended that DHFL is Finance and has granted home loan in due course of business after verifying not only the project and also on the basis of official capacity of the complainants hence, the complainants have adhere to the terms and conditions of the Loan Agreement executed between them. Perused the document, Tripartite Agreement was executed between the Opposite Party No.1 executed by Power of Attorney Opposite Party No.2, 3 and complainants. As per Clause- 5 & 7 of Tripartite Agreement reads as under;
CLAUSE - 5: Cancellation of Sale by the Builder and/or surrender/withdrawal by the Borrower from the scheme for any reasons whatsoever, Borrower shall continue to make payments of EMI's and/or Pre-EMI's as agreed in the loan agreement entered into with DHFL till the loan amount disbursed to the Builder referred above is refunded by the Builder failing which DHFL shall have full rights to initiate legal action against the Borrower and the builder. That DHFL shall have full rights to recover the difference amount between outstanding amount (including interest and other charges) standing in the loan account of the Borrower and the amount refunded by the Builder.
CLAUSE - 7: The Builder agrees that the DHFL shall be entitled to an exclusive and first charge over the Flat at all times. The Builder agrees that it shall not be entitled to claim any lien or priority for any amount prejudicing the interest of the DHFL until the dues of the DHFL are fully met and discharged.
Regarding that we have relied upon the Judgement produced by the complainant in FA.No.117/2015 in the matter between IDBI Bank Limited v/s Mr. Prakash Chandra Sharma & others passed by the Hon'ble National Consumer Disputes Redressal Commission in Para No.23 it held as under;
"When the complainants got issued legal notice, referring to the terms of the Special Payment Plan and the fact that the Developer had absconded without completing the project, the conduct of the Bank, in including the complainants name in the list of defaulters of CIBIL thereby, despite having disbursed the entire amount in advance to the Developer without following the RBI Regulations, undoubtedly caused mental agony, inconvenience and hardship to the complainants. It amounts to not only an act of complete deficiency in service on its part to the complainants, it amounts to unfair trade practice as defined in Sec.2 (r) as well."
13. In the present case also, the complainants have to pay sum of Rs.26,62,557/- towards construction of the project as per slab, the Opposite Party No.5 has disbursed loan to the vendors without any verification and violated the RBI Guidelines. The notification of RBI on housing loan with specific reference to Circular No.DBR No.B.C.13-08.12.001/ 2015-2016 RBI/2015-2016/46 dt.01.07.2015 laid down to protect interest of banks as well as the purchasers of immovable properties. It is the duty of Opposite Party No.5 prior to disbursed amount of Rs.15,83,405/- to take into consideration the capacity and capability of the developer in completing the project. In the present case, the Opposite Party No.2 failed to register the project in RERA Act, 2016 inspite of sufficient requests and also even issuing legal notice, the Opposite Party Nos. 1 to 4 have not developed the project and not started the work. Therefore, the legal notice dt.15.07.2017 the complainants have withdrawn the proposed project and surrendered the Flat No.M044, 4th Floor, Manasarovar Block of the Project Udgam-Green Luxury measuring 769 sq.ft. in Bangalore. Moreover, the complainants have produced a Memo dt.13.07.2022 stating that they have withdrawn the complaint filed before RERA. Hence, it is a well settled legal position that inspite of taking Rs.5,27,802/- as advance, loan amount of Rs.15,83,405/-, inspite of several requests and demand notice, the Opposite Party Nos. 1 to 4 have not developed the Project and even not started the work up to 2017 which amounts to deficiency in service on the part of the Opposite Party Nos. 1 to 4 and Opposite Party No.5 disbursed the amount in advance to the developer without following the RBI Regulations amounts to unfair trade practice on the part of the Opposite Party No.5. Hence, the Opposite Party Nos. 1 to 4 are liable to pay the amount paid by the complainants towards the allotted flat and the Opposite Party No.5 is liable to pay compensation for mental agony and inconvenience to the complainant. Moreover, the Opposite Party No.1 filed objections, but, not filed affidavit evidence. Hence, there is no weightage to the contention of the Opposite Party No.1. Hence, considering the facts and discussion made here, we are of the opinion that the complainants have proved deficiency in service on the part of the Opposite Parties. Hence, the following;
O R D E R The complaint is allowed.
The Opposite Party Nos. 1 to 4 are jointly and severally directed to pay Rs.5,27,802/- to the complainants with interest at 12% p.a. from the date of receipt of respective payments, till realization.
Further, the Opposite Party No. 5 is directed to recover the loan amount of Rs.15,83,405/- with interest at 12% p.a. from the date of disbursement of the loan, till realization from the vendors i.e. Opposite Party Nos. 1 to 4.
Further, Opposite Party No.5 is directed to remove the name of the complainant from the defaulters list of CIBIL and to withdraw all the legal proceedings initiated against the complainant in respect of the loan amount and interest.
Further, the Opposite Party Nos. 1 to 5 are jointly and severally liable to pay Rs.5,00,000/- to complainants as compensation for mental agony and inconvenience and Rs.25,000/- towards litigation expenses.
The Opposite Parties are directed to comply the Order within 45 days from the date of receipt of this Order.
Send a copy of this order to both parties.
Sd/- Sd/- MEMBER JUDICIAL MEMBER KCS* [HON'BLE MR. Ravishankar] PRESIDING MEMBER [HON'BLE MRS. Smt.Sunita Channabasappa Bagewadi] MEMBER