State Consumer Disputes Redressal Commission
Sh. Vivek Sharma vs Parsvnath Developers Ltd. on 10 July, 2023
C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023
IN THE DELHI STATE CONSUMER DISPUTES
REDRESSAL COMMISSION
Date of Admission: 20.09.2018
Date of hearing: 25.04.2023
Date of Decision: 10.07.2023
COMPLAINT CASE NO.- 1151/2018
IN THE MATTER OF
MR. VIVEK SHARMA,
S/O MR. U.S. SHARMA,
R/O FLAT NO. 101/MS-09,
KENDRIYA VIHAR, SECTOR-56,
GURGAON - 1220011, HARYANA.
(Through: Complainant in person)
...Complainant
VERSUS
M/S PARSVNATH DEVELOPERS LTD.
THROUGH ITS CHAIRMAN
6TH FLOOR, ARUNACHALA BUILDING,
19, BARAKHAMBA ROAD, NEW DELHI 110001.
(Through: Mr. Rakesh Bhardwaj, Advocate)
...Opposite party
ALLOWED PAGE 1 OF 14
C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL(PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
HON'BLE MR. J.P. AGRAWAL, MEMBER (GENERAL)
Present: Complainant in person.
None for OP
PER: HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
JUDGMENT
1. The present complaint has been returned from the District Commission vide order dated 20.08.2018 on the ground of pecuniary jurisdiction, filed by the Complainant before this commission alleging deficiency of service and unfair trade practice by the Opposite Party and has prayed the following reliefs:
1. Direct the Respondents / OP to pay a sum of Rs. 11, 44,850 /- along with interest @ 24% per annum from the date of payment till its realization towards the refund of the amount paid by the complainant for the booked Flat,
2. 2. Direct the Respondents / OP to pay a sum of Rs. 10.
00,000/- (Rupees Ten Lacs only) as compensation for harassment, mental pain and agony suffered by the complainant.
3. 3. Direct the respondents / OP to pay a sum of Rs.15, 000/- towards the cost of legal notice and a sum of Rs. 35,000/- towards litigation charges to the complainant. Pass any such other order(s) as deemed fit and proper as per the facts and circumstances of the case in favour of the Complainant and against the respondents as the same is very necessary in the interest and furtherance of justice and equity.
2. The Complainant purchased a unit bearing number T10-502 from the original owner i.e., Mr. Parmod Jain, in the project 'Parsvnath Pleasant' of the Opposite Party, situated at Dharuhera, Haryana. Subsequently, in November 2007, the Complainant received a ALLOWED PAGE 2 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 demand notice from the Opposite Party to pay outstanding dues, and the Complainant duly paid the amount of Rs. 3,39,000. However, the Complainant did not receive any correspondence from the Opposite Party for a long time regarding the said booking. Therefore, being a vigilant person, the Complainant inquired about the said project from reliable sources and also visited the site of the project. The Complainant was shocked to notice that there was no progress at the site except for a sample flat. Subsequently, the Complainant contacted the Opposite Party, who informed the Complainant that the construction of the project would start soon. The Opposite Party assured the Complainant that the construction of the unit would be completed within 24 months. On 15.03.2010, the Complainant again asked the Opposite Party about the progress of the project but failed to receive any satisfactory response. Therefore, the Complainant visited the main branch office of the Opposite Party, where he met senior managers who informed him that the construction had still not started. However, they offered to transfer/adjust the Complainant in another project that had better chances of timely completion. Left with no other option, the Complainant agreed to the proposal and a unit bearing B-188-S was allotted in the project named 'Elite Floors' situated at Dharuhera, Gurgaon. The Complainant paid a booking amount of Rs. 25,000 towards the new unit and the payment of Rs. 8,34,750 paid towards the previous unit was also transferred to this new unit. However, the Opposite Party once again failed to start the construction of the new unit and when the Complainant inquired about the construction, they replied with fake excuses, stating that construction would commence soon. This act of the Opposite Party put the Complainant in doubt and apprehension about the money ALLOWED PAGE 3 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 deposited by him. As a result, the Complainant sent a legal notice dated 23.07.2013, demanding the cancellation of the new unit and a refund of the money paid by him along with interest. Although the Opposite Party replied to the notice, stating that construction would commence in September-October 2013, no construction has started to date.
Over time, the Complainant has paid a sum of Rs. 8,59,750/- to the Opposite Party as and when demanded by them. Aggrieved by the act of the Opposite Party approached this commission seeking reliefs against the Opposite Party.
3. The Opposite Party has contested the present case and has raised preliminary objections as to the maintainability of the complaint case. The counsel of the Opposite Party submitted that the Complainant is not consumer under the Consumer Protection Act, 1986 as the Complainant invested the money to earn profit, which amounts to commercial purpose. He further submitted that the Complainant has no cause of action to file the present complaint.
4. The counsel for the Opposite Party further submitted that the present complaint involves complicated question of facts and law which need to be proved by way of leading detailed oral and documentary evidence, the present complaint cannot be disposed of by way of summary proceeding.
5. The counsel for the Opposite Party further contended that the delay, if any, occurred on account of global recession and the liability of the Opposite Party on account of delay is duly provided as per Clause 10(c) of the said Agreement and therefore, this commission does not have the jurisdiction to adjudicate the present complaint. Pressing the aforesaid objections, the counsel appearing ALLOWED PAGE 4 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 on behalf of the Opposite Party prayed that the complaint should be dismissed with cost.
6. The Complainant has filed the Rejoinder rebutting the written statement filed by the Opposite Party. Both the parties have filed their Evidence by way of Affidavit in order to prove their averments on record.
7. Written argument of the Complainant is also on record.
8. We have perused the material available on record and heard the counsel for the parties.
9. The fact that the Complainant had booked a unit with the Opposite Party is evident from the allotment dated 24.10.2007 for unit no. T10-502 and allotment dated 10.05.2010 for unit no. B-188-S. Payment to the extent of Rs. 8,59,750/- by the Complainant to the Opposite Party is not disputed by the Opposite Party.
10. Whether Complainant fall in the category of 'consumer' under the consumer protection act, 1986?
11. The Opposite Party contended that the Complainant is not Consumer as defined under the Consumer Protection Act, 1986 as they invested the money to earn profit, which amounts to commercial purpose. To resolve this issue, we deem it appropriate 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 ALLOWED PAGE 5 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 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."
12. It is imperative 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 Flats were purchased for commercial purpose is not supported by any documentary evidence as the onus shifts to the Opposite Parties to establish that the Complainant 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 Complainant are 'Consumers' as defined under Section 2(1)(d) of the Act."
13. From the aforesaid dicta of the Hon'ble National Commission, it flows that it is for the Opposite Party to prove that the flat purchased was for commercial purpose, by way of some documentary proof and a mere bald statement is not sufficient to raise adverse inference against the Complainant.
14. In the present case, the Opposite Party has merely made a statement that the Complainant purchased the unit for commercial purpose and on perusal of the record before us, we fail to find any material which shows that the Complainant 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 ALLOWED PAGE 6 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 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 is answered in the negative.
15. Whether the Complainant has cause of action to approach this commission?
16. The next question for adjudication before us is whether the Complainant has any cause of action to approach this commission. The facts reveal that the Complainant booked a unit bearing no. T10-502 and was transferred to unit bearing no B-188-S and also paid an amount of Rs. 8,59,750/- towards the. However, the Opposite Party neither completed the construction of the said unit nor the possession of the said unit has been handed over to the Complainant.
17. We further deem it appropriate to refer to Mehnga Singh Khera and Ors. Vs. Unitech Ltd. as reported in I (2020) CPJ 93 (NC), wherein the Hon'ble National Commission has held as under:
"It is a settled legal proposition that failure to give possession of flat is continuous wrong and constitutes a recurrent cause of action and as long as the possession is not delivered to the buyers, they have every cause, grievance and right to approach the consumer courts."
18. Applying the above settled law, it is clear that the Complainant are within their right to file the present complaint as the possession and completion of construction are still pending and has not seen the light of the day; giving the Complainant a recurrent cause of action to file the present complaint.
19. Whether the present complaint involves complicated questions of facts and law, which should be decided by the civil court?
ALLOWED PAGE 7 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023
20. The Opposite Party contended that the jurisdiction of this Commission would be barred in view of the fact that the present complaint is in fact a suit for recovery on which court fees is payable and would lie in a Civil Court and the Complainant is in order to save the payment of court fees has filed the complaint under the Consumer Protection Act, 1986. Moreover, the complicated question of facts and law which have been raised in the present complaint can only be decided before the Civil Court.
21. The Consumer Protection Act, 1986, came into being in order to protect the interests of Consumers who are affected by the acts of the service providers, who in order to attract the Consumers, tend to make lucrative offers but when it comes to actually providing the offered services, they take a step back.
22. Deficiency has been defined under section 2 sub-clause (g) which reads as follows:
"(2) (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;"
23. Returning to the facts of the present complaint, the perusal of the record shows that the Complainant avail the services of the Opposite Party for a consideration. However, the Opposite Party failed to complete the said project, aggrieved by which, the Complainant has sought the refund of the amount paid by him. Hence, the Complainant is entitled to file the present complaint before this commission since the Complainant is aggrieved by the deficient services of the Opposite Party i.e., the failure of the Opposite Party to handover the possession of the said unit within ALLOWED PAGE 8 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 reasonable time and it is only due to this reason, that the refund of the amount paid is sought from the Opposite Party, which this Commission is authorised to adjudicate.
24. Our view is further fortified by 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.
25. Moreover, nothing cogent has been brought on record by the Opposite Party which would reflect that there are such complicated questions involved which could not be settled on the basis of the pleadings filed on behalf of the contesting parties. Consequently, we are of the view that the present complaint falls within the four corners of the jurisdiction of this commission and there is no bar with respect to the jurisdiction of this commission to entertain cases related to the refund of amount deposited with the Opposite Party.
26. Whether the Opposite Party is deficient in providing its services to the Complainant?
27. Having discussed the preliminary objections raised on behalf of the Opposite Party, the next issue which arises is whether the Opposite Party is actually deficient in providing its services to the ALLOWED PAGE 9 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 Complainant. 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 ALLOWED PAGE 10 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 removal of a deficiency in service is the provision of 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."
28. At this stage, it is appropriate to refer to the Agreement that was executed between the parties. It is important to note that although there is no specific date mentioned on the agreement, the Opposite Party has not denied the existence of the date. According to clause 9 of the agreement, the Opposite Party was to complete the construction of the said unit within 24 months from the date of commencement of construction on the individual plot on which the unit is located. However, it is evident from the records that the Opposite Party failed to meet the construction deadline, as they themselves accepted in the para 13 of the written statement. Furthermore, it is evident from the records that the Opposite Party (received the initial payment for the unit in the year 2007. Despite this, the Complainant continues to endure suffering due to the actions of the Opposite Party.
ALLOWED PAGE 11 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023
29. We also deem it appropriate to refer to Aashish Oberai vs. Emaar MGF Land Limited reported in I (2017) CPJ 17 (NC), wherein the Hon'ble National Commission has held as under:
"I am in agreement with the learned senior counsel for the Complainant that considering the default on the part of the Opposite Party in performing its contractual obligation, the Complainant cannot be compelled to accept the offer of possession at this belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest."
30. Relying on the above settled law, we hold that the Opposite Party is deficient in providing its services to the Complainant as the Opposite Party had given false assurance to the Complainant with respect to the time for handing over the possession of the said unit and kept the hard-earned money of the Complainant. Therefore, now the Complainant are not bound to take the possession of the said unit after the stipulated period
31. The Opposite Party further submitted that the delay in handing over the possession was on account of global recession which hit economies all over the world including the Indian Economy, but more particularly the real estate sector. We are of the considered view that neither any new legislation was enacted nor any existing rule, regulation or order was amended stopping, suspending or delaying the construction of the complex in which the shop was agreed to be sold to the Complainant. There was no evidence of any lock-out or strike by the labour at the site of the project. There was no civil commotion, war, enemy action, terrorist action, earthquake or any act of God which could have delayed the completion of project within the time stipulated in the said ALLOWED PAGE 12 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023 Agreement. Therefore, this contention of the Opposite Party, holds no merit.
32. Keeping in view the facts of the present case and the extensive law as discussed above, we direct the Opposite Party to refund the entire amount paid by the Complainant i.e., Rs. 8,59,750/- along with interest as per the following arrangement:
A. A simple interest @ 6% p.a. calculated from the date on which each installment/payment was received by the Opposite Party till 10.07.2023 (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 pays the entire amount on or before 10.09.2023;
C. Being guided by the principles as discussed above, in case the Opposite Party fails to refund the amount as per the aforesaid clause (A) on or before 10.09.2023, 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 till the actual realization of the amount.
33. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party 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/-.
34. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.
ALLOWED PAGE 13 OF 14 C. NO. 1151/2018 MR. VIVEK SHARMA VS. PARSVNATH DEVELOPERS LTD D.O.D.: 10.07.2023
35. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
36. File be consigned to record room along with a copy of this Judgment.
(JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (PINKI) MEMBER (JUDICIAL) (J.P. AGRAWAL) MEMBER (GENERAL) Pronounced On: 10.07.2023 ALLOWED PAGE 14 OF 14