State Consumer Disputes Redressal Commission
Ravindranath Raghunath vs The Managing Director,Dlf Southern ... on 15 October, 2015
Daily Order BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI Present: Thiru J. Jayaram, PRESIDING JUDICIAL MEMBER
Tmt. P. Bakiyavathi MEMBER C.C. No. 156 / 2014 Dated this the 15th day of OCTOBER, 2015 Ravindranath Raghunath, ] S/o Vishwanath Ravindranath, ] 1A, Alpine Court, ] 12, Kotewall Road, ] .. Complainant Midlevels, Hong Kong ] Vs. The Managing Director, ] DLF Southern Homes Private Limited, ] Old No.828, New No.268, ] Poonamallee High Road, ] .. Opposite Party Kilpauk, Chennai - 600 010 ]
This case coming up before us for final hearing on 23-07-2015 and on hearing the arguments of both sides and upon perusing the material records, this Commission made the following Order: Counsel for Complainant: - Mr. Dwarakesh Prabakaran Counsel for Opposite Party - Mr. Iyer & Dolia. J. JAYARAM, PRESIDING JUDICIAL MEMBER The case of the complainant is as follows:
The complainant had agreed to purchase a flat in the residential complex known as Gardencity DLF OMR situate at Thazhambur village, Chengleput Taluk, Kancheepuram District by execution of an Apartment Buyers' Agreement, dated 25-04-2009, and as per the agreement, the flat measuring 1986 sq. ft. (including amenities and common area) was to be sold to the complainant subject to payment of Rs.61,42,580/- as consideration for purchase of the flat. The consideration was to be paid in accordance with the schedule of payment in Annexure III of the agreement. However, the said schedule of payment became redundant as the complainant had already paid the entire sale consideration prior to the execution of the agreement.
2. In fact, the complainant had agreed to purchase 2 flats viz. C 05151 and C 05153 in the same floor of the building. The opposite party expressed some vague difficulty in refunding the excess amount paid and the opposite party convinced the complainant to utilize the excess funds to purchase another flat viz. C05152 in the same floor.
3. The fact that all instalments, which were due prior to completion, had been paid even before execution of the Agreement, is reflected in the Customer Ledger of the opposite party handed over to the complainant. The customer ledger indicates that on 8-7-2009, the opposite party had adjusted an amount of Rs.28,31,577/- from the excess payments made for the other flat towards the payment for this flat. The ledger further reflects a credit entry dated 10-08-2009 for an amount of Rs.26,41,410/- as having been paid by the complainant by wire transfer towards further payment. Consequently, the total amount paid as on the date of execution of the agreement was Rs.54,72,987/-.
4. As per Clause 11 of the agreement, the flat was to be constructed and handed over to the complainant within 27 months from the date of execution of the agreement. The agreement was executed on 25-04-2009 and so the flat should have been handed over by August, 2011 and as a result of the inordinate delay and incompetence of the opposite party, the complainant is entitled to compensation of Rs.5/- per sq ft per month for the delay as per Clause 14 of the agreement.
5. Further the complainant became entitled to timely payment rebates and early payment rebates on account of having paid the entire consideration in advance as provided in Clause 1.4 of the agreement. The complainant was required to pay an interest-bearing maintenance security to the opposite party at the time of the flat being offered for possession. As the construction proceeded, the complainant received two letters dated 11-08-2011 and 25-11-2011 from the opposite party confirming that the complainant had been granted a timely repayment rebate of Rs.3,97,200/- and that early payment rebate could be extended to payments made in advance.
6. Finally, after a long wait, the complainant received a letter dated 28-09-2013 from the opposite party stating that the flat had been completed and would be handed over possession on completion of certain formalities and according to the letter, the complainant was to remit the amounts as per the final statement of account enclosed with the letter, and on perusal of the final statement, the complainant was shocked to find that the opposite party had charged interest to the tune of Rs.1,35,658/-, when the entire consideration had admittedly been paid in advance. Moreover, the strange demand of interest was contradictory to the grant of the timely payment rebate and early payment rebate in the final statement of account. After adjusting the payments already made by the complainant prior to the execution of the agreement and the limited rebates, an amount of Rs.14,19,559/- was indicated as being payable towards final statement of dues. The statement also sought additional payment of Rs.1,03,950/- towards payment of the interest bearing maintenance security which was payable only at this stage. With a view to take possession of the flat after agonizing delay, he decided to pay the amounts sought in the final statement of accounts without prejudice to his rights and contentions and the complainant accordingly transferred a sum of Rs.14,19,559/- by telegraphic transfer through HSBC Bank from Hong Kong on 21-10-2013. The payment for the demand of Rs.1,03,950/- towards interest-bearing maintenance security was also made through the same method.
7. However, the complainant was informed by HSBC bank's letters dated 28-10-2013 and 15-11-2013 that the transaction could be completed only on furnishing certain additional information and the funds were transferred successfully and the opposite party issued receipts for the aforesaid amounts confirming that the final statement of account had been settled in full by the complainant, and the delay if any in the funds which in the opposite party's account is attributable solely to the opposite party as the complainant had strictly followed the opposite party's instructions in carrying out wire transactions.
8. The complainant and his family members then proceeded to the opposite party's office on 28-11-2013 to complete the paper work and other minor formalities to enable handing over and the opposite party final check list also confirmed that all necessary steps had been carried out by the complainant. During the course of this meeting, the opposite party's representative took an unbelievable and shocking stand that a further amount of Rs.5,11,208/- was payable by the complainant without which the flat would not be handed over and when the complainant insisted on explanation for this further demand, he was provided a plain piece of paper containing 2 tables each referring to flat Nos. C 05151 and C 05152 separately and the sheet did not contain any signature or letter head of the opposite party. The table is as follows:
TPR - Rs. 4,15,800/- Registration Charges - Rs. 33,264/- Service Tax - Rs. 51,392/- Holding charges - Rs. 10,751/- TOTAL - Rs. 5,11,208/-
9. The complainant pointed out that the registration chares indicated in the final statement had already been remitted and that the complainant was actually entitled to a timely payment rebate and consequently, the additional demand of repayment of TPR and the proportion of service tax was impermissible and there was also no question of levying any holding charges as the complainant had remitted the funds within time, and once the final statement had been settled by the complainant, all dues stood discharged and the opposite party could not retrospectively withdraw the rebate granted to the complainant.
10. The deliberate refusal of the opposite party to handover the flat and the unscrupulous tactics adopted by the opposite party to endlessly extract money from the complainant amount to grave deficiency in the provision of service and also constitute very serious unfair trade practice and this ordeal has caused tremendous mental agony, loss and hardship to the complainant and his family as their plan to invest his hard-earned savings in flat and enjoying a new home in the vicinity of Chennai was shattered by the opposite party and the complainant incurred huge rental expenses on account of being unable to shift to the flat.
11. Hence the complaint praying for direction to the opposite party -
a) to hand over vacant physical possession and complete all registration formalities for sale and transfer of flat C 05151 in Gardencity DLF OMR with proportionate UDS in the land developed by the opposite party at Thazhambur village, Chengleput, Kancheepuram District in favour of the complainant within the time frame to be fixed by the Commission without insisting on payment of any further amount as the total consideration and additional dues of Rs.77,19,817/- mentioned in the final statement had already been paid, and
b) further direction to the opposite party to pay compensation of Rs.15,00,000/- for the mental agony and damage caused by the deficiency in service and unfair trade practice with interest @ 10 % p.a., and
c) for further direction to the opposite party to pay compensation of Rs.3,77,340/- as on date (calculated @ Rs.5/- per sq ft - total = 1986 sq ft per month from September 2011) for the delay in handing over the flat; and
d) further direction to pay costs of Rs.2 Lac.
12. The opposite party filed common proof affidavit in C.C. No.155 / 2014 and C.C. No.156 / 2014 as follows: The complaint is not maintainable before any Consumer Forum since the issues involved relate to contractual dispute arising out of agreed terms and conditions. Therefore, the Consumer Forum has no jurisdiction to entertain the complaint.
13. The complaint is not maintainable also for the reason that the complaint ought to be referred to arbitration in view of the Arbitration Clause in the agreement.
14. Further, the complaint does not fall within the ambit of Sec 2 (C) of the Consumer Protection Act.
15. As per the agreement, the total cost of the flat is Rs.61,42,580/- and payment was made by the complainant on 10-08-2009 as against the due date of 08-08-2009. As regards the final statement of account issued by the opposite party, the Final demand was not paid on time, and there was a delay of 19 days and consequently the provision made for the timely payment of Rs.4,12,800/- was reversed and disallowed by the opposite party.
16. As per Clause 14 of the agreement which governs the compensation for delay, the complainant agrees that if the opposite party is unable to give possession within the period stipulated in the agreement, then the opposite party agrees to pay compensation at the rate of Rs.5/- per sq ft per month for the period of such delay.
17. There is no unfair trade practice or deficiency in service on the part of the opposite party.
18. The complainant filed proof affidavit reiterating the averments in the complaint. 20 Exhibits were filed and marked as Ex.A1 to A20 on the side of the complainant. The opposite party filed proof affidavit and one exhibit was filed and marked as Ex.B1 on the side of the opposite party.
19. The Points for Consideration are:
1) Whether the Consumer Forum has jurisdiction to entertain the complaint 2) Whether the complaint is maintainable before the Consumer Forum in view of the Arbitration Clause 3) Whether the complaint comes under the purview of the Consumer Protection Act 4) Whether there is unfair trade practice or deficiency in service on the part of the opposite party as alleged in the complaint; 5) Whether the complainant is entitled to claim compensation from the opposite party 6) To what relief the complainant is entitled.
20. Point No.1: It is first contended by the opposite party that Consumer Forum has no jurisdiction to entertain the complaint since the issue involved are of civil nature. The Hon'ble Supreme Court and the Hon'ble National Commission have laid down that such complaints are maintainable before the Consumer Forum and that the complaint need not be relegated to Civil Court in the following decisions:
1. Dr. J.J. Merchant & Ors. vs. Shrinath Chaturvedi 2002 (3) CTC 558
2. Nizam Institute of Medical Sciences vs. Prasanth S. Dhananka & ors.
2009 (4) SC 165
3. CCI Chambers Co.op. Hsg. Society Ltd. vs. Development Credit Bank Ltd., 2003 (4) CTC 299
4. Sutlej Textile & Industries Ltd. vs. Punjab National Bank I (2010) CPJ 312 (NC) Therefore, the contention of the opposite party in this regard is untenable, and we hold that Consumer Forum has jurisdiction to entertain the complaint, and the point is answered accordingly.
21. Point No.2: The further contention of the opposite party is that Consumer Forum cannot entertain the complaint in view of the Arbitration clause in the agreement. It is well settled law that the complaint is maintainable before the Consumer Forum since the remedy sought in the complaint is in addition to the provisions of other laws. Sec 3 of the Consumer Protection Act reads as follows:
"3. Act not in derogation of any other law. - The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force".
Therefore, we hold that the complaint is maintainable before the Consumer Forum and the contention of the opposite party is unsustainable, and the point is answered accordingly.
22. Point No.3: The opposite party would further contend that the complaint does not come under the ambit of Sec 2 (1) (c) of Consumer Protection Act; but the opposite party could not cite the reason as to why the complaint does not come under the Consumer Protection Act. Law is well settled that housing construction matters come under the purview of the Consumer Protection Act as per Sec. 2 (1) (o) of Consumer Protection Act. Therefore, there is no force in the argument of the opposite party in this regard, and we hold that the complaint is maintainable before the Consumer Forum, and the point is answered accordingly.
23. Point No. 4 & 5: The agreement Ex.A1 discloses that the total price payable by the complainant to the opposite party is Rs.61,42,580/- and that the period stipulated for the construction of the flat and handing over possession of the flat is 27 months from the date of execution;
24. The payment of the entire amount in the agreement is admitted by the opposite party; and according to the opposite party the payment was made on 10-08-2009 to the opposite party, and not on 08-08-2009 as stated in the complaint. However, the agreement has come into existence only on subsequent date i.e. on 30-04-2009 and so the date of payment of sale consideration is not an issue.
25. It is pertinent to note that the opposite party has issued handing over letter Ex.A.14 dated 28-09-2013 to the complainant along with Final Statement of Account. Though the complainant had objections to the final statement of account, Ex.A14, he has acted upon the Final Statement of Account accepting it, and so we have to decide the issues on the basis of the Final Statement of Account. As per the Final Statement of Account, the balance payable by the complainant is Rs.14,19,559/-, and the complainant has transferred this amount to the opposite party on 22-10-2013 vide receipt Ex.A17, and it is further relevant to note that as per the Final Statement of Account, the complainant was required to send a sum of Rs.1,03,950/- as interest-bearing maintenance security for the apartment, and accordingly the complainant sent this amount also to the opposite party on 28-11-2013 vide Ex.A.24, Customer Ledger. Therefore, as the complainant has complied with the demands and the conditions made in the Final Statement of Account Ex.A14, the issues regarding the alleged illegal demands of holding charges, service tax, increased built up area, stamp duty, registration charges, and withdrawal of timely payment rebate do not survive for consideration.
26. From the above, it is clearly established that there is deficiency in service on the part of the opposite party and that the opposite party has adopted unfair trade practice in not handing over possession of the flat to the complainant deliberately, within the stipulated period of 27 months from the commencement of the construction and illegally demanding further amount of Rs.5,11,208/- from the complainant, after receiving the entire payment as per their own final statement of account. On considering the entire materials on record, we find that the opposite party, have done their level best to extract more money illegally from the complainant, thus intentionally delaying the handing over possession of the flat, imposing various demands in the final statement of account.
27. For the aforesaid reasons, we hold that there is unfair trade practice of serious nature and gross deficiency in service on the part of the opposite party; and hence the complainant is entitled to claim compensation from the opposite party, and the points are answered accordingly.
28. Point No.6: The complainant has claimed Rs.15 Lac as compensation for mental agony and damage caused due to the deficiency in service and for the unfair trade practice on the part of the opposite party. We feel that the compensation for mental agony is on the higher side and so we are inclined to reduce it to Rs.10 Lac. Further, the complainant is entitled to compensation of Rs.3,19,770/- as (Calculated at Rs.5/- per sq ft for 1986 sq ft) for the deliberate delay in handing over the flat. The complainant has claimed Rs.2 Lac towards costs which is very much on the higher side and we are inclined to reduce the costs to Rs.25,000/-; and the point is answered accordingly.
29. In the result, the complaint is partly allowed,
a) directing the opposite party to hand over vacant physical possession completing all registration formalities for sale and transfer of Flat No. C 05151 in Gardencity DLF OMR with proportionate Un Divided Share in the land developed by the opposite party at Thazhambur village, Chengalpattu Taluk, Kancheepuram District, in favour of the complainant, without insisting on any further payment from the complainant and
b) to pay a sum of Rs.10 Lakhs (Rupees Ten Lakhs only) as compensation for mental agony and damage caused by deficient services and unfair trade practices on the part of the opposite party, and
c) to pay further compensation of Rs.3,19,770/- (Rupees Three Lakhs Nineteen Thousand, Seven Hundred and Seventy only) as on date (calculated at the rate of Rs.5/- per sq ft - total 1986 sq ft. per month from September, 2011) for the delay in handing over the flat; and
d) to pay costs of Rs.25,000/- (Rupees Twenty Five Thousand only).
Time for compliance: Two months from the date of receipt of copy of this order. In case of default in compliance of the order, the amounts shall carry interest at the rate of 12% p.a. from the date of default till compliance.
TMT. P. BAKIYAVATHI J. JAYARAM MEMBER PRESIDING JUDICIAL MEMBER List of Documents filed by the Complainant Ex.A1 15-05-2008 Receipt Ex.A2 03-07-2008 Receipt Ex.A3 04-09-2008 Receipt Ex.A4 06-03-2009 Letter from Opposite Party Ex.A5 03-04-2009 Letter from Opposite Party Ex.A6 30-04-2009 Apartment Buyer's Agreement Ex.A7 11-08-2011 Letter from Opposite Party Ex.A8 25-11-2011 Letter from Opposite Party Ex.A9 14-01-2012 Letter from Opposite Party Ex.A10 28-03-2012 Letter from Opposite Party Ex.A11 13-04-2012 Letter from Opposite Party Ex.A12 10-08-2012 Letter from Opposite Party Ex.A13 17-07-2013 Receipt Details Statement Ex.A14 28-09-2013 Handing over letter Ex.A15 30-09-2013 Final Check List Ex.A16 21-10-2013 HSBC Application Form Ex.A17 22-10-2013 HSBC Outward Remittance Advice Ex.A18 24-10-2013 HSBC Application Form Ex.A19 24-10-2013 HSBC Outward Remittance Advice Ex.A20 15-11-2013 Letter from HSBC List of Documents filed by the Opposite Party: Ex.B1 17-09-2009 Letter from the opposite party to the complainant TMT. P. BAKIYAVATHI J. JAYARAM MEMBER PRESIDING JUDICIAL MEMBER