State Consumer Disputes Redressal Commission
Abhishek Mundhra vs Parsvnath Developers Ltd. on 28 June, 2023
C/285/2014 MR. ABHISHEK MUNDHRA VS. PARSVNATH DEVELOPERS LTD. D.O.D.: 28.06.2023
IN THE DELHI STATE CONSUMER DISPUTES
REDRESSAL COMMISSION
Date of Institution: 11.06.2014
Date of reserving the order: 08.05.2023
Date of Decision: 28.06.2023
COMPLAINT CASE NO.- 285/2014
IN THE MATTER OF
MR. ABHISHEK MUNDHRA
S/O MR. SHANKAR MUNDHRA
R/O E-865, SARASWATI VIHAR,
PITAMPURA, NEW DELHI-110034
(Through: Mr. Saurabh Jain, Advocate)
...Complainant
VERSUS
PARSVNATH DEVELOPERS LTD.
(THROUGH ITS MANAGING DIRECTOR)
REGISTERED OFFICE:
PARSVNATH METRO TOWER
NEAR SHAHDARA METRO STATION
SHAHDARA, DELHI-110032
(Through: Mr. Dhruv Gupta, Advocate)
...Opposite Party
CORAM:
HON'BLE MR. RAJAN SHARMA, MEMBER (JUDICIAL)
HON'BLE MS. BIMLA KUMARI, MEMBER (FEMALE)
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C/285/2014 MR. ABHISHEK MUNDHRA VS. PARSVNATH DEVELOPERS LTD. D.O.D.: 28.06.2023
Present: Mr. Saurabh Jain, counsel for the Complainant
Mr. Dhruv Gupta, counsel for the OP
PER: HON'BLE MR. RAJAN SHARMA, MEMBER (JUDICIAL)
JUDGMENT
1. The Complainant in the present complaint, which was filed on 11.06.2014, has prayed for the following reliefs:
"(i) Direct the Opposite Party to refund the entire deposited amount of Rs.48,29,926/- along with interest @ 18% to the Complainant;
(ii) Direct the Opposite Party to pay Rs.10,00,000/- to the Complainant as compensation for mental agony and physical hardship caused to the Complainant;
(iii) Grant a cost of litigation to the Complainant;
(iv) Any other order, relief or direction which this Hon'ble Commission may deem fit and proper under the circumstances of the case may kindly be passed in favour of the Complainant and against the Opposite Party."
2. In the present case, the Complainant had booked a residential flat with the Opposite Party and on 23.02.2007, the Opposite Party made the provisional allotment of the flat bearing no. 1201 admeasuring of 1855 sq. ft. in Tower-T7 in the complex namely „Parsvnath Privilege‟ to be constructed on Plot No. 11, Sector-Pi, (Chorosia Estate), Greater Noida, Uttar Pradesh. On 09.06.2007, Flat Buyers Agreement was executed between the Complainant and the Opposite Party. The total sale consideration of the said flat was of Rs.52,86,750/-. As per clause no. 10 (a) of the Flat Buyers Agreement, the Opposite Party had agreed to hand over the possession of the said flat within 36 months from the date of commencement of construction of the Particular Block in which the Flat was located and on receipt of all requisite approvals including ALLOWED PAGE 2 OF 13 C/285/2014 MR. ABHISHEK MUNDHRA VS. PARSVNATH DEVELOPERS LTD. D.O.D.: 28.06.2023 sanction of building plans, environmental clearances, etc. subject to force majeure and restraints/restrictions from any courts/authorities, non-availability of building materials and any circumstances beyond the control of the Developer and subject to timely payments to the Buyer.
3. It has been stated by the Complainant that he had opted for "Construction Linked Payment Plan" which was subsequently converted into "Time Linked Call" and he had paid an amount of Rs.48,29,926/- to the Opposite Party till the year 2013, as and when the same was demanded by the Opposite Party.
4. It is the case of the Complainant that construction at the site was immediately stopped in July 2008. However, the Opposite Party sent a letter dated 10.06.2010 to the Complainant admitting the fact that there was delay in completing the construction of the project due to global economic slowdown, experienced by the Real Estate sector in the country and assured the Complainant that the company was re- scheduling its plan to complete the project by March, 2012 and the Opposite Party further assured the Complainant that they would compensate for the delay which had occurred, as per clause no. 10 (c) of the Flat Buyer Agreement.
5. It is the further case of the Complainant that on 19.04.2012 the Opposite Party on its own shifted the Complainant‟s booked flat from Flat No. 1201 in Tower-T7 to Flat No. 1202 in Tower-T16 and started raising demand as per new payment schedule. Even though the construction of the project was at standstill, the Complainant had made all the payments which demanded by the Opposite Party with the hope that the Opposite Party would start the construction soon.
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6. It is the further case of the Complainant that from year 2008 to 2014, he had made several telephonic calls and personal visits at the site, but the Opposite Party never gave any plausible reply and always kept delaying the matter on one pretext or the other. In the month of May 2014, the Complainant visited the site for the last time where he was shocked to see that not even a single workman was at the construction site. Aggrieved by the status of the project, the Complainant requested the Opposite Party to refund the entire amount paid by him along with interest, but the officials of the Opposite Party denied to refund the amount.
7. Thus, the Complainant was left with no other option but to file the present complaint alleging deficiency of service and unfair trade practice on the part of the Opposite Party.
8. After the present complaint case was filed by the Complainant, notice of the complaint was issued to the Opposite Party on 19.08.2014.
9. Upon service, the Opposite Party filed the written statement on 28.07.2015, wherein the Opposite Party stated that the delay in completing the project was due to global economic slowdown, experienced by the real estate sector in the country. Further, in case of any delay, the rights of the Complainant were duly protected as stipulated in clause no. 10 (c) of the Buyers Agreement. The Opposite Party had also raised preliminary objections as to the maintainability of the complaint case. The Opposite Party had contended that the Complainant is not a "consumer" as the investment made by him is for commercial purposes. The Opposite Party had further contended that the present complaint is filed without ALLOWED PAGE 4 OF 13 C/285/2014 MR. ABHISHEK MUNDHRA VS. PARSVNATH DEVELOPERS LTD. D.O.D.: 28.06.2023 any cause of action and the present complaint involves complicated questions of law.
10. Thereafter, the Complainant filed the rejoinder rebutting the contentions raised in the written statement filed by the Opposite Party and reiterated the averments contained in the complaint.
11. The Complainant filed evidence by way of affidavit i.e. of Mr. Abhishek Mundhra S/o Mr. Shankar Mundhra, Complainant herein.
12. The Opposite Party had also filed evidence by way of affidavit i.e. of Mr. Madan Lal Dogra, Deputy General Manager (CRM) of the Opposite Party.
13. Written arguments have also been filed on behalf of both the parties.
14. We have given considerable thought to the submissions put forth by the parties and perused the material available on record.
15. The fact that the Complainant had booked the residential flat bearing no. 1201 in Tower-T7 in the project namely „Parsvnath Privilege‟ of the Opposite Party is evident from the Flat Buyers Agreement dated 09.06.2007 (annexed from page no. 13 to 30 of the Complaint). And payment to the extent of Rs.48,29,926/- paid by the Complainant to the Opposite Party is evident from the receipts issued by the Opposite Party (annexed from page no. 35 to 43 of the Complaint).
16. Before delving into the merits of the case, we deem it appropriate to adjudicate all the preliminary objections raised by the Opposite Party in the present complaint.
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17. The first question for consideration before us is "whether the Complainant is a „Consumer' or not."
18. The Opposite Party has contended that the Complainant is not a "Consumer" as defined under the Consumer Protection Act, 1986 as the Complainant had merely made an investment in real estate for commercial purposes.
19. 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 follows:
"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."
20. Further, in Anju Vinod Saraswat (Mrs.) Vs. Sahara Prime City Limited IV (2022) CPJ 206 (NC), it was held as under:
"Onus of establishing that complainant was dealing in real estate, i.e., in purchase and sale of plots/flats for commercial purpose to earn profits lies upon opposite party."
21. From the aforesaid dicta of the Hon‟ble National Commission, it flows that it is for the Opposite Party to prove that the said flat was purchased by the Complainant for commercial purposes, by way of some documentary proof and a mere bald statement is not sufficient to raise adverse inference against the Complainant.
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22. In the present complaint, the Opposite Party has merely made a statement that the Complainant purchased the said flat for commercial purpose and on perusal of the record before us, we fail to find any material which shows that the Complainant had booked the said flat for commercial purposes. Mere allegation, that the purchase of the said flat is for commercial purpose, cannot be a ground to reject the present consumer complaint. Consequently, the objection raised on behalf of the Opposite Party is answered in the negative.
23. The second question for consideration before us is "whether the Complainant has no cause of action to approach this Commission under the Consumer Protection Act, 1986."
24. The Opposite Party has contended that the Complainant has violated and breached the provisions of the Flat Buyers Agreement executed between them, so no cause of action had risen to the Complainant to file the present complaint.
25. The facts of the present case show that the Flat Buyers Agreement dated 09.06.2007 was executed between the Complainant & Opposite Party. The Complainant had paid a total sum of Rs.48,29,926/- to the Opposite Party till the year 2013, however, the possession of the said flat has still not been handed over to the Complainant.
26. 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."
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27. Applying the above settled law, it is clear that the
Complainant is within his right to file the present complaint as the possession of the said flat is still pending; giving the Complainant a recurrent cause of action to file the present complaint.
28. The third question for consideration is "whether the present complaint involves complicated question of facts and law, which should be decided by the civil court."
29. To resolve this issue, it is imperative to refer to the dicta of the Hon‟ble Supreme Court in J.J. Merchant Versus Shrinath Chaturvedi (2002) 6 SCC 635 wherein it was inter alia held by the Hon‟ble Supreme Court as under:
"Under the Act the National Commission is required to be headed by a retired Judge of this court and the State Commission is required to be headed by a retired High Court Judge. They are competent to decide complicated issues of law or facts. Hence, it would not be proper to hold that in cases where negligence of experts is alleged, consumes should be directed to approach the civil court. It was further held that merely because it is mentioned that the Commission or Forum is required to have summary trial would hardly be a ground for directing consumer to approach the civil court. For the trial to be just and reasonable, long-drawn delayed procedure, giving ample opportunity to the litigant to harass the aggrieved other side, is not necessary. It should be kept in mind that the legislature has provided alternative, efficacious, simple, inexpensive and speedy remedy to the consumers and that should not be curtailed on such ground. It would also be a totally wrong assumption that because summary trial is provided, justice cannot be done when some questions of facts are required to be dealt with or decided. The Act provides sufficient safeguards."
30. Returning to the facts of the present complaint, and perusal of the record shows that the Complainant had availed the services of the Opposite Party for a consideration. As per ALLOWED PAGE 8 OF 13 C/285/2014 MR. ABHISHEK MUNDHRA VS. PARSVNATH DEVELOPERS LTD. D.O.D.: 28.06.2023 clause 10 (a) of the Flat Buyers agreement dated 09.06.2007 executed between the parties, the Opposite Party was bound to hand over the possession of the flat within 36 months i.e. by July 2010. But the Opposite had done nothing than issuing demand letters to the Complainant and without raising construction at the site. On 10.06.2010, the Opposite Party admitted that there was a delay in completing the construction of the project and further assured the Complainant that the company will re-schedule its plan to complete the project by March, 2012. However, the possession of the said flat has still not been handed over to the Complainant. Aggrieved by the deficient services of the Opposite Party, the Complainant has filed the present complaint before this Commission. Hence, we are of the considered view that the present complaint does not involve any complicated question of facts and law and can easily be decided by this Commission and the matter does not require any detailed trial by any other Court of law.
31. 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.
32. The last question for consideration is "whether the Opposite Party is deficient in providing its services to the Complainant."
33. The expression Deficiency of Service has been dealt with by the Hon‟ble Apex Court in Arifur Rahman Khan and Ors.
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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 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.
34. It is noteworthy that the Flat Buyers Agreement dated 09.06.2007 entered into between the parties reflect that the ALLOWED PAGE 10 OF 13 C/285/2014 MR. ABHISHEK MUNDHRA VS. PARSVNATH DEVELOPERS LTD. D.O.D.: 28.06.2023 Opposite Party was bound to hand over the possession of the said flat within 36 months from the date of commencement of construction of the Particular Block in which the Flat which was allotted to the Complainant was located. However, on the perusal of record we have noted that the construction of the project was not completed till 2014. During the course of arguments on 18.10.2022, counsel for the Complainant submitted that Complainant does not want flat as the flat is not ready for occupation and wants his entire money back. Further, no documentary proof has been placed on record by the Opposite Party to show that the construction at the site is complete and the flat is ready for occupation. It is clear that the Opposite Party has failed to hand over the possession of the said flat to the Complainant within the stipulated time as per the agreed terms. The terms and conditions of the Flat Buyers Agreement dated 09.06.2007 executed between both the parties were not complied with by Opposite Party. It is further clear from the Flat Buyers Agreement that in case there is delay in completing the construction/handing over possession of the said flat then the Opposite Party would compensate the allottees @ Rs.5/- per sq. ft. per month as per clause no. 10(c) of the Flat Buyers Agreement. But, the Opposite Party has neither given any reason for delay which had occurred in completing the construction at the site nor did the Opposite Party compensate the Complainant.
35. We further deem it appropriate to refer to the judgment dated 05.11.1993 passed in Lucknow Development Authority Vs. M.K. Gupta / 1994 AIR 787, 1994 SCC (1) 243, wherein it has been held as under:
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"when a person hires the services of a builder, or a contractor, for the construction of a house or a flat, and the same is for a consideration, it is a "service" as defined by Section 2(0) of the Consumer Protection Act, 1986. The inordinate delay in handing over. possession of the flat clearly amounts to deficiency of service."
36. Consequently, 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 possession of the said flat and kept the hard-earned money of the Complainant for more than ten years. It is however a settled law that the Complainant cannot be expected to wait for an indefinite time period to get the benefits of the hard-earned money which they had spent in order to purchase the property in question. (Ref: Fortune Infrastructure v. Trevor D'Lima reported at (2018) 5 SCC 442)
37. Accordingly, the complaint filed by the Complainant is hereby allowed.
38. 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.48,29,926/- along with interest as per the following arrangement:
A. An interest @ 6% p.a. calculated from the date on which each instalment/payment was received by the Opposite Party till 28.06.2023 (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 27.08.2023;
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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 27.08.2023, the entire amount is to be refunded along with an interest 9% p.a. calculated from the date on which each instalment/payment was received by the Opposite Party till the actual realization of the amount.
39. 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.1,00,000/-.
40. Applications pending, if any, stand disposed of in terms of the aforesaid judgment.
41. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
42. File be consigned to record room along with a copy of this Judgment.
(RAJAN SHARMA) MEMBER (JUDICIAL) (BIMLA KUMARI) MEMBER (FEMALE) Pronounced On: 28.06.2023 ALLOWED PAGE 13 OF 13