State Consumer Disputes Redressal Commission
Sandeep Kumar vs M/S Bajwa Developers Ltd. on 21 August, 2017
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.358 of 2016
Date of institution : 17.11.2016
Date of decision : 21.08.2017
1. Sandeep Kumar Ayri, aged 42 years, son of Sh. Manohar Lal
Ayri;
2. Smt. Manu Priya, aged 42 years, D/o Tilak Raj Sharma;
Both resident of House No.1021, Sector 45-B, Chandigarh.
Presently resident of 247, Prospect Drive, Fort Mcmurry, AB
T9KOW7, Canada.
Both through their attorney Smt. Ritu Sharma, aged 45 years,
wife of Sh. Sanjay Kumar Sharma, resident of House No.298-B,
Sector 51-A, Chandigarh.
....Complainants
Versus
1. M/s Bajwa Developers Ltd. Registered Office, Sunny Business
Centre, 5th and 6th Floor, Sector 125, Tehsil Kharar, District
Mohali, through its Director Sh. Jarnail Singh Bajwa.
2. Sh. Jarnail Singh Bajwa, Director of M/s Bajwa Developers Ltd.
Registered Office, Sunny Business Centre, 5th and 6th Floor,
Sector 125, Tehsil Kharar, District Mohali.
....Opposite Parties
Consumer Complaint under Section 17 of
the Consumer Protection Act, 1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mrs. Kiran Sibal, Member.
Present:-
For the complainants : Sh. J.S. Bagga, Advocate For the opposite parties: Sh. Sukaam Gupta, Advocate for Sh. Manoj Vashishtha, Advocate.
JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT :
Facts of the Complaint The complainants, who are residing in Canada, have filed this complaint, under Section 17 of the Consumer Protection Act, 1986 Consumer Complaint No.358 of 2016 2 (in short, "the Act"), against the opposite parties, through their Special Attorney, Smt. Ritu Sharma.
2. Brief facts, as set out in the complaint, are that opposite party No.1 is having its registered/corporate office at Sunny Business Centre, 5th and 6th Floor, Sector 125, Tehsil Kharar, District Mohali. The complainants booked one flat of 2 BHK BR No.2167 of 900 sq.ft. in their project, "Imperial Apartments", in Sunny Enclave, F-21, Sector 74-A, 117, Mohali, for their own use. Earlier, this flat was booked by one Sh. Arun Kumar Sharma on 30.05.2011 and his allotment rights were sold by the opposite parties to the complainants and the complainants made payment of ₹6,25,000/- on 27.10.2011, as earnest money. The cost of the said flat was fixed as ₹25,00,200/- (rounded to ₹25,00,000/-) and agreement to sell dated 27.10.2011 was executed in favour of the complainants. The opposite parties charged ₹15,000/- from the complainants for transferring the allotment rights in their names at that time. The balance payment was to be made in instalments, as per the progress of the work in the project. The complainants made the total payment of ₹17,50,000/- to the opposite parties till 30.05.2012 on different dates, against receipts. The possession of the flat, in question, was to be delivered on 30.11.2012. On 30.05.2012, when the complainants visited the site of the flats, they found that there was no development in the project and the opposite parties advised them not to make further payments, as there were some difficulties in getting some sanctions and approvals from the competent authorities qua the project, in question. The opposite parties Consumer Complaint No.358 of 2016 3 told that they would intimate the complainants about the further payments. The complainants kept on waiting for a call from the opposite parties and, thus, they did not pay the further amount. The relatives of the complainants kept on visiting the site as well as the opposite parties, but no satisfactory reply was given. On 11.10.2016, the complainants came to India and visited the opposite parties on 20.10.2016 and 25.10.2016, but nobody revealed the actual exact position of delivery of possession of the flat, in question. Ultimately, they asked the opposite parties to refund the amount deposited by them, but they refused to do so. The act and conduct of the opposite parties amounted to deficiency in service. Accordingly, the complainants sought the following directions to the opposite parties:
i) to refund the earnest money and amount of instalments of ₹17,50,000/-, along with interest at the rate of 18% from the date of booking i.e. 30.05.2011, which comes to ₹10,49,862/-, till realization;
ii) to pay ₹1,00,000/-, as compensation for the mental agony and physical harassment caused to the complainants; and
iii) to pay ₹50,000/-, as litigation expenses.
TOTALING: ₹29,49,862/-.
Defence of the Opposite Parties
3. In pursuance to notice, the opposite parties appeared and filed reply to the complaint, raising certain preliminary objections that the complaint is time barred, as the agreement was entered into on 27.10.2011 and the last payment of ₹3,75,000/- was made by the Consumer Complaint No.358 of 2016 4 complainants on 07.11.2012. Thus, this complaint, having been filed on 02.07.2016, is barred by time. The complainants are not 'consumers' as per the Act, as the flats were meant for economical weaker section of the society and the complainants concealed their identity of being effluent members of the society. This Commission has no jurisdiction, as the transaction between the parties is purely of sale agreement for a total sale consideration of ₹25,00,000/- and the complainants failed to deposit the further instalments, as per the agreement. They adopted novel idea by filing this complaint to get refund of ₹6,50,000/-, along with interest and compensation, whereas they deposited only a sum of ₹10,49,862/- with the opposite parties and as per clause 3 of the agreement, the amount of ₹6,25,000/- deposited by the applicant is liable to be forfeited, in case the purchaser failed to deposit the agreed amount in 15 days from the due date. There is no 'consumer-service provider' relationship between the complainants and the opposite parties. The complainants were well aware that the approvals of the project, in question, were under process and these were to take time to obtain the same. The opposite parties have got all the approvals and also got the licence to develop the colony from GMADA. As per Para No.6 of the agreement, if due to any technical reason, the land could not be passed, then the buyer can get only the deposited amount of biana and not any compensation. On merits, it was admitted that the complainants got transferred the flat, in question in their names, which was earlier booked by one Arun Kumar Sharma. It was also admitted that the complainants deposited a sum of Consumer Complaint No.358 of 2016 5 ₹17,50,000/-. Other similar pleas, as raised in preliminary objections, were reiterated and denying all other allegations of the complaint, it was prayed that the complaint be dismissed with costs, under Section 26 of the Act.
Replication on behalf of the Complainants
4. Replication to the reply was filed by the complainants, in which they reiterated their averments made in the complaint and controverted the pleas taken by the opposite parties in their reply. Evidence of the Complainants
5. To prove their claim, the complainants tendered affidavit of Smt. Ritu Sharma, as Ex.C-A, along with documents Ex.C-1 to Ex.C15.
6. The opposite parties failed to lead any evidence, despite availing sufficient opportunities and, thus, their evidence was closed by order, vide order dated 21.07.2017.
Contentions of the Parties
7. We have heard learned counsel for the parties and gone through the record carefully.
8. Learned counsel for the complainants vehemently contended that the complainants purchased the flat, in question, from the opposite parties for ₹25,00,000/- and agreement Ex.C-6 was executed between the parties. Admittedly, the complainants deposited ₹17,50,000/- with the opposite parties. However, the opposite parties failed to complete the project, as they did not have the requisite licenses or permission to develop their project. The possession of the flat was assured to be delivered upto 30.11.2012, but the opposite Consumer Complaint No.358 of 2016 6 parties failed to complete the project/flat by that period. Due to this reason, the complainants did not pay the remaining instalments. On account of failure of the opposite parties to complete the project/flat, the complainants are entitled to refund of the amount deposited by them, along with interest and compensation.
9. Per contra, learned counsel for the opposite parties argued that there is no deficiency in service on the part of the opposite parties. The complainants themselves failed to perform their part of the agreement, by not paying the remaining instalments and, thus, failed to comply with the terms and conditions of the agreement. It was further argued that the complaint is time barred, as the agreement was entered into on 27.10.2011 and the last payment of ₹3,75,000/- was made on 07.11.2012, whereas the complaint was filed on 17.11.2016. The complainants were well aware that the approvals and sanctions for the project, in question, were yet to be obtained by the opposite parties and that it would take time. The complainants are residents of Canada, but they booked the EWS flat, by suppressing material fact of their identity. Thus, they are not entitled to any relief and the complaint is liable to be dismissed.
Consideration of Contentions
10. We have given our thoughtful consideration to the contentions raised by the learned counsel for the parties.
11. The present matter is squarely covered by the earlier verdict given by this Commission in case Ravinder Kaur v. The Managing Director, Bajwa Developers Limited & Ors. Consumer Consumer Complaint No.358 of 2016 7 Complaint No.186 of 2016, decided on 06.04.2017. So, we intend to dispose of this matter, in view of the decision given in the above noted case.
12. Admittedly, the flat, in question, was booked by the complainants with the opposite parties. In fact, the flat, in question, was earlier booked by Sh. Arun Kumar Sharma on 30.05.2011 and his allotment rights were purchased by the complainants from the opposite parties, by making payment of ₹6,25,000/- to them on 27.10.2011. The opposite parties also charged ₹15,000/- from the complainants as transfer fee, vide receipt Ex.C-5. Agreement to Sell, Ex.C-6, was executed between the complainants and the opposite parties on 27.10.2011, according to which the total sale price of the flat, in question, was ₹25,00,200/- (rounded to ₹25,00,000/-). The complainants paid the total amount of ₹17,50,000/- to the opposite parties, as is evident from the 2nd page of the Agreement to Sell, Ex.C-
6. As per the complainants, the possession of the flat, in question, was to be delivered to them upto 30.11.2012, but there was no development at the site. The opposite parties have not led any evidence to prove that the complainants failed to comply with the formalities for applying the EWS house. The complainants have produced copies of photographs Ex.C-10 to Ex.C-15, the originals of which are also on the record as Annexure C-9. The perusal of these photographs clearly shows that the project of the opposite parties is lying in abandoned condition and it is incomplete. Admittedly, the possession of the flat, in question, has not yet been delivered by the Consumer Complaint No.358 of 2016 8 opposite parties. Till the possession is not delivered, there is continuous cause of action in favour of the complainants and it cannot be said that the complaint is time barred. The opposite parties in their reply pleaded that the complainants were well aware that the approvals of the project, in question, were under process and these were to take time to obtain the same and that the opposite parties have got all the approvals and also got the licence to develop the colony from GMADA. It is relevant to mention that the opposite parties have not led any evidence in support of their pleadings made in the reply. There is no document on the record to prove that the requisite sanctions and approvals for the project, in question, have been obtained by the opposite parties from the competent authorities. In fact, the opposite parties failed to lead their evidence, in-spite of availing sufficient number of opportunities. On one date of hearing, even the cost was imposed upon them, but to no effect, resultantly, their evidence was closed by order. The fact remains that the evidence produced by the complainants remains unrebutted.
13. Keeping in view of the above circumstances, we hold that the opposite parties have failed to comply with the provisions of the PAPRA. As per section 3 (General Liabilities of Promoter) of the PAPRA, the opposite parties were required to make full and true disclosure of the nature of his title to the land, on which such colony is developed or such building is constructed or is to be constructed, make full and true disclosure of all encumbrances on such land, including any right, title, interest or claim of any party in or over such land. They Consumer Complaint No.358 of 2016 9 were also required to give inspection on seven days, notice or demand of the layout of the colony and plan of development works to be executed in a colony as approved by the prescribed authority in the case of a colony. However, the opposite parties failed to comply with Section 3 of the PAPRA.
14. As per Section 5 (Development of land into Colony) of PAPRA, the opposite parties were liable to obtain permission from the competent authority for developing the colony, but they failed to produce on record any such permission/licence. So, they also violated Section 5 of PAPRA.
15. As per Section 9 of PAPRA, every builder is required to maintain a separate account in a scheduled Bank, for depositing the amount deposited by the buyers, who intend to purchase the plots/flats, but there is no evidence on the record to show that any account has been maintained by the opposite parties in this respect. There is no evidence or pleading on record on behalf of the opposite parties in this respect. As such, the opposite parties also violated Section 9 of the PAPRA.
16. Further, as per Section 12 of the PAPRA, if the builder fails to deliver possession of the plot/apartment by the specified date, then the builder is liable to refund the amount deposited by the buyer with interest.
17. As per Rule 17 of the "Punjab Apartment and Property Regulation Rules, 1995, framed under Section 45 of the PAPRA, it has been provided as under:-
Consumer Complaint No.358 of 2016 10
17. Rate of interest on refund of advance money upon cancellation of agreement.- The promoter shall refund full amount collected from the prospective buyers under sub-
section (1) of section 6 together with interest thereon at the rate of twelve per cent per annum payable from the date of receipt of amount so collected till the date of re-payment."
18. The opposite parties had been collecting huge amounts from the buyers for the development of the project. The amount received from the complainants-buyers was required to be deposited in the schedule Bank, as per Section 9 of PAPRA and we wonder where that amount had been going. The opposite parties are not to play the game at the cost of others. When it insists upon the performance of the promise by the consumers, it is to be bound by the reciprocal promises of performing their part of the agreement. The opposite parties have failed to comply the aforementioned provisions of PAPRA, while launching and promising to develop their project. Thus, the delay in not completing the flat within the agreed period amounts to deficiency in service on the part of the opposite parties, for which the complainants are to be suitably compensated.
19. The Consumer Protection Act came into being in the year 1986. It is the benevolent piece of legislation to protect the consumers from exploitation. The spirit of the benevolent legislation cannot be overlooked and its object is not to be frustrated. The complainants have made payment of substantial amount to the opposite parties with the hope to get the possession of the flat in a reasonable period. The circumstances clearly show that the opposite parties made false statement of facts about the goods and services i.e. allotment of flat Consumer Complaint No.358 of 2016 11 and delivery of possession in a stipulated period. The act and conduct of the opposite parties is a clear case of misrepresentation and deception, which resulted in the injury and loss of opportunity to the complainants. Had the complainants not invested their money with the opposite parties, they would have invested the same elsewhere. There is escalation in the price of construction also. The builder is under obligation to deliver the possession of the plot/unit/flat within a reasonable period. The complainants cannot be made to wait indefinitely to get possession of the flat booked. From the facts and evidence brought on the record of the complaint, it is clearly made out that the opposite parties i.e. builder knew from the very beginning that they had not complied with the provisions of the PAPRA and Rules and would not be able to complete the flat and to deliver the possession within the stipulated period, thus by misrepresentation induced the complainants to book the plot, due to which the complainants have suffered mental agony and harassment. It is the settled principle of law that compensation should be commensurate with the loss suffered and it should be just, fair and reasonable and not arbitrary. The amount paid by the complainants is a deposit held by the opposite parties in trust of complainants and it should be used for the purpose of building the flat, as mentioned in Section 9 of PAPRA. The builder is bound to compensate for the loss and injury suffered by the complainants for failure to deliver the possession, so has been held in catena of judgments by the Hon'ble Supreme Court and the Hon'ble National Commission. To get the relief, the complainants have to wage a long Consumer Complaint No.358 of 2016 12 drawn and tedious legal battle. As such, the complainants were at loss of opportunities. In such circumstances, ever increasing cost of construction and the damages for loss of opportunities caused which resulted in injury to the complainants, are also required to be taken into consideration for awarding compensation. In addition to that they are also entitled to the compensation for the harassment, mental agony and wasting of time and money in litigation for redressal of grievance suffered by them on account of the betrayal by the opposite parties in shattering their hope of getting the plot by waiting for all this period. In these circumstances, the complainants are entitled to the refund of the amount deposited by them, along with interest and suitable compensation.
20. The complainants have claimed refund of ₹17,50,000/- along with interest at the rate of 18% . Hon'ble National Commission in case Kamal Sood v. DLF Universal Ltd. 2007 (3) C.P.J. 7 (NC), in similar set of circumstances, where the builder was at fault in not obtaining permission for construction in advance before issuing advertisement and collected money from customers without having any licence, ordered for refund of deposited amount along with interest at the rate of 12%, besides compensation. In view of the above authority as well as Rule 17 of PAPRA, the complainants are entitled to the refund of their deposited amount, along with interest at the rate of 12%.
21. In view of our above discussion, the complaint is allowed and the following directions are issued to the opposite parties: Consumer Complaint No.358 of 2016 13
i) to refund ₹17,50,000/-, to the complainants, along with interest at the rate of 12% per annum from the respective dates of deposits till realization, as per Rule 17 of PAPRA;
ii) to pay ₹1,00,000/-, as compensation for the mental agony and harassment suffered by them; and
iii) to pay ₹11,000/-, as costs of litigation.
22. The opposite parties shall comply with the order within 30 days of the receipt of copy of the order, failing which the compensation amount shall also carry interest at the rate of 12% per annum from the date of this order till realization.
23. The complaint could not be decided within the stipulated timeframe, due to heavy pendency of Court cases.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (MRS. KIRAN SIBAL) MEMBER August 21, 2017.
(Gurmeet S)