State Consumer Disputes Redressal Commission
Rashmi Chowdhury & Anr. vs M2K Infrastructure Pvt. Ltd. & Anr. on 17 September, 2024
CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
IN THE DELHI STATE CONSUMER DISPUTES
REDRESSAL COMMISSION
Date of Institution: 04.10.2017
Date of Decision: 17.09.2024
COMPLAINT CASE NO. - 1689/2017
IN THE MATTER OF
1. MS. RASHMI CHOWDHARY,
W/O MR. DEEP KUMAR CHOWDHARY,
2. MR. DEEK KUMAR CHOWDHARY,
BOTH RESIDING AT:
F-25/18, SECTOR- 3,
ROHINI, DELHI - 110085.
(Through: Mr. Sanjay Kumar Gosh, Advocate)
...Complainants
VERSUS
1. M2K INFRASTRUCTURE PVT. LTD.,
2. M2K INFRASTRUCTURE PVT. LTD.,
THROUGH ITS DIRECTOR,
BOTH AT:
E-13/29, HARSHA BHAWAN,
CONNAUGHT CIRCUS,
NEW DELHI - 110001.
(Through: Ms. Amita Gaur, Advocate)
...Opposite Parties
ALLOWED PAGE 1 OF 15
CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
HON'BLE MR. J.P. AGRAWAL, MEMBER (GENERAL)
Present: Mr. Sanjay Kumar Gosh, counsel for the Complainant
Ms. Amita Gaur, counsel for the OP.
PER: HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
JUDGEMENT
1. The present Complaint has been filed before this Commission under Consumer Protection Act, 1986, by the Complainants alleging deficiency in service on the part of Opposite Parties and has prayed for the following reliefs:
"a) To direct the opposite party to make the refund of Rs.26,35,062/- being the amount paid till now by the complainants to the opposite party as the flat handed over to the complainants in not in accordance to the promise made and is also of the inferior quality; And OR
b) Further direct the opposite party to make the payment of compensation @ 18% per annum on the amount of Rs.
26,35,062/-, being the amount paid by the complainants to the opposite party, to be calculated from the expected date of possession after even considering grace period i.e. March,2011 calculated till the realisation of the said compensation; And/ oR C) Further direct the opposite party to compensate the complainants for the extra rent paid after the due date of the possession till the date of possession as the same has been an additional expenditure & financial loss directly ALLOWED PAGE 2 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024 MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR incidental to the delay caused by the opposite party; And / oR
d) Further direct the opposite party to withdraw the illegal maintenance bills sent to the complainant by the sister concern of the opposite party with immediate effect,AND/oR
e) Further direct the opposite party to make the payment of Rs.50,000/- (Fifty thousand only) towards the cost of this legal proceedings. AND/oR Any other order which this Hon'ble Court may deem fit and proper may be passed in favour of the complainants and against the opposite party.
Prayer (b) "IN THE ALTERNATE b1. Direct the opposite party to give the physical possession of the apartment namely Unit no. F-308, in M2K county heights situated in M2K County Daruhera, Haryana, complete in all respect;
b2. Direct the opposite party to execute and Register the conveyance deed in favour of the complainant in respect of the flat - Unit no. F-308, in M2K county heights situated in M2K County Daruhera, Haryana.
b3. Direct the opposite parties to pay interest @ 18% on the amount deposited by the complainant for the period of delay in handing over of full and final possession of the flat and execution of the conveyance deed in favour of the complainant.
b4. Direct the opposite parties to handover the completion and occupancy certificate in respect of the said flat; b5. Refund the sum of Rs. 92,125/- collected by the opposite parties as additional EDC charges in 2014 alongwith interest @ 12% till the refund of the same; b6. Direct the opposite parties to complete the incomplete works in the said housing project like club, swimming pool gymnasium before offering possession of the said flat.
ALLOWED PAGE 3 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR b7. Direct the opposite parties to withdraw the illegal maintenance charges bill in respect of the said flat;"
2. The brief facts necessary for the adjudication of the present complaint are that on 18.11.2006, the Complainants booked an apartment in the project "M2K County" of the Opposite Parties, located at Sector-5, Dharuhera, Haryana. Subsequently, the Opposite Parties, vide letter dated 10.01.2007, allotted an apartment with a super area of 1350 sq. ft. in the aforementioned project, and the Complainants opted for a construction-linked plan towards the payment of the said apartment. Thereafter, an apartment buyer agreement was executed between them on 10.04.2008 for the said apartment with a total consideration of Rs.27,27,775/-, including DC/IDC & IFMS and Rs. 3,09,375/- for the preferential location charge. Moreover, the Opposite Parties assured the Complainants that they would hand over possession of the said apartment within 3 years from the start of excavation/bhoomipujan. However, the Opposite Parties failed to hand over possession of the said apartment to date, despite collecting 95% of the basic sale price from the Complainants by the end of 2010.
3. Furthermore, the Complainants received a letter dated 22.03.2016, wherein the Opposite Parties offered possession of the said apartment after an inordinate delay, along with a demand for Rs. 3,07,219/-. However, when the Complainants visited the site of the said project in September 2017, they were shocked to see that the construction of their apartment was still incomplete. Moreover, the Opposite Parties had failed to complete the construction of the various facilities as they were either non-operational or ALLOWED PAGE 4 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024 MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR incomplete. Therefore, the Complainants had to live on rent and pay rent in addition due to the inordinate delay on the part of the Opposite Parties. The Complainants, via emails dated 10.04.2016, 17.04.2016, 02.05.2017, and 03.06.2017, inquired about the status of the possession of the said apartment, but no reply was received from the Opposite Parties.
The Complainants over the time had paid a sum of Rs. 26,35,062/- to the Opposite Parties as and when demanded by it. The Complainants also sent a legal notice dated 22.07.2017 to the Opposite Parties asking for possession of the said Apartment alongwith interest for the inordinate delay in handing over the possession but was of no avail.
4. The Opposite Parties have contested the present case and has raised preliminary objections as to the maintainability of the complaint case. The counsel for the Opposite Parties also contended that the present complaint is barred by limitation as per Section 24A of the Consumer Protection Act, 1986 as the Opposite Parties offered the possession of the said apartment on 22.03.2016 and the present complaint is filed on 04.10.2017, beyond the period of 2 years. He further submitted that the jurisdiction of this commission is barred as there is an arbitration clause in the apartment buyer agreement.
5. The counsel for the Opposite Parties submitted that the present complaint involves complicated question of facts and law, which cannot be adjudicated in a summary procedure before this commission. The Complainants are trying to wriggle out their contractual obligation by raising false and frivolous disputes as the ALLOWED PAGE 5 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024 MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR Opposite Parties already completed its contractual obligation. The construction of the Complainants' apartment also completed but the failed to come to obtain the possession of the said apartment. He further submitted that the Complainants also failed to show any deficiency in services on the part of the Opposite Parties. Pressing the aforesaid objections, the counsel appearing on behalf of the Opposite Parties prayed that the complaint be dismissed.
6. The Complainants have filed his Rejoinder rebutting the written statement filed by the Opposite Parties. Thereafter, both the parties filed their Evidence by way of Affidavit in order to prove their averments on record.
7. We have heard the counsel appeared on behalf of both the parties and peruse the material available on record.
8. The fact that the Complainants booked the said apartment is evident from the Apartment Buyer Agreement dated 10.04.2008 [Annexure OP-3 (colly)]. The Complainants has made payment to the extent of Rs. 26,35,062/- to the Opposite Parties is not disputed by it.
9. The first question for consideration before us is whether the present complaint is barred by limitation as per the Consumer Protection Act, 1986?
10. The Opposite Parties have contended that the present complaint is barred by limitation as per Section 24A of the Consumer Protection Act, 1986. It is imperative to refer to Section 24A of the Consumer Protection Act, 1986, which provides as under:
"24A. Limitation period.--
ALLOWED PAGE 6 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR (1) The District Forum, the State Commission or the National Commission shall not admit a complaint unless it is filed within two years from the date on which the cause of action has arisen."
(2) Notwithstanding anything contained in sub-section (1), a complaint may be entertained after the period specified in sub-section (1), if the Complainant satisfies the District Forum, the State Commission or the National Commission, as the case may be, that he had sufficient cause for not filing the complaint within such period: Provided that no such complaint shall be entertained unless the National Commission, the State Commission or the District Forum, as the case may be, records its reasons for condoning such delay."
11. A perusal of the above statutory provision of law reflects that the complaint shall be filed within two years from the date on which the cause of action has arisen. It is clear from the record that the Opposite Parties failed to complete the construction of the said apartment within reasonable time.
12. 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."
ALLOWED PAGE 7 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
13. Relying on the above settled law, it is clear that failure to deliver possession being a continuous wrong constitutes a recurrent cause of action in favour of the buyer and therefore, the construction of the said villa complete, the Complainants are within right to file the present complaint before this commission. Consequently, the present complaint is not barred by limitation as per Section 24A of the Act.
14. The next question for consideration for us is whether the existence of arbitration clause in the agreement barred the jurisdiction of this commission?
15. The next preliminary objection raised by the Opposite Parties is that since there exists an arbitration clause in the agreement, the parties should be referred to arbitration and this commission is barred from exercising its jurisdiction. To deal with this issue, we deem it appropriate to refer to Emaar MGF Land Limited vs. Aftab Singh reported at I (2019) CPJ 5 (SC), wherein the Apex court has held as under:-
"55. We may, however, hasten to add that in the event a person entitled to seek an additional special remedy provided under the statutes does not opt for the additional/special remedy and he is a party to an arbitration agreement, there is no inhibition in disputes being proceeded in arbitration. It is only the case where specific/special remedies are provided for and which are opted by an aggrieved person that judicial authority can refuse to relegate the parties to the arbitration."
ALLOWED PAGE 8 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
16. The Hon'ble Apex Court has put to rest the controversy relating to the existence of arbitration clauses in the allotment letter/apartment buyer agreement etc. as is evident from the relevant paragraph of Emaar MGF Land Limited (supra). In the present case also, the Complainants have opted for the special remedies provided under the Consumer protection Act, 1986 therefore, this commission can refuse to relegate the present case to the arbitration. Hence, this commission is authorized to adjudicate the case and the existence of an arbitration clause in the agreement does not affect the jurisdiction of this commission.
17. The next question for consideration is whether the present complaint involves complicated questions of facts and law, which should be decided by the civil court?
18. The Opposite Parties 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 Complainants are 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.
19. 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.
ALLOWED PAGE 9 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
20. 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;"
21. Returning to the facts of the present complaint, the perusal of the record shows that the Complainants avail the services of the Opposite Parties for a consideration. However, the Opposite Parties failed to complete the said project within prescribed time, aggrieved by which, the Complainants have sought the refund of the amount paid by them. Hence, the Complainants are entitled to file the present complaint before this commission since the Complainants are aggrieved by the deficient services of the Opposite Parties i.e., the failure of the Opposite Parties to handover the possession within reasonable time and it is only due to this reason, that the refund of the amount paid is sought from the Opposite Parties, which this Commission is authorised to adjudicate.
22. 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 ALLOWED PAGE 10 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024 MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR 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.
23. Moreover, nothing cogent has been brought on record by the Opposite Parties 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.
24. 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 Parties.
25. Having discussed the preliminary objection raised on behalf of the Opposite Parties, the next issue which arises is whether the Opposite Parties are actually deficient in providing its services to the Complainants. 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.
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MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
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.
26. At this stage, we deem it appropriate to refer to Article 5 of the Apartment Buyer agreement dated 19.04.2008 entered into by both the contesting parties. It reflects that the Opposite Parties was bound to complete the construction of the said flat within 36 months plus 6 months of grace period from the date of commencement of construction of the particular block in which apartment is located. However, the Opposite Parties had offered the possession of the said apartment on 22.03.2016 after the expiry of the date of completion of the said apartment i.e., on 19.10.2011.
ALLOWED PAGE 12 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR Therefore, the Opposite Parties miserably failed to complete the construction of the said apartment within time frame. It is further admitted by the Opposite Parties in para 1 of the written statement that the Opposite Parties applied for the occupation certificate in on 17.06.2015 and the same was granted by the concerned authority on 22.03.2016, which clearly shows that the Opposite Parties construction was moving at snell pace.
27. The counsel for the Opposite Parties also submitted that the Complainants are try to wriggle out their contractual obligation by raising false and frivolous disputes as the Opposite Parties already completed its contractual obligation. Returning to the fact of the present case, it is noted that the fact that the Complainants booked the apartment in year 2008 with the expectation of receiving it by 2011, as assured by the opposite parties, cannot be denied. However, it is clear that the construction of the said apartment was proceeding at a very slow pace. Additionally, it has been well settled that the Complainants cannot be expected to wait for an indefinite time period to get the benefits of the hard-earned money which they have spent in order to purchase the property in question (Ref: Fortune Infrastructure v. Trevor D'Lima reported at (2018) 5 SCC 442). Consequently, the Opposite Parties contention holds no merits and dismissed.
28. Relying on the above settled law, we hold that the Opposite Parties are deficient in providing its services to the Complainants as the Opposite Parties had given false assurance to the Complainants with respect to complete the construction of the said apartment and had kept the hard-earned money of the Complainants.
ALLOWED PAGE 13 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
29. Furthermore, as per the facts and circumstances of the present case, we are of the view that it is justified to refund the amount already paid by the Complainants.
30. Keeping in view the facts of the present case and the extensive law as discussed above, we direct the Opposite Parties to refund the entire amount paid by the Complainants i.e., Rs. 26,35,062 /- along with interest as per the following arrangement:
A. An interest @ 6% p.a. calculated from the date on which each installment/payment was received by the Opposite Parties till 17.09.2024 (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 Parties pays the entire amount on or before 17.11.2024;
C. Being guided by the principles as discussed above, in case the Opposite Parties fails to refund the amount as per the aforesaid clause (A) on or before 17.11.2024, 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 Parties till the actual realization of the amount.
31. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Parties are directed to pay a sum of:
A. Rs. 2,00,000/- as cost for mental agony and harassment to the Complainants; and B. The litigation cost to the extent of Rs. 50,000/-.
ALLOWED PAGE 14 OF 15 CC. NO.1689/2017 D.O.D.:17.09.2024
MS. RASHMI CHOWDHARY AND ANR. VS. M2K INFRASTRUCTURE PVT. LTD. AND ANR
32. Applications pending, if any, stand disposed of in terms of the aforesaid judgment.
33. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
34. 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:
17.09.2024 LR-ZA ALLOWED PAGE 15 OF 15