National Consumer Disputes Redressal
Emaar Mgf Land Ltd. & Anr. vs Dilshad Gill on 27 May, 2015
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 345 OF 2014 (Against the Order dated 02/05/2014 in Complaint No. 17/2014 of the State Commission Chandigarh) 1. EMAAR MGF LAND LTD. & ANR. ECE HOUSE, 28, KASTURBA GANDHI MARG, NEW DELHI-110001 2. EMAAR MGF LAND LTD., SCO NO. 120-121, 1ST FLOOR, SECTOR-17-C, CHANDIGARH ...........Appellant(s) Versus 1. DILSHAD GILL R/O. HOUSE NO. 4773, A-BLOCK, DARSHAN VIHAR, SECTOR-68, MOHALI, PUNJAB 2. - - - ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE V.B. GUPTA, PRESIDING MEMBER HON'BLE MR. SURESH CHANDRA, MEMBER For the Appellant : Mr. Aditya Narain, Mr. Shanshank Bhushan, Ms. Anushree Narain and Mr. Arnav Narain, Advocates For the Respondent : Mr. Vikram Batra, Advocate Dated : 27 May 2015 ORDER Appellants/Opposite Parties have filed this appeal under Section 19 of the Consumer Protection Act, 1986 (for short, 'Act'), challenging order dated 02.05.2014, passed by State Consumer Disputes Redressal Commission, UT, Chandigarh (for short, 'State Commission') in Consumer Complaint No.17 of 2014, partly allowing the complaint of the Respondent/Complainant.
2. Brief facts are, that respondent wanted to move into a residential house in Tri-City Area, being allured by the advertisements of the appellants. There were some individuals, who were willing to transfer their units by entering into an independent agreement with the approval of the appellants One Sh. Jagmohan Marwaha, owner of unit bearing No TVM J1-F05-501, was interested in transferring his unit alongwith all the amount already deposited by him with the appellants. Respondent entered into an independent agreement with said Sh. Jagmohan and paid the amount, which Shri Jagmohan had paid to the appellants. Thereafter, respondent was nominated as owner of the aforesaid unit, vide letter dated 26.11.2011 of the appellants. The price of unit was Rs.51,42,750/-, out of which Rs.43,78,962/- stood already deposited with appellants as on 26.11.2011. The respondent paid another amount of Rs.87,500/- on 21.11.2011, Therefore, when respondent asked for any agreement to be signed, she was told that the agreement executed between Sh. Jagmohan Marwaha, and appellants, shall be applicable to her (respondent). The remaining amount was to be deposited, after the possession was given. It is further stated, that respondent received letter dated 13.5.2013 from the appellants, whereby she was asked to deposit Rs.3,05,969.70Ps within 30 days. The appellants told the respondent that since construction linked installment plan was opted, therefore, the remaining installments were to be paid, at the time of delivery of possession. The respondent submitted a written representation and asked to supply copy of the agreement and payment schedule alongwith other relevant documents but of no avail.
3. Thereafter, appellants vide letter dated 16.8.2013, arbitrarily increased the price of the unit, to Rs.60,83,543/- and asked the respondent to remit, total amount of Rs.18,38,829/- i.e. [(Rs.8,86,436 for revised area, Rs.8,23,081/- as 5% of basic &5% of EDC including applicable service tax, Rs.26,762/- as delayed interest and Rs.1,02,550/- as IFMS (Interest Free Maintenance Security) @Rs.50/- per sq. ft.]. Respondent refused to deposit the said amount and gave another representation dated 22.8.2013, but no action was taken on it. Thereafter, respondent contacted the original allottee and requested him to supply copy of contract, who informed that he had deposited all the documents with the appellants. Thereafter, appellants gave an agreement which was not signed by the respondent. However, it was endorsed in her favour.
4. As per Clause 21 of the agreement, appellants were liable to give possession of the apartment, within 36 months with a grace period of 3 months. Since, agreement was entered into on 6.2.2008, therefore possession of apartment was to be given by May 2011. There was absolutely no default of payment on account of the respondent till 26.11.2011. It was further stated, that appellants suo moto increased the so called super area of the unit and were trying to take shelter under the provisions of the contract. It was further stated, that as per Clause 23.1 of the agreement, appellants were liable to pay compensation @Rs.5/- per Sq. Ft. per month of the super area, for delay till possession was given.
5. The acts of the appellants in not delivering the actual physical possession complete in all respects, or refunding the amount alongwith interest, amounted to deficiency in rendering service, as also indulgence into unfair trade practice. Accordingly, left with no alternative, complaint was filed, seeking directions to the appellants, to refund Rs.43,78,962/- alongwith interest @18% per annum, from the respective dates of deposits, or in alternative to accept the amount as initially agreed to with the same super area, without any interest, to pay Rs.5 lacs as compensation for physical harassment and mental agony besides Rs.22,000/- as cost of litigation.
6. Appellants in their written statement stated, that respondent was duly informed at the time of transfer of flat, that all pending dues if any, were to be cleared before the same could be transferred. It was further stated, that respondent was well aware of the fact, that price of unit and area of the unit were tentative and subject to change.
The total cost of the unit was Rs.60.83 Lacs, out of which sum of Rs.43.78 Lacs was paid. The balance amount, was to be paid as per the demands raised on due dates mentioned in the payment schedule. It was further stated, that only 5% of the basic sale price and other charges including maintenance, water, club etc. were payable at the time of intimation of offer of possession, which were demanded vide letter dated 16.8.2013.
7. It is further stated, that respondent failed to pay the installments on time. Reminders to remit the due amounts were sent to her. The flat was transferred in the name of respondent, on completion of relevant transfer formalities in November 2011. Further, demand letter dated 21.3.2013 followed by reminders dated 12.4.2013 and 27.4.2013 were sent to the respondent but she did not remit the amount. The final notice dated 13.5.2013 was also sent to the respondent to make payment within 30 days. It was further stated, that appellants sent letter dated 23.7.2013, to the respondent intimating her as regards the change of layout plan. She was also sent letter of possession on 16.8.2013, which clearly stated that super area of unit had been changed to 190.54 sq. mt.
8. The appellants admit, that possession of flat was to be handed over within 36 months from the date of allotment. In case of any delay beyond the time frame mentioned in the agreement, respondent's interest was duly protected. Appellants asked the respondent to take possession but she failed to take the same. Thus, respondent is liable to pay holding charges as per terms and conditions of the agreement. Since, there had been delay in remitting the installments by the respondent, therefore she is not entitled to compensation under Clause 23.1 of the buyer's agreement. It was further stated, that occupation certificate was also obtained and respondent was called upon to take possession, after paying the outstanding installments, which she failed to pay. Hence, there is no deficiency on the part of the appellants.
9. The State Commission vide impugned order partly allowed he complaint of the respondent. Relevant portion of the order read as under;
"(i) The Opposite Parties are directed to refund the amount of Rs.39,41,066/- i.e. Rs.43,78,962.00 minus (-) Rs.4,37,896.00 being 10% of Rs.43,78,962.00]along with interest @ 9% per annum, from the respective dates of deposits.
(ii) The Opposite Parties, are jointly and severally, directed to pay Rs.20,000/- to the complainant as cost of litigation.
(iii) The amounts mentioned, in Clauses (i) and (ii), above, shall be paid, by the Opposite Parties, jointly and severally, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, they shall be liable to pay penal interest @ 12% per annum, instead of 9% per annum, on the amount mentioned in Clause (i) viz. Rs.39,41,066/- from the respective dates of deposits, till realization, besides payment of costs, till realization".
10. Being aggrieved, appellants have preferred this appeal.
11. We have heard the learned counsel for parties and gone through the record and perused the written submissions filed on behalf of the appellants.
12. It is submitted by learned counsel for appellants, that there is no deficiency on the part of appellants, since respondent did not file objections to the increase in the Super Area as intimated to her, by letter dated 16.08.2013. Thus, respondent who owed a sum of Rs.18,38,829/- payable to the appellants, failed to do so. Being a defaulter, respondent could not file complaint or seek any relief under the Act. On the other hand, appellants have fulfilled their contractual obligation of having completed construction of the apartment, having received the occupation certificate and offered possession of the apartment to the respondent, subject to payment of outstanding amounts due, in terms of agreement entered into between them.
13. It is further submitted, that State Commission erred in law by imposing interest @ 9% per annum on the amount paid by the respondent from the date of deposit. This is contrary to the agreement entered into between the parties and also contrary to law. In the present case, appellants had offered possession of apartment, after receipt of occupation certificate. The respondent being a defaulter, is seeking to wriggle out of the contract. The appellants also called respondent vide letter dated 02.12.2013 to take possession, after payment of all the dues, which was refused and ignored by her.
14. In support, learned counsel has relied upon following judgments;
(i) Prashant Kumar Shahi Vs. Ghaziabad Development
Authority,
(2000) 4 Supreme Court Cases 120 and
(ii) Managing Director, Maharashtra State Financial
Corporation and others Vs. Sanjay Shankarsa Mamarde,
(2010) 7 Supreme Court Cases, 489.
15. On the other hand, it is submitted by learned counsel for the respondent, that appellants arbitrarily increased the price of unit on their own. As per Clause 21 of the agreement, appellants were liable to give possession of the apartment within 36 months with a grace period of 3 months, from the date of agreement, dated 06.02.2008. Thus, possession of apartment was to be given by May, 2011, which they have failed to do so. Thus, there is deficiency on the part of the appellants.
16. It is further submitted, that total price of unit was Rs.51,42,750/- and by paying Rs.43,78,962/-, the respondent had paid 85% of the total price. As per the schedule of payment, 5% of the price was payable on receipt of the occupation certificate and 5% on intimation of possession. The appellants arbitrarily increased the super area of the flat which was more than 20% of the original area. It was in violation of Clause 18 of the agreement. Therefore, respondent was entitled for compensation @ Rs. 5/- per sq. ft. per month for delay, till possession was given. Since, the increase was more than 10%, appellants were required to seek consent of the respondent, which they did not obtain. Thus, there was delay in delivery of possession. Moreover, price of flat was increased by Rs.11 Lacs and there was delay of three years in offering possession. Therefore, amount paid by respondent is required to be refunded to her.
17. In support, learned counsel has relied upon following judgments;
(i) Emaar MGF Land Ltd. and Anr. Vs. Karnail Singh
and Anr,
Special Leave to Appeal (C) No.29392 of 2014
decided by Hon'ble Supreme Court 14.11.2014 and
(ii) Emaar MGF Land Pvt. Ltd. and another Vs. Krishan
Chander Chandna
First Appeal No.873 of 2013 decided on 29th
September, 2014 by this Commission.
18. The State Commission, while partly allowing the appeal, observed;
"14. It is evident, from record, that the complainant stepped into the shoes of the previous owner/allottee viz. Mr. Jagmohan Marwaha, with whom the Opposite Parties had executed the apartment buyer's agreement dated 6.2.2008, Annexure C-7. As is evident from nomination letter dated 26.11.2011, Annexure C-1, that in pursuance of the documents submitted by the previous owner viz. Sh. Jagmohan Marwaha and the complainant, apartment bearing No.TVM J1-F05-501 at 'The Views, Mohali' stood transferred in the name of Ms. Dilshad Gill and the Opposite Parties also confirmed having received a total sum of Rs.43,78,962/- towards the said property. Vide the aforesaid letter, the complainant was also informed that the next installment of Rs.2,48,763/- shall be due and payable on completion of flooring and wall paint slab, for which, a separate demand letter was to be sent by the Opposite Parties, 15-20 days prior to the due date.
The State Commission further observed;
17. The next question, which falls for consideration, is, as to whether, the Opposite Parties could increase the area of the apartment and, if so, to what extent. The complainant has submitted that as per the terms and conditions, the Opposite Parties could not increase the area in excess of 10% of the original area as indicted in the apartment buyer's agreement. On the other hand, the stand of the Opposite Parties, was that they could increase the area even beyond 10% by giving due notice to the complainant. By giving notice dated 16.08.2013, Annexure C-5, they duly complied with the conditions of the apartment buyer's agreement. It was further submitted by the Opposite Parties that the complainant did not deposit the outstanding installment and amounts, which became due, against her on account of increased area. It was, therefore, contended that there was no deficiency on the part of the Opposite Parties. To appreciate this controversy, it would be necessary to look into the relevant clauses of the apartment buyer's agreement. Clauses 1.2, 1.3 and 18/18.1 of the apartment buyer's agreement, being relevant, are extracted hereunder:-
1.2 The Allottee agrees and understands that the Sale Price of the Agreement shall be calculated on the basis of the Super Area (as defined and detailed out in Annexure III) and that the Super Area as stated in this Agreement is tentative and subject to change till the completion of the construction and the issuance of the occupation certificate by the competent authorities. The final super area of the Apartment shall be confined by the Company only after the construction is complete and the issuance of the completion certificate by the authorities.
1.3 The total price payable for the Apartment shall be re-calculated upon confirmation by the Company of the final Super Area. Any increase or reduction in the super area shall be payable or refundable as the case may be without any interest at the same rate per sq. ft of Super Area as abovestated. If there is an increase in the Super Area the Allottee shall pay to the company immediately upon demand raised by the Company. If there is a reduction in the super area the refundable amount shall be adjusted by the Company in any amount receivable from the Allottee or shall be adjusted by the Company from the final instalment as set forth in the Schedule of Payments.18
ALTERATION/MODIFICATION 18.1 In the event of any alteration/ modification resulting in more than 10% (ten percent) increase or decrease in Super Area of the Apartment, the Company shall in its sole opinion, any time prior to or upon the grant of occupation certificate, intimate the Allottee in writing of such increase or decrease in Super Area thereof and the resultant change, if any, in the Sale Price of the Apartment. In the event that the Allottee has any objection to such increase or decrease in Super Area, the Allottee shall within thirty (30) days of intimation of the increase or decrease by the Company file objections, failing which it shall be deemed that the Allottee has no objections and has given absolute consent to such increase or decrease in super area and/or any alterations/modifications and for payments, if any, to be paid in consequence thereof. However, in case the Allottee demands refund of the monies deposited by the Allottee towards the Apartment booking, then the Company, shall cancel this Agreement without any further notice and refund the money received from the Allottee within thirty (3) days of the sale of the Apartment to any third party. The Company shall refund the money to the Allottee after deduction of the Earnest Money, whereupon, the Company and/or the Allottee shall be released and discharged from all their obligations and liabilities under this Agreement. It being specifically agreed that irrespective of any outstanding amount payable by the Company to the Allottee, the Allottee shall have no right, lien or charge on the Apartment in respect of which refund as contemplated by this clause is payable.
18. A bare perusal of afore-extracted clauses reveals that when there was alteration/modification, resulting in more than 10% increase, or decrease in the super area of the apartment, the Company shall intimate the allottee, in writing, of such increase. In the instant case, such a change was duly notified to the complainant vide notice dated 16.08.2013, Annexure C-5. The allottee (complainant) could file objections within 30 days of intimation to the Company (Opposite Parties), failing which, it was to be deemed that the allottee had no objection and same amounted to absolute consent to such increase or decrease in super area and / or any alterations/modifications. Since the complainant did not inform the Opposite Parties, no deficiency, on this count, can be attributed to the Opposite Parties.
19. It is evident from letter/notice dated 16.8.2013, Annexure C-5, that a sum of Rs.18,38,829/- was due against the complainant, which was to be paid by her. The complainant failed to deposit this amount. The Opposite Parties then issued a notice dated 11.11.2013, Annexure R-6, calling upon the respondent/complainant to make payment of outstanding amount of Rs.18,12,062.01Ps within a period of 30 (thirty) days, failing which, the Buyer's Agreement was to be automatically cancelled. Clauses 3.1, 3.2 and 21.10 of the apartment buyer's agreement, being relevant are extracted hereunder:-
3.1 The Allottee has entered into this Agreement on the condition that out of the amount paid/payable by the Allottee towards the Sale Price including the parking spaces allotted, the Company shall treat 10% (ten percent) of the Sale Price of the Apartment as Earnest Money (hereinafter referred to as the "Earnest Money").
3.2 The Allottee hereby agrees that the Company shall have the right to forfeit out of the amounts paid/payable by the Allottee, the Earnest Money as aforementioned in the event of the failure of the Allottee to perform its obligations or non-fulfillment of all/any of the terms and conditions set out in this Agreement executed by the Allottee or in the event of failure of the Allottee to sign and return this Agreement in its original form to the Company within thirty (30) days from the date of its dispatch by the Company.
21.10 It is agreed by the Allottee that in the event of the failure of the Allottee to take the possession of the said Apartment in the manner as aforestated, then the Company shall have the option to cancel this Agreement in accordance with the terms of this Agreement or the Company may, without prejudice to its rights under any of the clauses of this Agreement and at its sole discretion, decide to condone the delay by the Allottee in taking over the possession of the said Apartment in the manner as stated in this clause on the condition that the Allottee shall pay to the Company the following amount:......."
20. Thus, from the perusal of the provisions of the afore-extracted clauses, it is clear that in the event of failure on the part of the allottee (complainant), in performing her obligations or non-fulfillment of all/any of the terms and conditions set out in the apartment buyer's agreement, Annexure C-7, the Opposite Parties could forfeit the amount of earnest money, which as per Clause 3.1 is 10% of the sale price of the apartment, and the rest of the amount paid by the complainant was to be refunded to her. Thus, the complainant was entitled to the refund of amount paid by her, minus the earnest money to the extent of 10% of the sale price of the apartment, in question. In the present case, since an amount of Rs.43,78,962/- stood paid to the Opposite Parties, therefore, the complainant is entitled to the refund of Rs.39,41,066/- i.e. (Rs.43,78,962.00 minus (-) Rs.4,37,896.00being 10% of Rs.43,78,962.00), which the Opposite Parties are liable to pay. By not refunding this amount, as per the aforesaid clause 3.2 of the apartment buyer's agreement, the Opposite Parties, were deficient, in rendering service. In our considered opinion, normal interest @ 9% per annum, from the respective dates of deposit, if granted, would be just and fair."
19. It is an admitted fact, that initially 'Apartment Buyer Agreement' was executed on 6.2.2008, between Appellants and the Original allottee -Mr. Jagmohan Marwaha, for a total consideration of Rs.51,42,750/- (Page No.42 of the paper book).
20. It is also an admitted fact, that vide letter dated 26.11.2011 (Page No.105 of the paper book) sent by appellants to the respondent, her nomination was confirmed. Thus, respondent had stepped into the shoes of original allottee. As per nomination letter, appellants confirmed having received a total sum of Rs.48,78,962/- towards the apartment in question. We fail to understand, as on what basis appellants have mentioned the total cost of the apartment, as Rs.60.83 lacs in their written statement.
21. Be that as it may, Clause no.21 of 'Apartment Buyer Agreement' states;
"21. POSSESSION PROCEDURE FOR TAKING POSSESSION AND FAILURE TO TAKE POSSESSION 21.1. Subject to Force Majeure conditions and reasons beyond the control of the Company and subject to the Allottee not being in default of any of the provisions of this Agreement and having complied with all provisions, formalities, documentation etc. and the terms and conditions of this Agreement, the Company proposes to hand over the possession of the Apartment within a period of 36 months from the date of allotment. The Allottee agrees and understands that the Company shall be entitled to a grace period of ninety (90) days, after the expiry of 36 months for applying and obtaining the occupation certificate in respect of the Group Housing Complex."
22. It is apparent from the above clause, that possession of the apartment was to be handed over within a period of 36 months from the date of allotment, with grace period of 3 months. Admittedly, no possession was offered to the original allottee or to the respondent, till 26.11.2011 when she stepped into the shoes of original allottee. Thus, on the date of accepting the present respondent as allottee on 26.11.2011, the apartment in question was not complete.
23. As appellants did not offer possession within the period prescribed under Clause 21 of the 'Apartment Buyer Agreement', the deficiency on the part of appellants, started right from that very moment. It is an admitted fact, that while offering the possession even in the year 2013, appellants sent letter dated 13.5.2013 and respondent was asked to deposit sum of Rs.3,05,969.70, within 30 days. When payment of the instalments is construction linked, then we fail to understand as to how before completing the construction appellants demanded the aforesaid amount. This act of appellants goes on to show, that even on 13.5.2013 construction of apartment was not complete. It was only vide letter dated 16.8.2013, appellants offered possession of the apartment, subject to certain payments.
24. Thus, appellants themselves have violated the material conditions with regard to handing over of the possession, now it does not lie in their mouth to demand further payment from the respondent. Even assuming for arguments sake, that payment as demanded vide letter dated 16.8.2013 was due, but the respondent was fully justified in not making the payment, when appellants failed to complete the construction and handover the possession, within the agreed period. Appellants could not force the respondent, after having accepting money from the original allottee in the year 2006 and part payment from present respondent in the year 2011, to accept possession of the apartment in the year 2013, which was against the terms of the Agreement. The above facts clearly goes on to show, that appellants have been enjoying the substantial amount of money received by them in the year 2006, till 2013. Therefore, this plea of appellants, that they have done their part of the duty and it is the respondent who is defaulter, does not hold any water.
25. The deficiency on the part of appellants is writ large in this case. We may note, that under such circumstances there was no occasion for the State Commission to have deducted 10% of the deposited amount as respondent was not at fault at all. On the other hand, appellants were deficient when they themselves have violated the terms and conditions of 'Apartment Buyer Agreement', The case law relied by ld. counsel for appellants are not applicable at all to the facts of the present case.
26. Accordingly, we hold that there is no merit in the present appeal. Present appeal is wholly misconceived and is without any legal basis. Therefore, we dismiss the same with punitive damage of Rs.1,00,000/- (Rupees One Lac only). Appellants are directed to deposit the aforesaid amount by way of demand draft in the name of 'Consumer Legal Aid Account', of this Commission, within a period of six weeks from today.
27. In case, appellants fail to deposit the aforesaid amount within the prescribed period, then they shall also be liable to pay interest @ 9% p.a. till realization.
28. List for compliance on 7.8.2015.
......................J V.B. GUPTA PRESIDING MEMBER ...................... SURESH CHANDRA MEMBER