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State Consumer Disputes Redressal Commission

Rajan Pal vs M/S Tdi Infrastructure Ltd. on 9 April, 2021

IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL COMMISSION

                                          JUDGMENT RESERVED ON: 17.03.2021
                                       JUDGMENT PRONOUNCED ON: 09.04.2021

                                 COMPLAINT NO. 438/2017

      IN THE MATTER OF

      RAJAN PAL                                                   .....COMPLAINANT
                                            VERSUS

      M/S TDI INFRASTRUCTURE LIMITED                           ......OPPOSITE PARTY

      CORAM:

      HON'BLE           DR.    JUSTICE         SANGITA          DHINGRA   SEHGAL
      (PRESIDENT)
      HON'BLE SH. ANIL SRIVASTAVA, (MEMBER)

      Present: Mr. A.B. Pandey, Counsel for the Complainant.
               Mr. Jai Singh, Counsel for the OP.

      PER: HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL,
                PRESIDENT
                                       JUDGMENT

[Via Video Conferencing]

1. The present complaint has been filed before this commission under Section 12 of the Consumer Protection Act, 1986 alleging unfair trade practices and deficiency in service by the opposite party, wherein the complainant has prayed as under:

a) "Refund the excess amount of Rs. 10,16,500/- (Rupees Ten Lakhs, Sixteen Thousand and Five Hundred Only), charged from the complainant, alongwith interest @ 21% per annum (the rate at which interest was charged by the respondent on all delayed payment, even when CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 1 of 16 the installment have been deposited within time) payable with effect from 17th August, 2015 till realization.

b) Pay to the complainant in compensation for the delay in delivery of possession amounting to Rs. 1,62,960/-

alongwith interest @ 21% per annum payable with effect from 1st January, 2016 till realisation.

c) Take steps for registration of necessary conveyance deed in favour of the complainant.

d) An amount of Rs. 51,000/- (Rupees Sixty five thousand only) towards the aggregate legal expenses incurred and being incurred by the complainant.

e) It is a matter of fact that possession has been delayed by the respondent beyond the contractual period of 30 months and the delay compensation @ Rs. 5 /- per sq. Foot per month is abysmal. Therefore, the respondent is liable to pay compensation amounting to Rs. 5,00,000/- the complainant for the entire period of delay in handing over possession as well towards mental and financial torture and hardship caused to complainant."

2. Brief facts necessary for the adjudication of the present complaint are that the complainant applied for an apartment in the project of the Opposite party titled "Tuscan Floors in TDI Tuscan City" located at Kundli, Sonepat, Haryana. Vide allotment letter dated 03.12.2010, a flat bearing Flat no. T-116/Ground Floor, admeasuring 1164 Sq. Ft. was allotted to the complainant for a total sale consideration of Rs. 30,36,926/-. Pursuant to the allotment, the complainant and the opposite party entered into an Independent floor/Apartment Buyer's Agreement dated 28.02.2011.

3. As per the agreement, the opposite party was to handover the possession of the flat within 30 months from the date of execution of the Apartment Buyers Agreement, i.e. on or before 28.08.2013. However, the complainant received the letter inviting Offer of possession along with statement of dues only on 17.02.2015, whereby CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 2 of 16 the opposite party increased the sale consideration of the flat to Rs. 40,86,157.01/- (excluding the club charges and maintenance charges) and also increased the super area from 1164 sq. ft. to 1429 sq. ft. The statement of account dated 17.02.2015, was in utter disregard to the Apartment Buyers Agreement which allowed an increase of only 10% of the sale consideration or Rs. 3,03,692.60/- towards escalation charges.

4. Being left with no other option, after having deposited a substantial amount of total sale consideration as originally agreed between the contesting parties, the complainant honoured the demands of the Opposite Party raised vide the Statement of Dues dated 17.02.2015 and deposited the sum with the Opposite Party. Having received the deposit of the total sale consideration including the alleged illegal demands, the Opposite Party handed over the actual physical possession of the flat to the complainant on 23.01.2016.

5. However, at a later stage, on being doubtful of the demands raised by the Opposite Party as to the increase in the Super Area and the ancillary charges connected thereto, complainant made a thorough inquiry of the various heads as per which the basic sale price was increased including EDC, Club Membership Charges, Miscellaneous Charges etc. and was surprised when it transpired that the amount demanded under various heads to honour the statutory dues of the competent authorities were never deposited with them and also the Club for which the Membership Charges were being demanded were only on paper and there was no construction till the date of filing of the present complaint denoting that it was nothing but a tactic of the Opposite Party to extort extra money from the complainant.

6. Moreover, even after receiving the complete sale consideration including the alleged illegal demands, the Opposite Party failed to CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 3 of 16 execute the conveyance deed in favour of the complainant and also failed to pay the damages for the delay in handing over the possession of the flat to the complainant. Being aggrieved by the said acts of the Opposite Party, the complainant filed the present consumer complaint.

7. During the course of proceedings, notice was issued to the Opposite party vide order dated 31.03.2017 and the counsel for the Opposite Party appeared on 14.07.2017, when the copy of the complaint was supplied to him. Subsequently, the Opposite Party filed its written statement along with an application for condonation of delay in filing the written statement, which was condoned vide order dated 15.12.2017.

8. Thereafter, the complainant filed its Rejoinder rebutting the written statement filed by the Opposite Party along with the Evidence by way of Affidavit.

9. On 14.01.2019, the direction for filing of the Evidence by way of Affidavit was given to the Opposite Party and the case was adjourned for 29.07.2019. On the next date i.e. 29.07.2019, the Opposite Party sought some more time to file the Evidence by way of Affidavit and the request was allowed subject to the payment of a cost of Rs. 2000/- payable on the next date of hearing i.e. 09.08.2019. However, when the case was called for hearing on 09.08.2019, the counsel for the complainant submitted that Opposite Party had failed to pay the cost of Rs. 2000/- subject to which the Evidence by way of Affidavit was to be filed. Even the Evidence by way of Affidavit was not ready and another adjournment was sought by the Opposite Party. Considering the laxity of the Opposite Party, the request for adjournment was disallowed and the right of the Opposite Party to file its Evidence by way of Affidavit was closed.

10. Thereafter, the direction for filing of written arguments were given to both the parties, which was duly complied by the complainant.

11. We have heard the counsel for both the parties and perused the material on record. Since the Opposite Party has failed to file its evidence by way of affidavit, the averments made in its written statement cannot be said to be proved, hence, cannot be taken on record. However, before delving into the merits of the case, we deem it appropriate to adjudicate preliminary issues of law as to the maintainability of the consumer complaint.

WHETHER THIS COMMISSION HAS JURISDICTION TO ADJUDICATE THE PRESENT COMPLAINT?

12. The first question for consideration is whether this commission has the jurisdiction to adjudicate the present complaint. We deem it appropriate to refer to Section 17 of the Consumer Protection Act, 1986 which reads as under:

"(1) Subject to the other provisions of this Act, the State Commission shall have jurisdiction--

(a) to entertain-

(i) complaints where the value of the goods or services and compensation, if any, claimed [exceeds rupees twenty lakhs but does not exceed rupees one crore]; and

(ii) appeals against the orders of any District Forum within the State; and

(b) to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Forum within the State, where it appears to the State Commission that such District Forum has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested or CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 5 of 16 has acted in exercise of its jurisdiction illegally or with material irregularity.

(2) A complaint shall be instituted in a State Commission within the limits of whose jurisdiction-

(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or

(b) any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the State Commission is given or the opposite parties who do not reside or carry on business or have a branch office or personally works for gain, as the case may be, acquiesce in such institution; or

(c) the cause of action, wholly or in part,arises."

13. Analysis of Section 17 of the Consumer Protection Act, 1986 leads us to the conclusion that this commission shall have the pecuniary jurisdiction in cases where the total claim including the compensation is more than twenty lakhs and less than One Crore. Moreover, clause 17(2) of the Act provides the extent of territorial jurisdiction, wherein it has been provided that the state commission shall have the jurisdiction to entertain cases where opposite party at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain or the cause of action arose.

14. Having discussed the statutory position, the facts of the present case reflect that the value of the apartment and the compensation prayed for by the complainant is beyond Rs. 20 Lakhs but does not exceed Rs. 1 Crore, accordingly, the commission has the pecuniary jurisdiction to deal with the present complaint. So far as the territorial jurisdiction is concerned the registered office of the Opposite Party is at 10, Shaheed Bhagat Singh Marg, New Delhi-110001. Since the registered office of the opposite parties fall within the territory of Delhi, this commission has the territorial jurisdiction to adjudicate the case. To strengthen the aforesaid findings, we tend to rely on Rohit Srivastava v. Paramount Villas Pvt. Ltd. reported at 2017 SCC OnLine NCDRC 1198, wherein it has been held as under:

"It is not in dispute that the Registered Office of Opposite Party No. 1 Company is situated in Delhi, i.e., within the territorial jurisdiction of the State Commission at Delhi and therefore, in the light of clear provision contained in Section 17(2)(a), which stipulates that a Complaint can be instituted in a State Commission, within the limits of whose jurisdiction, the Opposite Party actually carries on business. In view of the said provision, we have no hesitation in coming to the conclusion that since the Registered Office of the first Opposite Party is situated in Delhi, the State Commission did have the territorial jurisdiction to entertain the Complaint."

15. Relying on the above settled law, we are of the view that this commission has both the territorial and pecuniary jurisdiction to decide the present complaint.

WHETHER THE PRESENT COMPLAINT IS BEYOND THE PERIOD OF LIMITATION?

16. The next issue to be adjudicated is whether the complaint is within the period of limitation as prescribed in the Consumer Protection Act, CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 7 of 16 1986. It is imperative to refer to Section 24A of the Consumer Protection Act, 1986 wherein it is provided as under:-

"24A. Limitation period.- (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 as this 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."

17. Analysis of Section 24A of the Consumer Protection Act, 1986 shows that this commission is empowered to admit a complaint if it is filed within a period of 2 years from the date on which cause of action arose. In the case before us, the possession of the flat was handed over on 23.01.2016 to the complainant and it was for the complainant to file a consumer complaint on or before January, 2018 highlighting any deficiency of service with respect to the flat in question. The Dak entry of the present case reflects that the same has been filed on 06.03.2017, hence, it is well within the limitation period as prescribed by the Consumer Protection Act, 1986.

DEFICIENCY OF SERVICE

18. The next question which arises is whether the Opposite Party is actually deficient in providing its services to the complainant or not. The expression Deficiency of Service has been dealt with by the Hon'ble Apex Court in Arifur Rahman Khan and Ors. vs. DLF CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 8 of 16 Southern Homes Pvt. Ltd. and Ors. reported at (2020) 16 SCC 512, wherein it has been discussed as follows:

"27. .......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.

28. 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.

19. Returning to the facts of the case, the perusal of clause 30 of the Tuscan Floor Buyers Agreement dated 28.02.2011 entered into by the contesting parties reflects that the Opposite Party was bound to handover the possession of the said Apartment within 30 months of execution of the Agreement, which expired in the year 2013. However, the record is crystal clear that the possession was handed over on 24.01.2016 only i.e. after a delay of almost 3 years. With due regard to the settled law, we hold that the Opposite Party is deficient in providing its services to the Complainant as the Opposite Party had given false assurances to the complainant with respect to the time for delivery of possession of the apartment and has also failed to execute the conveyance deed in favour of the complainant till date.

UNFAIR TRADE PRACTICE

20. The next issue to be adjudicated relates to the unfair trade practices being followed by the Opposite Party. It has been alleged by the complainant that the opposite party has indulged in unfair trade practices by arbitrarily increasing the super area of the apartment with utter disregard to the Tuscan Floor Buyer Agreement leading to an increase in the total sale consideration of the apartment to the tune of Rs. 10,16,500/-.

21. The Hon'ble National Commission in the case of Consumer Case No. 285 of 2018 titled Pawan Gupta vs. Experion Developers Pvt. Ltd. decided on 26.08.2020 while dealing with a similar issue has held as under:-

"17. The complaints have been filed mainly for two reasons. The first is that the opposite party has demanded extra money for excess area and second is the delay in handing over the possession. In respect of excess area, the complainant has made a point that without any basis the opposite party sent the demand for CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 10 of 16 excess area and the certificate of the architect was sent to the complainant, which is of a later date. The justification given by the opposite party that on the basis of the internal report of the architect the demand was made for excess area is not acceptable because no such report or any other document has been filed by the opposite party to prove the excess area. Once the original plan is approved by the competent authority, the areas of residential unit as well as of the common spaces and common buildings are specified and super area cannot change until there is change in either the area of the flat or in the area of any of the common buildings or the total area of the project (plot area) is changed. The real test for excess area would be that the opposite party should provide a comparison of the areas of the original approved common spaces and the flats with finally approved common spaces/buildings and the flats. This has not been done. In fact, this is a common practice adopted by majority of builders/developers which is basically an unfair trade practice. This has become a means to extract extra money from the allottees at the time when allottee cannot leave the project as his substantial amount is locked in the project and he is about to take possession. There is no prevailing system when the competent authority which approves the plan issues some kind of certificate in respect of the extra super area at the final stage. There is no harm in communicating and charging for the extra area at the final stage but for the sake of transparency the opposite party must share the actual reason for increase in the super area based on the comparison of the originally approved buildings and finally approved buildings. Basically the idea is that the allottee must know the change in the finally approved lay-out and areas of common spaces and the originally approved lay-out and areas. In my view, until this is done, the opposite party is not entitled to payment of any excess area. Though the Real Estate Regulation Act (RERA) 2016 has made it compulsory for the builders/developers to indicate the carpet area of the flat, however the problem of super area is not yet fully solved and further reforms are required."

22. The perusal of the aforesaid dicta of the Hon'ble National Commission reflects that the Opposite Party is duty bound to bring forth valid reasons/explanation for the increase in the Super Area and the decision to increase/decrease the Super Area cannot be arbitrarily taken.

23. Returning to the facts of the present case, Clause 7 of the Tuscan Apartments Buyer Agreement is relevant to adjudicate the present issue, which reads as follows:-

"In the event of any increase or decrease to the extent of 10% to the agreed area of the Independent Floor/Apartment, due to alteration as aforesaid, the adjustments in the payments shall be made as per the basic rate as mentioned in Clause 2 above. However, if the increase/decrease is more than the extent of 10% then it shall be the company which shall have sole discretion to fix the rate for such an increase or decrease. Further if due to change in layout plan of the colony or on account of any other alterations, the Independent floor/apartment gets dislocated/omitted, then it shall be open for the Purchaser to opt for a substituted Independent floor/apartment as may be offered by the company. In case the purchaser is not willing to opt for any substituted allocation of Independent floor/apartment or in case the independent floor/apartment is omitted or the company is unable to hand over the same, the company will be liable to refund only the amount received from the Purchaser towards the TSC for the Independent floor/apartment along with a simple interest @ 9% p.a. which shall be calculated from the respective dates when the company has actually received the money in its account. No further compensation of any sort shall be payable by the company."

24. The exorbitant increase in the sale consideration by the Opposite Party is not maintainable on two grounds. Firstly, since the Opposite Party CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 12 of 16 has failed to file its evidence by way of affidavit, there is nothing on record to prove that the decision of the Opposite Party to increase the Super Area was for valid reasons by any competent authority, as already discussed above and secondly, as submitted by the Complainant that even though the Opposite Party has alleged that the increase is more than 10% of the total area, however, on actual measurement, the same increase was less than 10%, and as per clause 7 of the Apartments Buyer Agreement, the opposite party is not entitled for any further cost. Hence, the Opposite Party is liable for Unfair Trade Practice.

25. As per the original prayer clause, the complainant had demanded Rs. 10,16,500/-, however, the complainant later filed an additional affidavit dated 17.03.2021, wherein the complainant admitted that there was an error in calculating the excess amount. The complainant has clarified the amount as claimed in the prayer clause is incorrect and the amount which is to be returned by the Opposite party is actually Rs. 8,80,331/-.

26. Accordingly, we hold that Opposite party has no right to claim an amount of Rs. 8,80,331/- and is liable to refund the aforesaid amount. The Opposite party is only entitled to an amount of Rs. 1,68,900/- as the expenses for conveyance deed which the complainant has not paid as per final statement of account dated 17.08.2015 (Annexure C-4 Colly).

27. Having discussed the liability of the Opposite Party, the only question left to adjudicate is as to how the complainant is to be compensated for the deficient acts of the Opposite Party. It is imperative to refer to the recent pronouncements of the Hon'ble Supreme Court in terms of "Interest" which is being allowed on the refunded amount. In Arifur CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 13 of 16 Rahman Khan and Ors. (supra) which is the latest pronouncement (24.08.2020) on the cause, the Hon'ble Apex Court has allowed an interest @ 6% p.a. on the amount received by the Opposite Party, payable within one month and in case of default to pay within the stipulated period, an interest @ 9% p.a. was payable on the said amount.

28. Keeping in view the facts of the present case and the extensive law as discussed above, we allow the following reliefs as prayed for by the Complainant:

I. We direct the Opposite Party to pay compensation on Rs. 40,86,157.01/- for the delay in handing over the possession as per the following arrangement:

A. An interest @ 4% p.a. calculated from 01.09.2013 (being the date on which the possession was to be handed over to the complainant) till 23.01.2016 (being the date on which the possession was actually handed over to the complainant);

B. The rate of interest payable as per the aforesaid clause (A) is subject to the condition that the OP pays the entire amount on or before 30.06.2021; 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 30.06.2021, the entire amount is to be refunded with an interest @ 6% p.a. calculated from 01.09.2013 (being the date on which the possession was to be handed over to the CC 438/2017 RAJAN PAL V. M/S TDI INFRASTRUCTURE LTD. Page 14 of 16 complainant) till the actual realization of the amount.

II. In addition to the aforesaid, we direct the Opposite Party to refund the excess amount paid by the complainant i.e. Rs. 8,80,331/- along with interest as per the following arrangement:

A. An interest @ 6% p.a. calculated from 17.02.2015 (being the date on which the excess amount was demanded by the Opposite Party) till 09.04.2021 (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 OP pays the entire amount on or before 30.06.2021; C. Being guided by the principles as discussed above, in case the OP fails to refund the amount as per the aforesaid clause (A) on or before 30.06.2021, the entire amount is to be refunded with an interest @ 9% p.a. calculated 17.02.2015 (being the date on which the excess amount was demanded by the Opposite Party) till the actual realization of the amount.

III. Subject to the Complainant depositing the necessary amount i.e. Rs. 1,68,900/- with the concerned authority, the Opposite Party shall get the conveyance deed executed in favour of the Complainant within 2 months from the date of the present judgment.

IV. 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. 50,000/-.

29. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.

30. 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.

31. File be consigned to record room along with a copy of this Judgment.

(DR. JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (ANIL SRIVASTAVA) MEMBER Pronounced On:

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