National Consumer Disputes Redressal
M/S Skycity Builders & Promoters Pvt. ... vs Seema Singhal & 2 Ors. on 11 January, 2022
Author: R.K. Agrawal
Bench: R.K. Agrawal
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 1253 OF 2018 (Against the Order dated 27/03/2018 in Complaint No. 289/2017 of the State Commission Punjab) 1. M/S SKYCITY BUILDERS & PROMOTERS PVT. LTD. THROUGH ITS AUTHORIZED SIGNATORY ROHIT SONI S/O. SHRI KULDEEP SONI,
303, SHIVALIK ENCLAVE, LANDRAN ROAD, KHARA, MOHALI PUNJAB ...........Appellant(s) Versus 1. SEEMA SINGHAL & 2 ORS. W/O. SURENDER KUMAR SINGHAL, RESIDENT OF H NO 9, FIRST FLOOR, BLOCK-E-3, SECTOR 7, ROHINI DELHI 2. SURENDER KUMAR SINGHAL S/O. TARSEM CHAND, RESIDNET OF H NO 9, FIRST FLOOR, BLOCK-E-3,
SECTOR 7, ROHINI DELHI 3. GREATER MOHALU AREA DEVELOPMENT AUTHORITY, (PROFORMA RESPONDENT)THROUGH ITS ADDITIONAL CHIEF ADMINSTRATOR,
P.U.D.A. BHAWAN, SECTOR 62, MOHAIL ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE R.K. AGRAWAL,PRESIDENT HON'BLE MR. DINESH SINGH,MEMBER
For the Appellant : Mr. Mukand Gupta, Advocate For the Respondent : Mr. H.P.S. Ghuman, Advocate
Dated : 11 Jan 2022 ORDER
R.K. AGRAWAL, J., PRESIDENT
1. The present Appeal has been filed against the Order dated 27.03.2018 passed by the State Consumer Disputes Redressal Commission Punjab, Chandigarh (hereinafter to be referred to as "State Commission"), whereby the Complaint filed by the Complainants was allowed and M/s. Skycity Builders & Promoters Pvt. Ltd. (hereinafter referred to as the 'Opposite Party No. 1') was directed to refund ₹36,00,000/- alongwith interest at the rate of 12% p.a. from the respective dates of deposit till realization as per Rule 17 of the PAPRA; pay a sum of ₹4,12,000/- received by the Complainant as an Assured Return to OPs and adjusted by the OPs in the account of OPs; pay ₹1,00,000/- compensation for mental agony and harassment and pay ₹21,000/- towards litigation expenses.
2. Brief facts of the case as narrated in the Complaint are that the Opposite Party No. 1 had launched a Shopping Complex Project under the name and style of "City Heart" (hereinafter referred to as the Project) at NH-21, Chandigarh-Kharar Road, Kharar. Alluring by the advertisements and the pictures shown of the Project by the Opposite Party, the Complainants entered into an agreement with Opposite Party No. 1 to purchase Shop-cum-Office (hereinafter referred to "SCO") No. 84/B measuring 16X66 Sq. ft. 1056 Sq. ft. on First Floor of the Project to establish their shop for earning their livelihood. The Agreement was executed on 28.04.2015 at a settled consideration of ₹52,05,100/-. Another Agreement titled 'Unit Buyer Option Agreement Assured Return Plan' was also entered between the Opposite Party No. 1/Builder and the Complainants on 04.05.2015 for providing assured return @12.5% p.a. on received amount of ₹36 lakh, i.e., ₹37,500/- per month till the offer of possession or 24 months, whichever was earlier. The Complainants had made the payment of ₹40,12,500/- till 31.03.2016. After adding assured return, i.e., a sum of ₹37,500/- per month which was due from the Opposite Parties till the date of possession, the Complainants have paid a sum of ₹44,62,500/-. The Project was to be completed within 21 months period. However, Opposite Party No. 1 wrote a letter dated 16.09.2016, which contains a Maintenance Agreement to show that the possession of the shop has been given to the Complainants but the said Agreement is neither signed by the Complainant nor they have taken the possession of the shop in question. There is another letter dated 21.11.2016, vide which Opposite Party No. 1 had demanded the amount within 15 days without making reference to any particular amount stating that since your Unit is ready for possession and in case the payment is not made within 15 days, booking will be cancelled. The Complainant visited many times to the Office of the Opposite Party No. 1 Builder for getting the possession of the SCO, but Opposite Party/Builder could not give any satisfactory reply to the query regarding Completion Certificate. It was averred that even the Opposite Party No. 1 Builder could not get Completion Certificate from Opposite Party No. 2, Greater Mohali Area Development Authority (hereinafter referred to as OP No. 2 GMADA) till the date of filing of the Complaint. Alleging deficiency in service on the part of the Opposite Parties, Consumer Complaint was filed before the State Commission seeking directions to Opposite Party to refund the amount of ₹44,62,500/- alongwith interest @18% p.a. from the date of respective payments; to pay a sum of ₹5,00,000/- as compensation for unnecessary harassment and mental tension and agony and other sufferings and ₹55,000/- as litigation expenses.
3. The Opposite Parties contested the Complaint by filing their written version before the State Commission. The Opposite Party No. 1 Builder took preliminary objection that the Complaint is not maintainable for want of territorial jurisdiction; the Complainants have concealed the material facts. Project was approved by GMADA/PUDA. Requisite approvals from various Departments were obtained. The Complaint was bad for mis-joinder and non-joinder of necessary parties. The Municipal Corporation Kharar is the Authority, whereas the Project does not fall within the purview of Opposite Party No. 2 and the Opposite Party No. 2 had been wrongly impleaded by the Complainants. The entire market has been completed way back. The Complaint is barred by the rule of estoppels. The Agreement was executed between the Complainant and the Skycity Builders and the plea of the Complainant that SBP group was the main party did not survive. As per clause 22 of the Agreement, the Allottee is entitled for cancellation of the allotment within a period of six months of the Allotment and not at belated stage and there is an Arbitration Clause in the Agreement therefore, the present complaint is not maintainable. On merits, it was denied that the Complainants wanted to establish their shop for earning their livelihood. Basically, they do agree to get this SCO for resale and asked the value of resale of the shop being resident of Delhi. The SCO in question was ready in the month of August 2016 and it was intimated by the Opposite Party No. 1 to the Complainants vide registered letters dated 16.09.2016 and 17.09.2016, despite that the Complainants did not come-forward to take the possession. It was denied that there is any deficiency in service or unfair trade practice on the part of the Opposite Party No. 1. Complaint is without merit and it should be dismissed. Opposite Party No. 2 filed their written statement and submitted that there is no relationship of consumer and service provider between the Complainants and the Opposite Party No. 2, therefore, there is no locus standi to file the Complaint against Opposite Party No. 2. The Complaint is bad for mis-joinder and non-joinder of the necessary parties and that Municipal Council, Kharar is the necessary party. It was also stated that the allegations of deficiency in service is against Opposite Party No. 1 and Opposite Party No. 2 has no role to play in the present Complaint as the area under which the said Project falls, comes under the purview of municipal Corporation, Kharar, therefore, there is no merit in the Complaint filed against them and it should be dismissed.
4. After hearing Learned Counsel for the Complainant, the Opposite Parties and perusal of the material available on record, the State Commission observed that the Complaint falls within the territorial jurisdiction of the State Commission. They further observed that although there was an Arbitration Clause in the Agreement yet under Section 3 of the Consumer Protection Act, 1986 additional remedy has been provided for entertaining the Complaint before the Consumer Fora, therefore, the Complaint is maintainable and the plea of the Opposites Parties that the Arbitration clause is there, therefore, Consumer Complaint before this Commission is not maintainable, does not survive. The State Commission further observed that, in case a commercial property is to be used by the Complainants to earn their livelihood by way of self-employment then Consumer Complaint with regard to the Commercial Property is also maintainable. The State Commission relying upon the information received under RTI from Municipal Council, Kharar on 9.11.2017, wherein it was informed that till 9.11.2017 No Completion Certificate has been issued in favour of OP-1 Builder, held that there was deficiency in service on the part of the OP-1 Builder and partly allowed the Complaint by observing as under:-
"12. ......Then the information was taken by the complainants under the RTI (Ex.C-10) i.e. Letter from Municipal Council, Kharar dated 09.11.2017, wherein it has been referred that till date no completion certificate has been issued in favour of opposite party No.1 with regard to the completion of the project. In case opposite party No.1 has failed to complete the project within the specific time and to handover the possession, it amounts to deficiency in service and complainants are entitled to withdraw from the scheme. A reference can be made to the judgment reported in 2017(1) CPR 168 (NC) titled as "Sanjay Kumar v. Sahara Prime City Limited & Ors.", wherein it was held that allottee is entitled to withdraw from the scheme in the event of delay in completion of that project.
13. Now, we are to check it that how much amount was deposited by the complainants with opposite party No.1. In para No.6 of the complaint, it has been referred that the complainants have made a payment of Rs.40,12,500/- till 31.03.2016. There are three receipts Ex.C-5, Ex.C-5A, Ex.C-5B, Ex.C-5C and Ex.C-5D. According to it a sum of Rs.36,00,000/- has been paid and further the affidavit of complainant shows that the sum of Rs.36,00,000/- has been paid by the complainants. Similarly, reference is given in the agreement. Ex.C-4 is the Unit Buyers Option Agreement. No other evidence has been placed on record that the sum of Rs.40,12,500/- has been paid by the complainants to opposite party No.1. A sum of Rs.4,12,000/- has been paid to the complainants as assured return In case of refund any interest is to be given then in that eventuality, it is to be decided whether interest will be paid on the deposited amount or the complainants will be entitled to the interest or the assured return received by them from the OPs. Certainly, the complainants will be entitled to interest on the deposited amount and not on the amount received as assured income from the OPs. In case, the project was not completed within the specific time then the complainants are entitled for refund and in case refund then interest at the rate of 12% interest is to be paid, it has been so provided under Rule 17 of PAPRA Rules, 1995, which reads as under:-
"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 subsection (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." Therefore, in case on the deposited amount, we allow 12% interest then they will not be entitled to the interest in case payment for the assured return of Rs.37,500/- per month has been received by the complainant.
.........
15. Sequel to the above, we are of the opinion that there is deficiency in service on the part of the Opposite Party No.1 as Opposite Party No.1 failed to deliver the possession of the shop to the Complainants within the agreed time after receiving the major amount as demanded by the Opposite Party No.1 from time to time. In case, the shop has not been constructed or possession was not delivered within the agreed time then the Complainants have a right to withdraw from the scheme and seek refund. Accordingly, opposite party No.1 is directed as under:-
(i) to refund a sum of ₹36,00,000/- alongwith interest at the rate of 12% p.a. from the respective dates of deposit till realization as per Rule 17 of the PAPRA;
(ii) pay a sum of ₹4,12,000/- received by the Complainant as an Assured Return to OPs and adjusted by the OPs in the account of OPs.
(iii) pay ₹1,00,000/- as compensation for mental agony and harassment; and
(iv) pay ₹21,000/- as litigation expenses."
5. Aggrieved by this order, the Appellant/Opposite Party No.1 Builder has filed the present Appeal.
6. Mr. Mukund Gupta, learned Counsel appearing on behalf of the Appellant strenuously argued that the Respondents/Complainants had purchased the Shop-cum-Office (SCO) for commercial purpose to earn huge profits either by Reselling the said property or by doing business, therefore, the Complainants did not fall within the definition of Section 2(1)(d) of the Consumer Protection Act, 1986. As per terms of the Agreement, the possession of the Unit was to be delivered within 21 months of the Allotment. The Respondents/Complainants had made a payment of ₹36,00,000/- against sale-consideration of ₹52,05,100/- and that too not as per payment plan. The possession of the SCO was offered on 16.09.2016 and when balance payment was asked from the Respondents/Complainants, Respondents/Complainants filed a Consumer Complaint on 27.04.2017 seeking refund of the amount alleging that possession of the SCO was not offered in time. The Respondent No. 1 & 2/Complainants were allotted SCO No. 84/B on the 1st Floor. The other Allottees, Kailash Garg and Radhika Jindal, who were allotted SCO No. 84-C (2nd floor) and 84-D (3rd Floor) have already taken possession of the respective SCOs on 12.12.2017 and 12.02.2016 respectively and conveyance deeds were executed in their favour. But the Complainants refused to take possession of the SCO for the reason that they were not having sufficient balance amount to pay and they were not in need of commercial place for personal use and necessity rather the Respondents had invested huge money for purchasing the commercial property for reselling the same on higher price but due to recession in the market, prices of the commercial property have gone down with the result, the Respondents/Complainants by treating it to be bad investment decided not to pay the balance amount and chose to file a false and frivolous Complaint. It was also submitted that the requisite permissions and approvals have been obtained from the Competent Authorities for the Building. Despite that the Completion Certificate has not been issued by the Competent Authority for the reason best known to it. It was further submitted that the State Commission had erroneously awarded both interest as well as the compensation to the Complainant, which is against the settled principle of law. It was prayed that the Complaint be dismissed and the impugned order passed by the State Commission be set aside.
7. Per contra, Mr. H.P.S. Chauhan, learned Counsel appearing on behalf of the Respondents/Complainants supported the Order passed by the State Commission as according to him the State Commission has passed a well-reasoned order which is based on a correct and rightful appreciation of evidence and material available on record and does not call for any interference.
8. We have heard learned Counsel for the Parties, perused the Impugned Order passed by the State Commission, the Complaint, the Written Statement, all the documents available on record and given a thoughtful consideration to the various pleas raised by the Parties.
9. The contention of the learned Counsel for the Appellant/OP Builder that the Complainants are not 'Consumer' and that they had booked the SCO for earning profits is completely unsustainable in the light of the judgement of this Commission in Kavita Ahuja vs. Shipra Estates I (2016) CPJ 31, in which the principle laid down is that the onus of establishing that the Complainant was dealing in real estate i.e. in the purchase and sale of property in his normal course of business to earn profits, shifts to the Opposite Party, which in the instant case the Appellant Builder had failed to discharge by filing any documentary evidence to establish its case. Therefore we are of the considered view that the Complainant is a 'Consumer' as defined under Section 2 (1)(d) of the Act.
10. It is not in dispute that the Appellant Builder offered the Possession of the SCO on 16.09.2016 to the Complainants without obtaining the Completion Certificate from the Competent Authority. It is well-settled principle of law that without obtaining completion certificate, offering possession is not a valid/legal possession and is only a paper-possession. It is the duty of the Appellant Builder to obtain the Completion Certificate from the concerned Competent Authority and only after that they should deliver the possession. The Appellant Builder cannot force the Complainants to accept the possession in the absence of Completion Certificate. Admittedly, the Completion Certificate could not be received till the date of filing of the Appeal. The Complainants cannot be made to wait indefinitely for valid possession. Hence the decision of the Hon'ble Supreme Court in Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra,: II (2019) CPJ 29 (SC), wherein the Hon'ble Apex Court has laid down that the flat purchaser cannot be made to wait indefinitely for delivery of possession, squarely applies to the facts of this case. Therefore, we agree with the view taken by the State Commission that the Complainants are entitled for refund of the deposited amount.
11. The Complainants are also entitled for ₹4,12,000/- towards Assured Return in terms of the Unit Buyer Option Agreement Return Plan entered between the Parties, according to which the Complainants were entitled for assured return @12.5% p.m. on ₹36 lakh deposited by them, i.e., ₹37,500/- per month till offer of possession or 24 months, whichever is earlier, in this case by 16.09.2016.
12. As far as the contention of the learned Counsel for the Appellant/Builder that State Commission had erroneously awarded both interest as well as the compensation to the Complainant, which is against the settled principle of law, is concerned, we find force in it. The Hon'ble Supreme Court in 'DLF Homes Panchkula Pvt. Ltd Vs. D.S. Dhanda, II (2019) CPJ 117 (SC)', has observed that when interest is awarded by way of damages awarding additional compensation is unjustified.
13. Now coming to the question of quantum of Compensation. In cases of refund, the Hon'ble Supreme Court vide Order dated 05.06.2020 passed in Civil Appeal No. 2504/2020 entitled "Prateek Infra Projects India Pvt. Ltd. vs. Nidhi Mittal and Anr." has scaled down the rate of interest awarded by this Commission to 9% per annum. Similar view was also taken by the Hon'ble Supreme Court in Order dated 11.01.2021 passed in Civil Appeal No. 62/2021 entitled "M/s. Nexgen Infracon Pvt. Ltd. vs. Manish Kumar Sinha & Anr." and Order dated 01.10.2021 passed in Civil Appeal No. 5109/2021 entitled "M/s. Nexgen Infracon Pvt. Ltd. vs. Sanjay Dhall".
14. Respectfully following the principles laid down by the Hon'ble Supreme Court in Prateek Infra Projects India Pvt. Ltd. (supra), M/s. Nexgen Infracon Pvt. Ltd. (supra) and DLF Homes Panchkula Pvt. Ltd Vs. D.S. Dhanda (supra), as also keeping in view the fact that in the instant case, the Complainants have already been benefited by way of Assured Return till 16.09.2016, we are of the considered view that by way of damages and compensation, awarding interest @ 9% p.a. on ₹36 lakh deposited by the Complainants, w.e.f. 16.09.2016 till the date of realization, would meet the end of Justice. Accordingly, we partly allow the Appeal and the impugned Order dated 27.03.2018 passed by the State Commission stands modified in following terms:-
(i) The Appellant/OP-1 Builder is directed to refund a sum of ₹36,00,000/- alongwith interest at the rate of 9% p.a. from 16.09.2016, i.e., the date of offer of possession, till realization;
(ii) The Appellant/OP-1 Builder is also directed to pay a sum of ₹4,12,000/- received by the Complainants as an Assured Return and adjusted by the Appellant in its account.
(iii) Keeping in view the peculiar facts and circumstances of the case, there shall be no order as to costs.
......................J R.K. AGRAWAL PRESIDENT ...................... DINESH SINGH MEMBER