State Consumer Disputes Redressal Commission
Sanjay Kumar vs The Estate Officer, Gmada on 5 January, 2018
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.659 of 2017
Date of institution : 04.08.2017
Date of decision : 05.01.2018
Sh. Sanjay Kumar Son of Sh. Rishal Singh, Resident of Manjhu Niwas,
G.T. Sirsa Road, Fatehabad, Haryana.
....Complainant
Versus
The Estate Officer, Greater Mohali Area Development Authority, PUDA
Bhawan, Sector 62, Sahibzada Ajit Singh Nagar, Mohali (Punjab).
....Opposite Party
Consumer Complaint under Section 17 of the
Consumer Protection Act, 1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mrs. Kiran Sibal, Member.
Present:-
For the complainant : Ms. Namita Kandhari, Advocate For the opposite party : Sh. Anuj Kohli, Advocate.
JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT :
Facts of the Complaint The complainant has filed this complaint, under Section 17 of the Consumer Protection Act, 1986 (in short, "the Act"), seeking following directions to the opposite party:
i) to refund the total amount deposited by the complainant, along with interest at the rate of 12% per annum compounded annually from the date of deposit of earnest money till actual payment i.e. ₹22,04,011.00 upto 30.06.2017, along with future interest at the Consumer Complaint No.659 of 2017 2 rate of 12% (₹29700.00 per month) annually compounding w.e.f.
01.07.2017 till the actual payment;
ii) to pay compensation of ₹4,00,000/- for the mental agony and harassment suffered by the complainant;
iii) to pay ₹1,50,000/-, towards the cost of present proceedings;
and
iv) It was further prayed that any other relief which may be deemed proper, in view of facts and circumstances of the present matter may also be awarded.
Brief facts, as set out in the complaint, are that the opposite party issued advertisement in various newspapers regarding allotment of flats on 'Draw Basis' in "Purab Premium Apartment" at Sector-88, SAS Nagar, Mohali. In pursuance thereof, the complainant applied for allotment of a flat, under 'General Category', by way of an application, along with ₹6,90,000/-, as earnest money; which was financed through PNB. The complainant was declared successful allottee in the draw held on 20.03.2012, in pursuance of his Application Form No.11668, Category A, Residential Apartment Type-III. Letter of Intent (LOI) was issued by the opposite party in his favour on 23.05.2012. Thereafter, the complainant paid ₹13,80,000/-, being 20% of the price of the said apartment, through RTGS, on 18.06.2012 through Axis Bank in the account of GMADA, Mohali. In this manner, he had paid 30% of the total cost of the flat, in question. As per Clause 3(ii) of LOI, the possession of the flat was required to be handed over after the completion of development works at site within a period of 36 months Consumer Complaint No.659 of 2017 3 from the issuance of LOI, i.e. upto 23.05.2015. It was also one of the conditions of the LOI that if for some reasons, the opposite party is unable to deliver the possession of the apartment within the stipulated period, the allottee will have the right to withdraw from the scheme, by moving an application to the Estate Officer and that authority would refund the entire amount deposited by the applicant, along with interest at the rate of 8%, compounded annually. It was further pleaded that the complainant visited the site of the said flat in the month of March, 2015, but was shocked to see that there was no substantial construction work done at the site, even though the period of 34 months had passed after the issuance of the LOI and the possession was not likely to be delivered even till June, 2017. The cost of construction kept on increasing from time to time and it increased from ₹715 Crores to ₹750 Crores. The contractor was required to pay extra amount, which was being imposed upon the allottees. Even a case was registered against Chief Engineer, Sh. S.P. Singh, for committing illegalities in construction of flats. No construction was raised at the site even till the expiry period, which was extended upto 31.05.2017. The complainant waited for a sufficient long period and then in pursuance to the advertisement published in "Indian Express" dated 13.06.2017, it came to his notice that the construction work had not been completed by the opposite party till 31.05.2017. It also came to his notice that the opposite party, on the one hand, deducted 10% for the purpose of refund and on the other hand was selling the same flats on high premium. Another advertisement was issued, stating that the scheme was open on Consumer Complaint No.659 of 2017 4 03.11.2015 and it was projected that the possession would be given by 31.09.2016. The total area of the flat, in question, was 221 sq.ft. and the total price thereof was ₹98.31 lac. The complainant moved an application for refund of the amount, which was allowed, but a cheque, bearing No.112506 dated 30.04.2015, for ₹11,48,714/- only was issued, without giving any reason for deduction. The complainant issued legal notice dated 01.06.2017, vide Registered AD, to the opposite party, stating that less amount had been refunded, but no reply was given thereto. Various authorities have been cited in the complaint. The act and conduct of the opposite party amounted to deficiency in service and unfair trade practice, which caused mental agony and harassment to the complainant. Hence, the complaint.
Defence of the Opposite Party
2. Upon notice, the opposite party appeared and filed reply to the complaint, raising certain preliminary objections that there is no deficiency in service and unfair trade practice on its part. The complainant was refunded the amount, as per terms and conditions of the Letter of Intent, which has been accepted by the complainant. Thus, there is no contract existing between the parties and there is no relationship of 'consumer' and 'service provider' between them, which came to an end on receipt of refund of the amount by way of cheque; which has duly been got encashed by the complainant. It was further pleaded that the refund was made in the month of April, 2015 and this complaint has been filed beyond the period of two years therefrom. No application for condonation of that delay has been filed and, as such, the Consumer Complaint No.659 of 2017 5 complaint is barred by limitation. It was further pleaded that under Section 8 of the Arbitration and Conciliation Act, 1996, the matter is required to be decided by the Arbitrator and not by this Commission, as per Clause 6 of the LOI. Furthermore, the complainant is not a 'consumer', as he purchased the said flat for speculation purpose. On merits, it was admitted that the complainant applied for allotment of a flat with the opposite party. It was further admitted that LOI dated 23.05.2012 was issued in favour of the complainant. The payment of ₹6,90,000/- as earnest money by the complainant was not denied. The payment of ₹13,80,000/- by the complainant was also admitted. Clause 3 (ii) of the LOI is inapplicable to the present case, as the complainant had himself defaulted in making payment of instalments. The complainant could seek resort to Clause 3 (ii), only if he had performed his part of contract, by making the payment of instalments on the scheduled dates and the opposite party had failed to deliver the possession of the flat within the stipulated period of 36 months from the date of issuance of LOI. Since the complainant himself failed to pay the installments on stipulated dates, thus he also incurred liability to pay interest to the opposite party. Thus, the order for cancellation of LOI and forfeiture of amount has rightly been passed by the opposite party. Accordingly, the refund, after due deduction, has rightly been made to the complainant. It was further pleaded that the opposite party proposed to build a total of 4500 flats and draw of lots was held on 20.03.2012, in which around 1400 applicants were held successful. However, only 1075 successful applicants were found eligible. Accordingly, the Consumer Complaint No.659 of 2017 6 opposite party proposed to build 1620 number of flats. However, during the execution of the project, approximately 400 allottees had defaulted in making due payments and approximately 75 allottees opted for refund of their money. Moreover, the development of a Group Housing Project is always planned in such a manner that contribution from all the allottees is taken into consideration for its timely completion and any delay on the part of even one allottee, seriously prejudice the completion schedule. It was further pleaded that the allotment letters as well as offer of possession letters of the apartments have already been issued to the successful applicants in the month of June, 2016. It was further pleaded that demand notice dated 05.03.2015 was issued to the complainant. The complainant wrote letter dated 01.04.2015, requesting the opposite party for surrender of the flat, on the ground that he was unable to pay the dues. He also requested for cancelling his request and sought extension of time, vide letter dated 01.04.2015. He further wrote many letters in this regard, seeking extension of time to deposit the due instalments. It was further pleaded that after considering the application dated 01.04.2015 of the complainant, the LOI was cancelled as per its terms, vide office order dated 30.04.2015, and 10% of the total price, interest and penalty etc. was ordered to be forfeited in favour of GMADA and due amount was ordered to be refunded to the complainant. After the refund of the said amount, the complainant cannot claim any amount by way of present complaint. Other allegations of the complainant were denied and it was prayed that the complaint be dismissed. Consumer Complaint No.659 of 2017 7 Evidence of the Parties
3. To prove his claim, the complainant tendered his affidavit as Ex.C/A, along with documents Ex.C-1 to Ex.C-8, along with Mark-A to Mark-E.
4. The opposite party tendered affidavit of Sh. Mahesh Bansal, Estate Officer (Housing), GMADA, as Ex.OP-A, along with documents Ex.OP-1 to Ex.OP-10.
Contentions of the Parties
5. We have heard learned counsel for the parties and have gone through the record carefully. We have perused the written arguments submitted on behalf of the complainant.
6. Learned counsel for the complainant, in addition to the written arguments, vehemently contended that the opposite party has wrongly and illegally deducted excessive amount i.e. 10% of the cost of the flat i.e. ₹69,00,000/-. It only refunded the amount of ₹11,48,714/- out of the deposited amount of ₹20,70,000/-, vide cheque dated 30.04.2015. The complainant got served legal notice dated 01.06.2017, Ex.C-7, upon the opposite party, requesting it to refund the entire earnest money, along with interest at the rate of 24% per annum, as the opposite party itself was not in a position to complete the project, in order to deliver possession of the flat allotted to the complainant. The construction was not completed, in accordance with the schedule and the possession was not likely to be delivered even till June, 2017. It was further contended that initially the cost of the construction of the apartment was ₹7.15 Crores, but the amount was increased to ₹750 Consumer Complaint No.659 of 2017 8 Crores. The extra cost was to be paid by the contractor, but the same was being imposed on the allottees. It was further contended that the issue of irregularity was considered by the Punjab Vigilance Bureau and Chief Engineer, Sh. S.P. Singh, was arrested in this regard. The opposite party did not give any reason for the said illegal deduction of 10%. It committed deficiency in service and, therefore, the complaint is liable to be allowed and all the directions, as prayed for therein, are liable to be issued to the opposite parties. Learned counsel for the complainant, in support of her contentions, relied upon the following cases:
i) Satbir Singh v. State of Haryana 2002 (2) S.C.T. 354 (P&H);
ii) V.N. Shrikhande v. Anita Sena Fernandes 2011 (1) SCC 53 (SC);
iii) Greater Mohali Area Development Authority & Anr. v.
Priyanka Nayyar), First Appeal No.1456 of 2016 decided on 22.12.2016 (NC);
iv) S. Ravi Kumar v. M/s Kavisha Fine Homes Pvt. Ltd. 2015 (2) CPR 356 (NC); and
v) Dr. Indu Sharma v. Indraprastha Apollo Hospital & Ors.
2015 (3) CPJ 248 (NC).
7. Per contra, learned counsel for the opposite party vehemently contended that there is no privity of contract between the parties after April, 2015, as the due amount has already been refunded to the complainant, as per terms and conditions of LOI, vide cheque dated 30.04.2015. He issued legal notice dated 01.06.2017, Ex.C-7, i.e. Consumer Complaint No.659 of 2017 9 after a long period of more than two years after the receipt of the above said cheque. The complaint has been filed after the period of limitation from the receipt of the above said cheque and, thus, the same is time barred. Even otherwise, if the complainant was aggrieved, he could have filed appeal/revision against the said order of cancellation of LOI and forfeiture of amount, before the competent authority, as per Punjab Regional and Town Planning and Development Act, 1995. The deduction of 10% from the earnest money has been made, as per Section 45 (3) of the said Act. Therefore, the complainant is not entitled to the refund of any amount. It was further contended that since the complainant himself defaulted in making payment of due instalments within the stipulated time, therefore, the above amount was legally and validly deducted and the complainant is entitled to the amount, which has been refunded to him, after making deductions, as per the provisions of the said Act. There is no deficiency in service on the part of the opposite party and the complaint is liable to be dismissed. Consideration of Contentions
8. We have given a thoughtful consideration to the respective contentions of both the parties.
9. First of all, we would like to deal with the issue, whether the complaint has been filed within limitation?
10. Admittedly, the complainant was allotted the flat, in question, vide Letter of Intent dated 23.05.2012, Ex.C-1, in which the tentative price there was mentioned as ₹69,00,000/-. The complainant deposited 30% of the sale price of the said flat i.e. ₹20,70,000/- with the opposite Consumer Complaint No.659 of 2017 10 party upto 18.06.2012. It is also an admitted fact that the complainant has already received the sum of ₹11,48,714/-, vide cheque No.112506 dated 30.04.2015, Ex.C-6, which has been accepted by the complainant. Already a period of more than two years has elapsed and it is presumed that the said cheque was got encashed by the complainant in the month of May, 2015. Thereafter, the complainant remained silent for sufficient long period and issued legal notice dated 01.06.2017 i.e. after more than two years from the issuance of the above said cheque. It is a settled proposition of law that any amount of correspondence does not extend the period of limitation.
11. In United Bank of India v. Janata Paradise Hotel and Restaurant IV (2014) CPJ 383 (NC), Hon'ble National Commission has observed in Para No.6 as follows:-
"6. As far limitation is concerned, admittedly, last deduction was made in the year 1992 and matter was settled in the year 1995 and first letter submitted by complainant is dated 18.11.2007 and next letters dated 18.1.2008 and 24.5.2008, which were replied by OP by letter dated 26.5.2008. Complainant has not placed any correspondence on record from 1995 to 2007. In such circumstances, claim is clearly time barred. Learned Counsel for the respondent submitted that as claim was referred by OP to higher authorities as intimated by letter dated 26.5.2008 and his request was turned down by Ombudsman and RBI by letter dated 12.5.2009, complaint filed by him is well within limitation. This argument is devoid of force because correspondence does not extend limitation, particularly, when first request for refund is made after claim became time barred. In this matter, claim became time barred in the year 1995 and letter has been written on 18.11.2007.Consumer Complaint No.659 of 2017 11
Complainant has not placed any letter from 1995 to 2007 and thus, claim being barred by limitation, learned District Forum committed error in allowing complaint."
12. In Vandan Pareshkumar Manghita v. The Divisional Manager, National Insurance Co. Ltd., 2014 (4) CLT 254, Hon'ble National Commission observed in Para No.9 as follows:
"9. Learned counsel for the appellant submitted that claim was repudiated by letter dated 21.03.2012, which is apparently not correct. By this letter it was communicated that claim had already been closed vide letter dated 8.9.2009 and perusal of this letter does not reveal that claim was repudiated by this letter. Mere correspondence does not extend limitation and complaint was to be filed within period of 2 years from first intimation dated 8.9.2009 regarding "no claim".
13. The ratio of the law laid down in the above noted authorities fully applies to the present case, as the amount was refunded to the complainant, vide cheque dated 30.04.2015, whereas he issued legal notice on 01.06.2017 i.e. after more than two years therefrom. From 30.04.2015 to 01.06.2017, he did not lodge any protest against the above said deduction made by the opposite party and he suddenly woke up after a long slumber and issued the legal notice on 01.06.2017 and then filed the present complaint on 04.08.2017 before this Commission, i.e. after the period of limitation. By way of issuance of legal notice in the month of June, 2017, the limitation period is not extended. Even no application for condonation of delay has been filed, along with the complaint. Thus, we have no hesitation to conclude that the complaint is Consumer Complaint No.659 of 2017 12 barred by limitation, having been filed after the period of limitation of two years.
14. It also needs to be noticed that the complainant had been himself writing letter dated 03.06.2014, Ex.OP-6, and e-mail dated 28.06.2014, Ex.OP-7, to the opposite party, stating that he was unable to deposit the due instalments on time, due to his personal reasons and financial crises on account of his illness. He requested the opposite party to extend the time and to allow him to deposit the pending instalments in order to regularize his account. In e-mail, Ex.OP-7, he duly mentioned that he was not able to deposit the 4 six monthly instalments, due to his serious personal and financial problems. He further wrote letter dated 18.11.2014, Ex.OP-8, to the opposite party, wherein he even undertook to pay all the dues and penalties, as per the norms of the department. Similar letter dated 26.11.2014, Ex.OP-9, was also written by him to the opposite party. Ultimately, vide Office Order, conveyed vide Endorsement dated 24.04.2015, the Estate Officer, GMADA, cancelled the Letter of Intent issued in favour of the complainant, keeping in view his application of the complainant for refund of the amount, forfeited 10% of the total amount deposited by the complainant, in favour of GMADA under Section 45 (3) of Punjab Regional and Town Planning and Development Act, 1995. Accordingly, after deducting a sum of ₹9,21,286/-, a sum of ₹11,48,714/- was ordered to be refunded to the complainant. Against that order, the complainant has not filed any appeal/revision before the competent authority. Be that as it may, the fact remains that after the refund of the Consumer Complaint No.659 of 2017 13 above said amount has been accepted by the complainant, without lodging any kind of protest immediately after the passing of the above said cancellation/forfeiture order, he had no privity of contract with the opposite party in this matter. Furthermore, when the complainant himself committed default in making payment of instalments towards the price of the flat, in question, within the stipulated period, and he had been requesting the opposite party, vide aforesaid letters, for extension of time and ultimately sought refund of the amount deposited, now it does not lie in his mouth to allege that the opposite party committed any wrong by forfeiting 10% of the price of the flat from the amount deposited by him.
15. The ratio of law laid down in Priyanka Nayyar's case (supra), which has been relied upon by learned counsel for the complainant, is not applicable, in view default of the complainant in making due payments in the present case. The other authorities relied upon by the learned counsel for the complainant are also distinguishable.
16. So far as the plea of the complainant that as per Clause 3 (ii) of the LOI, Ex.C-1, the opposite party failed to complete the development works at site within 36 months from the date of LOI is concerned, it is relevant to mention that the LOI was issued on 23.05.2012 and the said period was to expire on 23.05.2015. However, the complainant himself applied for refund of the amount deposited by him by surrendering the flat, in question, vide application dated 01.04.2015, i.e. before the expiry of the above said period. Thus, the Consumer Complaint No.659 of 2017 14 said Clause was to come into operation on with effect from 23.05.2015 and not before that. Once the flat was wilfully surrendered by the complainant before the said expiry period, that too due to his own inability to pay the remaining instalments, then it cannot be said that the opposite party committed any deficiency in service by refunding the due amount after making statutory deductions from the amount deposited by him.
17. In view of our above discussion, the complaint is dismissed being barred by time, with the observations made above. However, the complainant will be at liberty to avail other remedy available to him, if any, in accordance with Punjab Regional and Town Planning and Development Act, 1995.
18. The complaint could not be decided within the stipulated timeframe, due to heavy pendency of Court cases.
19. Since there is shortage of postal stamps in this Commission, therefore, the parties through their counsel are directed to receive free certified copies of the order by hand and it is the responsibility of the learned counsel for the parties to inform them accordingly.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (MRS. KIRAN SIBAL) MEMBER January 05, 2018.
(Gurmeet S)