State Consumer Disputes Redressal Commission
Navjeevan Kumar vs M/S Country Colonisers Pvt. Ltd. on 26 March, 2018
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
1) Consumer Complaint No.697 of 2017
Date of institution : 17.08.2017
Date of decision : 26.03.2018
Navjeevan Kumar s/o Sh.Shamsher Ram, R/o H.No.570, Sector 69,
Mohali.
....Complainant.
Versus
1. M/s Country Colonizers Private Limited having its registered
office at P.O. Raon and Silk Mills Adjoining Coca Cola Depot,
G.T.Road, Chheharta, Amritsar, Punjab-143105 through its
Director Sh.Harmandeep Singh Kandhari.
2. Sh.Harmandeep Singh Kandhari, Director of M/s Country
Colonizers Private Limited, P.O. Raon and Silk Mills Adjoining
Coca Cola Depot, G.T.Road, Chheharta, Amritsar, Punjab-
143105.
3. Sh.Rajinder Singh Chadha, Director of M/s Country Colonisers
Private Limited, P.O. Raon and Silk Mills Adjoining Coca Cola
Depot, G.T.Road, Chheharta, Amritsar, Punjab-143105.
4. Sh.Manpreet Singh Chadha, Director of M/s Country Colonizers
Private Limited, P.O. Raon and Silk Mills Adjoining Coca Cola
Depot, G.T.Road, Chheharta, Amritsar, Punjab-143105.
5. Sh.Gurjeet Singh Kochar, Director of M/s Country Colonizers
Private Limited, P.O. Raon and Silk Mills Adjoining Coca Cola
Depot, G.T.Road, Chheharta, Amritsar, Punjab-143105.
....Opposite Parties.
6. Housing Development Finance Corporation Limited having its
branch office at SCO 153-155, Sector 8-C, Chandigarh through
its Branch Manager/Authorised Signatory.
....Performa Party.
2) Consumer Complaint No.690 of 2017
Date of institution : 14.08.2017
Date of decision : 26.03.2018
Rajesh Kumar Singla s/o Sh.Om Prakash Singla, R/o H.No.486/9,
Mahaveer Street, Smana Mandi, Patiala, Punjab.
....Complainant
Versus
Consumer Complaint No.697 of 2017 2
1. M/s Country Colonisers Private Limited having its Registered
Office at P.O. Rayon and Silk Mills, Adjoining Coca Cola Depot,
G.T. Road, Chheharta, Amritsar, Punjab-143105 through its
Managing Director/Authorised Signatory.
2. Rajinder Singh Chadha, Director of M/s Country Colonisers
Private Limited, r/o 21, Oak Drive, Chhatter Pur Farm, New Delhi
-110030.
3. Manpreet Singh Chadha, Director of M/s Country Colonisers
Private Limited, r/o 21, Oak Drive, Chhatter Pur Farm, New Delhi
-110030.
4. Harmandeep Singh Kandhari, Director of M/s Country Colonisers
Private Limited, R/o C-193, Sector-44, Noida 201301.
....Opposite Parties.
Consumer Complaints under Section 17 of
the Consumer Protection Act, 1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mrs. Kiran Sibal, Member.
Present (Consumer Complaint No.697 of 2017):-
For the complainant : Sh. S.S.Gill, Adocate
For OPs No.1-5 : Sh. Tejeshwar Singh, Advocate
For OP No.6 : Ms. Anjali Modgil, Advocate
MRS.KIRAN SIBAL, MEMBER
This order will dispose of above mentioned two (2) Consumer Complaints filed by the complainants, under Section 17 of the Consumer Protection Act, 1986 (in short, "the Act"), as the facts and the questions of law involved in both these complaints are the same and both the complaints have been filed against the same opposite parties/party by the complainants. The facts are taken from Consumer Complaint No.697 of 2017.
Consumer Complaint No.697 of 2017 3Consumer Complaint No.697 of 2017
2. The complainant has filed this complaint, under Section 17 of the Act, 1986, seeking following directions to the opposite parties:
i) to refund the entire payment made to the OPs i.e. ₹49,52,087/-, along with interest at the rate of 18% per annum from the date of deposit of the amounts;
ii) to pay ₹5,00,000/-, as compensation on account of mental agony and harassment suffered by him;
iii) to pay ₹55,000/-, towards litigation expenses;
iv) it was also prayed that any other relief, which may be deemed fit, may also be granted.
3. Brief facts, as set out in the complaint, are that the complainant purchased an Apartment in resale from the original allottee Sh.Gurnaib Singh Brar in the project being developed by OPs under the name and Style of "Wave Gardens", situated at Sector 85, Mohali. Apartment No.WG/C/1402, on 14th Floor in Tower Cosmos measuring approximately 1380 Sq.Ft. for a total sale consideration of ₹51,75,000/- was allotted to the original allottee, which was subsequently endorsed in the name of the complainant. Consequently, an Apartment Allottee(s) Arrangement was executed between the complainant and the OPs on 06.10.2012. As per clause 5.1 of the Apartment Allotment Arrangement executed between the parties, the possession of the said apartment was to be handed over within 30 months along with an extended period of 6 months from the date of execution of the Apartment Allotment Arrangement and/or from Consumer Complaint No.697 of 2017 4 the date of construction of Group Housing named as "Wave Gardens"
whichever was later. The complainant kept on making the payments towards the sale consideration of the said apartment and the details of the said payments are as follows:-
S.No. Date Amount (In ₹)
1. 20.05.2012 3,00,000/-
2. 20.07.2012 5,00,000/-
3. 30.01.2013 10,44,339/-
4. 30.01.2013 2,49,641/-
5. 22.03.2014 11,75,153/-
6. 22.03.2014 1,18,867/-
7. 13.01.2015 2,25,055/-
8. 14.07.2015 12,93,250/-
9. 21.09.2015 45,782/-
Total 49,52,087/-
The complainant had availed loan facility of ₹45,60,000/- from HDFC Limited, Chandigarh. Subsequently, a Tripartite Agreement was executed between the complainant and OPs on 26.12.2012. As per Clause 4.2 of the Apartment Allottee(s) Arrangement, the OPs charged 18% interest p.a. for default in making payment within the specified dates, whereas if the OPs delay in giving the possession of the said apartment, they are liable to pay compensation @ ₹5/- per Sq.Ft per month on super area of the said apartment as per Clause 5.5 of the Apartment Allottee(s) Arrangement, which was a very meager amount as the complainant has already paid back EMIs to the Bank @ 10.75% p.a. on a variable rate basis on the loan already availed for the said Consumer Complaint No.697 of 2017 5 apartment. As per Clause 5.1 of the Apartment Allottee(s) Arrangement, OPs were to hand over the possession of the said apartment within 36 months from the date of execution of the Apartment Allottee(s) Arrangement. Thus the stipulated date for handing over the possession of the said apartment was 05.10.2015. The OPs had not developed the project and there was no likelihood of the possession being handed over to the complainant in the near future. The complainant was regularly paying EMIs to the Bank for the loan facility availed for the said apartment without there being any likelihood of the possession being offered to him soon, thereby causing mental harassment to him. He received a letter dated 04.08.2016 from OPs regarding extension of the subvention scheme, whereby the complainant was informed that the subvention period was extended till 30.06.2018 and OPs were liable to bear interest accruing on the outstanding loan amount till 30.06.2018 or offer of possession, whichever was earlier and it was further informed that pre-EMIs already paid by him to the Bank would be refunded subject to clearance of all the dues. The said letter itself proves that the OPs could not be able to offer possession till June, 2018 and had failed in offering possession to the complainant as per the committed date. The complainant falls under the definition of "Consumer" under the Act and OPs are deficient in providing services to the complainant. OPs till date, have not offered the possession to the complainant even after receiving a substantial amount for the said unit. Hence, the present complaint.Consumer Complaint No.697 of 2017 6
Defence of the Opposite Parties
4. Upon notice, the opposite parties appeared before this Commission. Opposite parties No.1 to 5 filed joint written reply, whereas opposite party No.6 filed separate written reply.
5. Opposite parties No.1 to 5, in their written reply have raised certain preliminary objections that the complainant does not fall under the definition of 'consumer' under the Act, as he sought to buy the said housing unit, in question, for commercial purpose, as he already owns and resides in House No.570, Sector 69, Mohali and the said address was also listed as his permanent address in his Voter Card. He purchased the same for commercial purpose in order to earn profits. However, due to slump in real estate market, he is no longer interested to retain the said unit. The complaint is not maintainable, in view of Arbitration Clause 13 of the agreement. The complainant opted for subvention linked plan, under which the Bank pays the entire remainder of the amount, except for 15% of Basic Sale Price, which is payable by the complainant. Under the Tripartite Agreement, the EMI commences from the month following the month, in which the loan disbursement is complete. Till such commencement, the complainant is liable to pay the Pre-EMI interest, which is the agreed simple interest charged on the loan amount disbursed. The complainant has no cause of action to file this complaint. The complainant cannot take the plea of delay in delivery of possession, as he himself failed to make the payments on time. In fact, due to demonetization and slow down in the markets, the construction sector and payments, which were to be Consumer Complaint No.697 of 2017 7 received by the answering opposite parties, were seriously effected and due to that, the work of construction got little delayed, which was beyond the control of the opposite parties. Besides this, subsequent restrictions on cash and implementation of GST also halted the construction activities at the site. The prayer of the complainant for refund of the entire deposited amount is not maintainable, in the light of Tripartite Agreement and the payment plan opted by him, because the answering opposite parties have made huge payments on behalf of the complainant on account of Pre-EMI interest. It was further pleaded that the opposite parties entered into a Memorandum of Agreement (MoA) dated 03.02.2006 with the Government of Punjab and as per Clause 5(e) thereof, the State Government was to acquire land under the provisions of Land Acquisition Act, 1894 and transfer the same to the answering opposite parties for development. However, the State Government failed to acquire any land for the answering opposite parties and, as such, the approved plan of the entire project also shows certain "Critical Area' i.e. the lands, which are not in their possession, due to failure of the State Government. The lands, which are not available with them form 10% of the total land required for the project, due to which laying of lines for basic services is not complete. The request was made to the Land Acquisition Collector, Greater Mohali, vide letter dated 19.01.2012, requesting the State Government to acquire 23.21 acres of land, which falls within the master plan of the project, but without any result. However, opposite party No.1 managed to enter into a Land Use Agreement with the local farmer, from whose Consumer Complaint No.697 of 2017 8 land an access road has been laid for proper access to the project. Thus, the delay, if any, in the completion of the project is due to inaction on the part of GMADA. The complainant failed to show any agreement with opposite parties No.2 and 4 and, thus, the complaint is liable to be dismissed qua them. On merits, purchase of the apartment, in question, by the complainant in resale is admitted. It was also admitted that the complainant deposited a sum of ₹10,70,836.64 with the opposite parties. It was pleaded that the complainant opted for Subvention Linked Plan. Under this plan, the complainant pay 15% of the Basic Sale Price, following which the Apartment Allottee(s) Arrangement was executed between the Allottee(s) and the developer. There was no delay, as 36 months period had to start from the start of construction. If any delay was there, the same is duly explained in the preliminary objections. It was further pleaded that the amount claimed is more than ₹1 Crore, which is beyond the pecuniary jurisdiction of this Commission. It was pleaded that there is no deficiency in service on the part of these opposite parties. Other allegations of the complainant were denied and it was prayed that the complaint be dismissed.
6. Opposite party No.6, in its reply, raised preliminary objections that the rights of the parties to the present lis are governed by the loan agreement dated 29.01.2013. In case of cancellation of the unit or in the contingency of termination of the Apartment Allottee(s) Arrangement, opposite party No.6 has the first charge/right to seek apportionment of its dues. As on 24.09.2017, an amount of Consumer Complaint No.697 of 2017 9 ₹36,82,783/- was pending towards the total loan amount. On merits, it was pleaded that the complainant availed loan of ₹38,81,250/- out of the sanctioned loan amount of ₹41,40,000/- from opposite party No.6. It was further stated that the complainant had been paying EMIs strictly as per the terms and conditions mentioned in the loan agreement. Dismissal of the complaint qua opposite party No.6 was prayed. Evidence of the Parties
7. To prove his claim, the complainant tendered his affidavit as Ex.C-A, along with documents Ex.C-1, Ex.C-2 to C-2(h) (colly) to Ex.C-6.
8. Opposite parties No.1 to 5 tendered affidavit of Sh. Amarjeet Singh, Manager, as Ex.OP-1/A, along with documents Ex.OP1/1 and Ex.OP1/22.
9. Opposite party No.6 tendered affidavit of Sh. Nandan Singh Rawat, Authorized Signatory, as Ex.OP6-A, along with documents Ex.OP6/1 to Ex.OP6/4.
Contentions of the Parties
10. We have heard learned counsel for the parties and have gone through the record carefully.
11. Learned counsel for the complainant vehemently contended that the complainant paid the huge amount of ₹49,52,087/- with opposite parties No.1 to 5 towards the total cost of the unit, in question, but they failed to develop/complete the same, in order to deliver its possession within the stipulated period. As per Clause 5.1 of the agreement, the possession was to be delivered within 36 months Consumer Complaint No.697 of 2017 10 i.e. by 05.10.2015, but they did not carry out any construction/development at the spot, despite receipt of above substantial amount from the complainant towards the price of the plot, in question. The said opposite parties failed to prove by leading cogent and convincing evidence that they were justified in delaying the project, on the grounds mentioned in their reply. There is deficiency in service and unfair trade practice on their part. The complainant is entitled to the refund of the amount deposited by him, along with interest. Thus, all the directions, as prayed for in the complaint, are liable to be issued to opposite parties No.1 to 5.
12. Per contra, learned counsel for opposite parties No.1 to 5 vehemently contended that this Commission has no pecuniary jurisdiction to decide this complaint, as the amount involved in this case is more than ₹1 Crore. Another contention raised by the learned counsel for the opposite parties is that the complainant is having two houses, out of which one is situated in Chandigarh and, thus, he is not a 'consumer'. As per Arbitration Clause in the agreement, this dispute between the parties is triable by the Arbitrator. It was further contended that there was no specific period mentioned in the agreement for delivery of possession. The opposite parties were just to make endeavour to deliver the possession of the unit, in question, within 30 months, with an extended period of 6 months from the date of agreement and/or from the date of start of construction of Group Housing named as "Wave Gardens", whichever was earlier. Moreover, the complainant cannot allege any delay on the part of the Consumer Complaint No.697 of 2017 11 opposite parties, as he himself failed to pay the due amounts regularly on time. There is no deficiency in service on the part of opposite parties No.1 to 5 and the complaint is liable to be dismissed against them. Reliance was placed on judgment of the Hon'ble National Commission rendered in case Saavi Gupta & Anr. v. M/s Omaxe Azorim Developers Pvt. Ltd. & 3 Ors. Consumer Case No.208 of 2012 decided on 01.10.2012. Denying all other allegations made in the complaint, the learned counsel has prayed for dismissal of the complaint.
13. On the other hand, learned counsel for opposite party No.6 contended that the complainant got sanctioned loan of ₹41,40,000/- from it, out of which an amount of ₹38,81,250/- was disbursed. It was further contended that a tripartite agreement dated 26.12.2012 was executed between the parties and the parties are governed by the terms and conditions thereof. In case of cancellation of the unit or Apartment Allottee(s) Arrangement, opposite party No.6 has the first charge/right to seek apportionment of its dues. Consideration of Contentions
14. We have considered the respective contentions raised by the learned counsel for the parties.
15. So far as the plea opposite parties No.1 to 5 regarding pecuniary jurisdiction of this Commission is concerned, it is relevant to mention that in the preliminary objections mentioned in their reply, no such objection was taken by opposite parties No.1 to 5 nor this objection was pressed at the initial stage. Once the objection is not Consumer Complaint No.697 of 2017 12 pressed at the initial stage, then opposite parties No.1 to 5 have to show that what prejudice has been caused to them for non-raising the said objection at the relevant stage. Hon'ble Supreme Court in case "HARSHAD CHIMAN LAL MODI v. DLF UNIVERSAL LTD. AND ANOTHER" (2005) 7 Supreme Court Cases 791 held that the objections as to territorial and pecuniary jurisdiction have to be taken at the earliest possible opportunity and in any case before settlement of issues and cannot be allowed to be taken at a subsequent stage.
16. Otherwise also, the complainant is claiming refund of ₹49,52,087/- with interest and this amount does not exceed ₹1 Crore. The interest too has not been specified as to from which date the same has been claimed. Moreover, the period from which the interest is to be awarded is left to the discretion of the Commission. Therefore, the said objection of those opposite parties is not sustainable and the same is declined accordingly.
17. So far as the objection of opposite parties No.1 to 5 that as per Clause-13 of the agreement, Ex.C-1, the matter between the parties is liable to be referred to the Arbitrator, is concerned, it is relevant to mention here that the Larger Bench of the Hon'ble National Commission, vide order dated 13.07.2017, passed in Consumer Complaint No.701 of 2015 titled as Aftab Singh v. EMAAR MGF Land Limited & Anr., also held that an Arbitration Clause in the afore-stated kind of Agreements between the Complainants and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, notwithstanding the amendments made to Section 8 of the Arbitration Act, 1996. The Civil Consumer Complaint No.697 of 2017 13 Appeal No.(s) 23512-23513 of 2017 (M/s EMAAR MGF Land Limited & Anr. Vs. Aftab Singh) filed against the said order of the Hon'ble National Commission has also recently been dismissed by the Apex Court, vide order dated 13.02.2018, Consequently, the existence of an Arbitration Clause is not a bar to resolution of this dispute by this Commission. Accordingly, the said objection of the opposite parties No.1-5 is also rejected.
18. So far as the objection of opposite parties No.1 to 5 that the complainant has purchased the unit, in question, for commercial purpose, as he is owner of a house and he is not a 'consumer' under the Act, is concerned, it is relevant to mention opposite parties No.1 to 5 failed to prove that the complainant indulged in sale purchase of units for commercial purpose. Hon'ble National Commission in M/s IREO FIVERIVER PVT. LTD. v. SURINDER KUMAR SINGLA & OTHERS First Appeal No.1358 of 2016, decided on 29.11.2016, while relying upon its earlier decision in KAVITA AHUJA & OTHERS v. SHIPRA ESTATE LTD. & JAI KRISHNA ESTATE DEVELOPERS PVT. LTD. & OTHERS Consumer Case No.137 of 2010, decided on 12.02.2015, held the complainants as consumers, observing that that the appellant failed to show any cogent evidence, which may indicate that the respondents/complainants or any of them has been indulging in sale purchase of the properties or that the complainants or any one of them had booked the subject plots in the development project undertaken by the appellant with the intention to sell the plot on subsequent date for profit. In the case in hand also, there is no Consumer Complaint No.697 of 2017 14 evidence led by the opposite parties to prove that the complainant indulged in commercial activities to earn profits and that he has purchased the unit, in question, for further commercial purpose to gain profits. The authority cited by the learned counsel for opposite parties No.1 to 5 in Saavi Gupta's case (supra) is distinguishable, in view of the law laid down by the Hon'ble National Commission in above noted cases. Therefore, the said objection of opposite parties No.1 to 5 is also rejected.
19. Now coming to the merits of the case, admittedly, the complainant purchased the unit, in question, in resale from its original allottee. Apartment Allottee(s) Arrangement Ex.C-1 was executed between the parties on 06.10.2012. The total cost of the unit was ₹51,75,000/-. As per Clause 5.1 of the agreement, opposite parties No.1 to 5 were to make endeavour to deliver the possession of the unit, in question, within 30 months, with an extended period of 6 months from the date of agreement and/or from the date of start of construction of Group Housing named as "Wave Gardens", whichever was earlier. Thus, the possession was to be delivered upto 15.10.2015, but they failed to develop/complete the unit, in question, so as to deliver its possession to the complainant by that date. As per Statement of Account, Ex.C-3, the complainant paid a sum of ₹49,52,087/- with opposite parties No.1 to 5. They failed to lead any evidence on record to prove that due to demonetization and slow down in the markets, the construction sector and payments, which were to be received by them, were seriously effected and due to that, the work Consumer Complaint No.697 of 2017 15 of construction got little delayed, which was beyond the control of the answering opposite parties. They also failed to prove that the subsequent restrictions on cash and implementation of GST also halted the construction activities at the site.
20. Opposite parties No.1 to 5 have also raised the plea that they have failed to complete the project because as per the Memorandum of Agreement dated 03.02.2006 (in short 'MoA'), the State Government was to acquire the land but State Government failed to acquire land for them in terms of MoA. As per Clause 5(e) of the MoA, State Government was to acquire the land under the provisions of Land Acquisition Act, 1894. These opposite parties pleaded that they made several requests to the State Government to initiate the acquisition and handover the possession to them to carry out development work on the same and GMADA was to provide external access roads to the project, who have failed to do so.
21. The aforesaid plea of opposite parties No.1 to 5 is not tenable, because according to provisions of Punjab Apartment and Property Regulation Act, 1995 (in short, "PAPRA"), it is the duty of the opposite parties itself to supply the information with regard to their ownership, permissions from PUDA/GMADA, licences and 'Change of Land Use' etc. The non-supply of this vital information to the complainant is against the provisions of PAPRA.
22. In Section 3 of PAPRA, 'General liabilities of the promoter' have been explained, which are as under:-
"3. General Liabilities of Promoter:-Consumer Complaint No.697 of 2017 16
(1) Notwithstanding anything in any other law for the time being in the force, a promoter, who develops a colony or who constructs or intends to construct a building of apartments, shall, in all transactions with persons taking or intending to take a plot or an apartment on ownership basis, be liable to give or produce, or cause to be given or produced, the information and the documents mentioned hereinafter in this section. (2) A promoter who develops a colony or who constructs or intends to construct such building of apartments shall,-
(a) make full and true disclosure of the nature of his title to the land on which such colony is developed or such building is constructed or is to be constructed, such title to the land having been duly certified by an attorney-at-law or an advocate of not less than seven years standing, after he has examined the transactions concerning it in the previous thirty years ; and if the land is owned by another person, the consent of the owner of such land to the development of the colony or construction of the building has been obtained;
(b) make full and true disclosure of all encumbrances on such land, including any right, title, interest or claim of any party in or over such land;
(c) give inspection on seven days, notice or demand,-
(i) of the layout of the colony and plan of development works to be executed in a colony as approved by the prescribed authority in the case of a colony; and
(ii) of the plan and specifications of the building built or to be built on the land as well as of the common areas and facilities and common services provided (including supply of electricity and water, sewerage and drainage systems, lifts, fire-
fighting equipment), such plans and specifications being in accordance with the provisions of the building regulations, and approved by the authority which is required so to do under any law for the time being in force, indicating thereon what parts of the building and the appurtenant areas are intended to be kept as common areas and facilities in the case of apartments :
Provided that the number and sizes of the apartments shall conform to such building regulations, and the area of an apartment shall not exceed such limit as may be fixed by the competent authority;
(d) display or keep all the documents, plans and specifications or copies thereof referred to in clauses (a), (b) and (c) of this sub-section at the site and in his office and make them available for inspection to persons taking or intending to take a plot or an apartment and after the association is formed, he shall furnish the association a copy of these documents and of the sanctioned plan of the building;
(e) disclose the nature of fixtures, fittings and amenities, including the provision for one or more lifts, provided or to be provided;Consumer Complaint No.697 of 2017 17
(f)disclose on reasonable notice or demand, if the promoter is himself the builder, the prescribed particulars as respects the designs and the materials to be used in construction, and, if the promoter is not himself the builder, disclose all agreements entered into by him with the architects and contractors regarding the design, materials and construction of the building;
(g) specify, in writing, the date by which possession of the plot or apartment is to be handed over and he shall hand over such possession accordingly;
(h) except where there are no agreements about specific plots or apartments and allotment is made by draw of lots, prepare and maintain a list of plots or apartments with their numbers, the names and addresses of the parties who have taken or agreed to take plots or apartments, the price charged or agreed to be charged therefor, and the terms and conditions, if any, on which the plots or apartments are taken or agreed to be taken;
Provided that the competent authority may direct that,-
(i) in the case of residential apartments, if the total number of apartments is one hundred or more, ten percent of the apartments; and
(ii) in the case of colony, if the total area of the colony is forty hectares or more, ten per cent of the area under residential plots and houses, be reserved for being sold or leased to such person belonging to such economically weaker section of society, in such manner and on such terms and conditions as may be prescribed;
(i) state in writing, the precise nature of and the terms and conditions governing the association to be constituted of persons who have taken or are to take the apartments;
(j) not allow person to enter into possession until an occupation certificate required under any law is duly given by the appropriate authority under that law and no person shall take possession of an apartment until such occupation certificate is obtained;
(k) make a full and true disclosure of all outgoings, including ground rent, if any, municipal or other taxes, charges for water and electricity, revenue assessment, interest on mortgages or other encumbrances, if any;
(l) give the estimated cost of the building and the apartments proposed to be constructed, or colony to be developed, and the manner in which escalation in such cost for valid reasons may be approved by mutual agreement ;
(m) make a full and true disclosure of such other information and documents in such manner as may be prescribed; and
(n) give on demand and on payment of reasonable charges true copies of such of the documents referred to in any of the clauses of this sub-section as may be prescribed. Consumer Complaint No.697 of 2017 18
Further Section 4 of PAPRA provides as follows:
4. Issuing of Advertisement or Prospectus:-
(1) No promoter shall issue an advertisement or prospectus, offering for sale any apartment or plot, or inviting persons who intend to take such apartments or plots to make advances or deposits, unless,-
(a) the promoter holds a certificate of registration under sub-section (2) of section 21 and it is in force and has not been suspended or revoked, and its number is mentioned in the advertisement or prospectus; and
(b) a copy of the advertisement or prospectus is filed in the office of the competent authority before its issue or publication. (2) The advertisement or prospectus issued under sub-
section (1) shall disclose the area of the apartments or plots offered for sale, title to the land, extent and situation of land, the price payable and in the case of colonies, also layout of the colony, the plan regarding the development works to be executed in a colony and the number and the validity of the licence issued by the competent authority under sub-section (3) of section 5, and such other matters as may be prescribed. (3) The advertisement or prospectus shall be available for inspection at the office of the promoter and at the site where the building is being constructed or on the land being developed into a colony, alongwith the documents specified in this section and in section 3.
(4) When any person makes an advance or deposits on the faith of the advertisement or prospectus, and sustains any loss or damage by reason of any untrue statement included therein, he shall be compensated by,-
(a) the promoter, if an individual; (b) every partner of the firm, if the promoter is a firm; (c) every person who is a director at the time of issue of the
advertisement or prospectus, if the promoter is a company :
Provided, however, that such person shall not be liable if he proves that,-
(a) he withdrew his consent to become a director before the issue of the advertisement or prospectus; or
(b) the advertisement or prospectus was issued without his knowledge or consent, and on becoming aware of its issue, he forthwith gave reasonable public notice that it was issued without his knowledge or consent; or
(c) after the issue of the advertisement or prospectus and before any agreement was entered into with buyers of plots or apartments, he, on becoming aware of any untrue statement Consumer Complaint No.697 of 2017 19 therein, withdrew his consent and gave reasonable public notice of the withdrawal and of the reasons therefor. (5) When any advertisement or prospectus includes any untrue statement, every person who authorised its issue, shall be punished with imprisonment for a term which may extend upto one year or with fine which may extend upto five thousand rupees, or, with both, unless he proves that the statement was immaterial or that he had reason to believe and did upto the time of issue of the advertisement or prospectus believe that the statement was true."
They have not produced any evidence to prove that they have complied with the provisions of Sections 3 and 4 of PAPRA in letter and spirit, by making full and true disclosure of the nature of their title to the land on which such colony is developed or such building is constructed. There is also no evidence on record to prove that, before allotment of the unit, in question, to the complainant, he was made aware about the execution of the above MoA between opposite parties No.1 to 4 and the State Government; which might have effected the decision of the complainant for purchasing the unit, in question, from these opposite parties in those circumstances. By not complying with the above said provisions of PAPRA, these opposite parties are certainly guilty of rendering deficient services and adopting unfair trade practice.
23. Further, as per Section 9 of PAPRA, every builder is required to maintain a separate account in a scheduled Bank, for depositing the amount deposited by the buyers, who intend to purchase the plots/flats, but no evidence has been led on the record by these opposite parties to prove that any account has been maintained Consumer Complaint No.697 of 2017 20 by them in this respect. As such, these opposite parties also violated Section 9 of the PAPRA.
24. As per Rule 17 of the "Punjab Apartment and Property Regulation Rules, 1995, framed under Section 45 of PAPRA, it has been provided 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 sub-
section (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."
25. It stands proved that these opposite parties failed to hand over the possession of the unit, in question, to the complainant within the stipulated period, without any sufficient reason. The amount paid by the complainant is a deposit held by these opposite parties, in trust of complainant and it should be used for the purpose of building the plots/flats, as mentioned in Section 9 of PAPRA. The builder is bound to compensate for the loss and injury suffered by the complainant for failure to deliver the possession, so has been held in catena of judgments by the Hon'ble Supreme Court and the Hon'ble National Commission. To get the relief, the complainant has to wage a long drawn and tedious legal battle. As such, the complainant was at loss of opportunities. Therefore, the complainant is entitled to the refund of the amount deposited by him, along with interest and compensation. It is relevant to mention that first of all the amount of loan advanced by opposite party No.6 for making payment of the price of the unit is to be Consumer Complaint No.697 of 2017 21 payable to opposite party No.6 and thereafter the remaining amount is to be paid to the complainant.
26. It is also relevant to mention that the complainant opted for 'Subvention Linked Plan' and the complainant deposited a sum of ₹10,70,836.64, which is more than 20% of the sale price of the flat, in question. Thereafter, he got sanctioned a loan of ₹45,60,000/- from HDFC Limited. Tripartite Agreement (Building Subvention Facilities) was executed between the parties on 26.12.2012. Home Loan Agreement, Ex.OP-6/2 was executed between the parties. The fact remains that opposite parties No.1 to 5 were liable to bear the Pre- EMI interest payable to OP No.6 on behalf of the complainant as per letter Ex.C-5. The possession was delayed and as per letter dated 04.08.2016, Ex.C-5, the Subvention Scheme was further extended by these opposite parties till 30th June, 2018 or offer of possession, whichever is earlier. Both those occasions have not yet reached the specific point of time. Thus, opposite parties No.1 to 5 are liable to bear the Pre-EMI interest till the refund of entire amount to the Bank/complainant. If any amount has been paid by opposite parties No.1 to 5 as Pre-EMI interest, the same would be adjusted accordingly.
27. Accordingly, the complaint is allowed against opposite parties No.1 to 5 and the same is dismissed against opposite party No.6. Following directions are issued to opposite parties No.1 to 5: Consumer Complaint No.697 of 2017 22
i) to refund the amount of ₹49,52,087/-, along with interest at the rate of 12% per annum from the respective various dates of payment till realization, as per Rule 17 of PAPRA;
It is made clear that opposite parties No.1 to 5 shall also bear the Pre-EMI interest accrued on the loan amount obtained by the complainant from the Bank, from 26.12.2012 (date of execution of Tripartite Agreement) till the refund of the entire amount to the Bank/complainant. If any amount has been paid by opposite parties No.1 to 5 as Pre-EMI interest, the same would be adjusted accordingly.
It is also made clear that, first of all, opposite parties No.1 to 5 shall pay the outstanding amount to opposite party No.6-Bank towards the loan advanced by it to the complainant and, thereafter, the remaining amount, if any, shall be paid to the complainant;
ii) to pay ₹1,00,000/-, as compensation for the mental agony and harassment suffered by the complainant as well as litigation expenses.
Consumer Complaint No.690 of 2017
28. Similarly, in Consumer Complaint No.690 of 2017 (Rajesh Kumar Singla vs. M/s Country Colonizers Private Ltd. & Ors.), the complainant has booked residential unit No.301, in Tower Daffodil on 3rd Floor, Type 3BHK measuring approximately 1885 sq.ft. for a total consideration of ₹77,41,438/- in the project of the o``pposite parties, by paying the amount of ₹58,21,609/-, vide Ex.C-2 (Colly) and Ex.C-3 Consumer Complaint No.697 of 2017 23 respectively. As per Clause 4.2 of the Apartment Allottee(s) Arrangement Ex.C-1 dated 21.05.2013, the OPs charge 18% interest p.a. for default in making payment within the specified dates, whereas if the OPs delay in the possession of the said apartment, they are liable to pay compensation @ ₹5/- per sq.ft. per month on super area of the said apartment as per Clause 5.5 of the Apartment Allottee(s) Arrangement. As per Clause 5.1 of the Apartment Allottee(s) agreement, the OPs were to hand over the possession of the said apartment within 36 months from the date of execution of the Apartment Allottee(s) Arrangement. Thus, the stipulated date for handing over the possession of the said apartment was 20.05.2016. The OPs had not developed the project and there was no likelihood of the possession being handed over to the complainant in the near future. Hence, the complainant sought following directions to the opposite parties:
i) to refund the entire payment made to the OPs i.e. ₹58,21,609/-, along with interest at the rate of 9% per annum from the date of deposit of the amounts;
ii) to pay ₹2,00,000/-, as compensation on account of mental agony and harassment suffered by him; and
iii) to pay ₹50,000/-, as litigation expenses.
29. The opposite parties filed reply, on the similar lines of their reply, as given in Consumer Complaint No.697 of 2017.
30. To prove his claim, the complainant tendered his affidavit as Ex.C-A, along with documents Ex.C-1, Ex.C-2 to C-2(h) to Ex.C-4. Consumer Complaint No.697 of 2017 24
31. The opposite parties tendered in evidence affidavit of Sh. Amarjit Singh, their Authorized Signatory, as Ex.OP-1/A, along with documents Ex.OP1/1 to Ex.OP1/8.
32. In view of the reasons and discussion held in Consumer Complaint No.697 of 2017, this complaint is allowed and following directions are issued to the opposite parties:
i) to refund the amount of ₹58,21,609/-, along with interest at the rate of 12% per annum from the respective various dates of payment till realization, as per Rule 17 of PAPRA; and
ii) to pay ₹1,00,000/-, as compensation for the mental agony and harassment suffered by the complainant as well as litigation expenses.
33. Compliance of the orders passed in all the complaints shall be made by the opposite parties within 30 days of the receipt of certified copy of the order.
34. The complaints could not be decided within the stipulated timeframe, due to heavy pendency of Court cases.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (MRS. KIRAN SIBAL) MEMBER March 26, 2018.
Lb/-