State Consumer Disputes Redressal Commission
Monika Sarup vs M/S Country Colonisers Pvt. Ltd. on 1 March, 2018
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.885 of 2017
Date of institution : 10.10.2017
Reserved On : 21.02.2018
Date of decision : 01.03.2018
Monika Sarup Wife of Sh. Sidharth Sarup, Resident of Flat No.201,
Group Housing 15-A, Sector 20, Panchkula (Haryana), through her
Special Power of Attorney Gautam Mediratta.
....Complainant
Versus
1. M/s Country Colonisers Pvt. Ltd., P.O. Rayon and Silk Mills,
Adjoining Coca Cola Depot, G.T. Road, Chheharta, Amritsar,
Punjab (India)-143105, through its Managing Director.
2. The Branch Manager, M/s Country Colonisers Pvt. Ltd., Wave
Estate, Site at Sector 85, Mohali-160062 (Punjab).
....Opposite Parties
Consumer Complaint U/s 17(1)(a) of the Consumer
Protection Act, 1986 (as amended up to date).
Quorum:-
Shri J.S. Klar, Presiding Judicial Member
Mrs. Kiran Sibal, Member.
Present:-
For the complainant : Sh. R.K. Sharma, Advocate For opposite parties : Sh. Tejeshwar Singh, Advocate. J.S. KLAR, PRESIDING JUDICIAL MEMBER:
Complainant, Monika Sarup, has instituted this complaint, under Section 17 (1) (a) of the Consumer Protection Act, 1986 (in short, "the Act") against the opposite parties, on the averments that they floated a scheme to develop a Mega Integrated Township, known as "Wave Estate", in Sectors 85 and 99, S.A.S. Nagar, Mohali. The complainant booked 3 bedroom residential apartment/unit, having Consumer Complaint No.885 of 2017 2 super area of 1885 sq.ft., in the above said scheme of the opposite parties, by paying booking amount of ₹5,00,000/-, vide cheque No.163019 drawn on SBI, Chandigarh; which was acknowledged by the opposite parties, vide receipt dated 11.05.2012. The opposite parties allotted 3 BHK apartment No.601, measuring 1885 sq.ft., Tower DAFFODIL, 6th Floor, Wave Gardens, Sector 85, S.A.S. Nagar, Mohali to the complainant. Agreement was also executed between the parties on 14.09.2012 in this regard. As per Para 5.1 of the said agreement, the opposite parties were required to complete the development of the project in general and the apartment in particular within a period of 30 months, along with extended period of 6 months, from the date of execution of the above agreement or from the date of start of the construction, whichever was later. The project was to be completed on or before 13.09.2015 by the opposite parties. The complainant paid total amount of ₹31,33,484/- towards the price of the apartment to the opposite parties and copy of Statement of Account dated 15.11.2016 is to this effect. The project was neither developed, as per the schedule by the opposite parties, nor they refunded the entire amount paid by the complainant, with interest, despite e-mail dated 07.06.2013 of complainant to surrender the apartment. Despite lapse of more than 4 years, the opposite parties have failed to develop/complete the project, in question, and refused to refund the amount, with interest. The complainant also served legal notice upon the opposite parties on 28.11.2016 in this regard, but it went un-responded. The complainant has alleged that the opposite parties committed unfair trade practice, Consumer Complaint No.885 of 2017 3 besides causing deficiency in service in this case to her. Earlier, the complainant filed complaint bearing No. CC/146/2017 before this Commission, which was withdrawn on 26.09.2017, with liberty to file fresh complaint. This complaint has been filed pursuant to that. She prayed that the opposite parties be directed to refund the deposited amount of ₹31,33,484/-, along with interest at the rate of 12% per annum from the date of payment till realization; and to pay compensation of ₹3,00,000/- for unfair trade practice and deficiency in service as well as mental harassment; and ₹55,000/-, as litigation expenses.
2. Upon notice, the opposite parties appeared and filed written reply, raising preliminary objections that the complaint is not maintainable, because the complainant is not 'consumer' as defined in Section 2 (1) (d) of the Act. She owns a big and better residential unit at Chandigarh i.e. House No.117, Sector 21-B, Chandigarh and she has purchased the flat, in question, for speculative purposes. It is further averred that the complainant permanently resides in Canada, as admitted in e-mail sent by her to the opposite parties on 07.06.2013. The complainant purchased this unit for commercial purposes only to earn profits, as she is engaged in the business of sale and purchase of the property. The complainant has failed to adhere to the payment plan and has not cleared the dues in time payable to the opposite parties as per payment plan. The amount of ₹25,82,985.02P is outstanding against the complainant payable to the opposite parties. She has paid the amount of ₹31,33,484/- out of the amount of Consumer Complaint No.885 of 2017 4 ₹56,82,497.02P to the opposite parties. Where the complainant is herself a defaulter, she cannot allege any deficiency in service to the opposite parties. There are delays exceeding two months in making payment of many due amounts and opposite parties have right to cancel the booking and forfeit the earnest money under Clause 4.4 and 4.2 of the Apartment Allottee(s) Arrangement (hereinafter to be referred as 'agreement'), for failure of complainant in this regard. In view of delayed payments made by the complainant to the opposite parties, they deferred the cancellation of the apartment of the complainant, which they were entitled to cancel under Clause 4.2 and 4.4 of the agreement. The complainant is bent upon seeking refund of the paid amount and is liable to pay forfeiture of ₹10,60,312/- on account of 15% of basic sale price, ₹12,10,055/- on account delay payment interest charges, ₹3,53,437/- on account of brokerage and ₹43,685/- on account of brokerage taxes; totaling ₹26,67,489/-. The opposite parties were left with no option, but to cancel the allotment of the complainant under Clause 4.4 and 4.2 of the agreement. The complainant tries to escape from the apartment agreement, on the pretext of alleged non-completion of the construction by the opposite parties within the agreed period. As per Clause 5.1 of the agreement, the developer shall make every attempt to complete the development of the project as far as possible within 36 months and no fixed mandatory date for completion of the project has been prescribed in the agreement. Opposite party No.1 entered into Memorandum of Agreement (in short "MoA") dated 03.02.2006 with the State Consumer Complaint No.885 of 2017 5 Government of Punjab, whereunder the State Government shall acquire land under provisions of Land Acquisition Act, 1894 and transfer the same to the opposite parties for development. The State Government has failed to acquire any land for the opposite parties and hence the approved plan of entire project also shows certain critical areas, because the land is not in possession of the opposite parties due to the failure of the State Government in acquiring it. The lands, which are not available with the opposite parties, form 10% of the total land required for the entire project and it caused delay in laying of lines for basic services. The State Government was requested to acquire 23.21 acres of land, which falls within the master plan of the project. The Greater Mohali Area Development Authority (GMADA) was to provide external access roads to the project upon execution of CLU with the local farmer, which GMADA has failed to do so even up till this date. Opposite party No.1 has managed to enter into Land Use Agreement with the local farmer from whose land an access road has been laid for proper access to the project. Clause 9 of the agreement provides that allottee has understood the terms and conditions of the agreement and undertook to abide by them. The opposite parties further averred that matter is complex, which can be adjudicated by the competent Civil Court only. The opposite parties also contested the complaint of the complainant even on merits on the above-referred premises. The opposite parties denied any breach of the contract or undue wilful default on their part in this case. The opposite parties prayed for dismissal of the complaint.
Consumer Complaint No.885 of 2017 6
3. In order to prove his case, the complainant tendered in evidence affidavit of her Special Power of Attorney (SPA) Sh. Gautam Mediratta, as Ex.CA, along with documents Ex.C-1 to Ex.C-8.
4. On the other hand, the opposite parties tendered in evidence affidavit of Sh. Amarjit Singh, Authorized Representative, as Ex.OP-1/A, along with documents Ex.OP-1/1 to Ex.OP-1/21.
5. We have heard learned counsel for the parties and have also examined the record of the case.
6. The first point raised by counsel for the opposite parties in this case is that the complainant has not been proved to be 'consumer', as defined in Section 2 (1) (d) of the Act and, as such, the complaint merits dismissal on this point. Pleadings of the parties have been carefully examined by us. The flat, in dispute, is located in the residential project. The complainant opted to purchase 3 bedroom residential apartment with super area of 1885 sq.ft. from the opposite parties in the above scheme. The submission of the counsel for the opposite parties is that the complainant has shifted to Canada and, as such, she has no need to purchase this 3 bedroom residential apartment. Our attention has been drawn to letter, Ex.OP-1/3 dated 07.06.2013, wherein the complainant wrote to the opposite parties that she would be leaving India and settling abroad permanently. On the basis of this document, Ex.OP-1/3, the forceful submission of the counsel for the opposite parties before this Commission is that the complainant is not proved to be 'consumer' of the opposite parties. We have come to this conclusion that it cannot be said that the Consumer Complaint No.885 of 2017 7 complainant is not a 'consumer'. It is a residential project, wherein she opted to purchase 3 bedroom apartment from the opposite parties in the above scheme. There is no restriction on her to come back and reside in 3 bedroom residential apartment. In this regard, reliance can be placed on a case reported as RESHMA BHAGAT v. SUPERTECH LTD. 2016 (I) CPR 428 (NC), wherein Hon'ble National Commission held that it cannot be a 'rule of thumb' that every NRI cannot own a property in India. NRIs do come to India, every now and then. Most of the NRIs have to return to their native land. It does not mean that she cannot be consumer of the opposite parties. Moreover, it is not a commercial project and it is a residential project and residential apartments are generally purchased by the purchaser with the aim of residing therein. It has not been proved on record that she has been indulging in sale and purchase of the property, so as to generate any profits therefrom. Consequently, on the basis of Ex.OP-1/3, it cannot be said that the complainant is not consumer of the opposite parties, more so, when the project launched by the opposite parties is purely a residential project. The contention of the opposite parties is not accepted by us on this point, by holding that the complainant is 'consumer' of the opposite parties.
7. Now, on the point of deficiency in service on the part of the opposite parties in not developing the project and the defence of the opposite parties that the complainant committed default in making payment of instalments on time to the opposite parties, evidence is required to be referred to by us for settlement of this controversy Consumer Complaint No.885 of 2017 8 between the parties. Firstly, we touch this point, as to whether the opposite parties have raised the construction, while developing the project as per the stages thereof and thereby discharged their part of the agreement. The Special Power of Attorney holder (SPA) of complainant Sh. Gautam Mediratta tendered in evidence his affidavit, Ex.C/A, on the record. This witness has deposed that the complainant took 3 bedroom residential apartment with super area of 1885 sq.ft. in the above said scheme by paying booking amount of ₹5,00,000/- to the opposite parties on 11.05.2012, vide receipt Ex.C-1. Apartment No.601, measuring 1885 sq.ft., Tower DAFFODIL, 6th Floor, Wave Gardens, Sector 85, S.A.S. Nagar, Mohali was allotted to her by the opposite parties. Apartment Allottee(s) Arrangement (agreement) was also executed on 14.09.2012, vide Ex.C-2 on the record. The opposite parties were to complete the development of the project within a period of 30 months, with extended period of 6 months from the date of execution of the above agreement or from the date of start of construction of Group Housing named "Wave Garden". As per the affidavit of this witness, the development/construction was to be completed of this project before 13.09.2015. He further stated that the complainant surrendered it to the opposite parties, seeking refund of the amount, vide e-mail dated 07.06.2013, Ex.C-3. He also proved the copy of Statement of Account, Ex.C-4, dated 15.11.2016 to the effect that the complainant paid total amount of 31,33,484/- to the opposite parties. This witness states that since the project has not been developed as per the schedule by the opposite parties, the Consumer Complaint No.885 of 2017 9 complainant requested the opposite parties, vide e-mail dated 13.11.2016, Ex.C-5, to refund the deposited amount with interest. It has further transpired in the deposition of this witness that the complainant visited the spot on 15.11.2016 and found no development in the project. The opposite parties failed to develop the project even despite lapse of more than 4 years. The complainant was constrained to serve legal notice dated 28.11.2016 upon the opposite parties, coupled with postal receipts to substantiate it as Ex.C-6. We have considered the above referred documents proved in evidence of the complainant in this case. Clause 5.1 of the above Apartment Allottee(s) Arrangement/agreement, Ex.C-2, dated 14.09.2012 lays down as under:
"5.1 Subject to Clause 5.2 and further subject to all the Allottee(s) of the said "Apartment" in the "Said Project"
making timely payment, the Developer shall endeavor to complete the development of "Said Project" in general and the said "Apartment" in particular as far as possible within 30 (thirty) months along with an extended period of (6) six months from the date of execution of this Apartment Allottee(s) Arrangement and/or from the date of start of construction of Group Housing named as "Wave Gardens"
whichever is later."
It is, thus, plain from perusal of this document that the developer was to complete the development of the said project in general and apartment in particular within 30 months with extended period of 6 Consumer Complaint No.885 of 2017 10 months from the date of execution of this agreement or from the date of start of construction of Group Housing named as "Wave Garden", whichever is later. Even while including extended period of 6 months, the development was supposed to be completed by the opposite parties on 14.09.2015. It has transpired in the evidence of SPA of the complainant that no development has been done by the opposite parties in the project, despite lapse of more than 4 years. Due to this reason, the complainant sent e-mail to the opposite parties, surrendering the apartment and seeking refund of the amount. Ex.C-4 is the Statement of Account on the record, showing the balance amount towards the complainant. The stress of the statement of SPA of the complainant is that no development work has been completed by the opposite parties in the project, despite scheduled time to complete it.
8. The opposite parties tendered the rebuttal evidence against it on the record, consisting of affidavit of Sh. Amarjit Singh, Authorized Signatory, vide Ex.OP-1/A. This witness has stated that the complainant sent e-mail to the opposite parties on 07.06.2013, Ex.OP- 1/3, followed by another e-mail dated 03.12.2015, Ex.OP-1/4, to the effect that she is residing in Canada. He further stated that the complainant failed to pay the due amounts in time, in accordance with the payment plan. Huge dues remained outstanding from the complainant to the opposite parties to the tune of ₹25,82,985.2P. Out of total amount of sale consideration of ₹56,82,497.2P, only ₹31,33,484/- have been paid by the complainant to the opposite Consumer Complaint No.885 of 2017 11 parties till date and the Account Statement dated 18.05.2017 is Ex.OP- 1/20. He also stated that Payment Demand Notice dated 16.11.2012 is Ex.OP-1/5 and copy of payment receipt dated 09.01.2013 is Ex.OP-1/6 towards the start of construction. Copy of Payment Demand Notice dated 09.12.2013 on ground floor roof slab is Ex.OP-1/7 and copy of payment receipt dated 19.09.2014 is Ex.OP-1/8. Copy of Payment Demand Notice dated 01.05.2013 is Ex.OP-1/9 on 4th floor roof slab and copy of payment reminder dated 23.06.2014 is Ex.OP-1/10 and copy of another payment reminder dated 15.07.2014 is Ex.OP-1/11. Copy of Payment Demand Notice dated 01.11.2014 is Ex.OP-1/12 on 8th floor roof slab, copy of Payment Demand Notice dated 02.02.2015 on 12th floor roof slab is Ex.OP-1/13 and copy Payment Demand Notice dated 23.05.2015 is Ex.OP-1/14 on final roof slab. This witness has further maintained that there is huge balance of ₹25,82,985/- payable by the complainant to the opposite parties. The complainant is defaulter in the instant case and a defaulter is not entitled to allege deficiency in service of the opposite parties. The opposite parties are entitled to cancel the allotment of the flat under Clauses 4.4 and 4.2 of the above agreement for default of allottee to make the payments on time. The complainant is also liable to pay interest on the delayed amounts. The opposite parties deferred the cancellation of the apartment and afforded many opportunities and sufficient time to the complainant to clear the outstanding payment to avoid forfeiture of earnest money. Since the complainant sought refund of the amount, the complainant is liable to face forfeiture of ₹10,60,312/- on account of Consumer Complaint No.885 of 2017 12 15% of basic sale price, ₹12,10,055/- on account delay payment interest charges, ₹3,53,437/- on account of brokerage and ₹43,685/- on account of brokerage taxes; totaling ₹26,67,489/- as on the date of cancellation. The unit has been cancelled by the opposite parties, vide cancellation letter dated 23.05.2017, Ex.OP-1/21. The case of the opposite parties is that the complainant remained defaulter of the opposite parties and is not entitled to challenge any alleged deficiency in service on the part of the opposite parties.
9. As per the case of the opposite parties, on the part of alleged deficiency in service, it has transpired in the evidence of this witness that there has not been undue delay in the development. There was no committed date to deliver the possession within three years period, as contended by the complainant. As per Clause 5 (e) of Memorandum of Agreement (MoA) dated 03.02.2006, the State Government was to acquire land as per provisions of Land Acquisition Act and such acquisition shall be limited to only 10% of total area of the project space and then to make it available to the opposite party- Company. The copy of MoA with the State Government is dated 03.02.2006 Ex.OP-1/5. The State Government has failed to acquire any land for the opposite parties and hence the approved plan of entire project has also showed certain critical areas i.e. the land, which is not in possession of the opposite parties due to failure of the State Government in acquiring the same. 10% of the total area required for the project is not in possession of the opposite parties, on account of non-acquisition of this land by the State Government and due to which Consumer Complaint No.885 of 2017 13 laying of lines for basic services is not complete. The approved plan of the entire project, showing the critical area, is Ex.OP-1/16. The matter was also taken up with Land Acquisition Collector, Greater Mohali Area Development Authority (GMADA), S.A.S. Nagar, Mohali, vide letter dated 19.01.2012 Ex.OP-1/17, requesting the State Government to acquire 23.21 acres of land within the master plan of the project and hand over possession thereof to the opposite parties to carry out due development work. The GMADA was to provide external excess roads to the project upon execution of Land Use Agreement with the local farmer, which GMADA has failed to do even up till this date. Opposite party No.1 has manager to enter into Land Use Agreement with a local farmer, from whose land an access road has been laid for proper access to the project, due to inaction of GMADA in providing proper external access road. Several road blocks were faced in construction. Copy of Land Use Agreement dated 14.06.2012 is Ex.OP-1/18. The project has been delayed by State Government and GMADA due to their own inaction. The evidence in the shape of documents is also considered by us on the record on the side of the opposite parties.
10. From hearing respective submissions of counsel for parties and appraisal of evidence on the record, we have come to this conclusion that this is a case, where the opposite parties have also not completed the project within the scheduled time. As per the evidence of witness of the opposite parties, 10% of the area was to be acquired by the State Government and then handed over to the opposite parties for development of the project. The GMADA was to lay the outer roads Consumer Complaint No.885 of 2017 14 and other basic amenities in the project and they have not been done in this case. Critical areas have been shown in the plan Ex.OP-1/16 by the opposite parties, which put hindrances in the development of this project. It cannot be said that the opposite parties have performed their part of the contract, by completing the development of the project within the scheduled time, as per Clause 5.1 of agreement, Ex.C-2. Similarly, on the other hand, the complainant has also committed default in not making payments of some of the instalment on time. The complainant wrote e-mail to the opposite parties, expressing her willingness to surrender the unit to seek refund of the deposited amount. The opposite parties cancelled the allotment of the apartment allotted to the complainant.
11. Now we have to see, whether it was entire fault of the complainant in not making the payments on time to the opposite parties, without any trace of fault on the part of the opposite parties? This is a case where primarily the opposite parties could not develop the project, may be on account of some snags, within the scheduled time. The opposite parties insisted upon payments, without developing the project on their part proportionately. The complainant is also at default in not making payments of the instalments on time, as reflected on the record in this case. The counsel for the opposite parties referred to law laid down in Rishabh Enterprises v. Neetu Datta 2012 (3) CPJ 146 (NC), to the effect that where it was mandatory to deposit the required amounts every month and complainant has not deposited them with the developer, the developer was justified in cancelling the Consumer Complaint No.885 of 2017 15 allotment. The refund was ordered after deducting 10% of the cost of the plot, as per agreement. Counsel for the opposite parties also referred to law laid down by Chandigarh Statement Consumer Disputes Redressal Commission in M/s Omaxe Chandigarh Extension Developers Limited v. Sukhpreet Singh Kang 2014 (1) CPR 41, to the effect that the complainant defaulted in making payment of instalments, despite letter and reminder sent to him. There was no deficiency in service and order of District Forum, granting interest and litigation costs was set aside. Reference was also made to law laid down by the Hon'ble National Commission in DLF Southern Towns Pvt. Ltd. v. T.P. Balachandra Panicker 2015 (1) CPJ 445, to the effect that the complainant failed to perform the terms and conditions of agreement, in-spite of repeated reminders. The complainant neither made the payment of instalments in time nor sent duly signed agreement. The opposite party was within its right to forfeit the amount, as per the agreement. Herein, we find that this is a case where both the parties are at fault and opposite parties are also at fault in not developing the project within the scheduled time. The opposite parties averred and proved that the State Government failed to acquire 10% of land for them and GMADA further failed to lay out the outer pipes and roads in the project to complete it. Whatever the case may be, the consumer is concerned with development of the project within the agreed time and not with the excuses projected by the opposite parties. On the other hand, Hon'ble National Commission has also examined this point in RDB LEGEND INFRASTRUCTURE (PVT) Consumer Complaint No.885 of 2017 16 (LTD) & ORS. V. MKN SRINIVASA RAO First Appeal No.1456 of 2017 decided on 18.01.2018, wherein it was held that where both the parties are at fault and by balancing the equity between the parties in the light of above said defaults, the Hon'ble National Commission ordered that interest of justice would be met, by directing the appellant to pay to the complainant interest at the rate of 11% per annum on the above said amount of ₹24,26,250/-, instead of 12% interest per annum from the date of receipt of payment, as directed by the State Commission. Whatever the case may, this is a case where both the parties are found at fault. The complainant is also at fault in not releasing the payments on time to the opposite parties and notices were sent to the complainant by the opposite parties and opposite parties could not complete the project within the agreed period. The opposite parties have cancelled the apartment allotted to the complainant, without completing the project on time on their part. So, in the circumstances of the case, we find that the opposite parties are not entitled to invoke the forfeiture Clause in this case, because they have not completed the project within the stipulated period. The equities have to be balanced in this case against both the sides. Consequently, we are of this view that the opposite parties shall refund the entire deposited amount of the complainant, by not completing the project, along with interest at the rate of 10% per annum from their respective deposits till actual payment. The lower rate of interest than 12% per annum has been granted to the complainant in this case, for not releasing the payment of instalments on time by the complainant. Consumer Complaint No.885 of 2017 17
12. As a result of our above discussion, we accept the complaint of the complainant, by directing the opposite parties to refund the entire deposited amount of the complainant, along with interest at the rate of 10% per annum from the respective dates of deposit till actual payment to the complainant. No compensation for mental harassment and litigation expenses is granted to the complainant, on account of default on her part as well.
13. Arguments in this complaint were heard on 21.02.2018 and the order was reserved.
14. Since there is shortage of postal stamps in this Commission, therefore, the parties through their counsel are directed to receive free certified copy of the order by hand and it would be the responsibility of the learned counsel for the parties to inform them accordingly.
15. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(J.S. KLAR) PRESIDING JUDICIAL MEMBER (MRS. KIRAN SIBAL) MEMBER March 01, 2018.
(Gurmeet S)