State Consumer Disputes Redressal Commission
Saloni Jindal vs Country Colonisers Pvt. Ltd. on 17 February, 2020
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH
Misc. Application No.2260 of 2018
And
Misc. Application No.514 of 2019
In/and
Consumer Complaint No.42 of 2018
Date of Institution : 19.01.2018
Date of Reserve : 17.01.2020
Date of Decision : 17.02.2020
1. Saloni Jindal, R/o Kothi No.1168, 1st Floor, Phase IX, Mohali,
Punjab.
2. Rajiv Jindal, R/o Kothi No.1168, 1st Floor, Phase IX, Mohali,
Punjab.
....Complainants
Versus
1. M/s Country Colonisers Private Limited, through its Managing
Director / Manager / Authorized Signatory. Regd. Office at
P.O. Rayon & Silk Mills, Adjoining Coca Cola Depot,
Chheharta Amritsar, Punjab-143105
2. Sh.Rajinder Singh Chadha, Chairman and Director M/s
Country Colonisers Private Limited (Wave Group Company),
Regd. Office at P.O. Rayon & Silk Mills, Adjoining Coca Cola
Depot, Chheharta Amritsar, Punjab-143105
3. M/s Country Colonisers Private Limited, Wave Infratech
Venture through its Vice Chairman / Director, Sh.Manpreet
Singh Chadha, Site Office at Sector 85, Mohali, Punjab.
4. Manpreet Singh Chadha, Vice Chairman / Director of Country
Colonisers Private Limited (Wave Group Company), Site
Office at Sector 85, Mohali, Punjab.
...... Opposite parties
5. Housing Development Finance Corporation Ltd., Registered
Office at Ramon House, HT Parekh Marg, 169, Backbay
Reclamation, Churchgate, Mumbai 400020, Maharashtra.
....Proforma Opposite Party
Consumer Complaint under Section 17 of
the Consumer Protection Act, 1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mr. Rajinder Kumar Goyal, Member
Mrs.Kiran Sibal, Member Consumer Complaint No 42 of 2018 2 Present:-
For the complainant : Sh.Hitesh Malik, Advocate with Sh.Jivesh Malik, Advocate For Opp. Parties No.1to4 : Sh.Tejeshwar Singh, Advocate For Opposite party No.5 : Ms.Neetu Singh, Advocate RAJINDER KUMAR GOYAL, MEMBER :
The complainant has filed this complaint, under Section 17 of the Consumer Protection Act 1986, (in short, "the Act"), for issuance of the following directions to the opposite parties:
I. to pay the entire amount of the cost of unit as retained by the opposite parties;
II. to pay interest calculated at the rate of 18% per annum on the amount deposited from the date of deposit till actual realization;
III. to pay Rs.5,00,000/- as compensation on account of mental agony and harassment suffered by the complainants.
IV. to pay Rs.1,00,000/- as litigation expenses; and V. any other order which this Commission may deem fit and proper.
Misc. Application No.2260 of 2018
2. This application has been filed by opposite party No.1 under Order 1 Rule 10 with the prayer for deletion/striking out opposite parties No.2 to 4 on the ground that the refund of the amount is to be paid by opposite party No.1-company. Opposite parties No.2 to 4 are Directors of opposite party No.1 and there is no assertion against the Directors. It has been further stated that in view of the Consumer Complaint No 42 of 2018 3 settled proposition that a Company is a distinct juristic person which is to act through a Director.
3. Reply to the application has not been filed by the complainant.
4. We have heard the learned counsel for the parties on the said application.
5. Opposite parties No. 2 to 4 are the Directors and Chairman of opposite party No.1 and are responsible authorities holding the reputed posts for functioning of opposite party No.1 on the side of administrative as well as financial dealings. Deletion of opposite parties No.2 to 4 from the array of parties would not serve the purpose while deciding the complaint. Accordingly, the application filed by opposite parties No.1 to 4 is hereby dismissed. Misc. Application No.514 of 2019 (Dismissal of Complaint)
6. This application has been filed by opposite parties No.1 to 4 with the prayer to dismiss the consumer complaint being not maintainable in view of Section 79 read with Section 89 of the Real Estate (Regulation and Development) Act, 2016. It is stated that the Commission does not have jurisdiction to adjudicate upon the said dispute, in view of the provisions of the Real Estate (Regulation and Development) Act, 2016 which came into force on 01.05.2017. It was further submitted that RERA is a comprehensive act, enacted to serve the interest of consumers and regulate promoters in the real estate sector.
7. Short reply to the application was filed by the complainant and stated that opposite party No.1 had not registered the present Consumer Complaint No 42 of 2018 4 real estate project with the Real Estate Regulatory Authority established under the Act of 2016. The complainant also referred to one judgment passed by the Hon'ble National Commission in Consumer Complaint No.1764 of 2017 titled as Ajay Nagpal versus M/s Today Homes and Infrastructure Private Limited wherein it is held that Section 71 nor Section 79 and nor Section 89 creates any embargo or prohibits the jurisdiction of the Consumer Fora. The complainant prays for dismissal of the application in view of the law laid down by the Hon'ble National Commission.
8. We have heard the arguments of the counsel for the parties and have carefully gone through the record.
9. In the present case the project in question was launched by opposite parties No.1 to 4 and the complainants booked one residential floor with the opposite parties in the year 2013. The facts are not in dispute. The main stress of opposite parties No.1 to 4 is only with regard to the maintainability of the complaint before this Commission since the RERA has come into force on the date of filing of the present complaint. It needs to be mentioned that provisions of Sections 2, 20 to 39, 41 to 58, 71 to 78 came into force with effect from 01.05.2016 and the provisions of Sections 3 to 19, 40, 59 to 70 and Section 79 to 80 came into force with effect from 01.05.2017. It is also an admitted fact that the complainants had entered into Residential Floor Allottee(s) Arrangement prior to the coming into force of the RERA and they had also booked the flat/apartment much earlier to the date of enforcement of RERA in the State of Punjab and even in the country, in the year Consumer Complaint No 42 of 2018 5 2014. Having failed to comply with the terms of the said Arrangement the complainants have approached this Commission for the illegal acts, omissions and commissions and adoption of unfair trade practice and various types of deficiencies in service and as such, they being 'consumers' and the opposite parties being 'service providers' have approached this Commission under the C.P. Act. It would be appropriate to reproduce the relevant provisions of Sections 71, 79, 88, 89 of RERA as under:-
"71. Power to adjudicate.-(1) For this purpose of adjudicating compensation under sections 12, 14, 18 and section 19, the Authority shall appoint in consultation with the appropriate Government one or more judicial officer(s) deemed necessary, who is or has been a District Judge to be an adjudicating officer for holding an inquiry in the prescribed manner after giving any person concerned a reasonable opportunity of being heard.
Provided that any person, whose complaint in respect of matters covered under sections 12, 14, 18 and section 19 is pending before the Consumer Disputes Redressal Forum or the Consumer Disputes Redressal Commission or the National Consumer Redressal Commission, established under section 9 of the Consumer Protection Act, 1986 (68 of 1986), on or before the commencement of this Act, he may, with the permission of such Forum or Commission, as the case may be, withdraw the complaint pending before it and file an application before the adjudicating officer under this Act. (2).....
(3)....."
79. Bar of jurisdiction.-No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Authority or the adjudicating officer or the Appellate Tribunal is empowered by or under this Act to determine and Consumer Complaint No 42 of 2018 6 no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.
88. Application of other laws not barred.--The provisions of this Act shall be in addition to, and not in derogation of the provisions of any other law for the time being in force.
89. Act to have overriding effect.-The provisions of this Act shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force."
Some questions were raised by the 'consumers' with the Ministry of Housing and Urban Property Alleviation, Government of India. Under Frequently Asked Questions (FAQ) at Sr. Nos. 85 and 86 it has been observed as under:-
"85. Are the civil courts and consumer forums barred from entertaining disputes under the Act? As per Section 79 of the Act civil courts are barred from entertaining disputes (suits or proceedings) in respect of matters which the Authority or the adjudicating officer or the Appellate Tribunal is empowered under the Act to determine. However, the consumer forums (National, State or District) have not been barred from the ambit of the Act. Section 71 proviso permits the complainant to withdraw his complaint as regards matters under Section 12, 14, 18 and section 19 from the consumer forum and file it with the adjudicating officer appointed under the Act.
86. Can a complainant approach both the Regulatory Authority/adjudicating officer and the consumer forums for the same disputes?
The laws of the country do not permit forum shopping, thus, an aggrieved can only approach one of the two for disputes over the same matter."Consumer Complaint No 42 of 2018 7
In answer to question No.85 it has been stated that the jurisdiction of the Consumer Fora at District, State or National level has not been barred from the ambit of C.P. Act. Rather Section 71 of RERA provides the 'consumer', whose complaint in respect of matters covered under Sections 12, 14, 18 and Section 19 is pending before the Consumer Disputes Redressal Forum or the Consumer Disputes Redressal Commission or the National Consumer Redressal Commission, established under Section 9 of the C.P. Act, an option to seek permission from the Fora, as the case may be, to withdraw the complaint pending before it and file an application before the adjudicating officer under the RERA.
10. A perusal of Section 79 of RERA reveals that the provisions of said Act bar the jurisdiction of Civil Court. The Consumer Fora under the C.P. Act are not Civil Courts; rather, are performing the judicial functions, which are summary in nature. As such, bare reading of Section 79 of RERA makes it clear that the same is not applicable.
11. In answer to question No.86 it has been stated that the consumer/complainant can approach either of the two authorities i.e. the Consumer Fora under the C.P. Act or the authorities established under the RERA.
12. It is also relevant to mention that as per Section 3, the provisions of the C.P. Act are in addition to and not in derogation of the provisions of any other law for the time being in force. Similarly Section 71 of the RERA has specifically mentioned about the applicability of the provisions, which falls under Section 12, 14, 18 Consumer Complaint No 42 of 2018 8 and Section 19 of the C.P. Act and the first proviso to Section 3 of the RERA provides that the projects, which are ongoing on the date of commencement of the RERA and for which the completion certificate has not been issued, the promoter shall make an application to the Authority for registration of the said project within a period of three months from the date of commencement of RERA. Section 88 of RERA says that application of other laws is not barred. The provisions of RERA shall be in addition to and not in derogation of the provisions of any other law for the time being in force. The provisions of Section 88 of the RERA and the provisions of Section 3 of the C.P. Act are almost identical, which means both the Fora have jurisdiction to entertain and decide the matter, whichever come in their respective jurisdiction. Section 89 of the RERA provides that the provisions of RERA shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. However, there is no inconsistency between the provisions of the two Central Acts. The C.P. Act is applicable where there is deficiency in service and adoption of unfair trade practice, whereas the provisions of RERA have own field i.e. Section 12, 14, 18 and 19 of RERA. This makes it very much clear that there is no inconsistency in the provisions of both the Acts. Section 88 of RERA has clarified that application of other laws is not barred. The remedies are additional remedies under the RERA as well.
13. Moreover, by introduction of RERA, the jurisdiction of the C.P. Act is not specifically ousted. The scope and reach of the C.P. Consumer Complaint No 42 of 2018 9 Act of 1986 has been considered by the Hon'ble Supreme Court in catena of judgments, some of the important ones are: Lucknow Development Authority v. M.K. Gupta (1994) 1 SCC 243, Fair Air Engineers (P) Ltd. vs. N. K. Modi (1996) 6 SCC 385, Skypay Couriers Limited v. Tata Chemicals Limited (2000) 5 SCC 294, State of Karnataka vs. Vishwabharathi House Building Cooperative Society (2003) 2 SCC 412, CCI Chambers Cooperative Housing Society Limited Vs. Development Credit Bank Limited (2003) 7 SCC 233, Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (2004) 1 SCC 305, H.N. Shankara Shastry Vs. Assistant Director of Agriculture, Karnataka (2004) 6 SCC 230.
14. In M.Lalitha's case (supra), Hon'ble Supreme Court noticed the background, the object and reasons and the purpose for which the Act of 1986 was enacted. After referring to its earlier judgments in M.K. Gupta's case (supra) and N.K. Modi's case (supra), the Hon'ble Supreme Court observed as under:-
"11. The preamble of the Act declares that it is an Act to provide for better protection of the interest of consumers and for that purpose to make provision for the establishment of Consumer Councils and other authorities for the settlement of consumer disputes and matters connected therewith. In Section 3 of the Act in clear and unambiguous terms it is stated that the provisions of the 1986 Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.
12. From the Statement of Objects and Reasons and the scheme of the 1986 Act, it is apparent that the main Consumer Complaint No 42 of 2018 10 objective of the Act is to provide for better protection of the interest of the consumer and for that purpose to provide for better redressal, mechanism through which cheaper, easier, expeditious and effective redressal is made available to consumers. To serve the purpose of the Act, various quasi-judicial forums are set up at the district, State and national level with wide range of powers vested in them. These quasi-judicial forums, observing the principles of natural justice, are empowered to give relief of a specific nature and to award, wherever appropriate, compensation to the consumers and to impose penalties for non-compliance with their orders."
15. In Kishori Lal Vs. Chairman, Employees' State Insurance Corporation 2007(5) Recent Apex Judgments (R.A.J.) 68, the Hon'ble Supreme Court held as under:-
"17.......... The trend of the decisions of this Court is that the jurisdiction of the Consumer Forum should not and would not be curtailed unless there is an express provision prohibiting the Consumer Forum to take up the matter which falls within the jurisdiction of civil court or any other forum as established under some enactment. The Court had gone to the extent of saying that if two different fora have jurisdiction to entertain the dispute in regard to the same subject, the jurisdiction of the Consumer Forum would not be barred and the power of the Consumer Forum to adjudicate upon the dispute could not be negated."
16. Further in National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr. (2012) 2 SCC 506, it has been authoritatively held by the Hon'ble Supreme Court that the protection provided to the consumers under the Act is in addition to the remedies available under any other Statute. Consumer Complaint No 42 of 2018 11
17. Similarly, State Consumer Disputes Redressal Commission Chandigarh, U.T. Chandigarh in Consumer Case No.659 of 2017 (Veena Ghai & Anr. v. Manohar Infrastructure & Constructions Pvt. Ltd.), which was decided along with bunch of similar other cases, vide order dated 28.06.2018, observed that RERA and PAPRA will not debar the jurisdiction of the Consumer Fora in entertaining the complaints filed by a consumer alleging deficiency in providing service, negligence and adoption of unfair trade practice, on the part of the opposite parties. It has been held as follows:-
"Further contention was raised by Counsel for the opposite parties that in the face of provisions of the RERA, under which the opposite parties have registered the project, in question, on 15.09.2017, it was not open to this Commission, to entertain and decide the present complaint. He further asserted that sufficient safeguard is provided under the provisions of RERA and if the complainants are feeling aggrieved of any action, on the part of the opposite parties, they may approach under the said Act (RERA) and not under the Act, 1986.
We are not inclined to accept this argument. At the time of arguments, it is very fairly admitted by Counsel for the contesting parties, that the provisions of RERA are prospective in nature. It was also so said by the High Court of Bombay in the case of NeelKamal Realtors Suburban Pvt. Ltd. and anr. Vs. Union of India and ors. 2018 (1) R.C.R. (Civil) 298. It is on record that under the RERA, the opposite parties got themselves registered their project, only on 15.09.2017. It is also on record that some of the provisions of RERA came into operation on 01.05.2016 and even the remaining of it, in May 2017. In all, the grievance has been Consumer Complaint No 42 of 2018 12 raised by the complainants qua wrongful act/mistake done leading to deficiency in providing service and adoption of unfair trade practice, in selling the project by the opposite parties without sanctions/approvals, before coming into existence of RERA. Reading of the provisions of Section 88 of RERA makes it very clear that the same are in addition and not in derogation of the provisions of any other law for the time being in force. Section 79 of the RERA further makes it very clear that jurisdiction of only the Civil Court to entertain a suit or proceedings qua action taken as per the provisions of the said Act, is barred.
It may be stated here that the Consumer Foras under the Act, 1986 despite having some trappings of a Civil Court are not the Civil Courts. As such, the jurisdiction of the Consumer Foras is not debarred, to entertain the complaints filed by consumers, alleging deficiency in providing service, negligence and adoption of unfair trade practice against the opposite parties. Intention of the framers of law has been made clear by the concerned Department i.e. Ministry of Housing and Urban Property Alleviation, Government of India in its website www.mygov.in/group/ministry-housing-and- urban-poverty-alleviation. Under Frequently Asked Questions (FAQ), at Sr.nos. 85 and 86, it was observed as under:-
"85. Are the civil courts and consumer forums barred from entertaining disputes under the Act?
As per section 79 of the Act civil courts are barred from entertaining disputes (suits or proceedings) in respect of matters which the Authority or the adjudicating officer or the Appellate Tribunal is empowered under the Act to determine. However, the consumer forums (National, State or District) have not been barred from the ambit of the Act. Section 71 proviso permits the complainant to withdraw his complaint as regards matters under section 12, 14, 18 and section 19, Consumer Complaint No 42 of 2018 13 from the consumer forum and file it with the adjudicating officer appointed under the Act.
86. Can a complainant approach both the Regulatory Authority / adjudicating officer and the consumer forums for the same disputes?
The laws of the country do not permit forum shopping, thus, an aggrieved can only approach one of the two for disputes over the same matter."
It was also so said by the State of Punjab in its Official Website Portal rera.punjab.gov.in. The above fact clearly indicates that in the face of provisions of the RERA, any action taken under the provisions of Act 1986 is not debarred. In view of above findings, we can safely say that RERA and PAPRA will not debar the jurisdiction of this Commission in entertaining the complaints filed by a consumer alleging deficiency in providing service, negligence and adoption of unfair trade practice, on the part of the opposite parties. Further, in another judgment passed by the Hon'ble National Commission passed in Consumer Case No.1764 of 2017 titled as "Ajay Nagpal Vs. Today Homes & Infrastructure Pvt. Ltd." decided on 15.04.2019, wherein it has been held as under:-
"40. From the various decisions of the Hon'ble Supreme Court referred to above, the following principles emerge:-
(i) The Consumer Protection Act, 1986 is a supplement Act and not in derogation of any other Act.
(ii) Any Consumer who is aggrieved by any defect in goods purchased or deficiency in service as also regarding unfair trade practice, can approach the Consumer For a by filing the complaint under the Act. Even a Class Action Complaint is permissible under the Act.Consumer Complaint No 42 of 2018 14
(iii) The Consumer Fora constituted under the Consumer Protection Act, 1986 are not Civil Courts.
(iv) The Consumer Fora can provide for the reliefs as contemplated under Section 14 of the Act.
(v) A Consumer cannot pursue two remedies for the same cause of action. However, if a Consumer has not approached for redressel of its grievance under the particular Statute, the Consumer can approach the Consumer Fora under the Consumer Protection Act. But, if the Consumer had already approached the Authority under the relevant Statute, he cannot simultaneously file any complaint under the Consumer Protection Act.
(vi) Mere availability of a right to redress the grievance
in a particular Statute will not debar the
complainant/ Consumer from approaching the Consumer Fora under the Act.
(vii) Even though under Sections 14, 15, 18 and 19 of RERA, various provisions have been made which are to be followed by the Developer/Promoters and the rights and duties and the return of amount as compensation as also rights and duties of Allottees, yet same cannot mean to limit the right of the Allottee only to approach the Authorities constituted under the RERA, he can still approach the Consumer Fora under the Consumer Protection Act.
(viii) Section 71 of RERA which gives the power to adjudicate, does not expressly or impliedly bar any person from invoking the provisions of the Consumer Protection Act. It has also given a liberty to the person whose complaint is pending before the Consumer Fora to withdraw it and file before the RERA authorities.Consumer Complaint No 42 of 2018 15
(ix) Section 79 of RERA only prohibits the jurisdiction of Civil Court from entertaining any suit or proceeding in respect of any matter which can be decided by the Authorities constituted under the RERA. As the Consumer Fora are not Civil Courts, the provisions of Section 79 which bar the jurisdiction of Civil Courts, will not be attracted. So far as to grant injunction is concerned, only that power has been taken away Section 79. But, it does not, in any manner, effect the jurisdiction of the Consumer Fora in deciding the complaints.
Both, the Consumer Protection Act, 1986 and the Real Estate (Regulation and Development) Act, 2016 are supplemental to each other and there is no provision in the Consumer Protection Act, which is inconsistent with the provisions of RERA."
18. In view of law laid down in the above noted authorities, it is held that this Commission is competent to entertain and decide the present complaint and the provisions of RERA do not bar the jurisdiction of the Consumer Fora. Accordingly, the application filed by the opposite parties No.1 to 4 is hereby dismissed. Facts of the Complaint
19. Brief facts, as set out in the complaint, are that the complainants came across by the assurances made by the opposite parties No.1 to 4 through various newspapers, media, marketing emails and telemarketing with regard to launching of their residential township under the name and style of 'Wave Gardens' in Sectors 85 and 99, S.A.S. Nagar, Mohali. The complainants booked a flat in their project in January, 2013 by paying Rs.3,00,000/- by cheque to opposite party No.1 on 09.02.2013. The opposite parties No.1 to 4 Consumer Complaint No 42 of 2018 16 vide demand note dated 27.02.2013 asked for an instalment of Rs.5,82,657/-, which the complainants paid by way of cheque dated 19.03.2013. The opposite parties No.1 to 4 offered a "Subvention Scheme" to the complainants stating that there would be no Equal Monthly instalments payable till the date of possession, accordingly, the complainants availed housing loan from HDFC Limited for a sum of Rs.38,00,000/- which was sanctioned on 18.06.2013. Thereafter, the complainants entered into "Independent Residential Floor Allottee(s) Arrangement" with the opposite parties on 05.03.2015 for allotment of an Independent Residential Floor, bearing No.25/GF on GF in Sector 99, Mohali, having saleable area 1343 sq.ft. The complainants further entered into a Tripartite Agreement in furtherance of Subvention Scheme on 23.03.2015. The opposite party No.1 received a sum of Rs.46,19,377/- out of the total due amount of Rs.57,08,171.58. As per clause 5.1 of the agreement the possession of an Independent Residential Floor was to be delivered within 24 months with an extended period of 6 months from the date of execution of the agreement, however, the opposite parties No.1 to 4 failed to comply with the terms and conditions of the agreement. Even the complainants are paying the monthly instalments of interest on the loan amount to opposite party No.5 and have made a total payment of more than Rs.2,00,000/-. The opposite parties No.1 to 4 further demanded the remaining amount, however, the opposite parties No.1 to 4 failed to handover the possession of the property within the stipulated period, which expired in August, 2017. The complainants are residing in a rented Consumer Complaint No 42 of 2018 17 accommodation and are waiting to move into their own property. The complainant No.2 is continuously visiting the site and saw that the project is nowhere near completion. The complainants submit that they have decided to opt out of the project for the inordinate delay and non-compliance of the terms and conditions by opposite parties No.1 to 4. The complainants despite repeated requests and reminders have not received the amount deposited with opposite parties. The aforesaid act and conduct of opposite parties No.1 to 4 amounts to deficiency in service and unfair trade practice. Hence, the present complaint, seeking aforesaid relief.
20. Upon notice, the opposite parties appeared and filed their written statements to the complaint.
21. Opposite parties No.1 to 4 filed their written statement taking preliminary submissions that the present complaint is not maintainable as the complainants do not fall under the definition of 'consumer' as defined in the Act. The complainants have sought to buy an apartment in question for commercial purposes. It has been stated that complainants are permanent residents of Mohali and are well settled. There is no averment in the complaint as to under what circumstances they require a residential accommodation in Mohali and there is no occasion for them to shift and reside at another place in the same city i.e. Mohali. The complaint is not maintainable for want of pecuniary jurisdiction. The complainants are defaulter in making the payments to the opposite parties within the stipulated period. The complainants have defaulted in fulfilling the obligations under Clause 12(a) of the Allottee(s) Arrangement and therefore, Consumer Complaint No 42 of 2018 18 under Clause 12(i), the Developer retains the right to cancel allotment and forfeit the earnest money. It is submitted that due to ongoing slump in the real estate market, the complainants are no longer interested in retaining the Unit, in question. The complainant has paid only Rs.8,82,657/- from his own pocket and rest of the amount was paid by opposite party No.5. The construction is going on at a good pace. The present complaint is not maintainable in view of the arbitration clause 13 in the Apartment Allottee(s) Arrangement. It has been further pleaded that the answering opposite parties No.1to4 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 party No.1 for development. However, the State Government failed to acquire any land for it 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 it, 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 has managed to enter into a Land Use Agreement with the local farmer, from whose land an access road has been laid for Consumer Complaint No 42 of 2018 19 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, which was beyond the control of opposite party No.1. It was contended that there was no time for mandatory completion of construction of the Project under the Apartment Allottee(s) Arrangement. The Commission has got no jurisdiction to entertain and decide the present complaint. In the present case, intricate questions of law and facts are involved and require a great deal of evidence to be led from both the sides, hence is purely within the competency of a Civil Court. On merits, allotment of the unit, in question, in favour of the complainants is admitted, however, the complainants\ had not specified the purpose of the booking the second residential unit in Mohali as they had already admitted that they are resident of Mohali. The complainant is in the habit of habitually delaying payments and is in the habit of delaying payments. However, the possession of the apartment is almost ready and it is going to be handed over soon. It is further pleaded that there is no fixed time for handing over the possession within 30 months. It is denied that there is any deficiency in service on the part of opposite parties No.1 to 4. Other similar pleas, as raised in preliminary objections, have been reiterated and denying other allegations of the complainant and prayed for dismissal of the complaint with costs.
22. Opposite party No.5, in its written statement, raised preliminary objections that the rights of the parties to the present lis are governed by the Tripartite agreement Ex.OP-5/2. In case of Consumer Complaint No 42 of 2018 20 cancellation of the unit or in the contingency of termination of "Floor Buyer's Agreement", opposite party No.5 has the first charge/right to seek apportionment of its dues. As on 18.04.2018, an amount of Rs.33,65,719/- was outstanding towards the total loan amount. On merits, it is submitted that the complainants approached opposite party No.5 for sanctioning of Rs.38,00,000/- which was further increased to Rs.45,00,000/- as per their request. Out of which Rs.33,58,400/- has been disbursed by the answering opposite party. Dismissal of the complaint qua opposite party No.5 was prayed.
23. To prove their claim, the complainant No.2 tendered in evidence his affidavit as Ex.CA along with documents i.e. copy of demand notice dated 27.02.2013 as Ex.C-1, copy of cheque dated 19.03.2013 as Ex.C-2, copy of sanction letter dated 18.06.2013 as Ex.C-3, copy of agreement dated 05.03.2015 as Ex.C-4, copy of tripartite agreement as Ex.C-5, copies of payment receipts as Ex.C- 6 to Ex.C-11, copy of customer ledger dated 13.09.2017 as Ex.C- 12, copy of statement of account dated 07.09.2017 as Ex.C-13, copy of lease documents dated 16.02.2018 as Ex.C-14(colly).
24. Opposite parties No.1 to 4 filed the affidavit of Sh.Amarjit Singh, Authorized Signatory of opposite parties No.1 to 4 as Ex.OP- 1/A, along with documents i.e. copy of letter of authorization as Ex.OP-1/1, copy of driving licence as Ex.OP-1/2, copy of voter card as Ex.OP-1/3, copy of account statement dated 05.12.2018 as Ex.OP-1/4, copy of payment demand notice dated 05.01.2016 as Ex.OP-1/5, copies of payment receipts as Ex.OP-1/6, Ex.OP-1/7, Consumer Complaint No 42 of 2018 21 copy of outstanding letter as Ex.OP-1/8, copies of reminders as Ex.OP-1/9 and Ex.OP-1/10, copy of letter as Ex.OP-1/11, copy of payment demand notice dated 26.07.2017 as Ex.OP-1/12, copy of payment demand notice as Ex.OP-1/13(colly), copy of band subvention deduction detail memo dated 27.03.2015 as Ex.OP- 1/14, copy of payment demand notice dated 16.03.2015 as Ex.OP- 1/15, copies of receipts as Ex.OP-1/16 to Ex.OP-1/17, copy of bank subvention deduction details memo dated 13.01.2016 as Ex.OP- 1/18, copy of intimation of possession letter dated 15.06.2018 as Ex.OP-1/19, copy of occupancy certificate dated 05.11.2018 as Ex.OP-1/20, copy of partial completion certificate dated 12.09.2018 as Ex.OP-1/21, copy of memorandum of agreement dated 03.02.2006 as Ex.OP-1/22, copy of approved plan of the project as Ex.OP-1/23, copy of land acquisition letter dated 19.01.2012 as Ex.OP-1/24, copy of land use agreement dated 14.06.2012 as Ex.OP-1/25, copy of Mohali Master Plan as Ex.OP-1/26.
25. Opposite party No.5 filed the affidavit of Aditya Kochar, Assistant Manager dated 04.10.2018 as Ex.OP-5A along with documents as copy of authorization letter dated 22.08.2018 as Ex.OP-5/1, copy of loan agreement dated 27.03.2015 as Ex.OP-5/2, copy of Tripartite Agreement as Ex.OP-5/3, copies of account statements as Ex.OP-5/4(colly).
Contention of the Parties
26. We have heard learned counsel for the parties and have gone through evidence and record carefully.
Consumer Complaint No 42 of 2018 22
27. Learned counsel for the complainant vehemently contended that the complainants booked one residential floor with opposite parties No.1 to 4 for their residential purposes. The complainants opted Subvention Scheme as offered by opposite parties No.1 to 4 and availed the housing loan from opposite party No.5, which was sanctioned on 18.06.2013. An "Independent Residential Floor Allottee(s) Arrangement" was executed between the parties on 05.03.2015, as per which the possession was to be delivered to the complainants within 30 months from the date of execution of the agreement. The complainants against the total sale consideration, paid a sum of Rs.46,19,377/-. However, there was no progress at the site of the project and opposite parties No.1 to 4 and kept on unnecessarily delaying construction, despite receipt of substantial amount from the complainants towards the price of the flat, in question. The complainants are even paying the instalments to the Bank against the loan disbursed to opposite parties No.1 to 4. The complainants number of times visited the office of opposite parties No.1 to 4 to take the possession but no offer of possession was ever made to the complainants. When the complainants lost their hope to get the possession in near future then they decided to opt out of the project and seek refund of the amount along with interest but neither the possession was offered nor refund was made. Thus, there is clear-cut deficiency in service and unfair trade practice on the part of opposite parties No.1 to 4. Therefore, the complainants are entitled to all the reliefs, as prayed for in the complaint. Consumer Complaint No 42 of 2018 23
28. Per contra, learned counsel for opposite parties No.1 to 4 vehemently contended that the complainants do not fall within the definition of consumer and bought the housing unit for commercial purposes and not for residential purpose. The complaint is not maintainable before this Commission in view of the Arbitration Clause 13 in the Agreement. Learned counsel for opposite party No.1 further argued that intricate questions of facts and laws are involved in the present complaint and cannot be decided in a summary procedure. It was further contended that there was no specific period mentioned in the agreement for delivery of possession. They were just to make endeavour to deliver the possession of the unit, in question, within 30 months from the date of agreement. Moreover, the complainants cannot allege any delay on their part, as they themselves failed to pay the due amounts regularly on time. As such, the complainant cannot allege any deficiency on the part of opposite parties No.1 to 4. Therefore, the complaint is liable to be dismissed with costs.
29. Learned counsel for opposite party No.5 contended that there is no deficiency in service on the part of opposite party No.5, as it just advanced the loan amount in favour of the complainants for making payment of price of the unit, in question, to opposite parties No.1 to 4 under the Tripartite Agreement. In case of cancellation of the unit or in the contingency of termination of the Floor Buyer's Agreement, it has the first charge/right to seek apportionment of its dues. The complaint is liable to be dismissed against it.
Consumer Complaint No 42 of 2018 24Consideration of the Contentions
30. We have given our thoughtful consideration to the respective contentions raised by learned counsel for the parties.
31. First of all, we would like to decide the objection raised by opposite parties No.1 to 4 that the complainants do not fall under the definition of 'consumer', as defined in the Act, on the ground that he purchased the unit, in question, for commercial purpose in order to earn profits.
32. In this regard, It is relevant to mention that there is no evidence from the side of opposite parties No.1 to 4 to prove that the complainants are indulging in sale/purchase of property for commercial purpose and simple assertion in this regard in the reply of the opposite parties No.1 to 4 is not sufficient to prove this fact. 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 STATE DEVELOPERS PVT. LTD. & OTHERS Consumer Case No.137 of 2010, decided on 12.02.2015, held the complainant as consumers, observing 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 complainant 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 earning profit. In the instant case also, as Consumer Complaint No 42 of 2018 25 already discussed above, there is no evidence led by opposite parties No.1 to 4 to prove that the complainants indulged in sale/purchase of properties or that they purchased the unit, in question, for further sale or for earning profits. Accordingly, the above said objection/contention of opposite parties No.1 to 4 are rejected and the complainants are held to be 'consumers' as defined, under the Act.
33. Opposite Parties No.1 to 4 took another objection in its reply that complicated questions of law and facts are involved, therefore, this Commission has no jurisdiction to entertain the complaint. In case we go through the pleadings of the parties, the complainant had booked one flat with opposite parties No.1 to 4 and had paid a sum of Rs.46,19,377/- as demanded by opposite parties No.1 to 4. An Agreement was executed between the complainant and opposite parties No.1 to 4 and as per the terms and conditions of the agreement, the opposite parties No.1 to 4 were to deliver the possession within 24 months with an extended period of six months, from the date of execution of the agreement. It is only the interpretation of agreement and then to see whether there is any deficiency in service on the part of the opposite parties? We do not see that any complicated questions of law and facts are involved, which cannot be adjudicated by this Commission. In this regard, we are fortified by the judgment of 'Dr.J.J.Merchant and Ors. V. Shrinath Chaturvedi' 2002(6) SCC 635, wherein it was held that the State Commission and District Forum are headed by retired High Court Judges and Officers of District Judge level and in our Consumer Complaint No 42 of 2018 26 view, this is not such a case which cannot be decided by the 'Consumer Fora' after obtaining evidence and if need be after getting an expert opinion.
34. The further objection raised by opposite parties No.1 to 4 is that this Commission has no pecuniary jurisdiction to entertain and try the complaint. In this respect, it is relevant to mention that the basic sale price of the flat, in question, is Rs.57,08,000/-, as per Independent Residential Floor Allottee(s) Arrangement Ex.C-4 executed between the parties and against the total sale consideration the complainants have paid a sum of Rs.46,19,377/- to opposite parties No.1 to 4, which is above Rs.20,00,000/- and below Rs.1,00,00,000/-. Therefore, the complaint filed by the complainants is well within the pecuniary jurisdiction of this Commission. Accordingly, the objection raised by opposite parties No.1 to 4 in this regard is rejected.
35. So far as the other objection of opposite parties No.1 to 4 that as per Arbitration Clause-13 of the agreement, Ex.C-4, 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 Complainant 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 Appeal No.(s) Consumer Complaint No 42 of 2018 27 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 opposite parties No.1 & 2 is rejected.
36. At the outset, it is relevant to mention that the merits of the present complaint are squarely covered by the earlier verdicts given by this Commission in following cases:
i) Consumer Complaint No.436 of 2018
(Jagmit Singh Vs. M/s Country Colonisers
Private Limited & Ors.) decided on
24.09.2018; and
ii) Consumer Complaint No.658 of 2017
(Gurvinder Singh v. M/s Country
Colonizers Private Limited & Anr.)
decided on 06.02.2018; and
iii) Consumer Complaint No.725 of 2017
(Sukhvinder Singh v. Country Colonizers
Private Limited & Ors.) decided on
18.01.2018.
37. So, we intend to dispose of this matter, in view of the decisions given in the above noted cases.
38. Admittedly, the complainants purchased the unit, in question, from opposite parties No.1 to 4 for a Basic Sale Price of Consumer Complaint No 42 of 2018 28 Rs.57,08,000/- as per Independent Residential Floor Allottee(s) Arrangement, Ex.C-4 executed between the complainant and opposite parties No.1 to 4 on 05.03.2015. As per Clause 5.1 of the said agreement, subject to Clause 5.2 and further subject to all the allottee(s) of the said "Apartment" in the said project making timely payment(s), the developer was to endeavour to complete the development of the project in general and the said apartment in particular as far as possible within 24 months, with an extended period of 6 months from the date of execution of the Apartment Allottee(s) Arrangement and/or from the date of start of construction of Group Housing named 'Wave Estate', whichever was later. There is no evidence, as to when the construction of the said unit/flat had started. Thus, we infer that the possession was to be delivered within 24 months of the date of the agreement 05.03.2015 with an extended period of six months. However, opposite parties No.1 to 4 failed to develop/complete the unit, in question, so as to deliver its possession to the complainants by that date, despite receipt of substantial amount from the complainants towards the price of the flat, in question. The complainants as per agreement opted for Subvention Plan and availed a housing loan of Rs.45,00,000/- from opposite party No.5 - HDFC Ltd. and a Tripartite Agreement was executed between the parties, Ex.OP-5/2. As per Clause 3 of the Tripartite Agreement, the builder assumes the liability of payments under the loan agreement as payable by the Borrower to HDFC during the 24 months. However, the opposite parties No.1 to 4 have failed to prove that how much EMIs have been paid to the Bank by Consumer Complaint No 42 of 2018 29 them on behalf of the complainants. It is not disputed that opposite parties No.1 to 4 have send various reminders to the complainants for clear their pending dues vide Ex.OP-1/8 to Ex.OP-1/13 but still the opposite parties No.1 to 4 received the payments after due date/ delay. The opposite parties No.1 to 4 have tendered an intimation letter for offering the possession, issued to the complainants along with few annexures, dated 15.06.2018, vide Ex.OP-1/13, which after filing of the complaint. Moreover, the Completion Certificate has not been obtained by opposite parties No.1 to 4. The Certificate produced on record by opposite parties No.1 to 4 is 'Partial Completion Certificate', which was obtained only on 12.09.2018 vide Ex.OP-1/21. It proves that when opposite parties No.1 to 4 booked the flat and sent the intimation of possession, the requisite approvals were not in their hands, which itself is a deficiency on service on their part. The complainants against the total sale consideration have a sum of Rs.46,19,377/- vide Ex.OP-1/4 issued on 05.12.2018 and Ex.C-12 issued on 13.09.2017. The opposite parties also tendered in evidence the Occupancy Certificate issued by GMADA on 05.11.2018. From the perusal of the same, it shows that the said Certificate was issued much after institution of the complaint.
39. We are fortified with the judgment passed by Hon'ble National Commission in a case titled as Aashish Oberai Vs. Emaar MGF Land Limited, Consumer Case No. 70 of 2015, decided on 14 Sep 2016, under similar circumstances has held that the complainants cannot be compelled to take possession if Consumer Complaint No 42 of 2018 30 the same has not been given within the promised period. It was observed as under:-
"12. During the course of hearing, it was contended by the learned counsel for the opposite party that on 06.4.2016, they have already obtained post-completion certificate in respect of the villa allotted to the complainant.
He also submitted that vide letter dated 06.5.2016, they have already informed the complainant about grant of the part occupancy certificate and asked him to pay an additional amount of Rs.3,01,200/- on account of revision of EDC by Government of Punjab. The learned counsel for the complainants however, maintained that considering the breach of its contractual obligation by the opposite party, the complainant is not obliged to accept the offer of possession at such a belated stage, particularly when the said offer is not accompanied by an offer to pay adequate compensation for the delay in offering possession of the villa. I am in agreement with the learned senior counsel for the complainant that considering the default on the part of the opposite party in performing its contractual obligation, the complainant cannot be compelled to accept the offer of possession at this belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest."
Moreover, the Hon'ble National Commission in para 9 and 10 of its judgment reported in III(2018) CPJ 135 titled as "TDI Consumer Complaint No 42 of 2018 31 Infrastructure Ltd. & Ors. Vs. Aditya Tomar" relied upon by the learned counsel for the complainant has held as under:-
"9. In an order passed in "GTM Builders & Promoters Pvt. Ltd. vs. Deepti Ular Jain & Anr." [FA No. 522 / 2011 dated 29.10.2015] , this Commission held as follows:- ".....in the event of a Developer failing to deliver possession of the property within the stipulated period, for any reason, save and except a force majeure condition, agreed to between the contracting parties, an allottee cannot be compelled to wait endlessly and he would be within his rights to seek refund of the amount deposited with the Developer against allotment if the delivery of possession of the flat in question as per the scheduled time frame is not in sight..."
10. It is made out from above that a complainant could not be forced to take possession of the property, after the expiry of the promised date of delivery of possession as per the agreement. It is held, therefore, that the complainant was very well within his rights to obtain refund of the money deposited by him and hence, the State Commission has not committed any illegality or irregularity in directing refund of the amount deposited, although there was no prayer to that effect in the consumer complaint itself. The next issue that requires consideration in the matter is with regard to the settlement."
40. Not only this, the Hon'ble National Commission has also recently held in Consumer Case No. 1702 of 2016 (Shalabh Nigam v. ORRIS Infrastructure Pvt. Ltd. & Anr.) decided vide order dated Consumer Complaint No 42 of 2018 32 06.05.2019 that the allottees have right to ask for refund if the possession is inordinately delayed and particularly beyond one year after stipulated period.
41. The Hon'ble Supreme Court has also recently held in Civil Appeal No.3207-3208 of 2019 titled as Marvel Omega Builders Pvt. Ltd. & Anr. Vs. Shrihari Gokhale and Anr. that if there is any delay in handing over the possessions, then the complainant is justified to seek the refund. The relevant para of the judgment is reproduced hereunder:-
"Even assuming that the villa is now ready for occupation (as asserted by the Appellants), the delay of almost five years is a crucial factor and the bargain cannot now be imposed upon the Respondents. The Respondents were, therefore, justified in seeking refund of the amounts that they had deposited with reasonable interest on said deposited amount. The findings rendered by the Commission cannot therefore be said to be incorrect or unreasonable on any count."
42. Opposite party No.1 has also raised the plea that due to force majeure circumstances, it 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 for its project, but State Government failed to acquire land, as per Clause 5(e) of the MoA, under the provisions of Land Acquisition Act, 1894. Opposite party No.1 further pleaded that it made several requests to the State Government to initiate the acquisition and handover the possession of the land to it in order to carry out development works on the same and that GMADA was to provide external access roads to the project, who have failed to do so. Thus, Consumer Complaint No 42 of 2018 33 the delay in completing the project was only due to inaction on the part of GMADA.
43. The aforesaid plea of opposite parties No.1 to 4 is not tenable, because according to provisions of Punjab Apartment and Property Regulation Act, 1995 (in short, "PAPRA"), it was its duty to supply the information with regard to their ownership, permissions from PUDA/GMADA, licenses and 'Change of Land Use' etc. The non-supply of this vital information to the complainants is against the provisions of PAPRA.
44. In Section 3 of PAPRA, 'General liabilities of the promoter' have been explained, which are as under:-
"3. General Liabilities of Promoter:-
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 Consumer Complaint No 42 of 2018 34 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;
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,-
(g) 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 Consumer Complaint No 42 of 2018 35 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.
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.Consumer Complaint No 42 of 2018 36
(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 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."
45. Opposite parties No.1 to 4 have not produced any evidence to prove that it has complied with the aforesaid provisions of Sections 3 and 4 of PAPRA in letter and spirit, by making full and true disclosure of the nature of its title to the land on which such colony was to be developed or such building was to be constructed. There is also no evidence on record to prove that before allotment Consumer Complaint No 42 of 2018 37 of the unit, in question, to the complainant, they were made aware about the execution of the above MoA between them and the State Government; which might have affected the decision of the complainants for purchasing the unit, in question, from it, through resale/transfer, in those circumstances. By not complying with the above said provisions of PAPRA, opposite parties No.1&2 is certainly guilty of rendering deficient services and adopting unfair trade practice.
46. 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 opposite parties No.1 to 4 to prove that any account has been maintained by them in this respect. As such, opposite parties No.1 to 4 also violated Section 9 of the PAPRA.
47 . 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."Consumer Complaint No 42 of 2018 38
48. It stands proved that opposite parties No.1 to 4 failed to hand over the possession of the unit, in question, to the complainants within the stipulated period, without any sufficient reason. 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 complainants have to wage a long drawn and tedious legal battle. As such, the complainants were at loss of opportunities. Therefore, the complainants are entitled to the refund of the amount deposited by him, along with interest and compensation.
49. So far as the complaint filed against opposite party No.5 is concerned, it is relevant to mention that there is no deficiency in service on its part, as it just advanced loan amount in favour of the complainants to be paid to opposite parties No.1 to 4 towards price of the unit, in question. So, the complaint is dismissed against it.
50. However, it is relevant to mention that the complainants obtained loan from opposite party No.5-HDFC Ltd. to the tune of Rs.45,00,000/- for making the payment towards the price of the unit, in question, to opposite parties No.1 to 4. Tripartite Agreement Ex.OP-5/2 was duly executed between the parties. As per Outstanding Loan Amount Sheet produced by opposite party No.5 at the time of arguments, a sum of Rs.33,58,400/- stood disbursed out of sanctioned loan amount and as on 17.01.2020 and a sum of Rs.33,50,831/- was due towards the loan account of the complainants. As per terms of the Tripartite Agreement, in case of Consumer Complaint No 42 of 2018 39 cancellation of the unit, the amount payable to the borrower is to be directly paid to the HDFC Ltd. Since opposite parties No.1 to 4 failed to complete/develop the project, so as to deliver possession of the unit, in question, to the complainants within the stipulated period of 30 months from the date of Agreement and the complainants are held entitled to refund of the entire deposited amount, along with interest, so first of all, the outstanding amount of loan advanced by opposite party No.5 is to be paid to it and thereafter the remaining amount, if any, is to be paid to the complainants.
51. In view of our above discussion, the complaint is allowed against opposite parties No.1 to 4 and the same is dismissed against opposite party No.5. Following directions are issued to opposite parties No.1 to 4:-
i) to refund the amount of Rs.46,19,377/-, along with interest at the rate of 12% per annum from the respective dates of deposit till realization, as per Rule 17 of PAPRA minus the pre-EMI, if any, already paid by opposite parties No.1 to 4;
It is made clear that, first of all, opposite party No.5 shall issue a certificate qua balance repayable loan amount as on the date of order and opposite parties No.1 to 4 shall pay the outstanding amount to opposite party No.5-HDFC Ltd. towards the loan advanced by it to the complainants and, thereafter, the remaining amount, if any, shall be paid to the complainants;
Consumer Complaint No 42 of 2018 40
(ii) to pay Rs.60,000/-, as compensation for the mental agony and harassment suffered by the complainants as well as litigation expenses.
52. Opposite parties are directed to comply with this order within a period of one month from the date of receipt of certified copy thereof.
53. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (RAJINDER KUMAR GOYAL) MEMBER (KIRAN SIBAL) MEMBER February 17, 2020 parmod