State Consumer Disputes Redressal Commission
Narinder Kumar Ahuja vs M/S Country Colonisers Pvt. Ltd. on 24 July, 2019
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH
Misc. Applications No.846 & 847 of 2019
In/and
Consumer Complaint No.295 of 2018
Date of Institution : 16.04.2018
Date of Reserve : 09.07.2019
Date of Decision : 24.07.2019
1. Mr.Narinder Kumar Ahuja son of Sh.Banwari Lal Ahuja
2. Mrs. Meera Ahuja wife of Mr.Narinder Kumar Ahuja
Both residents of House No.1679, Second Floor, Sector 34-D,
Chandigarh-160022.
....Complainants
Versus
1. M/s Country Colonisers Private Limited, Regd. Office P.O.
Rayon & Silk Mills, Adjoining Coca Cola Depot, G.T. Road,
Chheharta Amritsar, Punjab-143105 through its
Chairman/M.D./ Director/Authorized Officer.
Corporate Office: M/s Country Colonisers Private Limited, C-1,
Sector -3, Noida-201301 (U.P.)
Site Address:- M/s Country Colonisers Private Limited, Site
Address: Sector 85, Mohali, Punjab, 160062 through.
2. Sh.Harmandeep Singh Kandhari, Director of M/s Country
Colonisers Private Limited, Regd. Office, P.O. Rayon & Silk
Mills, Adjoining Coca Cola Depot, G.T. Road, Chheharta,
Amritsar, Punjab-143105.
...... Opposite parties No.1 & 2
3. Housing Development Finance Corporation Ltd., SCF-55,
Phase-III-B2, Mohali, Punjab 160059, through its Authorized
Signatory.
....Proforma Opposite Party No.3
Consumer Complaint under Section 17 of
the Consumer Protection Act, 1986.
Consumer Complaint No 295 of 2018 2
Quorum:-
Mr.Rajinder Kumar Goyal, Presiding Member
Mrs.Kiran Sibal, Member Present:-
For the complainant : Sh.Deepak Aggarwal, Advocate For Opp. Parties No.1&2 : Sh.Tejeshwar Singh, Advocate For Opposite party No.3 : Ms.Neetu Singh, Advocate RAJINDER KUMAR GOYAL, PRESIDING 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 refund the amount of Rs.37,26,540/- along with interest @ 15% per annum from the respective dates of deposit till realization of the amount.
II. to pay an amount of Rs.3,00,000/- on account of mental harassment and deficiency in service.
III. to pay Rs.1,00,000/- as litigation expenses; and IV. any other direction which this Commission may deem fit.M.A. No.846 of 2019
2. This application has been filed by opposite parties No.1 & 2 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 Consumer Complaint No 295 of 2018 3 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.
3. Reply to the application was filed by the complainant wherein the complainant denied all the averments as averred by opposite parties No.1 & 2 and submitted that the Consumer Foras have the jurisdiction to entertain the complaints Also, the complainants referred various judgments in their reply to support their contentions.
4. We have heard the arguments of the counsel for the parties and have carefully gone through the record.
5. In the present case the project in question was launched by opposite parties No.1 & 2 and the complainants submitted application in the month of February, 2013, Ex.C-1, for allotment of residential flat/apartment in question. The facts are not in dispute. The main stress of opposite parties No.1 & 2 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 Consumer Complaint No 295 of 2018 4 flat/apartment much earlier to the date of enforcement of RERA in the State of Punjab and even in the country, in the year 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)....."Consumer Complaint No 295 of 2018 5
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 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?Consumer Complaint No 295 of 2018 6
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."
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.
6. 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.
7. 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.
8. 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 Consumer Complaint No 295 of 2018 7 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 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 Consumer Complaint No 295 of 2018 8 other laws is not barred. The remedies are additional remedies under the RERA as well.
9. Moreover, by introduction of RERA, the jurisdiction of the C.P. Act is not specifically ousted. The scope and reach of the C.P. 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.
10. 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 Consumer Complaint No 295 of 2018 9 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 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."
11. 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 Consumer Complaint No 295 of 2018 10 the Consumer Forum to adjudicate upon the dispute could not be negated."
12. 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.
13. 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 Consumer Complaint No 295 of 2018 11 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 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:- Consumer Complaint No 295 of 2018 12
"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."
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:- Consumer Complaint No 295 of 2018 13
"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.
(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 Consumer Complaint No 295 of 2018 14 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.
(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."
14. 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 Consumer Complaint No 295 of 2018 15 jurisdiction of the Consumer Fora. Accordingly, the application filed by the opposite parties No.1 & 2 is hereby dismissed. M.A. No.847 of 2019
15. This application has been filed by opposite parties No.1 & 2 for placing on record additional affidavit and additional documents on the ground that these are necessary for proper adjudication of the case.
16. Reply to the application has been given by the complainant stating therein the documents placed on record by opposite parties No.1 & 2 are not relevant. The complainants further denied all the averments as averred by opposite parties No.1 & 2 in their application and prayed to dismiss the application.
17. We have heard the learned counsel for the parties and have gone through the record carefully.
18. From the perusal of the record, we find that opposite parties No.1 & 2 has not detailed any reason that how these documents are material for proper adjudication of the case. From the perusal of the documents, we find that these documents are just provisional allotment letters and copy of the complaint. Moreover, the opposite parties no.1 & 2 have already closed their evidence and we find that these documents have been placed just to linger on the proceedings of the case. There is nothing material in the documents, which we could say are helpful to decide the present complaint. Hence, the same is hereby dismissed. Consumer Complaint No 295 of 2018 16 Facts of the Complaint
19. Brief facts, as set out in the complaint, are that the complainant No.1 is working in a private company named M/s Sun Pharmaceutical Industries Limited and purchased the unit, in question for residential purposes for their daughters after retirement. The complainants came across by the assurances made by opposite parties No.1 & 2 through various newspapers, media, marketing emails and telemarketing with regard to launching of its residential township in Sectors 85 and 99, S.A.S. Nagar, Mohali. The complainant purchased an Independent Residential Floor (in short, "flat") from opposite parties No.1 & 2, bearing No.72, Second Floor, Sector 99, measuring 1060 sq.ft., constructed 200 sq. yards plot, in the said project. The complainants made a payment of Rs.3 lacs towards booking amount on 20.01.2013. The complainants opted Subvention payment plan, according to which they were made to understand that till the date of handing over possession of floor No.72, pre-EMI interest will be paid by the Company to the Bank concerned. As per condition No.30 of the application, the development was to be completed within 24 months along with extended period of 6 months from the date of execution of the Agreement. The complainants made various visits to the office of opposite parties No.1 & 2 to provide them agreement in respect of Floor No.72. The said agreement dated 19.07.2013 was sent to the complainants for their signatures after a delay of 6 months, which was sent back by 30.07.2013. To make the timely payments, the complainant got approved the housing loan of Rs.33,60,000/- from Consumer Complaint No 295 of 2018 17 HDFC Ltd.. To complete the formalities, the agreement was to be submitted which they did not sent back to the complainants after their signatures. On 13.09.2013, the complainants sent mail to opposite parties No.1 & 2 with the request to expedite the matter. In response to that, it was replied by opposite parties No.1 & 2 that the agreement was has been sent to Delhi Office for signatures, which will be received back in 3-4 days. When no agreement received, the complainants again sent an e-mail dated 08.10.2013 wherein the issue of validation of the housing loan sanction/ approval upto 22.10.2013 by proforma opposite party No.3, was also shared. As per the agreement dated 19.07.2013, the total sale consideration of Floor No.72 was fixed as Rs.42,00,000/- which include Rs.40,00,000/- as basic sale price and Rs.2,00,000/- towards preferential location charges. As per clause 5.2 of the agreement, subject to force majeure circumstances, opposite parties No.1 & 2 were liable to handover physical possession of floor No.72 within 24 months with extended period of 6 months from the date of execution i.e. by 18.01.2016. The complainants shocked to know from opposite parties No.1 & 2 after about 14 months of booking of floor No.72 and making substantial amounts that floor No.72 is not available at the site, on account of change in layout plan of the project, in question. The complainants were asked to relocate themselves to Floor No.47 in the said project, which was not suitable to them. Vide email dated 21.03.2014, the complainants showed their angriness in the matter but under compelled circumstances, the complainants accepted relocation to floor No.47. Consumer Complaint No 295 of 2018 18 Thereafter floor No.50 was offered to the complainant which was not made available to them. Various emails dated 01.04.2014 were exchanged between the parties in that regard. The complainants sent emails dated 29.10.2014, 06.11.2014 and 18.11.2014 with the request to opposite parties No.1 & 2 to do the needful and to provide certain documents for revalidation of housing loan. When the complainants got fed up with the behavior of opposite parties No.1 & 2 they decided to seek refund of the amount deposited and accordingly sent an email dated 19.11.2014. After various meetings, it was ultimately decided to allot floor No.12, Second Floor, in the said project. At the relevant time, it was submitted by opposite parties No.1 & 2 that an agreement will be executed in respect of floor No.12, Second Floor. Ultimately vide email dated 12.12.2014, the complainants were allotted floor No.12, Second Floor in the said project, which was accepted by the complainants. An agreement was sent to the complainants for signatures, wherein the date of said agreement was put as 03.02.2015 and also as per clause 5 therefor, possession was to be delivered within 30 months (24+6) therefrom. The issue was taken up by the opposite parties through vide their e-mail dated 11.02.2015. Subsequently, vide email dated 12.02.2015, the opposite parties admitted that there is a clerical mistake regarding price of relocated Floor No.12 which will be got rectified and the total cost for the said floor will remain same as per agreement dated 19.07.2013. Despite repeated emails and reminders the opposite parties No.1 & 2 vide email dated 24.02.2015 admitted that the date of agreement execution will Consumer Complaint No 295 of 2018 19 remain same as per previous agreement. The opposite parties also committed to give this condition in writing on their company's letter head but they did not do so. Thereafter, a Tripartite Agreement was executed into between the parties on 08.02.2015 according to which opposite parties No.1 & 2 paid pre-EMI interest to opposite party No.3. The complainants as per demand of the opposite parties paid the payments but still the possession was not offered to the complainants. The complainants visited the site number of times to see the construction work and development activities but the pace of work was very slow. The complainants visited the site on 24.02.2018 and were shocked to see that the project and relocated floor No.12, Second Floor was not habitable and various works were still incomplete. Against the total sale consideration, the complainants have paid Rs.37,26,540/- to opposite parties No.1 &
2. The possession of the unit was to be delivered by the opposite parties No.1 & 2 by 18.01.2016. Also the pre-EMI interest which the opposite parties No.1 & 2 committed to make the payment till possession, have been stopped by opposite parties No.1 & 2 after 24 months and compelled the complainants to pay the same. The aforesaid act and conduct of the opposite parties No.1 & 2 amounts to deficiency in service. 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 & 2 filed their written statement taking preliminary submissions that the present complaint is not Consumer Complaint No 295 of 2018 20 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 resale purposes. Even in the complaint, the complainants have stated that they have purchased the unit so that they could gift separate house to their daughters, therefore, there is no urgency to get the possession of the unit. The possession of the apartment was offered to the complainants but they did not deposit the balance payments due. It was further contended that all the requisite formalities have been met with and the possession of the apartment was offered to the complainants. The complainant is defaulter in making the payments to the answering opposite parties within the stipulated period. The present complaint is not maintainable in view of the arbitration clause 13 in the Apartment Allottee(s) Arrangement. It was contended that there was no time for mandatory completion of construction of the Project under the Apartment Allottee(s) Arrangement. As per clause 5.5 of the agreement, that in case of delay in construction of the flat, for the reasons attributable to opposite parties No.1&2, it shall be liable to pay Rs.5/- per sq.ft. per month for the delayed period. 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 requires a great deal of evidence to be led from both the sides, hence is purely within the competency of a Civil Court. It was further pleaded that the answering opposite parties No.1& 2 entered into a Memorandum of Agreement (MoA) dated 03.02.2006 with the Government of Punjab and as per Clause Consumer Complaint No 295 of 2018 21 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 parties No.1 & 2 has managed to enter into a Land Use Agreement with the local farmer, from whose land an access road has been laid for proper access to the project. Thus, the delay, if any, in the completion of the project is due to inaction on the part of GMADA, which was beyond the control of opposite parties No.1 & 2. On merits, allotment of the unit, in question, in favour of the complainant was admitted. The payment of Rs.37,26,540/- has also been admitted. It is denied that there is any deficiency in service on the part of opposite parties No.1 & 2. Other similar pleas, as raised in preliminary objections, were reiterated and denying other allegations of the complainant, it was prayed that the complaint be dismissed, with costs.
22. Opposite party No.3, in its reply, raised preliminary objections that the rights of the parties to the present lis are Consumer Complaint No 295 of 2018 22 governed by the Tripartite agreement Ex.OP-3/1. In case of cancellation of the unit or in the contingency of termination of "Floor Buyer's Agreement", opposite party No.3 has the first charge/right to seek apportionment of its dues. As on 31.07.2018, an amount of Rs.28,23,480/- was outstanding towards the total loan amount. On merits, it is submitted that out of Rs.32,00,000/-, Rs.30,00,000/- has been disbursed by the answering opposite party. Dismissal of the complaint qua opposite party No.3 was prayed.
23. To prove their claim, the complainants tendered in evidence the affidavit of Narinder Kumar Ahuja, complainant No.1 as Ex.C-A and Ms.Meera Ahuja, complainant No.2, as Ex.C-B along with as documents Ex.C-1 to Ex.C-34, Ex.C-35(colly), Ex.C-36, Ex.C-37, Ex.C-38(colly), Ex.C-39 to Ex.C-42.
24. In support of their defence, opposite parties No.1&2 tendered in evidence the affidavit of Sh.Amarjit Singh, Authorized Signatory as Ex.OP-1/A along with documents as Ex.OP1/1 to Ex.OP1/5.
25. In support of its defence, opposite party No.3 tendered in evidence the affidavit of Sh.Aditya Kochar, Assistant Manager as Ex.OP-3/A along with documents as Ex.OP-3/1 to Ex.OP-3/4.
26. We have heard learned counsel for the parties and have gone through the record carefully.
27. Learned counsel for the complainant vehemently contended that there was no progress at the site of the project and opposite parties No.1&2 kept on unnecessarily delaying construction, despite receipt of substantial amount from the complainant towards the Consumer Complaint No 295 of 2018 23 price of the flat, in question. Opposite parties No.1 & 2 also frequently changed the floor without any consent of the complainants and issued a new agreement with new date of possession. As per the terms and conditions of the allotment/agreement, the development work was to be completed within a period of 30 months from the date of execution of the agreement, but it failed to execute any development at the project site within that period. When the flat, in question, was not complete and basic amenities were also not existing at the site, nor any Completion Certificate/Occupancy Certificate was shown, the complainant sought refund from opposite parties No.1&2. It was further contended that out of the total price of the flat, in question, the complainant paid a total sum of Rs.37,26,540/- to opposite parties No.1 & 2, but it failed to honour its commitments. Thus, there is clear-cut deficiency in service and unfair trade practice on its part. Therefore, the complainant is entitled to all the reliefs, as prayed for in the complaint.
28. Per contra, learned counsel for opposite parties No.1 & 2 vehemently contended that the complainant do not fall within the definition of consumer and bought the housing unit for investment 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 Consumer Complaint No 295 of 2018 24 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 complainant cannot allege any delay on their part, as they themselves failed to pay the due amounts regularly on time. It was further contended that opposite parties No.1 & 2 paid huge amount towards Pre- EMI interest to opposite party No.3-HDFC Limited on behalf of the complainants, under the Subvention Scheme. As such, the complainant cannot allege any deficiency on the part of opposite parties No.1 & 2. Therefore, the complaint is liable to be dismissed with costs.
29. Learned counsel for opposite party No.3 contended that there is no deficiency in service on the part of opposite party No.3, 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& 2 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.
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 & 2 that the complainants do not fall under the definition of 'consumer', as defined in the Act, on the ground that he Consumer Complaint No 295 of 2018 25 purchased the unit, in question, for resale 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&2 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 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 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 already discussed above, there is no evidence led by opposite parties No.1&2 to prove that the complainants indulged in sale/purchase of properties or that he purchased the unit, in question, for further sale or for earning profits. Accordingly, the above said objection/contention of opposite parties No.1 & 2 are Consumer Complaint No 295 of 2018 26 rejected and the complainant is held to be 'consumer' as defined, under the Act.
33. Opposite No.1 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 & 2 and had paid a sum of Rs.37,26,540/- as demanded by opposite parties No.1&2. An Agreement was executed between the complainant and opposite parties No.1 & 2 and as per the terms opposite parties No.1&2 was 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 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&2 is that this Commission has no pecuniary jurisdiction to entertain and try the complaint. In this respect, it is relevant to mention that the Consumer Complaint No 295 of 2018 27 basic sale price of the flat, in question, is Rs.40,00,000/-, as per allotment letter as Ex.C-1 and agreement Ex.C-9 executed between the parties and against the total sale consideration the complainants have paid a sum of Rs.37,26,540/- to opposite parties No.1 & 2, 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 & 2 in this regard is rejected.
35. So far as the other objection of opposite parties No.1&2 that as per Arbitration Clause-13 of the agreement, Ex.C-9, 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) 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.
Consumer Complaint No 295 of 2018 28
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 complainant purchased the unit, in question, from opposite parties No.1&2 for a Basic Sale Price of Rs.40,00,000/- and PLC Rs.2,00,000/-. Independent Residential Floor Allottee(s) Arrangement, Ex.C-9 was executed between the complainant and opposite parties No.1&2 on 19.07.2013 and then on 03.02.2015 as Ex.C-23. The basic sale price of the unit was Rs.40,00,000/-. 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 Consumer Complaint No 295 of 2018 29 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 19.07.2013 with an extended period of six months. However, opposite parties No.1&2 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. Number of mails were exchanged by the complainant with opposite parties No.1 & 2 with regard to signing of the agreement and with regard to approval and other issues raised with opposite parties No.1 & 2 of the project as Ex.OP-10 to Ex.C- 22 but no positive response was given to the complainants. The opposite parties then executed another agreement on 03.02.2015, wherein again the date of possession was mentioned as 24 months with an extended period of six months. As per e-mail dated 12.02.2015, Ex.C-26, the opposite parties No.1 & 2 stated that the agreement for the new unit cannot be issued to the complainants on a back date. As per e-mails exchanged between the parties, it was stated that the terms and conditions will be the same as per previous agreement. Further as per Ex.C-31, the opposite parties Consumer Complaint No 295 of 2018 30 No.1 & 2 stated that the date of agreement execution will remain the same as mentioned in previous agreement issued to you. The complainants to make the timely payments availed a housing loan of Rs.33,60,000/- from opposite party No.3. The complainants have tendered the photographs of 24.02.2018, Ex.C-35, which shows that the project, in question, is not complete and is not in a habitable condition and lot of work is still pending to complete the project. As per e-mail dated 27.02.2018, Ex.C-36, when no steps were taken by opposite parties No.1 & 2 to hand over the possession to the complainants, they seek refund along with interest at the rate of 18% per annum from respective dates of deposit till realization. Against the total sale consideration, the complainants have already paid a sum of Rs.37,26,540/- as per Account Statement as Ex.OP1/3 as well as the fact has been admitted by opposite parties No.1 & 2 para No.46 in their reply. The opposite parties also tendered in evidence the Occupancy Certificate issued by GMADA on 06.11.2018. From the perusal of the same, it shows that the said Certificate was much after institution of the complaint.
39. Section 14 of Punjab Apartment and Property Regulation Act, 1995 (in short, "PAPRA") deals with responsibility of the promoter to obtain Completion and Occupation Certificate from the competent Authority, which reads as under:
"14. It is the responsibility of the promoter-
(i) in the case of apartments, to obtain from the authority required to do so under any law completion and occupation certificates for the building and if a promoter, within a reasonable time, Consumer Complaint No 295 of 2018 31 after the construction of the building, does not apply for an occupation certificate from the aforesaid authority, the allottee of an apartment may apply for an occupation certificate from the said authority;
and
(ii) in the case of a colony, to obtain
completion certificate from the competent
authority to the effect that the development works have been completed in all aspects as per terms and conditions of the licence granted to him under Section 5.
2. The authority referred to in sub-section (1) shall, after satisfying itself about the agreement of sale between the promoter and the allottee, and the compliance of the building regulations and all other formalities, issue an occupation certificate."
th
40. Further, Clause 3.12 (i) of the Notification dated 07 July, 2015 published in the Punjab Government Gazette Extraordinary by Department of Local Government (Town Planning Wing), which is applicable to the properties falling within the Municipal Limits, provides as under:
"No person shall occupy or allow other person to occupy any new building or part of a new building for any purpose whatsoever until such building or part thereof has been certified by the local authority or of any person authorized by it in this behalf to be in every respect completed according to the sanctioned plan and fit for the use for which it is erected."
41. A reference can also be made to Section 272 of The Punjab Municipal Corporation Act, 1976, which reads as under:-
"272. Completion Certificate. -Consumer Complaint No 295 of 2018 32
(1) Every person who employs a licensed architect or engineer or a person approved by the Commissioner to design or erect a building or execute any work shall, within one month after the completion of the erection of the building or execution of the work, deliver or send or cause to be delivered or sent to the Commissioner a notice in writing of such completion accompanied by a certificate in the form prescribed by byelaws, made in this behalf and shall give to the Commissioner all necessary facilities for the inspection of such building or work.
2. No person shall occupy or permit to be occupied any such building or use or permit to be used any building or a part thereof effected by any such work until permission has been granted by the Commissioner in this behalf in accordance with bye-laws made under this Act: Provided that if the Commissioner fails within a period of thirty days after the receipt of the notice of completion to communicate his refusal in grant such permission, shall be deemed to have been granted."
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 Consumer Complaint No 295 of 2018 33 external access roads to the project, who have failed to do so. Thus, 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 & 2 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 complainant 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,-Consumer Complaint No 295 of 2018 34
(i) of the layout of the colony and plan of development works to be executed in a colony as approved by the prescribed authority in the case of a colony; and
(ii) of the plan and specifications of the building built or to be built on the land as well as of the common areas and facilities and common services provided (including supply of electricity and water, sewerage and drainage systems, lifts, fire-fighting equipment), such plans and specifications being in accordance with the provisions of the building regulations, and approved by the authority which is required so to do under any law for the time being in force, indicating thereon what parts of the building and the appurtenant areas are intended to be kept as common areas and facilities in the case of apartments :
Provided that the number and sizes of the apartments shall conform to such building regulations, and the area of an apartment shall not exceed such limit as may be fixed by the competent authority;
(d) display or keep all the documents, plans and specifications or copies thereof referred to in clauses
(a), (b) and (c) of this sub-section at the site and in his office and make them available for inspection to persons taking or intending to take a plot or an apartment and after the association is formed, he shall furnish the association a copy of these documents and of the sanctioned plan of the building;
(e) disclose the nature of fixtures, fittings and amenities, including the provision for one or more lifts, provided or to be provided;
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;
Consumer Complaint No 295 of 2018 35Provided that the competent authority may direct that,-
(h) in the case of residential apartments, if the total number of apartments is one hundred or more, ten percent of the apartments; and
(ii) in the case of colony, if the total area of the colony is forty hectares or more, ten per cent of the area under residential plots and houses, be reserved for being sold or leased to such person belonging to such economically weaker section of society, in such manner and on such terms and conditions as may be prescribed;
(i) state in writing, the precise nature of and the terms and conditions governing the association to be constituted of persons who have taken or are to take the apartments;
(j) not allow person to enter into possession until an occupation certificate required under any law is duly given by the appropriate authority under that law and no person shall take possession of an apartment until such occupation certificate is obtained;
(k) make a full and true disclosure of all outgoings, including ground rent, if any, municipal or other taxes, charges for water and electricity, revenue assessment, interest on mortgages or other encumbrances, if any;
(l) give the estimated cost of the building and the apartments proposed to be constructed, or colony to be developed, and the manner in which escalation in such cost for valid reasons may be approved by mutual agreement ;
(m) make a full and true disclosure of such other information and documents in such manner as may be prescribed; and
(n) give on demand and on payment of reasonable charges true copies of such of the documents referred to in any of the clauses of this sub-section as may be prescribed.
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 Consumer Complaint No 295 of 2018 36 or plots offered for sale, title to the land, extent and situation of land, the price payable and in the case of colonies, also layout of the colony, the plan regarding the development works to be executed in a colony and the number and the validity of the licence issued by the competent authority under sub-section (3) of section 5, and such other matters as may be prescribed. (3) The advertisement or prospectus shall be available for inspection at the office of the promoter and at the site where the building is being constructed or on the land being developed into a colony, alongwith the documents specified in this section and in section 3. (4) When any person makes an advance or deposits on the faith of the advertisement or prospectus, and sustains any loss or damage by reason of any untrue statement included therein, he shall be compensated by,-
(a) the promoter, if an individual;
(b) every partner of the firm, if the promoter is a firm;
(c) every person who is a director at the time of issue of the advertisement or prospectus, if the promoter is a company :
Provided, however, that such person shall not be liable if he proves that,-
(a) he withdrew his consent to become a director before the issue of the advertisement or prospectus; or
(b) the advertisement or prospectus was issued without his knowledge or consent, and on becoming aware of its issue, he forthwith gave reasonable public notice that it was issued without his knowledge or consent; or
(c) after the issue of the advertisement or prospectus and before any agreement was entered into with buyers of plots or apartments, he, on becoming aware of any untrue statement 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 & 2 has not produced any evidence to prove that it has complied with the aforesaid provisions of Sections Consumer Complaint No 295 of 2018 37 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 of the unit, in question, to the complainant, he was 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&2 to prove that any account has been maintained by them in this respect. As such, opposite parties No.1&2 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 Consumer Complaint No 295 of 2018 38 per cent per annum payable from the date of receipt of amount so collected till the date of re-payment."
48. It stands proved that opposite parties No.1&2 failed to hand over the possession of the unit, in question, to the complainant 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.3 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&2 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.3-HDFC Ltd. to the tune of Rs.32,00,000/- for making the payment towards the price of the unit, in question, to opposite parties No.1&2. Tripartite Agreement Ex.OP3/1 was duly executed between the parties. As per Outstanding Loan Amount Sheet (Ex.OP-3/2), a sum of Rs.28,23,480/- stood disbursed out of sanctioned loan amount and as on 31.07.2018, a sum of Rs.28,23,480/- was due towards the Consumer Complaint No 295 of 2018 39 loan account of the complainant. As per terms of the Tripartite Agreement, in case of cancellation of the unit, the amount payable to the borrower is to be directly paid to the HDFC Ltd. No doubt, there is no cancellation of allotment in this case, but as discussed above, since opposite parties No.1&2 failed to complete/develop the project, so as to deliver possession of the unit, in question, to the complainant 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.3 is to be paid to it and thereafter the remaining amount, if any, is to be paid to the complainant.
51. In view of our above discussion, the complaint is allowed against opposite parties No.1&2 and the same is dismissed against opposite party No.3. Following directions are issued to opposite party No.1:-
i) to refund the amount of Rs.37,26,540/-, 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 already paid by opposite parties No.1&2;
It is made clear that, first of all, opposite party No.3 shall issue a certificate qua balance repayable loan amount as on the date of order and opposite parties No.1&2 Consumer Complaint No 295 of 2018 40 shall pay the outstanding amount to opposite party No.3-HDFC Ltd. towards the loan advanced by it to the complainants and, thereafter, the remaining amount, if any, shall be paid to the complainants;
(ii) to pay Rs.65,000/-, as compensation for the mental agony and harassment suffered by the complainants as well as litigation expenses.
52. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(RAJINDER KUMAR GOYAL) PRESIDING MEMBER (KIRAN SIBAL) MEMBER July 24, 2019 parmod