National Consumer Disputes Redressal
Ram Balakrishnan vs Somitri Das on 24 May, 2018
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 236 OF 2011 1. RAM BALAKRISHNAN S/o. Bala Subramaniam,
5/128-A, Bhuvaneswari Nagar, Salem- 636 016 (T.N.) ...........Complainant(s) Versus 1. SOMITRI DAS General Manager - Marketing.,
LANCO HILLS,
Plot #565, Phase III, Road No:92, Jubilee Hills Hyderabad - 500 033 A.P. ...........Opp.Party(s)
BEFORE: HON'BLE MR. JUSTICE AJIT BHARIHOKE,PRESIDING MEMBER
For the Complainant : Ms. V. Mohana, Sr. Advocate
Assisted by Mr. K. Muthu, Advocate For the Opp.Party : Mr. Vineet Tayal, Advocate
Dated : 24 May 2018 ORDER
JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER
Complainant Ram Balakrishnan is a Non Resident Indian settled in USA. The complainant on coming to know about development project undertaken by the opposite party approached the opposite party for booking of an apartment in the said project. The complainant vide letter dated 20.8.2007was allotted Flat No.8s LH-1004 on payment of Rs.24,53,940/-. The total consideration payable in respect of the said flat was Rs.98,13,760/-. The consideration amount as per the agreement was to be paid in construction link installments and the opposite party was supposed to deliver the possession of the subject apartment to the complainant within three years of the allotment with three months' grace period, subject to force majeure. According to the complainant on getting the communications regarding the progress of the construction, the complainant kept on making payment of the installments and in all he has paid a sum of Rs.76,48,940/- against the consideration amount. The stipulated date for delivery of possession even after the grace period has long expired but the possession of the subject flat has not been delivered to the complainant. According to the complainant even the construction activity has not proceeded beyond the basic structure. The complainant, therefore, called upon the opposite party to cancel the contract and refund his money with interest. The opposite party, however, failed to oblige. Claiming this to be deficiency in service and unfair trade practice, the complainant raised a consumer dispute by approaching this Commission.
2. The opposite party on being served with the notice of the complaint filed written statement wherein a preliminary objection as to the pecuniary jurisdiction of the National Commission was raised. It was also pleaded that the complainant is not a consumer as envisaged under Section 2 (1) (d) of the Consumer Protection Act, 1986 because the complainant had booked the flat for making profit by selling the same after the completion of the project on appreciated price.
3. The opposite party has denied deficiency in service on its part and submitted that failure of opposite party to complete the construction and deliver possession of subject apartment to the complainant is due to force majeure circumstances, namely, the stay order against construction passed by Hon'ble High Court of Andhra Pradesh in writ petition No.17192/2007 and also interim stay orders against the opposite party from continuing with the construction by Andhra Pradesh Waqf Tribunal, Hyderabad in OS/99/2007 filed by Mehboob Alam Khan and one Ibrahim Bin Abdullah Masquati . It is also alleged that Dargah Committee also filed a suit against the opposite party company before the Andhra Pradesh Waqf Tribunal for recovery of the loan bearing survey No.201 of Manikonda Village on the basis of notification dated 6.4.2006 issued by the Waqf Board. In the said matter also the Waqt Tribunal passed an order dated 28th March, 2011 restraining the opposite party company from alienating of the property which was part of project site and that High Court of Andhra Pradesh vide its judgment dated 3rd April, 2012 upheld the restraint order passed by Waqf Tribunal dated 28th March, 2011. The said stay order was ultimately vacated by the Hon'ble Supreme Court vide its order dated 8.5.2012 in SLP (C) No.13954/2011. Thereafter, the respondent company has resumed the work at the project site.
4. Both the parties have filed affidavit evidence in support of their respective claims.
5. I have heard Ms. V. Mohana, Sr. Advocate on behalf of the complainant and Shri Vineet Tayal, Advocate for the opposite party and perused the record.
6. Learned counsel for the opposite party has taken me through Section 21 (a) (i) of the Consumer Protection Act, 1986 and submitted that instant complaint is not maintainable as it is not within the pecuniary jurisdiction of this Commission.
Section 21 (a) (i) of the Act provides as under:
21. Jurisdiction of the National Commission. -- Subject to the other provisions of this Act, the National Commission shall have jurisdiction--
(a) to entertain-- (i) complaints where the value of the goods or services and compensation, if any, claimed exceeds rupees one crore
7. On reading of the above, it is clear that for the purpose of computing the pecuniary jurisdiction, the consumer fora has to take into account the value of the goods bought or services hired or availed plus compensation claimed by the complainant. In the matter of Ambrish Kumar Shukla & Ors. Vs Ferrous Infrastructure Pvt. Ltd. CC No. 97/2016, the larger Bench of this Commission had dealt with the scope and interpretation of Section 21 (a) (i) and observed as under :
" It is evident from a bare perusal of Sections 21, 17 and 11 of the Consumer Protection Act that it's the value of the goods or services and the compensation, if any, claimed which determines the pecuniary jurisdiction of the Consumer Forum. The Act does not envisage determination of the pecuniary jurisdiction based upon the cost of removing the deficiencies in the goods purchased or the services to be rendered to the consumer. Therefore, the cost of removing the defects or deficiencies in the goods or the services would have no bearing on the determination of the pecuniary jurisdiction. If the aggregate of the value of the goods purchased or the services hired or availed of by a consumer, when added to the compensation, if any, claimed in the complaint by him, exceeds Rs. 1.00 crore, it is this Commission alone which would have the pecuniary jurisdiction to entertain the complaint. For instance if a person purchases a machine for more than Rs.1.00 crore, a manufacturing defect is found in the machine and the cost of removing the said defect is Rs.10.00 lacs, it is the aggregate of the sale consideration paid by the consumer for the machine and compensation, if any, claimed in the complaint which would determine the pecuniary jurisdiction of the Consumer Forum. Similarly, if for instance, a house is sold for more than Rs.1.00 crore, certain defects are found in the house, and the cost of removing those defects is Rs.5.00 lacs, the complaint would have to be filed before this Commission, the value of the services itself being more than Rs.1.00 crore. "
8. Applying the aforesaid yardstick to the facts of this case, it is clear that instant case is within the jurisdiction of this Commission because as per the provisional allotment letter / agreement of sale executed between the parties and the schedule (e ) dealing with the consideration payable, the agreed value of the apartment is Rs.98,13,760/-. Perusal of the prayer clause would show that complainant has prayed for refund of sum of Rs. 78,48,940/- paid to the opposite party against the agreed consideration alongwith 18% interest thereon from the date of respective payment amounting to Rs.45,03,491/-. If the aforesaid figures are added up, the value of the complaint for the purpose of pecuniary jurisdiction being the value of the service plus compensation is much more than Rs.1.00 crore. Thus, the complaint is within the pecuniary jurisdiction of this Commission.
9. Counsel for the opposite party has further contended that instant complaint is not maintainable because the complainant is an NRI and not a consumer as envisaged under section 2 (1) (d) of the Act as he intended to sell the subject apartment on profit. The above argument of the opposite party is misconceived for the reason that perusal of the definition of 'consumer' as envisaged under section 2 (1) (d) of the Act would show that for the purpose of definition, Act do not make any distinction between the buyers who are Indian citizens or NRIs. Merely because the complainant is an NRI, it would not given rise to a presumption that he had booked the subject apartment with the intention to make profit by selling the same on a later date. The opposite party has not led any evidence to substantiate the plea that the complainant had booked the flat with commercial intention to sell it at a higher rate. Therefore, I find no force in the contention.
10. So far as merits of the case are concerned, perusal of the agreement of sale entered into between the parties would show that said agreement was executed on 31.10.2008. As per clause 5 (iii) of the agreement, the opposite party had promised to complete the construction of the building and hand over possession of the subject property to the complainant by 31.10.2009 or within a grace period of three months thereafter i.e. 31.01.2010. Admittedly, till date possession of subject apartment has not been handed over to the complainant despite of expiry of the stipulated timeline.
11. Counsel for the opposite party has set up a defence of Force Majeure and contended that opposite party was prevented from completing the construction and handing over possession of the flat to the complainant because of stay order against construction issued from time to time by Hon'ble High Court of Andhra Pradesh and Andhra Pradesh Waqf Tribunal, Hyderabad. The aforesaid defence set up by the opposite party is not acceptable. Stand of the opposite party is that it was prevented from undertaking the construction work due to stay order issued by Hon'ble High Court of Andhra Pradesh and Waqf Tribunal. However, it is admitted on the record that subject stay order was ultimately vacated by the Hon'ble Supreme Court vide order dated 08.05.2012 in SLP ( C ) No. 13954/2011. Had the intention of the opposite party been clear to fulfil his obligation, nothing prevented the opposite party to complete the construction of the subject building and hand over possession of subject flat to the complainant within one year and three months after the vacation of the stay order. This, however, is not the case. Even after the expiry of almost six years from the date of vacation of stay order by the Hon'ble Supreme Court, the opposite party has not completed the construction of the building and deliver possession of the subject flat to the complainant. From this it is evident that opposite party has failed to fulfil his promise to deliver possession of the subject flat within the stipulated period and plea of Force Majeure is raised only in order to avoid liability for non-completion of the construction. Thus, I have no hesitation in holding the opposite party guilty of deficiency in service.
12. Now the question arises as to what should be the compensation to be awarded to the complainant in this case? Counsel for the complainant has pressed for refund of amount of Rs.76,48,940/- paid against the consideration amount with 18% interest thereon. Counsel for the opposite party on the contrary has drawn my attention to clause 5.1.(iii) wherein it is provided that opposite party shall deliver possession of subject apartment to the complainant latest by 31.01.2010 inclusive of three months grace period subject to Force Majeure and in the event of any delay beyond the stipulated period, the developer shall pay to the purchaser an amount of Rs.5/- per square feet of the built up area for every month of delay upto a maximum of six months. The said stipulation in the contract is oppressive and highly tilted towards the builder. If this stipulation is to be enforced, it would give unfair advantage to the developer over the consumer and he would delay the construction and utilize the money received against the consideration amount for other purpose without even paying the interest on the same. Further, counsel has opposite party has drawn my attention to clause 7.7 of the agreement of sale which provides that on termination of agreement, developer shall not be liable to pay any interest on the amounts refunded and submitted that this being the case of termination of contract, the opposite party is liable to refund the principal amount only. Aforesaid condition, in my view, would be applicable only in the cases where because of justifiable reason, the parties agree to terminate the contract and the said provision cannot be used by the opposite party to achieve undue advantage over the complainant. Thus, in my view, taking into account deficiency in service committed by the opposite party, reasonable compensation has to be awarded to the complainant. Complainant has failed to lead cogent evidence to show as to what is the extent of damage suffered by him because of non performance of contract by the opposite party. This, however, does not mean that he has not suffered any loss. Had the complainant deposited the amount paid against the consideration amount in the bank, he would earned interest on the same. Therefore, taking into account the interest rates prevalent during the period w.e.f. date of allotment till date, in my opinion, 10% interest on the principal amount would be reasonable and would meet the ends of justice.
13. In view of the discussion above, the complaint is allowed with following directions:
1. The Opposite party shall refund the entire amount of Rs.76,48,940/- to the complainant within six weeks from today alongwith compensation of simple interest @ 10% per annum from the date of each payment till the realisation of the amount.
2. The Opposite party shall pay a sum of Rs.10,000/- as cost of litigation to the complainant.
......................J AJIT BHARIHOKE PRESIDING MEMBER