State Consumer Disputes Redressal Commission
Naresh Kumar Goel S/O Sh. Rangi Ram Goel vs Manohar Infrastructure & ... on 29 November, 2019
Daily Order STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T., CHANDIGARH Complaint case No. : 451 of 2018 Date of Institution : 30.11.2018 Date of Decision : 29.11.2019 Naresh Kumar Goel S/o Sh.Rangi Ram Goel, R/o H.No.306, R.C.S. Society, Sector-48A, Chandigarh. Sudesh Goel W/o Sh.Naresh Kumar Goel, R/o H.No.306, R.C.S. Society, Sector-48A, Chandigarh. ......Complainants V e r s u s Manohar Infrastructure & Constructions Private Limited, Manohar Campus, SCO 139-141, Sector-17C, Chandigarh, through its Managing Director/Director/Secretary/Authorized Signatory. Tarinder Singh, Director of Manohar Infrastructure & Constructions Private Limited, Manohar Campus, SCO 139-141, Sector-17C, Chandigarh. Narinder Bir Singh, Director of Manohar Infrastructure & Constructions Private Limited, Manohar Campus, SCO 139-141, Sector-17C, Chandigarh. Sarabjeet Kaur, Director of Manohar Infrastructure & Constructions Private Limited, Manohar Campus, SCO 139-141, Sector-17C, Chandigarh. .....Opposite parties Complaint under Section 17 of the Consumer Protection Act, 1986 BEFORE: JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT. MRS. PADMA PANDEY, MEMBER.
MR.RAJESH K. ARYA, MEMBER.
Argued by: Sh.Pardeep Solath, Advocate for the complainants. Sh. I.P. Singh, Advocate for the opposite parties. JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT
The above captioned complaint has been instituted seeking directions to the opposite parties, to refund the amount of Rs.21,60,000/- paid by the complainants towards purchase of plot in the project named "Palm Springs", Mullanpur, Punjab. It is the case of the complainants that, in the first instance, they had booked two plots, separately, measuring 200 square yards each, under applications no.PSR-07 to PSE-02, for their two sons, on 12.04.2011 and 09.05.2011 respectively, on making payment of Rs.10,80,000/- each i.e. totaling to Rs.21,60,000/-. Thereafter, the complainants started making requests to the opposite parties to provide information regarding development at the project site, but they did not do so, and on the other hand, raised demand of Rs.5,40,000/- each, vide letters dated 16.05.2014, which was challenged by them. When neither agreement was executed nor development at the project site took place, request was made by the complainants to cancel allotment of plots and refund the amount paid, to which the opposite parties refused. It has been asserted by the complainants that the opposite parties suggested them to write a letter to the effect that complainant no.1 be refunded the amount paid, on account of personal reasons and as such left with no alternative, a letter dated 24.02.2016 (Annexure C-3) was written by him. Even then refund was not made. Ultimately, complainant no.1 was forced to sign some documents, for adjustment of refund of amount paid towards plot booked under application no.PSR-07 to PSE-02. In this manner, out of two plots referred to above, one plot i.e. PSE-02 stood transferred in the name of the complainants and the amount of Rs.10,80,000/- already paid towards plot no.PSR-07 was adjusted again plot booked under application no.PSE-02, intimation of which was given to the complainants vide letter dated 09.05.2017 (Annexure C-6). It has been asserted that despite the fact that Rs.21,60,000/- stood received by the opposite parties towards price of plot booked under application no.PSE-02, even then neither agreement was executed between the parties nor development work has been completed at the project site nor possession thereof has been offered. It also came to the notice of the complainants that the project in question has been launched and plots therein were sold to the prospective buyers without obtaining necessary permissions/sanctions from the competent Authorities.
By stating that the aforesaid act and conduct of the opposite parties amount to deficiency in providing service and adoption of unfair trade practice, the complainants have filed the present case.
Their claim has been contested by the opposite parties, on numerous grounds, inter alia, that they did not fall within the definition of "consumer" as defined under Section 2(1)(d) of the Act; that this Commission did not vest with pecuniary and territorial jurisdiction; that time was not the essence of the contract; that the complaint filed is beyond limitation; that the complainants were requested number of times to make remaining payment and sign buyer's agreement but they failed to do so; that complicated questions of facts and law are involved in this complaint, as such, the same cannot be entertained by this Commission, proceedings before which are summary in nature; that only Civil Court has jurisdiction to entertain and decide this complaint; that the project of the opposite parties has been registered under the Real Estate (Regulation and Development) Act, 2016 (in short, the RERA) on 15.09.2017; that as per Section 35 of the PAPR Act, jurisdiction of Civil Court is barred to entertain and decide any question relating to matters arising under PAPR Act; that application for filing joint complaint has not been filed by the complainants; that affidavit has not been filed alongwith the complaint; and that opposite parties no.2 and 3 have been wrongly impleaded in their personal capacity and at the same opposite party no.4 has resigned from her duties with the Company.
On merits, it has been admitted by the opposite parties that they have received the amounts as asserted by the complainants for the sale of plots in question; and that ultimately, only one plot booked under application no.PSE-02 was retained by the complainants, in the manner explained above, against which total amount of Rs.21,60,000/- stood received by the opposite parties. It has been stated that the project was approved on 22.03.2013 and the formal agreement was signed with the Government of Punjab on 14.06.2013; that thereafter some more land was added to the project, for which completion period was given upto 13.06.2018, vide supplementary agreement dated 16.06.2016 executed with the Government; that later on exemption from the applicability of provisions of the PAPR Act stood granted by the Government, on 25.01.2017 and as such all the irregularities committed by them stood compounded, as exemption granted will have retrospective effect; that once the State Government has not held that the opposite parties had violated the provisions of PAPR Act, as such, this Commission cannot go into the said question; that on request made by the opposite parties, the Competent Authority extended completion period of the project upto 31.07.2019; and that as on date the opposite parties have obtained all permissions in respect of the project in question. However, it is alleged in the reply that the above named complainants failed to make the remaining sale consideration therefore they are not entitled for any relief; and that there has been lot of development in the project. By placing reliance upon the judgment of the Hon'ble Supreme Court of India, in DLF Homes Panchkula (P) Ltd. vs Sushila Devi, 2019 (Civil Appeal Nos. 2285-2330 of 2019 (@ SLP(C) NOS.928-930, 932-938, 940-967 and 969-976 of 2019), decided on 26 February 2019, it has been stated that claim of the complainants seeking interest @18% p.a. is totally unjustified. Rather, it should be @9% p.a. However, ironically, it has been claimed in the reply that the opposite parties are trying to complete the project, as early as possible, as the development work is going on, in full swing and work with regard to provision of basic amenities such as water, electricity etc. are near completion. It is alleged in the reply that the project was delayed on account of red-tapism in the offices of different departments of the Govt. and also due to the business competition and political rivalries and this is why, the competent authorities have delayed in granting approvals/sanctions. While applying the theory of force majeure circumstances (which means irresistible circumstances beyond ones control such like act of God), it has also been alleged that delay in delivery of possession of plots occurred also on account of shortage of building material and ban on mining by the government. Remaining averments of the complaint have been denied.
This Commission has afforded adequate opportunities to both the parties to adduce evidence in support of their respective contentions, by way of filing affidavit. In pursuance thereof, they have adduced evidence by way of affidavit and also produced numerous documents.
We have heard both the parties and have carefully gone through record of the case, very carefully.
In this case, following points have emerged for consideration: -
Whether this Commission has territorial and pecuniary jurisdiction to entertain this complaint?
Whether this Commission is competent to entertain this complaint?
Whether the complainants fall under the definition of consumer?
Whether there is any violation on the part of the opposite parties in the matter?
Whether time was essence of the contract?
Whether the complaint filed is time barred?
Whether there was any deficiency in rendering service, negligence and unfair trade practice on the part of the opposite parties?
Whether the complainants are entitled to get refund of the amount paid alongwith interest and if yes, at what rate?
First coming to the objection regarding territorial jurisdiction, it may be stated here that Sub-section 2 of Section 17 of the Act envisages that person aggrieved have remedy to file a complaint before a State Commission within the limits of whose jurisdiction:-
"(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain; or
(b) any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the State Commission is given or the opposite parties who do not reside or carry on business or have a branch office or personally works for gain, as the case may be, acquiesce in such institution; or
(c) the cause of action, wholly or in part, arises".
In the present case, perusal of almost all the documents placed on record, pertaining to transaction carried out between the parties, reveal that the same have been issued and received from/by Chandigarh Office of the opposite parties i.e. Manohar Infrastructure and Constructions Pvt. Ltd., SCO No.139-141, Sector 17-C, Chandigarh, meaning thereby that the opposite parties were actually and voluntarily residing and carrying on their business, at the said Chandigarh Office for gain. As such, Objection taken in this regard is rejected.
Coming to objection raised by the opposite parties with regard to pecuniary jurisdiction, it may be stated here that in the present case, if the total value of the plot, in question i.e. Rs.36 lacs; plus interest @18% claimed on deposited amount of Rs.21,60,000/-; plus compensation claimed to the tune of Rs.10 lacs for mental agony etc. are added, the same exceeds Rs.20 lacs and fell below Rs.1 crore. Thus, this Commission has got pecuniary Jurisdiction to entertain and decide this complaint.
Now coming to the objection raised that the complainants did not fall within the definition of 'consumer', it may be stated here that in para no.3 (Brief facts) of their complaint supported by the affidavit of complainant no.1, it has been stated by them that their intentions to purchase plots were for the future settlement of their sons. Mere fact that, in the first instance, two separate plots were purchased by the respective complainants is no ground to snub them out of the purview of 'consumer' under the Act. Since the opposite parties have levelled allegations against the complainants, the onus lay upon them to place on record documentary evidence in that regard, which they failed to do so. In Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, decided by the Hon'ble National Commission, it was held that the buyer(s) of the residential units, would be termed as consumers, unless it is proved that he or she had booked the same for commercial purpose. There is nothing on record to prove that the complainants are speculators. As such, they fall within the definition of 'consumer'.
There is no dispute that, in the first instance, the complainants had booked two plots separately measuring 200 square yards each, on 12.04.2011 and 09.05.2011 respectively, on making payment of Rs.10,80,000/- each i.e. totaling to Rs.21,60,000/-. The amount received was equal to 30% of the total sale consideration, in each plot. However, thereafter, when till 2016 i.e. after more than five years of booking of the plots, neither agreements were executed between the parties nor development work was completed at the project site, complainant no.1 wrote letter dated 24.02.2016 (Annexure C-3) intimating the opposite parties to cancel the allotment of both the plots and refund the amount paid by them towards the said plots. It was also intimated by the complainants to the opposite parties that the deposited amount be refunded, as now they need the same for their medical treatment. Another letter dated 15.11.2016 (Annexure C-4) was also written by the complainants, in that regard but of no avail. Ultimately, the allotment of plot booked under application no. PSR-07 was cancelled and the amount paid towards the same was adjusted in the plot booked under application no.PSE-02. Thereafter, vide document dated 09.05.2017 (Annexure C-6), it was intimated by the opposite parties to the complainants that an amount of Rs.21,60,000/- stood received by them in respect of single plot measuring 200 square yards, which was booked under application dated 12.04.2011 i.e. PSE-02.
It may be stated here that irrespective of the fact that the complainants, in the first instance, purchased two separate plots and thereafter surrendered one out of them, yet, the fact remains that despite receiving more than 25% of the total sale consideration i.e. Rs.10,80,000/- out of Rs.36 lacs, the opposite parties failed to execute buyer's agreement in respect of the plot in question. However, it is also evident from the record that instead of executing buyer's agreements, the opposite parties raised demand of Rs.5,40,000/- vide letters dated 16.05.2014 (Annexure C-1 and C-2). There is no dispute that even by the date, when this complaint has been filed and arguments were heard therein, neither agreement was got executed between the parties in respect of plot booked under application no.PSE-02 nor possession thereof had been offered to the complainants. Both the parties are leveling allegations against each other. Counsel for the complainants contended that the opposite parties failed to provide agreement for signatures of the complainants, whereas on the other hand, Counsel for the opposite parties while placing reliance of letters dated 16.05.2014 (Annexures C-1 and C-2) contended with vehemence that the complainants were requested number of times for execution of the agreements but they failed to do so. However, this Commission has gone through the contents of the said letters and found that it was nowhere mentioned in the letters dated 16.05.2014 that the complainants are required to come forward for execution of agreements, whereas, on the other hand, a demand of Rs.5,40,000/- each was made through the said letters. As stated above, once the opposite parties had already received substantial amount of Rs.10,80,000/- out of total cost of Rs.36 lacs, which comes to 30% of the total sale consideration, it was required of them to allot plots; execute agreements under law; complete the development work; obtain completion certificate from the competent authorities; and then deliver possession of the plots. However, instead of doing that, the opposite parties were interested only in raising demands from the complainants. As such, the demand raised is not only unfair but illegal, which contravenes Section 6 (1) of the PAPR Act, which lays a duty on the opposite parties to execute the agreement for sale as per law, after obtaining the maximum sale consideration of 25%. It is apposite here to reproduce the said provision: -
"6. Contents of agreement of sale:- (1) Notwithstanding anything contained in any other law for the time being in force, a promoter who intends to construct or constructs a building of apartments, all or some of which are to be taken or are taken on ownership basis, or who intends to offer for sale plots in a colony, shall, before he accepts any sum of money as advance payment or deposit, which shall not be more than twenty five per cent of the sale price, enter into a written agreement for sale with each of such persons who are to take or have taken such apartments, or plots, as the case may be, and the agreement shall be in the prescribed form together with prescribed documents and shall be registered under the Registration Act, 1908 (Central Act No. 16 of 1906) ;
Provided that, if only a refundable application fee is collected from the applicant before draw of lots for allotment, such agreement will be required only after such draw of lots.
(2) xxxxxxxxxxxxxxxx..................
(3) xxxxxxxxxxxxxxxxx..................."
Thus, the opposite parties were duty bound under law to execute the agreement and to get it registered under the Registration Act 1908, after obtaining 25% of the sale consideration, but in this case, the said provision has been violated. The opposite parties also cannot take shelter under the exemption certificate from the provisions of PAPR Act, which was issued in their favour only on 25.01.2017 i.e. much after booking of the plots. It has no where been proved that the said exemption will have retrospective effect but in our considered opinion, it will have prospective effect only. The opposite parties were deficient in providing service and adopted unfair trade practice on this count.
Furthermore, the opposite parties in their written statement have very candidly admitted that at the time of booking of the plots and collecting money from the complainants, they were not having requisite licences, approvals and permissions from the competent authorities, yet, it was asserted by them all the irregularities stood compounded when notification exempting the provisions of PAPR Act was issued in their favour on 25.01.2017. We do not agree with the plea taken. Infact, the money has been collected with animus of cheating and fraud which cannot be cured by obtaining the exemption from the provisions of PAPR Act, at the subsequent stage. Furthermore, it is settled law that a builder cannot take advantage of the situation by simply saying that the statutory approvals had not been obtained from the Government Authorities or that the same had been delayed. The builder is duty bound to ensure that before accepting the amount of booking, necessary permission/sanctions have been granted for launching the project and selling the units therein. It was so said by the Hon'ble National Commission in Omaxe Limited and anr. Vs. Dr. Ambuj Chaudhary, First Appeal No. 300 of 2012, decided on 13.02.2017.
Surprisingly, the Government of Punjab, Department of Housing and Urban Development (Housing II Branch) i.e. the competent authority was well aware of the fact that the project has been started without permissions and huge money has been collected and usurped by the opposite parties from innocent buyers yet it did not hear the aggrieved consumers before granting exemption to the project on 25.01.2017 from the provisions of PAPR Act. As such, the said act of the competent authority is against the principles of natural justice; fair play and not binding on the complainants and other prospective buyers.
Now coming to delay in offering possession of the plot to the complainants, it may be stated here that the opposite parties in their written reply in para nos.18 and 19, have very candidly admitted that development work at the project site is going on in full swing; basic amenities such as roads, sewerage, electricity etc. are near completion and that possession of the plot is being delivered. However, except some photographs, perusal of which too reveal that still a lot of work is pending to be done at the project site, no other cogent and convincing evidence has been placed on record, to prove that the development is at the advance stage as alleged in the reply and that basic amenities such as roads, electricity, sewerage, water supply etc. are near completion. Still, no exact period/date has been given, by which possession of the plot could be delivered. Burden to prove that the project has been completed and the area/site, in question, is fully developed or is about to complete, is on the builder/opposite parties. It was so said by the Hon'ble National Commission, in Emaar MGF Land Limited and another Vs. Krishan Chander Chandna, First Appeal No.873 of 2013 decided on 29.09.2014. At the same time, perusal of contents of the written reply reveal that self-contradictory pleas have been taken with regard to delay in offer of possession of the plot in question to the complainants. In some paragraphs it has been stated that delay took place in offering possession because there was delay on the part of the Govt. Departments to sanction approvals/ permissions; due to shortage of construction material etc. etc. whereas, at the same time, it has been stated that since more land was added to the project, as such, permission was sought from the competent Authorities for extension of time for completing the project in question.
As such, perusal of contents of reply filed by the opposite parties clearly go to show that they were not serious in completing the project and are now taking bald excuses for causing delay, just with a view to defeat the genuine claim of the complainants. Under these circumstances, it is held that the opposite parties by not executing agreement within the stipulated period referred to above; nor completing the development work even by the date when this complaint was filed and by not delivering possession of the plot booked under application no.PSE-02 - despite the fact that the same was booked as far as back in 2011- indulged into unfair trade practice and were also negligent and deficient in providing service, for which the complainants deserve to be suitably compensated.
At the same time, it is also held that plea taken by the opposite parties to the effect that delay took place in offering possession because there was delay on the part of the Govt. Departments to sanction approvals/permissions; and shortage of construction material etc. does not carry out any weight, in the absence of any documentary evidence in that regard. Not even a single letter has been placed on record by the opposite parties showing that they ever reported the Govt. Authorities concerned that there is a delay on their part in granting sanctions/approvals in respect of the project in question or that any such letter, by which they have given notice to the said Authorities that in case the needful is not done in a prescribed time, they shall move to the appropriate platform of law, in the matter.
Now coming to the plea regarding shortage of construction material, it may be stated here that nothing has been placed on record by the opposite parties to prove that they were unable to procure the said construction material, in adequate quantity. There is no evidence of the opposite parties having invited tenders for supply of construction material and there being no response to such tenders. A similar plea with regard to shortage of building material as a cause for delay in delivery of possession of the units was taken by a builder before the Hon`ble National Consumer in Consumer Case No.347 of 2014, titled as Swaran Talwar & 2 others v. M/s Unitech Limited (along three connected complaints), decided on 14 Aug 2015, which was rejected and the complaint was allowed in favour of the complainant. The principle of law, laid down, in the aforesaid case is fully applicable to the present case. In the present case also, the opposite parties failed to convince this Commission, that they actually encountered force majeure (which means irresistible circumstances beyond ones control such like act of God etc.) circumstances, as a result whereof, delay in handing over possession of the plots occurred. As such, the stand taken by the opposite parties, in this regard, is rejected.
Now coming to the objection taken by the opposite parties with regard to jurisdiction of this Commission and maintainability of this complaint. It may be stated here that it is a simple case of non-execution of agreement under the provisions of Section 6 of the PAPR Act within the reasonable time; and non-delivery of possession of plot to the complainants by the opposite parties thereby causing financial loss, mental agony and harassment to the complainants. The acts, omissions and commissions on the part of the opposite parties amount to deficiency in providing service as well as the negligence and adoption of unfair trade practice. In Narne Construction P. Ltd., etc. etc. Vs. Union of India and Ors. Etc., II (2012) CPJ 4 (SC), it was held that when a person applies for the allotment of a building or site or for a flat constructed by the Development Authority and enters into an agreement with the Developer, or the Contractor, the nature of transaction is covered by the expression 'service' of any description. Housing construction or building activity carried on by a private or statutory body constitutes 'service' within the ambit of Section 2(1)(o) of the Act. Similar principle of law was laid down, in Haryana Agricultural Marketing Board Vs. Bishambar Dayal Goyal & Ors. (AIR 2014 S.C. 1766). Under these circumstances, no complicated question of facts and law are involved in this complaint. The complaint involves the consumer dispute and the same is maintainable before this Commission. Furthermore, in view of Section 3 of the Act 1986, it is open to the consumers to approach the Consumer Foras for redressal of their grievance notwithstanding that he/she can get relief under any other Act/Court. In view of above findings, we can safely say that the provisions of the RERA and PAPR Act 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 builder/developer. As such, Objection taken in this regard stands rejected.
At the time of arguments, it was vehemently contended by Counsel for the opposite parties that since the project in question has been got registered under the RERA in the year 2017 and also because some cases are pending before the Hon'ble Punjab and Haryana High Court on this issue, as such, jurisdiction of this Commission is barred to entertain this complaint arising out of the plot in question located in the said project and the complaint be relegated to RERA. It may be stated here that it is an admitted fact that under the RERA, the opposite parties got themselves registered their project, only on 15.09.2017. At the time of said registration, no notice was issued to the complainants and other proposed buyers under the opposite parties and at the time of transaction between the parties in April 2011, there was no registration under RERA and now after a period of more than seven years, the claim of complainants cannot be ignored on this score.
In all, in the present case, the grievance has been raised by the complainants qua wrongful act/mistake done leading to deficiency in providing service, negligence 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. 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 barred to entertain the complaints filed by consumers, alleging deficiency in providing service, negligence and adoption of unfair trade practice against the builder like the opposite parties. The contention raised by the opposite parties is also devoid of merit, in view of principle of law laid down by the Hon'ble National Commission in Mohit Sharma & Anr. Vs. M/S. Ramprastha Promoters and Developers Pvt. Ltd. & Anr., Consumer Case No. 2384 of 2017, decided on 01 May 2019, wherein it was held that RERA does not bar the jurisdiction of Consumer Fora. Similar view was reiterated by the Hon'ble National Commission in Sandeep Mittal Vs. Ireo Grace Realtech Pvt. Ltd., Consumer Case No. 1916 of 2016 decided on 30 Jul 2019.
Thus, it transpires that the opposite parties were not competent to sell plots or flats and to collect money from the complainants and other prospective buyers, in April 2011, as far as the present project is concerned. Since not even a single document has been placed on record by the opposite parties to counter the allegations leveled by the complainants, it can very well be said that the project in question was launched and units therein were sold to the innocent buyers, in complete violation of the mandatory requirements as per Law, just with a view to grab money from them. The aforesaid act of the opposite parties amounted to grave deficiency in providing service, negligence and adoption of unfair trade practice on their part. Under these circumstances, we are of the considered opinion that we cannot make the complainants to wait for an indefinite period, in the matter. It is well settled law that non-delivery of possession of plots/units in a developed project by the promised date or if there is no agreement within a reasonable period say two to three years from the date of booking, is a material violation on the part of a builder and in those circumstances, the allottee is well within his/her right to seek refund of the amount paid. It was also so said by the Hon'ble National Commission in Sujay Bharatiya & Anr. Vs. Unitech Reliable Projects Pvt. Ltd., Consumer Case No.1814 of 2017 decided on 05.07.2018. The above view taken is further supported by the principle of law laid down by the Hon'ble Supreme Court of India in the case titled as Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, Civil Appeal No.12238 of 2018, decided on 02.04.2019. In the present case also, since there has been an inordinate delay in the matter, as such, we are of the considered opinion that if we order refund of the amount paid alongwith suitable interest that will meet the ends of justice.
The question, as to what rate of interest should be granted while ordering refund of the deposited amount, in case, the builder fails to deliver possession of residential units/plots, by the stipulated date or within a reasonable period where no agreement has been executed, fell for determination before the Hon`ble Supreme Court of India in H.U.D.A. Vs. Neelam Sharma, Civil Appeal no.3417 of 2003 decided on 18.08.2004. In the said case, the Hon`ble Supreme Court held that in case of refund of amount, the Interest Act would apply and 12% interest is to be granted from the date of amounts deposited till repayment.
Recently also, under similar circumstances, the Hon'ble Commission in Alok Kumar Vs. M/S. Golden Peacock Residency Private Limited & Anr., Consumer Case No. 1315 of 2018, decided on 06 Sep 2019 while ordering refund of the amount paid, awarded interest @12% p.a. In view of principle of law laid down by the Hon`ble Supreme Court of India and also the National Commission, if interest @12% p.a. is awarded to the complainants, from the respective dates of deposits till realization that will meet the ends of justice. At the same time, the opposite parties are also held liable to compensate the complainants for deficiency in providing service, negligence and adoption of unfair trade practice and also causing them mental agony and harassment.
As far as objection taken to the effect that the complaint filed is beyond limitation, it may be stated here that since it is an admitted fact that possession of the plot in question has not been delivered even by the date when this complaint had been filed before this Commission, as such, objection taken with regard to limitation, is not sustainable in the eyes of law, especially in view of principle of law laid down in Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal Shah and Anr., II 2000 (1) CPC 269=AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC), wherein it was held that when possession of the residential units/plots is not offered, there is a continuing cause of action, in favour of the allottee/buyer. It is also held that once an objection with regard to limitation has been taken by the opposite parties, at the same time, taking contrary objection to the effect that time was not the essence of contract is also not sustainable in the eyes of law.
An objection has also been taken by the opposite parties to the effect that opposite parties no.2 to 4 i.e. Directors of the Company have been wrongly impleaded as parties, in their personal capacity. We do not agree with the objection raised. It may be stated here that it is not the proven case of the opposite parties that the above-named persons are not their Directors. Had opposite party no.4 resigned from her duties, the opposite parties could have placed on record her resignation letter, but it has not so been done. As such, it is held that these persons are holding such important positions in the Company, where they are directly involved with the decision-making process in the Company and will be jointly and severally liable alongwith the Company, for all the acts done. Similar view was taken by the Hon'ble National Commission, in a case titled as M/s. India Bulls Real Estate & Wholesale Services Ltd. & Ors, Vs. Vemparala Srikant & Anr., First Appeal No. 797 of 2017, decided on 16 Aug 2017. Objection taken in this regard is rejected.
Now coming to the objection taken to the effect that application under Section 12 (1) (c) seeking permission to file joint complaint has not been filed by the complainants and also that affidavit has not been filed alongwith the complaint, as such, it is liable to be dismissed on this ground alone, we do not agree with the same. Firstly, once the plot in question stood purchased jointly by the complainants, in the manner explained above, they are not required to file any application under Section 12 (1) (c) seeking permission to file a joint complaint. The view taken by this Commission is supported by the judgment of the Hon'ble National Commission titled as Karnail Singh & 2 Ors. Vs. M/s. Emerald Lands (India) Private Limited & 5 ors., Consumer Case No. 2809 of 2018, decided on 02 Jan 2019, wherein the three complainants who had jointly been allotted plot in a project, moved an application under Section 12(1)(c) of the Act, which was rejected by it saying that it is wholly misconceived and the complaint was treated to have been filed under Section 12(1)(a) of the Act. As far as objection taken to the effect that affidavit has not been attached with the complaint, it may be stated here that we have gone through the record and found that the averments made in the complaint, has been duly verified by complainant no.1, by way of filing his affidavit dated 29.11.2018. In this view of the matter, objections taken are rejected.
For the reasons recorded above, this complaint is partly accepted, with costs. The opposite parties, jointly and severally, are directed as under:-
To refund the amount of Rs.21,60,000/- to the complainants, alongwith interest @12% p.a., from the respective dates of deposits onwards, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, thereafter, the said amount of Rs.21,60,000/- shall carry 3% penal interest i.e. 15% p.a. (12% p.a. plus (+) 3% p.a.), from the date of passing of this order, till realization.
To pay compensation for causing mental agony and physical harassment; deficiency in providing service and adoption of unfair trade practice and also cost of litigation, in lumpsum, to the tune of Rs.50,000/-, to the complainants, within a period of 30 days, from the date of receipt of a certified copy of this order, failing which, the said amount of Rs.50,000/-, shall carry interest @12% p.a. from the date of passing of this order, till realization.
However, it is made clear that, if the complainants have availed loan facility from any banking or financial institution, for making payment of installments towards the said plot, it shall have the first charge of the amount payable, to the extent, the same is due to be paid by the complainants.
Certified Copies of this order be sent to the parties, free of charge.
The file be consigned to Record Room, after completion.
Pronounced.
29.11.2019 Sd/-
[RAJ SHEKHAR ATTRI] PRESIDENT Sd/-
(PADMA PANDEY) MEMBER Sd/-
(RAJESH K. ARYA) MEMBER Rg.