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State Consumer Disputes Redressal Commission

Sanjay Rohatgi & Anr. vs M/S Ansal Landmark Township Pvt. Ltd. & ... on 6 January, 2021

IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL COMMISSION

                                    JUDGMENT RESERVED ON: 23.12.2020
                                  JUDGMENT PRONOUNCED ON: 06.01.2021

                              COMPLAINT NO. 681/2018

     IN THE MATTER OF

     MR. SANJAY ROHATGI & ANR.                             .......COMPLAINANTS

                                          VERSUS

     M/S ANSAL LANDMARK TOWNSHIP PVT.
     LTD & ORS.                    ......OPPOSITE PARTIES

     CORAM:

     HON'BLE          DR.     JUSTICE         SANGITA         DHINGRA       SEHGAL
     (PRESIDENT)
     HON'BLE SH. ANIL SRIVASTAVA, (MEMBER)

     Present: Mr. Jalaj Agarwal, Counsel for Complainant.
                  Ms. Tanya Verma, Counsel for the OP. (OP ex-parte)

     PER: HON'BLE DR. JUSTICE SANGITA DHINGRA SEHGAL,
               PRESIDENT
                                     JUDGMENT

[Via Video Conferencing]

1. The present complaint has been filed before this commission under Section 17 of the Consumer Protection Act, 1986 alleging deficiency of services and Unfair Trade Practices by the opposite parties and has prayed as under:

a) Direct the opposite parties to handover the physical possession of the residential plot bearing no. 0060, Block-

C, admeasuring 367 sq. mtrs. in Ansal Aquapolis, CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 1 of 13 Ghaziabad, U.P to the complainants without any delay alongwith interest @ 18% per annum for the delay period.

b) Direct the opposite parties to pay a sum of Rs. 1,00,000/- as compensation for harassment and mental agony.

c) Direct the opposite party to pay Rs. 50,000/- as litigation costs.

2. Brief facts necessary for the adjudication of the present complaint are that the complainants booked a residential plot with the OP in the project called "Ansal Aquapolis" at Ghaziabad, U.P. On 11.12.2006, an allotment letter was issued by the OP to the complainants for the plot bearing no. 0060, Block-C having super area of 367 sq. mtrs. Thereafter, Plot Buyer Agreement was executed between the parties on 03.03.2007. However, till date possession of the plot has not been handed over by the OP.

The complainants over the time had paid a sum of Rs. 23,62,368/- to the OP as and when demanded by him.

3. During the course of the proceedings, notice was issued to the OP on 06.07.2018, the counsel for the OP appeared on 09.01.2019 and the copy of complaint was supplied to him. Subsequently, the OP neither appeared nor filed his written statement within the statutory period as provided under the Consumer Protection Act, 1986. In pursuance to this, the OP was proceeded ex-parte vide order dated 24.7.2019.

4. Evidence by way of affidavit and written arguments are duly filed by the complainants.

5. We have heard the counsel for the complainants and perused through the material on record.

6. The fact that the complainants had booked a plot with the OP is not in dispute from the evidence on record. Payment to the CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 2 of 13 extent of Rs. 23,62,368/- by the complainants to the OP is evident from the material before us.

7. Before delving into the merits of the case, we deem it appropriate to adjudicate the preliminary issues involved in the present matter.

• WHETHER THE COMPLAINANTS HAS CAUSE OF ACTION TO APPROACH THIS COMMISSION?

8. The first question for consideration before us is whether the complainant has any cause of action to approach this commission. The facts reveal that an agreement to purchase a plot was executed by the complainant with the OP on 03.03.2007. The handing over of the possession of plot in question is still pending.

9. To deal with this issue, it is appropriate to refer to Mehnga Singh Khera and Ors. Vs. Unitech Ltd. as reported in I (2020) CPJ 93 (NC) wherein the Hon'ble National Commission has held as under:

"It is a settled legal proposition that failure to give possession of flat is continuous wrong and constitutes a recurrent cause of action and as long as the possession is not delivered to the buyers, they have every cause, grievance and right to approach the consumer courts."

10. Applying the above law it is clear that the complainant is within his right to file the present complaint as the handing over of possession of plot is still pending and has not seen the light of the day; giving the complainant cause of action to file the present complaint.

• WHETHER COMPLAINANTS FALLS IN THE CATEGORY OF 'CONSUMER' UNDER THE CONSUMER PROTECTION ACT, 1986?

11. Section 2(d) of the Consumer Protection Act, 1986 defines 'consumer' as under:-

"(d) "consumer" means any person who-

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii) hires or avails of] any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who [hires or avails of] the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payments, when such services are availed of with the approval of the first-

mentioned person;

[Explanation: For the purposes of sub-clause (i), "commercial purpose" does not include use by a consumer of goods bought and used by him CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 4 of 13 exclusively for the purpose of earning his livelihood, by means of self-employment;]"

12. We further deem it appropriate to refer to Mehnga Singh Khera and Ors. Vs. Unitech Ltd. as reported in I (2020) CPJ 93 (NC) on this issue, wherein the Hon'ble National Commission has held as under:

"In the case of the purchase of houses which the service provider undertakes to construct for the purchaser, the purchase can be said to be for a commercial purpose only where it is shown that the purchaser is engaged in the business of purchasing and selling houses and/or plots on a regular basis, solely with a view to make profit by sale of such houses. If however, a house to be constructed by the service provider is purchased by him purely as an investment and he is not undertaking the trading of houses on a regular basis and in the normal course of the business profession or services in which he is engaged, it would be difficult to say that he had purchased houses for a commercial purpose. A person having surplus funds available with him would not like to keep such funds idle and would seek to invest them in such a manner that he gets maximum returns on his investment. He may invest such funds in a Bank Deposits, Shares, Mutual Funds and Bonds or Debentures etc. Likewise, he may also invest his surplus funds in purchase of one or more houses, which is/are proposed to be constructed by the service provider, in the hope that he would get CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 5 of 13 better return on his investment by selling the said house(s) on a future date when the market value of such house (s) is higher than the price paid or agreed to be paid by him. That by itself would not mean that he was engaged in the commerce or business of purchasing and selling the house (s)."

13. We further deem it appropriate to refer to "Aashish Oberai Vs Emaar MGF Land Limited reported in I (2017)C PJ17(NC) wherein it is held as under:

"6. .......A person cannot be said to have purchased a house for a commercial purpose only by proving that he owns or had purchased more than one houses or plots. In a given case, separate houses may be purchased by a person for the individual use of his family members. A person owning a house in a city A may also purchase a house in city B for the purpose of staying in that house during short visits to that city. A person may buy two or three houses if the requirement of his family cannot be met in one house. Therefore, it would not be correct to say that in every case where a person owns more than one house, the acquisition of the house is for a commercial purpose."

14. Applying the law discussed above it is clear that the complainant bought a plot for consideration. There is no evidence that the complainants had booked the plot in question for a commercial purpose. The complainants are thus a 'consumer' as defined under the Consumer Protection Act, 1986.

• WHETHER THIS COMMISSION HAS JURISDICTION TO DECIDE THE PRESENT COMPLAINT?

15. The next question of consideration is whether this commission has jurisdiction to decide the present complaint. We deem it appropriate to refer to Section 17 of the Consumer Protection Act, 1986 which provides as under:

"(1) Subject to the other provisions of this Act, the State Commission shall have jurisdiction--

(a) to entertain-

(i) complaints where the value of the goods or services and compensation, if any, claimed [exceeds rupees twenty lakhs but does not exceed rupees one crore]; and

(ii) appeals against the orders of any District Forum within the State; and

(b) to call for the records and pass appropriate orders in any consumer dispute which is pending before or has been decided by any District Forum within the State, where it appears to the State Commission that such District Forum has exercised a jurisdiction not vested in it by law, or has failed to exercise a jurisdiction so vested or has acted in exercise of its jurisdiction illegally or with material irregularity. (2) A complaint shall be instituted in 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 CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 7 of 13

(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."

16. Analysis of Section 17 of the Consumer Protection Act, 1986 shows that this commission will have the pecuniary jurisdiction in cases where the total claim including the compensation is more than twenty lakhs and less than one crore. Moreover, clause 17(2) provides the extent of territorial jurisdiction wherein it has been provided that the state commission will have the jurisdiction to entertain cases where opposite party 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.

17. Having discussed the statutory position, the facts of the present case reflect that the value of the apartment and the compensation prayed by the complainants is Rs. 99,00,000/- (approx) and the commission has the pecuniary jurisdiction to deal with the present complaint. So far as the territorial jurisdiction is concerned the registered office of the OP is at B-47, Connaught Place, New Delhi-110001. Since the registered office falls within the territory of Delhi, this CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 8 of 13 commission has the territorial jurisdiction to finally adjudicate the case. To strength the above finding we rely on Rohit Srivastava v. Paramount Villas Pvt. Ltd. reported at 2017 SCC OnLine NCDRC 1198, wherein it was held that:

"It is not in dispute that the Registered Office of Opposite Party No. 1 Company is situated in Delhi, i.e., within the territorial jurisdiction of the State Commission at Delhi and therefore, in the light of clear provision contained in Section 17(2)(a), which stipulates that a Complaint can be instituted in a State Commission, within the limits of whose jurisdiction, the Opposite Party actually carries on business. In view of the said provision, we have no hesitation in coming to the conclusion that since the Registered Office of the first Opposite Party is situated in Delhi, the State Commission did have the territorial jurisdiction to entertain the Complaint"

18. Relying on the above settled law, we are of the view that this commission has both territorial and pecuniary jurisdiction to decide the present complaint.

• DEFICIENCY OF SERVICE

19. The next question which arises is whether the Opposite Parties is actually deficient in providing its services to the complainants or not. The expression Deficiency of Service has been dealt with by the Hon'ble Apex Court in Arifur Rahman Khan and Ors. vs. DLF Southern Homes Pvt. Ltd. and Ors. reported at 2020 (3) RCR (Civil) 544, wherein it has been discussed as follows:

"23. .......The expression deficiency of services is defined in Section 2 (1) (g) of the CP Act 1986 as:

(g) "deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service.

24. A failure of the developer to comply with the contractual obligation to provide the flat to a flat purchaser within a contractually stipulated period amounts to a deficiency. There is a fault, shortcoming or inadequacy in the nature and manner of performance which has been undertaken to be performed in pursuance of the contract in relation to the service. The expression 'service' in Section 2(1) (o) means a service of any description which is made available to potential users including the provision of facilities in connection with (among other things) housing construction. Under Section 14(1)(e), the jurisdiction of the consumer forum extends to directing the opposite party inter alia to remove the deficiency in the service in question. Intrinsic to the jurisdiction which has been conferred to direct the removal of a deficiency in service is the provision of compensation as a measure of restitution to a flat buyer for the delay which has been occasioned by the developer beyond the period within which possession was to be handed over to the purchaser. Flat purchasers suffer agony and harassment, as a result of the default of the developer. Flat purchasers make legitimate assessments in regard to the future course of their lives based on the flat which has been purchased being available for use and occupation. These legitimate expectations are belied when the developer as in the present case is guilty of a delay of years in the fulfilment of a contractual obligation.

20. At this stage, we deem it appropriate to refer to the Plot Buyer agreement where no time limit is given for handing over the possession of the plot in question. It is imperative to refer "Ajay Enterprises Pvt. Ltd. and Ors. vs. Shobha Arora CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 10 of 13 and Ors." reported in MANU/CF/0296/2019, wherein it has been held as under:

"......under Section 46 of the Indian Contract Act, 1872, the following provision is there:

46. Time for performance of promise, where no application is to be made and no time is specified -

Where, by the contract, a promisor is to perform his promise without application by the promisee, and no time for performance is specified, the engagement must be performed within a reasonable time. Explanation - The question "what is a reasonable time" is, in each particular case, a question of fact".

19. From the above provision it is clear that if there is no time limit for the performance of a particular promise given by one party, it is to be performed within a reasonable time. In most of the builder buyer agreements, the period ranges from 24 to 48 months and the most common agreement seems to be for 36 months plus grace period of six months for completion of construction and delivery of possession. If the possession is delivered beyond 42 months or beyond 48 months, the deficiency in service on the part of the opposite party shall stand proved."

21. Moreover, it has been well settled that the complainants cannot be expected to wait for an indefinite time period to get the benefits of the hard earned money which they have spent in order to purchase the property in question (Ref: Fortune Infrastructure v. Trevor D'Lima reported at (2018) 5 SCC

442).

22. Applying the above settled law, it is clear that the opposite parties are deficient in providing its services to the Complainants as even after passing of more than 12 years, the OP failed to handover the possession of the plot in question.

23. Having discussed the liability of the Opposite Parties, the only question left to adjudicate is as to how the complainants is to be compensated for the deficient acts of the Opposite Parties. It is imperative to refer to the recent pronouncements of the Hon'ble Supreme Court in terms of "Interest" which is being allowed on the refunded amount. In Arifur Rahman Khan and Ors. (supra) which is the latest pronouncement (24.08.2020) on the cause, the Hon'ble Apex Court has allowed an interest @ 6% p.a. on the amount received by the Opposite Party, payable within one month and in case of default to pay within the stipulated period, an interest @ 9% p.a. was payable on the said amount.

24. Keeping in view the facts of the present case and the extensive law as discussed above, we direct the Opposite Parties to refund the entire amount paid by the complainant i.e. Rs. 23,62,368/- along with interest as per the following arrangement:

A. An interest @ 6% p.a. calculated from 25.09.2007 (being the date of last payment made by the complainant to the OP) till 06.01.2021 (being the date of the present judgment);

B. The rate of interest payable as per the aforesaid clause (A) is subject to the condition that the OP pays the entire amount on or before 05.03.2021;

C. Being guided by the principles as discussed above, in case the OP fails to refund the amount as per the aforesaid clause (A) on or before 05.03.2021, the entire amount is to be refunded with an interest @ 9% p.a. calculated from 25.09.2007 till the actual realization of the amount.

25. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party is directed to pay a sum of A. Rs. 1,00,000/- as cost for mental agony and harassment to the complainant; and B. The litigation cost to the extent of Rs. 50,000/-.

26. Applications pending, if any, stands disposed of in terms of the aforesaid judgment.

27. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.

28. File be consigned to record room along with a copy of this Judgment.

(DR. JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (ANIL SRIVASTAVA) MEMBER Pronounced On: 06.01.2021 CC 681/2018 SANJAY ROHTAGI VS. ANSAL LANDMARK TOWNSHIP PVT. LTD. Page 13 of 13