State Consumer Disputes Redressal Commission
Karan Mittal vs Pearls Infrastructure Projects Ltd. on 30 November, 2017
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.
Consumer Complaint No.177 of 2016
Date of Institution :10.06.2016
Order reserved on: 30.11.2017
Date of Decision : 30.11.2017
1. Sh. Karan Mittal s/o Sh. Surinder Singh Mittal, r/o
H.No.1609-C, Sector-38 B, Chandigarh through his power of
attorney holder, Sh. Surinder Singh Mittal, s/o Sh. Amar
Singh, r/o H.No.408 A, Shakti Nagar backside Khalsa
School, Near Shakti Bhawan Mandir, Mansa, Punjab.
2. Vikas Mittal s/o Sh. Surinder Singh Mittal, r/o B-144, Rail
Nagar Society, Sector-50, Noida, G.B. Nagar, Uttar Pardesh
through his power of attorney holder, Sh. Surinder Singh
Mittal, s/o Sh. Amar Singh, r/o H.No.408 A, Shakti Nagar
backside Khalsa School, Near Shakti Bhawan Mandir,
Mansa, Punjab.
.....Complainants
Versus
1. Pearls Infrastructure Projects Ltd., SCO 6, Sector-69,
Mohali through its Managing Director/Authorized Signatory.
2. Axis Bank Limited, SCO 350-352, Sector-34A, Chandigarh,
through its Managing Director/Authorized Signatory.
........Opposite Parties
Complaint under Section 17 (i) (a)
of the Consumer Protection Act
1986.
Quorum:-
Shri J. S. Klar, Presiding Judicial Member.
Smt. Surinder Pal Kaur, Member Present:-
For the complainants : Sh. S.S. Gill, Advocate For opposite party No.1 : Sh. Ammish Goel, Advocate For opposite party No.2 : None ............................................CC 177 of 2016 2
J.S. KLAR, PRESIDING JUDICIAL MEMBER :-
This complaint has been instituted by the complainants under Section 17 (i)(a) of Consumer Protection Act 1986 (in short referred to as Act) on the allegations that complainants as co- applicants booked a residential plot for their personal and family use, measuring 250 sq. yds. for basic sale price of Rs.72,50,000/- in Pearls City, Sector-100 Mohali, township of OP No.1 by paying the booking amount of Rs.7,25,000/-, vide receipts Nos.22748, 22749, 22750 and 22751 dated 09.05.2012 and plot No.138 was allotted to them on 09.05.2012. Further, another payment of Rs.7,25,000/- was also made on 28.06.2012, vide receipts Nos.23869, 23870 and 23870. Complainants have executed instrument of General Power of Attorney in the name of Sh. Surinder Singh Mittal for the purpose of prosecution of the present case. Buyer's agreement was executed between the complainants and OP No.1 on 08.08.2012. Further, complainant made various payments to OP No.1 and the details of which are as under:-
Sr. Receipt Date Amount(Rs.)
No. No.
1. 24705 17.08.2012 Rs.3,25,000/-
2. 24706 17.08.2012 Rs.4,00,000/-
3. 26589 20.11.2012 Rs.43,750/-
4. --- 23.11.2012 Rs.5,00,000/- (paid by Axis Bank)
5. --- 05.02.2013 Rs.3,00,000/- (paid by Axis Bank)
6. 28009 14.02.2013 Rs.2,43,750/-
7. --- 13.05.2013 Rs.3,00,000/-
8. 29593 22.05.2013 Rs.1,00,000/-
9. 29594 22.05.2013 Rs.1,43,750/-
10. --- 10.09.2013 Rs.3,00,000/- (paid by Axis Bank)
CC 177 of 2016 3
11. 30971 12.09.2013 Rs.1,33,750/-
12. 30972 12.09.2013 Rs.1,10,000/-
13. --- 04.12.2013 Rs.1,12,500/- (paid by Axis Bank)
14. 31959 12.12.2013 Rs.1,00,000/-
15. 31960 12.12.2013 Rs.1,50,000/-
16. 33133 25.03.2014 Rs.2,00,000/-
17. 33134 25.03.2014 Rs.50,000/-
18. 33395 28.04.2014 Rs.1,12,500/-
19. 33731 07.07.2014 Rs.1,50,000/-
20. 33732 07.07.2014 Rs.1,50,000/-
21. 33733 07.07.2014 Rs.62,500/-
22. 34160 20.11.2014 Rs.1,00,000/-
23. 34162 20.11.2014 Rs.1,50,000/-
24. 34163 20.11.2014 Rs.1,12,500/-
25. 34250 18.12.2014 Rs.50,000/-
26. 34251 18.12.2014 Rs,1,12,500/-
27. 34252 18.12.2014 Rs.2,00,000/-
28. 34706 18.04.2014 Rs.1,62,500/-
29. 34707 18.04.2015 Rs.2,00,000/-
30. 34813 04.06.2015 RS.62,500/-
31. 34814 04.06.2015 Rs.50,000/-
32. 34815 04.06.2015 Rs.50,000/-
33. 34827 09.06.2015 Rs.2,00,000/-
34. 34976 29.07.2015 Rs.39,900/-
Complainants also took loan of Rs.15,12,500/- from OP No.2 for payment of the said plot and have been paying regular EMIs. As per Clause 10 of the Plot Buyers Agreement, OP No.1 was to deliver the possession of the plot within 3 years from the date of execution of agreement and they have made payment of more than 95% of the sale consideration of the said plot. OP No.1 till date has not delivered possession to them and there has been a delay of almost nine months from the stipulated date for possession i.e. 08.08.2015. They further averred that as per notification dated 02.09.2014, the developer can offer possession only, if they have obtained partial/full completion of the project. They were promised to be provided with club facility in Sector - CC 177 of 2016 4 100 as per the brochure and the OP No1. have charged them for club membership in advance, whereas according to Clause 18 of the agreement, it was the discretion of the complainants to become a member of the club and the said club was to be developed in Sector 100 and Sector 104 would have a common club and the said club was being developed in Sector 104 which would also take time to be completely built, but the club has still not been developed in Sector 104 as well by OP No.1. Moreover, complainants were also told that the water tank for supplying water to Sector 100 would be built in Sector 104 and the same would be catering to Sector 100 and Sector 104 respectively.
Moreover, Sewage Treatment Plant (STP) has not been started in Sector 100 Mohali and it was being told the STP of Sector 104 only would cater to Sector 100 requirements. Moreover, the promise of hi-tech 24x7 security promise as per the brochure is empty one. No water works arrangement has been made in Sector 100 which makes the area unlivable. The community center is in deplorable state and there are no street lights in the said area. There are no transformers and feeders installed in the said township as well. The Power House of Sector 104 is to cater to Sector 100 for the time being, as represented by OP No.1 and it is unable to cater to Sector 104, what to think of Sector 100. The said sector does not even have a permanent electricity connection so far. The deadline given by PUDA to OP No.1 to complete the project has already expired. OP No.1 has charged CC 177 of 2016 5 amount of 18% per annum on account of delay in making payments for the plot, but buyers agreement does not contain any penalty clause in delay in handing over the possession to consumer, which is unfair on the part of OP No.1. Thus, complainants alleged deficiency in service on the part of OPs and prayed for refund of amount of Rs.69,27,400/- paid to OP No.1 along with interest @ 18% p.a. from date of deposit till actual payment and further prayed for compensation of Rs.3,00,000/- for mental harassment and Rs.1,00,000/- as cost of litigation.
2. Upon notice, OP No.1 failed to file any written reply in this case. OP No.1 placed on record documents Ex.OP1/1 to Ex.OP1/5 without filing any written version.
3. Upon Notice, written reply was filed by OP No.2 by raising preliminary objections that complaint is not maintainable, as OP No.2 has funded the purchase of the plot in question on submission of original documents of allotment and has a prior right for repayment of its dues in the loan account No.PHR004100601140. It was further averred that in view of the agreement between parties, in case of termination of said allotment, dues of the OP No.2 are to be repaid then only any leftover money can be given back to complainants. On merits, preliminary objections were reiterated by OP No.2 and all other averments made in the complainant were vehemently denied by it. It prayed for dismissal of complaint with costs. CC 177 of 2016 6
4. The complainants tendered in evidence affidavit of Surinder Singh Mittal (General Power of Attorney of Complainants) as Ex.C-A along with documents Ex.C-1 to Ex.C-9 and closed the evidence. As against it, OP No.1 tendered in evidence documents Ex.OP1/1 to Ex.OP1/5 and closed the evidence. OP No.2 tendered in evidence affidavit of Ms. Megha Ahluwalia, Manager of OP No.2 as Ex.OP-2/A along with documents Ex.OP2/1 to Ex.OP2/8 and closed the evidence.
5. We have heard learned counsel for parties at considerable length and also examined the record of the case. No written version of OP No.1, projecting its defense, has appeared on the record in this case. We have to examine the evidence on the record for adjudicating this complaint. Surinder Singh Mittal, GPA of complainants tendered in evidence his affidavit Ex.C-A. He testified that complainants executed instrument of GPA in his favour, vide Ex.C-2 and Ex.C-3 on the record. He deposed that complainants booked a residential plot of 250 sq. yds. for their personal and family use for basic sale price of Rs.72,50,000/- with OP No.1. The booking amount of Rs.7,25,000/- was paid, vide receipts Nos.22748, 22749, 22750 and 227451 dated 09.05.2012. Plot No.138 was allotted to them on 09.05.2012 by OP No.1 and proved plot buyers agreement executed between the parties on 08.08.2012, vide Ex.C-4 on the record. Clause 10 of plot buyers agreement mandates OP No.1 to deliver possession of the plot within three years period from the CC 177 of 2016 7 date of official launch of Sector 100 of the said township or from the date of signing flat buyers agreement, whichever is later. The possession was to be delivered of flat No.138 to complainants by 07.08.2015, as per Clause 10 of Ex.C-4. He proved the payments made by complainant to OPs by virtue of receipts Ex.C-5, Ex.C- 5/1 to Ex.C5/34. The statement of account issued by OP No.2 Axis Bank of complainant is Ex.C-5/35 for payment of installments. Letter No.4966-CTP(Pb)/SP-458 dated 02.09.2014 is Ex.C-7 dealing with completion certificate and partial completion instructions to be followed by the promoter issued by Punjab Government. Vide Ex.C-8/1 dated 10.09.2015, GAMADA provided information to one Mohan Dutt that project of OP No.1 is not exempted and OP No.1 has not yet applied for completion certificate. No completion certificate was applied by OP No.1 to the authorities for the project till 10.09.2015. The brochure issued by OP No.1 is Ex.C-9 for development of the project.
6. OP No.1 represented in brochure Ex.C-9 that the project will be outfitted with below noted features:-
Large area reserved for green belt. A lavishly designed club house offering a plethora of sports and leisure activities. Provision for Multiplex cum shopping mall with all modern facilities.
Specially earmarked area for Senior Secondary School, Nursery school and creches.
Dispensary.
Gurudwara and Temple.
Meticulously planned infrastructure. 24x7 Hi Tech Security.
An array of options to choose from independent built-up villas to built up apartments.CC 177 of 2016 8
Variable plot sizes starting from 150 sq. yrds (125.41 sq. mtrs.) Above referred evidence has been adduced on record by complainants.
7. No written version of OP No.1 has appeared on record in this case. Affidavit of Gurpinder Brar Senior Manager of OP No.1 is Ex.OP1/A on the record without any defense in written version of OP No.1. He stated that complainants admitted email dated 23.03.2014 that there was no increase in the rates due to slump and hence, they requested for the refund of the amount. He proved email Ex.OP1/2 on the record. He denied any deficiency in service on part of OP No.1 in delivering possession of the allotted plot to complainants. He further stated that some plot holders have even constructed their plots in the projects and have been living there as well. The complainants have not fulfilled the terms and conditions of buyers agreement, as testified by him. He further stated that the residential colony has been developed by OP No.1 after obtaining the approvals and all the basic amenities like roads, sewerage, water and electricity supply have been provided in the project. He stated that role of OP No.1 is limited being agent of promoter PACL India Limited in this case. The promoter has been stopped by Top Court to carry out any kind of activity, hence, the developer cannot pursue it in his individual capacity and it only looks after marketing and sales on behalf of promoter. He proved the copy of order Ex.OP1/4 of Top Court and newspaper cutting Ex.OP1/5 on the file. He denied any CC 177 of 2016 9 deficiency in service on the part of OP No1. OP No.2 is only the financer of the complainant for payment of the installments amount on its behalf to OP No.1-developer. It also led evidence, vide power home sanction letter Ex.OP2/2, home loan agreement Ex.OP2/3, Ex.OP2/4 and permission to mortgage dated 02.11.2011 Ex.OP2/5 and quardripartite agreement dated 30.10.2012 Ex.OP2/6 and statement of account Ex.OP2/7 on the file. The submission of OP No.2 is that it has prior right of recovery being the financer and left out amount, if any, has to be paid to complainant only.
8. From the critical evaluation of evidence on record, we find that no written version of OP No.1 in the shape of written statement appeared before us in this case. Complainants mainly relied upon Clause 10 of buyers agreement Ex.C-4 whereby OPs agreed to deliver possession of the plot to them within three years from the date of official launch of Sector 100 of said township or from the date of signing of flat buyers agreement, whichever is later subject to force majeure circumstances. No force majeure circumstances have been pleaded by OP No.1 in this case, nor they have been established on the record justifying the extension of time in delivery of possession to the consumer by OP No.1. Plot buyers agreement was executed on 08.08.25012, vide Ex. C-4 and possession was required to be delivered by 07.08.2015 to complainants by OPs in this case. So far, possession has not been delivered of the plot by OP No.1 to complainants, despite CC 177 of 2016 10 the fact that the year 2017 is coming to close. The total sale price of the plot was Rs.72,50,000/- as given in plot buyers agreement Ex.C-4. Complainants have paid more than 95% of the amount of sale consideration to OP No.1, which fact is proved on record by virtue of receipts Ex.C-5, Ex.C-5/1 to Ex.C-5/34 and the same fact has also been stated on oath by Surinder Singh Mittal GPA of complainants in his testimony, vide his affidavit Ex.C-A, particularly para No.5 of the affidavit on the record. When OP No.1 has received more than 95% of sale price from complainants and as such latter cannot be faulted in this regard. OP No.1 was duty bound to deliver possession of the plot to complainants within scheduled time of three years. Even the year 2017 is coming to close and possession of the plot has not yet been delivered in a developed state to complainants. Non-delivery of possession within schedule time despite receipt of sale consideration is deceptive and unfair trade practice in our view. The hard earned money of the customers is being utilized by the developers without performing their own duties. The statement of account is issued by OP No.2 bank in the account of Karan Mittal, vide Ex.C-5/35 releasing amounts from time to time for the same. Even Government of Punjab has issued instructions, vide Ex.C-7 dated 02.09.2017 for obtaining completion certificate from the competent authorities or partial completion certificate. OP No.1 received the entire consideration of more than 95% of sale price from complainants and issued receipts to complainants in that CC 177 of 2016 11 regard. The complainants obtained loan from OP No.2-Bank and loan agreement is Ex.OP2/3 and power home sanction letter is Ex.OP2/2 and application for power home loan is Ex.OP2/1 on the record. Permission to mortgage by OP No.1 to Axis Bank is Ex.OP2/5 on the record. The quadripartite agreement dated 30.10.2012 executed between complainants and OP No.1 and OP No.2 and M/s. PACL Limited is Ex.OP-2/6 on the file.
9. Complainants also pleaded and proved in affidavit on the record that OPs have also not provided the advertised facilities in the project, where plot of complainants is located. Submission of counsel for complainants is that completion certificate can be issued under Section 14 of PAPRA Act by the authorities, if the developer has completed the execution of storm water, drinking water, sewage system, HT electrical network including transformer, street lighting, roads, etc. to its satisfaction. Complainants pleaded and proved that they were given the option to exercise the discretion of becoming member of the club, the club has still not been developed in Sector 104. Moreover, complainants were also told that the water tank for supplying water to Sector 100 would be built in Sector 104 and the same would be catering to Sector 100 and Sector 104 Mohali respectively. Moreover, Sewage Treatment Plant (STP) has not been started in Sector 100 Mohali and it was being told the STP of Sector 104 only would cater to Sector 100 requirements. Moreover, the promise of hi-tech 24x7 security promise as per the CC 177 of 2016 12 brochure is only an empty one. No water works arrangement has been made in Sector 100, which makes the area unlivable. There are no transformers and feeders installed in the said township as well. The Power House of Sector 104 is to cater to Sector 100 for the time being, as represented by OP No.1 and it is unable to cater to Sector 104, what to think of Sector 100. The said sector does not even have a permanent electricity connection so far. This pleading is contained in the complaint and there is affidavit of Surinder Singh Mittal GPA of complainants to substantiate it on the record. Initially onus stood discharged by complainants that OPs have not developed the project, where the plot is located and there are no arrangement of basic amenities thereat. OP No.1 has not filed written version in this case and even evidence adduced on record is unable to dislodge the case of the complainants. Consequently OP No.1 is deficient in service in not giving the possession of the allotted plot to complainants within scheduled time despite receipt of sale consideration amount. There is no completion certificate or partial completion certificate yet applied by OP No.1 with the competent authority as contemplated under Section 14(1) of PAPRA Act. Even basic amenities as recorded above have not been developed by OP No.1 in the project. OP No.1 has not led any substantial evidence to prove this fact that it has developed the project. The reliance of OP No.1 is on one email sent by complainants, vide Ex.OP1/2, Karan Mittal-complainant No.1 sent it to OP No.1 on 23.03.2014 CC 177 of 2016 13 to wave the interest amount. Statement of account as on 19.01.2017 is Ex.OP1/3. We thus hold OP No.1 deficient in service and OP No.2 is only the financer to advance the finance.
10. We find that even plot buyers agreement Ex.C-4 was also executed between the parties viz. OP No.1 and PACL Limited a company incorporated under the Companies Act 1956. PACL Limited is also a party to plot buyers agreement Ex.C-4 on the record in this transaction. The version of OP No.1 is that it is only agent of PACL Limited and PACL Limited has been virtually developing the project in this case. Ex.OP1/4 order of Supreme Court in Civil Appeal No.133301 of 2015 titled as Subrata Bhattacharya Vs. Securities & Exchange Board of India, Top Court passed its order that where PACL Limited is concerned in any dispute or before any Court, SEBI shall constitute a Committee for disposing of the land purchased by above company so that the sale proceeds can be paid to investors, who have invested their funds in the company for purchase of the land. Hon'ble Mr. Justice R.M. Lodha, the former Chief Justice of India, has been designated as Chairman of the said Committee by Apex Court. The Committee has been authorized by Apex Court to collect relevant record including title itself and so on and a Nodal Officer shall be appointed, who shall be incharge of funds collected and shall have a liaison with the Committee and shall also work as a Secretary of the said Committee. The Nodal Officer issued public notice Ex.OP-1/5. The Apex Court has CC 177 of 2016 14 ordered not to part with or share record and to approach the Committee etc., wherein PACL Ltd. has a right or interest in order to repay customers/investors of PACL Limited here in this case, PACL Limited is also a party to prior agreement and as such the intervention of the above Hon'ble Committee is a indispensable and mandatory in this case, as per directions of the Hon'ble Supreme Court.
11. Since OP No.1 has been found deficient in service in this case, hence, complainants are held entitled to refund the deposited amount with interest at the rate of 12% per annum from the date of their deposit till actual payment from OP No.1. Complainants are also entitled to compensation of Rs.1,50,000/- for mental harassment and Rs.30,000/- as cost of litigation. It is made clear in this order that since PACL Limited has some concern in the matter as per buyers agreement, hence the amount involved in this case shall be recovered from OP No.1 through the instrumentality of above Hon'ble Committee constituted by the Hon'ble Supreme Court under the Chairmanship of his lordship Hon'ble R.M. Lodha, former Chief Justice of India. The Hon'ble Committee shall then, disburse the amount to the complainants as per directions of the top Court.
12. Arguments in this complaint were heard on 30.11.2017 and the order was announced in open Court. Certified copies of the order be communicated to the parties under rules.
CC 177 of 2016 15
13. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(J.S. KLAR)
PRESIDING JUDICIAL MEMBER
November 30, 2017 (Surinder Pal Kaur)
DB MEMBER