National Consumer Disputes Redressal
Jagannath D. Hiray & Anr. vs Lodha Crown Buildmart Pvt. Ltd. & 4 Ors. on 22 February, 2019
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 1304 OF 2015 1. JAGANNATH D. HIRAY & ANR. Both R/at: 701, Seawood Garden, Palm Beach Road, Sector -17, Sanpada, Navi Mumabi ...........Complainant(s) Versus 1. LODHA CROWN BUILDMART PVT. LTD. & 4 ORS. 216, Shah And Nahar Industrial Estate, Dr. E. Moses Road, Worli, Mumbai - 400 018. 2. Rejendra Narpatlal Lodha, Past Directorof Lodha Grown Buildmart Pvt. Ltd., 216, Shah And nahar Industrial Estaet, Dr. E.Moses Road, Worli, Mumbai -400 018. 3. Anurag Rameshmal Sanghvi, Past Director of Lodha Grown Buildmart Pvt. Ltd., 216, Shah And Nahar Industrial Estate, Dr. E.Moses Road, Worli, Mumbai - 400 018. 4. Ramandas Omprakash Pandey, Present Director of Lodha Grown Buildmart Pvt. Ltd., 216, Shah And Nahar Industrial Estate, Dr. E.Moses Road, Worli, Mumbai - 400 018. 5. Pranav Goel Present Directors of Lodha Crown Buildmart Pvt. Ltd., 216, Shah And Nahar Industrial Estate, Dr. E. Moses Road, Worli, Mumbai - 400 018. ...........Opp.Party(s)
BEFORE: HON'BLE MR. PREM NARAIN,PRESIDING MEMBER
For the Complainant : Mr. Nagaraj V. Hoskeri, Advocate
with Mr. Jagannath D.H. & Ms. Baby Hirey,
complainants, in person For the Opp.Party : For the Opposite party No.1: Mr.Sukumar Pattjoshi , Sr. Advocate with
Mr. Sasiprabhu & Mr. Suman, Advocates
For the Opposite party Nos.2 to 5: Ex-parte
Dated : 22 Feb 2019 ORDER
This consumer complaint has been filed by Mr. Jagannath D. Hiray & anr. against the opposite parties Lodha Crown Buildmart Pvt. Ltd. & Ors.
2. The facts relevant for the disposal of the present consumer complaint are that the complainants have jointly booked a 3 BHK Flat No. B-6004 on 60th floor of Building known as "LODHA DIORO"(hereinafter, referred to as "Building") for a total consideration of Rs.4, 45, 68, 432/- by agreement to sell dated 9.5.2012 which has been duly registered with the office of Joint sub Registrar, Mumbai-2 at Sr. No. 3282. The prescribed form for allotment of the above said flat was filled up by the office of the opposite parties on 10.12.2011 which was signed by the complainant and the office has acknowledged the receipt of the said application. OPs demanded Rs.14, 00, 000 in cash from the complainant for the allotment of two car parking in the said building and the same has been duly complied with by the complainants but no receipt has been issued with respect to the payment by the OPs. Complainant further states that they have paid Rs.22, 28, 500/- towards the stamp duty, Rs.30,000/- towards registration fees and Rs. 1400 towards copying charges in connection with the said agreement. Complainants allege that OPs have charged floor rising rate at the rate of Rs. 5310 per sq. ft. on built up area allotted to them. As per the demand of the OPs, complainants paid the amount of Rs.2,58,86,018/- which includes principal, interest and other charges and Rs.4,45,690/- towards the payment of MVAT.
3. It is the case of the complainant that on 19.7.2013 they were informed for the first time by OPs that they were going to construct the said building of 55 storeys in order to ensure the completion and possession of flats by the end of 2015. Complainants state that they were in constant touch with the OPs to know the actual reason as to the reduction in the number of floors in the building but they did not get any satisfactory reply from their side. In fact, OPs kept on demanding payment. By letter dated 6.8.2014, opposite parties gave the reason for reduction that they did not get permission from the competent authority which is contrary to their earlier reason. Complainants allege that the commencement certificate has been granted by the MMRDA on 20.2.2013 for G+53 floors and opposite parties were fully aware that no permission would be granted by MMRDA for a building more than 55 floors, prior to accepting the application for allotment of flat to the complainants, even then they failed to inform the complainants and kept on demanding the balance amount.
4. Complainants further state that they have received a cancellation letter from the opposite parties dated 23.2.2015 putting some unreasonable conditions on them and vide the said letter acknowledged the receipt of payment of Rs.2, 23, 58, 563/- only. Complainants allege that the opposite parties are responsible for misrepresentation and suppressing the true and material facts and that there is no fault on the part of the complainants and they have not showed their inability to perform their part of the contract on the basis of registered agreement dated 9.5.2012. Complainants go on to state that it is the opposite parties who are unable to perform their part of the contract. The letter for cancellation issued by the OPs amounted to contravention of the provisions of law and deficiency in service. Complainants have incurred expenses of Rs.2,81,45,918/- till 15.6.2013 in acquiring the said flat.
5. Complainants issued a legal notice to the opposite parties dated 21.4.2015 through their Advocate as they were left with no other option. By letter dated 12.10.2015, OPs advocate has given reply to the complainant's notice. Complainants state that the reply given by the OPs advocate is false, frivolous and with no merit or substance.
6. Complainants have filed the present complaint in this Commission praying to hold and declare the opposite parties to be guilty of deficiency in service and unfair trade practice and their act of threatening of cancellation of the registered agreement for sale dates 9.5.2012 vide notice dated 23.2.2015 be declared as illegal and hence not binding upon the complainants; to direct the opposite parties to hand over possession of the said flat AND/OR in the alternative, to hand over identical flat for the same area, same view, same rate as existing on 9.5.2012 in the same complex; in case of failure to hand over the possession of the said flat for any reason whatsoever, then the OPs be directed to refund the entire amount of Rs.2,81, 45, 918/- along with 18% interest from the date of receipt of the respective payments, and also to pay the difference between the rate at the time of booking and the prevailing market rate and/or additional amount of compensation/damages of Rs.1,00, 00, 000/- whichever is more; Rs.50,00,000/- towards mental torture and inconvenience; Rs.5,00,000/- towards the costs of the complaint.
7. Opposite party have filed their written version in reply to the complaint filed by the complainant. At the outset, OP took the preliminary objections firstly, as to Misjoinder of appropriate parties as OP state that complainants have failed to file any of the documents on record to prove the nexus between OPs 2 to 5 with the captioned complaint. Secondly with respect to the maintainability of the complaint, OP states that complainants are not "Consumers" within the Consumer Protection Act, 1986. Other grounds like no compensation for the loss arising out of own wrong or using the consumer commission as a tool for harassing the OPs have also been taken by the opposite parties. Opposite parties further stated that no payment with respect to the car parking space has been asked from the complainants so issuing of receipts for the same does not arise at all. OP goes on to aver that no floor rise rate @ Rs.5310/- per square feet has been charged from the complainants as mentioned by them. OP has only demanded for the outstanding payments due to the complainants as per the agreed terms and that interest has been charged on the amount due to the Complainants for the default committed on their part in making time bound payment. OP specifically denied in their written version that Complainants have paid Rs.2,58,86, 018/- and Rs.4,45,690 towards MVAT. OP states that an option had been given to the Complainants for transfer of the said flat to the new flat and OP was ready to adjust the payment made against the consideration payable towards the new flat offered. The letter dated 23.2.2015 that has been mentioned by the complainants can be seen as a "Termination Letter" of the booking issued to the Complainants for the reason of failure to revert with the confirmation of the transfer of the said flat to new flat within the stipulated period. OP captioned the complaint being false, baseless, frivolous and with no merits in itself and hence deserves to be dismissed with cost.
8. Both the parties filed their evidence on 15.7.2016 & 26.10.2016 by way of affidavit.
9. Heard the learned counsel for the parties and perused the record.
10. Learned counsel for the complainants stated that in the letters and emails dated 19/7/2014 and 18/06/2014 sent by the opposite parties, they have mentioned the reason for reducing the number of floors as being to complete the project by the end of 2015, but in the subsequent letter dated 6/8/2014 the opposite parties came up with a new ground for reducing the number of floors of the building as non-approval of permission by the competent authority which is contrary to the reason stated earlier. Even after the letter dated 6/8/2014 issued by the opposite parties, they kept on demanding payments from the complainant in respect of flat No.B-6004, as per the payment schedule mentioned in the aforementioned agreement for sale dated 9/5/2012 and interest thereon after illegally changing the plan of building without obtaining their written or oral consent which is mandatory u/s 7 of the Maharashtra ownership Flat Act, 1963.
11. Learned counsel for the complainant argued that the commencement certificate was granted by the MMRDA on 20/02/2013 in respect of plot/block no.C of Wadala truck terminal in which permission is granted only upto G+ 53 floors. It is further argued that the opposite parties were fully aware that no permission would be granted by MMRDA for a building having more than 55 floors prior to accepting the payment for allotment of flat no.B-6004 on the 60th Floor to the complainants. It is further argued that the opposite parties with malafide dishonest intentions, deliberately and knowingly misrepresented facts to the complainants regarding the number of floors in LODHA DIORO and induced them to book said flat on the 60th floor and compelled them to pay excess amounts towards floor rise, view premium, VAT, service tax, stamp duty etc.
12. It is argued that even on receipt of the commencement certificate dated 20/02/2013 the opposite parties failed and neglected to inform the complainants about reduction in floors and kept on demanding the balance amount as per the agreement in respect of flat No.B-6004. For the period between 20/02/2013 till the date on which the complainants were informed about the reductions in floors i.e. 19/7/2013, the opposite parties knowingly and dishonestly collected a further Rs.45,00,000/- from the complainants.
13. Learned counsel for the complainant stated that the complainants thereafter received from the opposite parties a cancellation letter dated 23/02/2015 putting therein some unreasonable conditions on them. The opposite parties vide the said letter acknowledged the receipt of Rs.2,23,58,563/- only. On the face of the said letter dated 23/02/2015, it is illegal, bad in law, false and unwarranted. There is no fault on the part of the complainants who were always willing to perform their part of the contract on the basis of the agreement for sale dated 9/5/2012. It is further argued that the opposite parties are responsible for misrepresentation and suppression of true and material facts since the beginning in order to extract excess amounts from the complainants. It is further argued that the opposite parties have been unable to perform their end of the contract in the event of which they have tried to illegally and with malafide dishonest intentions attempted to unilaterally terminate the contract based on their ifs and whims.
14. Learned counsel for the complainants stated that the complainants have paid Rs.2,44,86,018/- including interest, MVAT to the opposite parties from 10.12.2011 to 15.06.2013 as per their demands and the payment schedule. In addition to that, they have also paid Rs.14,00,000/- in cash towards cost of two parking spaces at the time of booking the flat. The complainants were required to pay Rs.22,28,500/- as stamp duty and Rs.30,000/- as registration charges and Rs.1400/- as copying charges for registration of the agreement. Thus, in all the complainants have incurred expenses of Rs.2,81,45,918/- till 15.06.2013 in acquiring the said flat. It is further argued that by letter dated 23.2.2015 for cancellation of booking, the opposite party has admitted an amount of Rs.2,23,58,563/- admitting that "as a goodwill gesture we shall refund the amounts paid by you towards the consideration of flat with simple interest at 12% p.a. to you and accordingly an amount of Rs.3,50,50,655/- is due to be refunded". However, the complainants are not interested for the same as they had paid 18% interest on late payment amount to the opposite parties and if the same principle is applied, the complainants are also entitled to receive the same rate of interest i.e. 18% p.a. From the record it appears that the complainant is ready to accept alternative flat situated at 50th floor i.e. flat No.5004 in order to settle the dispute amicably as mentioned in the daily order of the Commission dated 17.03.2016. Thereafter it was revealed that the opposite party is not having sanction for the said flat also. This show the opposite parties have misguided the Commission by filing false and fabricated written version on record.
15. On the other hand learned counsel for the opposite parties stated that the present consumer complaint filed before this Hon'ble Forum deserves to be dismissed for mis-joinder of the appropriate parties. It is the submission of opposite party No.1 that there is no privity of contract between opposite parties Nos.2 to 5 and the complainant. It is submitted by opposite parties that, the complainants do not fall within the ambit of the meaning of the term consumer as envisaged under the Act, but mere speculators who applied for the allotment of the said flat with an intention to make an investment which gets corroborated from the payment vouchers issued by the complainant itself to OP in the name of "Hiray Enterprises Builders and Developers". Notably, the complainant had booked the flat in question with OP even after having a permanent residence as mentioned by them in the Application Form filled by them. Thus, it is submitted that services of opposite party No.1 have been availed purely for a commercial purpose. It is therefore submitted that, the complainant is not a consumer but indulging in commercial activities and the present complaint is nothing but an attempt to misuse the process of this court as can be highlighted by decisions of this Hon'ble National Commission in Chilkuri Adarsh Vs. ESS ESS VEE Constructions III it was held that , "we are of the view that the complaint .. cannot be maintained before the consumer fora, like ours... related to the commercial purpose and the complainants, therefore, will not come within the definition of "consumer" as per Section -2(1)(d) of the Consumer Protection Act, 1986, "Further, in the case of Jagmohan Chabra & Another V/s DLF Universal Ltd., it was held that, "the complaint was not maintainable under the Consumer Protection Act, 1986... the complainant is having existing residence.. still booked the said flat therefore, it is manifest that complainant had availed the services of the opposite party purely for investment or commercial purpose and therefore, complainant does not fall within the definition of consumer as it stands after amendment.
16. Learned counsel for the opposite parties stated that the opposite parties issued Commencement Certificate on 09.12.2011 for construction of multi-storeyed buildings on the WTT Block 'C' under the project named New Cuffe Parade. The commencement certificate was accompanied with a map for the construction of towers and as per the map, the total number of floors to be constructed in Lodha Dioro tower in which the complainant had booked flat was 63 and the height of tower was approved to be of 210 meters. On the basis of aforesaid approval, the OP entered into agreement for sale with the complainant on 09.05.2012. However, to the utter shock of OP, the Airport Authority of India (AAI) failed to give permission for construction of 63 floors and issued an NOC dated 30.10.2013 for construction only upto the height of 139.90 meters, contrary to the approval given by MMRDA. Being aggrieved by the decision of AAI, the OP wrote letters dated 28.7.2015 and 30.07.2015 to the Joint Secretary and Chairman, Appellate Committee of Ministry of Civil Aviation, to atleast grant permission of construction upto height of 187.9 metres, which was of no avail. In absence of any reply, the OP then filed a Writ Petition bearing No.240 of 2016 before the Bombay High Court against AAI and other Government Authorities, which is sub-Judice. It was under these circumstances that the OP was compelled to reduce the number of floors in the Lodha Dioro tower and had informed the complainant through letter dated 06.08.2014 that the total number of floors will be now 55 instead of 63. Through the same letter, OP offered a new flat to complainant at 50th Floor having an extra carpet area of 21 sq. ft. without any extra cost under the speculation that the request of OP will be considered and the authorities will give permission to construct building atleast upto height of 187.9 metres. Notably, as the request of OP was not considered by the AAI, the OP has now been constrained to build only 45 floors in the Lodha Dioro tower. Hence, the reduction in number of floors by OP in the aforesaid tower was not deliberate and was due to non grant of permission by Competent Authorities.
17. Learned counsel for the opposite parties averred that through letter dated 06.08.2014, complainant was offered a new flat on the 50th floor of the same Lodha Dioro tower in which he had initially booked the flat with extra 21 sq. ft. carpet area without any extra cost. However, in view of the recent change in circumstance under which the OP is now constrained to construct only 45 floors in the said tower, the OP has now offered him a new flat in the same building with the same carpet area and on the same consideration value, without any extra cost, which the complainant has refused. Alternatively, the OP had also offered to refund the entire consideration value paid so far to complainant along with simple interest at 9% to which he again refused. It is submitted that the reduction in number of floors was due to reasons beyond the control of OP, for which it cannot be blamed. However, even in the said circumstances, the OP is proactively making its best effort to provide him the equal benefits, which is being repeatedly refused by the complainants.
18. Learned counsel for the opposite parties further stated that the terms and conditions of the Application Form submitted by the complainants on 11.12.11 and the Agreement to Sale entered on 09.05.12 provided for a contingency as occurred in the instant case, as approvals and permissions were yet to be received from the relevant authorities. The same can be shown by extracting relevant clauses of the Agreement of Sale. Clause No.6.1 of the Agreement of Sale and Application from stipulates that, "The purchaser is aware that while the builder/developer has obtained some of the approvals, certain other approvals are awaited. Having regard to the above position the purchaser have entered in to this agreement without any objection or demure" and agrees not to raise, waives his right to raise any such objection, in that regards. Further Clause 11.4 of the Agreement of Sale state that, "If as a result of any legislative order or regulation or direction of non-receipt of relevant approvals from the government or the public authorities, the builder/developer is unable to provide unit for fit outs or complete the building and/or gives possession of the unit to the purchaser within time. The builder/developer may by notice in writing terminate this agreement and the only responsibility and the liability of the builder/developer in such an event will be to pay over to the purchaser such consideration or as may have been paid by the purchaser with simple interest @9% per annum from the date of payment of each installments and the first of such 13th Month in which the cancellation/termination takes place."
19. Learned counsel for the opposite parties further stated that interest can only be granted till the date of filing of the complaint as decided by the Hon'ble Supreme Court in Union of India Vs. Bright Power Projects (India) Pvt. Ltd., (2015) 9 SCC 695. Learned counsel further relied upon the decision of Hon'ble Supreme Court in Secretary, Irrigation, Department, Government of Orissa and Ors. Vs. G.C.Roy, (1992) 1 SCC 508 in this regard.
20. There is no provision in the agreement for award of interest on the refund of the amount and therefore, the complainants are not entitled to any interest beyond legally permissible under the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 which is 9% per annum.
21. I have given a thoughtful consideration to the arguments advanced by both the learned counsel for the parties and have examined the material on record. First of all the opposite parties have raised the objection that the complainants are not consumers as they have deposited the amounts by way of cheques/payment vouchers issued by Hiray Enterprises Builders and Developers. The assertion of the learned counsel for the opposite parties may have some substance in his argument, but the question is whether the said booking was made for commercial purpose. It is seen from allotment letter dated 18.01.2012 that the allotment has been made in the name of Jagannath D. Hiray. Even, if the amount has been paid by the Hiray Enterprises Builders and Developers, the booking may be and is for the complainants. This may be either a proprietorship concern or a partnership firm or a private limited company. All these three category of association of persons are covered under the definition of "persons" because the Hon'ble Supreme Court in Karnataka Power Transmission Corporation and Anr. Vs. Ashok Iron Works Private Limited, (2009) 3 SCC 240, has held that a company registered under the Companies Act,1956 is the "person" within the meaning of person as given in Section 2(m) of the Consumer Protection Act, 1986 and partnership is exclusively covered under Section 2(m) of the Consumer Protection Act, 1986. The opposite parties have not given any evidence that the complainants are involved in regular trading of flats/plots. Hence, in the light of the fact that the booking has been made by individuals and an allotment letter has been issued in the name of individuals, the present booking cannot be said to be for a commercial purpose.
22. On merits it is seen that originally the flat was booked on 60th floor and the opposite parties could not get the permission to build upto 60th floor. The permission was given for G+ 53 floors. The opposite parties offered similar flat on 50th floor, but even this floor was not permitted by the competent authority. In fact, the opposite parties got permission to build only upto 45th floor. Though the opposite parties state that they are ready to allot some other flat, however, no specific proposal has been given to the complainants or has been indicated before this Commission. In such situation, when the booked flat cannot be delivered by the opposite parties as the opposite parties could not get permission to build the flat, clearly, the opposite parties are guilty of deficiency in service. The opposite parties should have accepted bookings and should have entered into agreement to sale only after getting proper permission from the competent authority. In this situation, the complainants are entitled for refund of the deposited amount with the opposite parties.
23. The complainants have prayed for refund of total amount of Rs.2,81,45,918/-, which includes Rs.22,28,500/- as registration charges for agreement to sale and Rs.14,00,000/- paid in cash to the opposite parties for two parking spaces. The opposite parties had denied receiving Rs.14,00,000/- for parking spaces. The opposite parties have accepted only payment of Rs.2, 23, 58, 563/-. The complainants have given the details of payments by way of cheques and RTGS along with his evidence affidavit and the same is as follows:-
Cheque/RTGS
Date
Amount
Bank
453635
10.12.2011
Rs.7,20,000/-
IDBI
453639
13.01.2012
Rs.33,00,000/-
IDBI
635184
13.01.2012
Rs.4,36,843/-
SVCB
453638
13.01.2012
Rs.23,892/-
IDBI
453647
03.03.2012
Rs.44,12,275/-
IDBI
453648
03.03.2012
Rs.88,970/-
IDBI
517905
24.4.2012
Rs.33,87,201/-
IDBI
517904
24.4.2012
Rs.99,960/-
IDBI
520137
14.8.2012
Rs.15,00,000/-
IDBI
635191
14.8.2012
Rs.25,00,000/-
SVCB
608575
14.8.2012
Rs.10,00,000/-
DENA
520138
14.8.2012
Rs.2,71,187/-
IDBI
RTGS
12.1.2013
Rs.5,00,000/-
IDBI
RTGS
14.1.2013
Rs.3,00,000/-
IDBI
RTGS
14.1.2013
Rs.10,00,000/-
SVCB
RTGS
02.3.2013
Rs.15,00,000/-
SVCB
RTGS
10.4.2013
Rs.15,00,000/-
SVCB
RTGS
15.6.2013
Rs.15,00,000/-
IDBI
Total: Rs.2,40,40,328/-
24. The opposite parties have not clarified as to which of these payments have not been received by the opposite parties. The complainants are entitled to get refund of Rs.2,40,40,328/-. The complainants have further requested that they have paid Rs.4,45,690/- as MVAT by cheque no.5201115 from IDBI bank dated 29.5.2012. Apart from this, the complainants have sought refund of Rs.22,59,900/- as registration charges for agreement to sale. So far as MVAT is concerned, it is a tax and may have been paid to the tax authorities. So far as registration charge for agreement to sale is concerned, the complainants had spent this amount for registering the agreement to sell the flat no.B-6004. As this flat is not being sold to the complainants, this stamp duty and other registration charges have gone waste, so far as the complainants are concerned. Though this amount has gone to the Government Exchequer and the amount has not been with the opposite parties for any use, however, the complainants have suffered the loss. As both the parties have signed this agreement and both the parties were confident of sale and purchase of the flat in question, in my view, the opposite parties should be responsible for refund of 50% of the registration charges to the complainants. The total charges of stamp duty and registration charges comes to Rs.22,58,500/-. Therefore opposite parties would be liable to pay 50% of this amount i.e. Rs.11,29,250/-. Accordingly, the following order is passed:
ORDER
25. Based on the above discussion, CC No.1304 of 2015 is allowed and the opposite parties No.1,4 and 5 are jointly and severally ordered to refund Rs.2,51,69,578/- (Rupees two crores fifty one lakhs sixty nine thousand five hundred seventy eight only) to the complainants along with 9% interest p.a. from the date of respective deposits/respective payments till actual realization. The complaint against opposite parties No.2 & 3, who are Ex-Directors of opposite party No.1 is dismissed. Opposite parties to comply with this order within a period of 45 days from the date of receipt/service of this order, failing which interest of 12% p.a.shall be payable instead of 9% per annum from the date of this order till actual payment and the complainants would also be entitled to file execution under Section 25/27 of the Consumer Protection Act, 1986.
...................... PREM NARAIN PRESIDING MEMBER