National Consumer Disputes Redressal
M/S. Jaiprakash Associates Ltd. vs Dn Khurana on 26 September, 2022
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 2059 OF 2019 (Against the Order dated 12/07/2019 in Complaint No. 66/2017 of the State Commission Uttar Pradesh) 1. M/S. JAIPRAKASH ASSOCIATES LTD. ...........Appellant(s) Versus 1. DN KHURANA 2. . . ...........Respondent(s)
BEFORE: HON'BLE MR. C. VISWANATH,PRESIDING MEMBER HON'BLE MR. JUSTICE RAM SURAT RAM MAURYA,MEMBER
For the Appellant : Mr. Krishnan Venugopal, Senior Advocate
: Mr. Sumeet Sharma, Advocate
: Mr. Tenzen Negi, Advocate
: Mr. Paras Chaudhary, Advocate
: Mr. Kaushik Advocate
: Ms. Pallavi, Advocate For the Respondent : For Respondents-1 to 3 : Mr. Sankalp Mehrotra, Advocate
For Respondent-4 : Mr. Mayank Singh, Advocate
For Intervener : Mr. Aditya Parolia, Advocate
Dated : 26 Sep 2022 ORDER
1. Heard Mr. Krishnan Venugopal, Senior Advocate, assisted by Mr. Sumeet Sharma, Advocate, for the appellant and Mr. Sankalp Mehrotra, Advocate, for respondents-1 to 3, Mr. Mayank Singh, Advocate, for respondent-4. Mr. Aditya Parolia, Advocate argued as an intervener, on legal issue.
2. Jaiprakash Associates Limited (opposite parties-1 & 2) has filed above appeal from the order of State Consumer Disputes Redressal Commission, Uttar Pradesh, dated 12.07.2019, passed in CC/66/2017, partly allowing the complaint with cost of Rs.10000/- and directing the appellant to return Rs.4578008/- with interest @18% per annum from the date of respective deposit till the date of actual payment, to the complainants.
3. The office has reported 4 days delay in filing the appeal. The appellant has filed IA/16782/2019, for condonation of delay. Cause shown is sufficient. The delay in filing the appeal is condoned.
4. D.N. Khurana, Mrs. Prem Khurana and Konark Khurana (respondents-1 to 3) filed CC/66/2017 for directing Jaiprakash Associate Limited and Jaypee Infratech Limited (opposite parties-1 to 2) (i) to refund Rs.4578008/- with interest @24% per annum, from the date of respective deposits till the date of refund,, (ii) to pay Rs.5/- lacs as compensation for medical treatment, Rs.21000/-, per month from 27.08.2013 till the date of refund and Rs.15/- lacs as compensation for mental agony and harassment, (iii) to pay Rs.25000/- as the cost of litigation; and (iv) any other relief, which is deemed fit and proper in the facts and circumstance of the case.
5. The complainants stated that Jaiprakash Associates Limited (the appellant) and Jaypee Infratech Limited (respondent-4) (hereinafter referred to as the builders) were companies, registered under Companies Act, 1956 and engaged in the business of developing and constructing group housing project. They launched a group housing project in the name of "Kasa Isles" at Jaypee Greens, Noida and made wide publicity in the year 2010. Mr. Kuldeep Verma and Ms. Simmi Verma applied for a flat and deposited the required money on 30.07.2010. The builders provisionally allotted Unit No.-KSI 11-1603 (super area 1570 sq.ft., total consideration of Rs.4702280/-, on 27.08.2010 to them. Under the allotment letter dated 27.08.2010, the builders assured to deliver possession within 36 months from the date of allotment with grace period of six months. Mr. Kuldeep Verma and Ms. Simmi Verma transferred the aforesaid unit to the complainants with prior approval of the builders. The complainants paid Rs.4569276/- and Rs.121154/- towards interest upto 25.05.2013. The builders provisionally allotted Unit No.-KSI 11-1603 (super area 1570 sq.ft.), to the complainants on 25.05.2013, in which payment of Rs.4569276/- has been acknowledged. The period of 36 months expired on 27.08.2013 and grace period of 180 days as given under Clause-7.2 of Standard Terms and Condition also expired on 27.02.2014. The complainant enquired about the date of delivery of possession. The builders, vide email informed that possession would be offered till December, 2016. The complainant-1 was aged about 77 years and booked the flat for peaceful living of his family in it. D.N. Khurana suffered with heart attack on 15.10.2015 and has undergone through surgery. He took a rented accommodation on the rent of Rs.21000/- per month, which was a huge burden upon him. The complainants gave a legal notice dated 21.11.2016 to the builders for delivery possession but the builders did not respond. Then the complaint was filed, claiming deficiency in service.
6. The appellant and Jaypee Infratech Limited (respondent-4) filed its joint written reply in the complaint, in which, material facts relating booking/ allotment of the flat and payments made by the complainants, including money advanced by their predecessors have not been disputed. They denied of committing deficiency in service and unfair trade practice. They stated that Taj Expresswat (now Yamuna Expressway) Project was conceived by Government of U.P., in the year 2002, for connecting Noida to Agra. The project also envisaged development of 25 million Sq.Mtr. land along with the expressway on Build-Operate-Transfer basis, for which bids were invited. Bid of M/s. Jaiprakash Industries Limited was lowest as such the project was awarded to it and Concession Agreement dated 07.02.2003 was executed between Yamuna Expressway Industrial Development Authority and M/s. Jaiprakash Industries Limited. By a scheme of amalgamation approved by Allahabad High Court, vide order dated 10.03.2004, M/s. Jaiprakash Industries Limited was amalgamated with Jaypee Cement Limited w.e.f. 01.04.2002 and the name of Jaypee Cement Limited was changed as Jaiprakash Associates Limited w.e.f. 11.03.2004. As per direction of Yamuna Expressway Industrial Development Authority in the letter dated 06.11.2006 and 15.02.2007, Jaypee Infratech Limited was incorporated on 05.04.2007 as a Special Purpose Vehicle for completion of the project. By Project Transfer Agreement dated 22.10.2007, the development of the project of expressway from Noida to Agra was assigned to Jaypee Infratech Limited, who was required to fund the cost of the Project by development and sale of five townships or sale of the land. Entire land for development at five locations, including the land of Kasa Isles Project was leased to Jaypee Infratech Limited on 27.11.2007. A Development Agreement dated 01.05.2009 was executed between Jaypee Infratech Limited and Jaiprakash Associates Limited, under which task of development construction, marketing, sale etc. were assigned to Jaiprakash Associates Limited. After obtaining necessary approval, development work of the "Kasa Isles" was started. However, for the reasons beyond their control i.e. due to force majeure events, such as, shortage of labour, scarcity of water, restrictions in excavations, villager's agitations, legal impediments etc., the construction was delayed. The funding of the development project had to be done partly from sale of apartment and partly from sale of land. In the year 2010, sale of parcels of land was halted and serious law and order problem was created due to farmer's agitation. The government of U.P. issued order dated 29.08.2014 for payment of additional incentive of 64% to the farmers, which resulted total scarcity of funds for development of the project. The villagers stopped the work of development till payment of the amount. State Government decided not to handover the Expressway connecting Noida and Greater Noida to the builders in 2012, resulting a substantial loss of revenue to Jaypee Infratech Limited. National Green Tribunal, vide order dated 11.01.2013, restrained all the builders of Noida and Greater Noida from extracting underground water. National Green Tribunal vide order dated 14.08.2013, restrained all construction work within a radius of 10 km from Okhla Bird Sanctuary and vide order dated 28.10.2013, restrained the authorities from granting completion certificate to any building. By an order dated 03.04.2014 directed the authorities to create an eco-sensitive zone for Okhla Bird Sanctuary. The builders filed MA No.240 of 2014 for modification of the order dated 03.04.2014, which was rejected on 30.05.2014. Against these orders Civil Appeal Nos.5822-5823 of 2014 were filed, which were dismissed by Supreme Court on 10.06.2014. State Government notified eco-sensitive zone on 19.08.2015. Under Clauses-7.1 and 7.2 of Standard Terms and Conditions, the builders were entitled for extension of period for which the construction was obstructed due to force majeure causes. The builders were known for their quality and commitment and they were trying to complete the project and handover possession at the earliest. The preliminary objection that the complainant was not a consumer as they had booked the flat for commercial purpose, which fact is proved from the fact that due to down fall of market in real estate, the complaint was filed for refund of money and not for possession and Standard Terms and Conditions contained an arbitration clause and the complainant be relegated for arbitration have also been raised.
7. The complainants filed Affidavit of Evidence of D.N. Khurana and documentary evidence. The builder did not file any evidence. State Commission, vide impugned judgment dated 12.07.2019, held that the complainants had deposited Rs.4569276/-. Out of which Rs.121154/- was adjusted towards interest and Rs.4448122/- has been shown as deposited in his account. Total consideration was Rs.4702280/-. Jayprakash Associates Limited was a joint promisor within the meaning of Section 43 of the Contract Act, 1872 as such it was liable to refund the amount to the complainants. On these findings, the complaint was allowed and the order as mentioned above has been passed. Hence Jaiprakash Associates Limited has filed this appeal.
8. In the appeal, it has been stated that IDBI Bank instituted a proceeding under Insolvency and Bankruptcy Code, 2016 against Jaypee Infratech Limited (respondent-4), before National Company Law Tribunal, Allahabad, in which, the Tribunal imposed moratorium vide order dated 09.08.2017 and appointed Interim Resolution Professional. D.N. Khurana (respondent-1) submitted his claim of Rs.7874174/- on 23.08.2017 before Interim Resolution Professional. Various home buyers in the projects of Jaypee Infratech Limited also submitted their claims. Home buyers are financial creditors within the meaning of Section 5 (7) read with Explanation to Section 5 (8) (f) to Insolvency and Bankruptcy Code, 2016. National Building Construction Corporation of (India) Ltd. has submitted a plan for completion of the project of Jaypee Infratech Limited, which was approved by Committee of Creditor on 17.12.2019. However, Supreme Court set aside this plan. Thereafter, National Company Law Tribunal invited fresh plan for completion of the project on 07.06.2021. Committee of Creditor approved the plan of Suraksha Realty Limited on 09.07.2021. Under this plan, Suraksha Realty Limited proposed the complete the project within 40 months and the home buyers would be given possession of their flats without any delayed compensation.
9. The counsel for the appellant submitted that National Company Law Tribunal, Allahabad has declared moratorium against Jaypee Infratech Limited, vide order dated 09.08.2017 under the Code, 2016 and the proceeding is still going on. Section-63 bars jurisdiction of Civil Court and by virtue of Section 238, the provisions of the Code, 2016 have overriding effect. Supreme Court in Hirakund Industrial Works Vs. Varsha Fabrics (P) Ltd. (2020) 14 SCC 198 and Ghanshyam Mishra and sons. Pvt. Ltd. Vs. Edelweiss ARC Ltd. (2021) 9 SCC 657, held that the provisions of the Code, 2016 had overriding effect over all other statute including Consumer Protection Act, 1986. The remedy of the home buyer is to submit his claim before Interim Resolution Professional. Deepti Kumar (respondent-1) has submitted her claim of Rs.4776280/- along with interest, on 21.08.2017 before Interim Resolution Professional. Home buyers are 'financial creditors' within the meaning of Section 5 (7) read with Explanation to Section 5 (8) (f) of the Code, 2016. Committee of Creditors approved the plan of Suraksha Realty Limited on 09.07.2021, under which, Suraksha Realty Limited proposed to complete the project within 19 months and the home buyers would be given possession of their flat without any delayed compensation. Resolution of approval of the plan is binding on all 'financial creditors'. In view of moratorium dated 09.08.2017, State Commission ought to have abated the proceeding of the complaint before it. Some of the home buyers filed writ petition before Supreme Court, i.e. in Chitra Sharma and others Vs. Union of India and others, (2018) 18 SCC 575, by final order, Supreme Court declined to disburse the amount deposited by the appellant to the home buyers of Jaypee Infratech Limited, holding that home buyers were 'financial creditors' and member of Committee of Creditors and directing them to submit their claim before Interim Resolution Professional. Supreme Court in Innoventive Industries Limited Vs. ICICI Bank and anr., (2018) 1 SCC 407, held that the Code, 2016 is a complete code. Under Section-28 of the Code, 2016, Committee of Creditors supervises the affairs of Interim Resolution Professional, in respect of corporate debtor. Under Section 30(4) of the Code, 2016, the resolution plan has to be approved by Committee of Creditors by a majority voting share of at least 66%. In the present case, there were more than 21000 home buyer's votes. Committee of Creditors has approved the plan of Suraksha Realty Limited on 09.07.2021, under which, home buyer would be given possession of their flat. This is binding upon them as held by Supreme Court in Jaypee Kensington Boulevard Apartment Welfare Association and others Vs. NBCC (India) Ltd. and ors., (2021) SCC OnLine SC 253. In Committee of Creditors of Essar Steel India Ltd. Vs. Satish Kumar Gupta, (2020) 8 SCC 531, held that Committee of Creditors alones determines its feasibility and viability based on its own commercial wisdom. Even National Company Law Tribunal has limited jurisdiction to interfere with the approved plan. It is not open for the home buyer to claim flat from Jaypee Infratech Limited and also take refund from Jayprakash Associates Limited. Supreme Court in SAIL Vs. Union of India, (2006) 12 SCC 233, held that a litigant is estopped from raising inconsistent and mutually destructive plea. Relying upon Development Agreement dated 01.05.2009, executed between Jaypee Infratech Limited and Jaiprakash Associates Limited, in which task of development, construction, marketing, sale etc. were assigned to Jaiprakash Associates Limited as well as various clauses of provisional allotment letter and Standard Terms and Condition, it has been submitted that Jaiprakash Associates Limited was an agent of Jaypee Infratech Limited. The home buyer paid entire money to Jaypee Infratech Limited. This Commission has taken view that the person, who had received money, was liable to return it. In view of Section 230 of Contract Act, 1872, recovery proceeding cannot be initiated/continued against an agent for the acts of a disclosed principal. He relied upon the judgments in Marine Container Services South Pvt. Ltd. Vs. Go Go Garments, (1998) 3 SCC 247, Prem Nath Motors Vs. Anurag Mittal, (2009) 16 SCC 274, Vivek Automobiles Vs. Indian Inc., (2009) 17 SCC 657, for the proposition that an agent cannot be held liable for the acts of a disclosed principal. Clause-9.1.5 of Standard Terms and Conditions provides for return of the money without any interest or compensation and earnest money. State Commission has illegally directed for payment of interest @18% per annum. Delay was caused for the reasons of force majeure and the period was liable to be extended under Cluase-7.1 of Standard Terms and Conditions. The judgments of this Commission in CC/1495/2015, Arvind Dhingra Vs. JAL (decided on 01.10.2018) has been set aside by Supreme Court. CC/2194/2016 Anish Singhal Vs. JAL (decided on 01.10.2019) was not related to the project of Jaypee Infratech Limited. Judgement in CC/11320-11329/2018 Gaurav Goel & anr. vs. JAL was challenged in Civil Appeal Diary No. 5804 of 2020, which was decided in terms of settlement vide order dated 25.10.2021. Judgment in CC/976/2017 Rajeev Kumar Singh Vs. JAL, (decided on 15.06.2020) has been stayed by Supreme Court in Civil Appeal No.4724-4725 of 2021, vide order dated 16.08.2021. None of these judgments can be considered as binding precedent. Judgment of Anjali Rathi Vs. Today Homes, (2021) SCC OnLine SC 729, is distinguishable as the promoter had given undertaking before Supreme Court to bear the liability, in that case.
10. The complainants do not dispute that National Company Law Tribunal, Allahabad has declared moratorium against Jaypee Infratech Limited, vide order dated 09.08.2017 under the Code, 2016 and the proceeding was going on. However, the complainants argued that Jaiprakash Associates Limited was one of a joint promisor as such he is severally liable to refund the amount under Section 43 of the Contract Act, 1872. Jaiprakash Associates Limited was the 'promoter" as defined under the Real Estate (Regulation and Development) Act, 2016 and the complainant is entitled to claim refund of money from him under Section 19 (4) of this Act. The complaint is not liable to be abated due to pendency of insolvency proceeding against Jaypee Infratech Limited as the appellant is independently liable to return the money.
11. We have considered the arguments of the counsel for the parties and examined the record. First issue arises for consideration as to whether the proceeding before State Commission was liable to be abated against the appellant due to order of National Company Law Tribunal, Allahabad, dated 09.08.2017, declaring moratorium, in the proceeding under the Code, 2016, instituted against Jaypee Infratech Limited, which is still pending. The appellant relied upon Sections 63, 231 and 238 of the Code, 2016, which are quoted below:-
Section-63. Civil Court Not To Have Jurisdiction.- No civil court or authority shall have jurisdiction to entertain any suit or proceeding in respect of any matter on which, National Company Law Tribunal or the National Company Law Appellate Tribunal has jurisdiction under this Code.
Section-231. Bar of Jurisdiction.- No civil court shall have jurisdiction in respect of any matter, in which, the adjudicating authority over the board is empowered by or under this code to pass any order and no injunction shall be granted by any court or authority in respect of any action taken or to be taken in pursuance of any order passed by such adjudicating of the board under this Code.
Section-238. Overriding Effect.- The provisions of this Code shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law.
12. These provisions bars the jurisdiction of court/authority in respect of any matter, on which, National Company Law Tribunal or the National Company Law Appellate Tribunal has jurisdiction under the Code, 2016. National Company Law Tribunal, while adjudicating 'corporate insolvency resolution process' under the Code, 2016 can declare moratorium against corporate debtor under Section-14, which is quoted below:-
Section-14. Moratorium.- Subject to provisions of sub-sections (2) and (3) on insolvency commencement date, the adjudicating authority shall by order declare moratorium for prohibiting all of the following, namely:-
(a) The institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgement, decree or order in any court of law, tribunal, arbitration panel or authority;
(b) transferring, encumbering, alienating or disposing off by corporate debtor any of the assets or any legal right or beneficial interest therein.
13. Under Section-14 (a), institution of suit etc. against corporate debtor can be prohibited while under Section-14 (b) prohibition can be imposed upon the corporate debtor from transferring etc. its assets. Supreme Court in Chitra Sharma and others Vs. Union of India and others, (2018) 18 SCC 575 and Jaypee Kensington Boulevard Apartment Welfare Association and others Vs. NBCC (India) Ltd. and ors., (2021) SCC OnLine SC 253., did not hold that the proceeding against the appellant for refund of money is liable to be abated/stayed due to pendency of proceeding under the Code, 2016, against Jaypee Infratech Limited. In none of the cases, relied upon by the appellant, it has been held that the proceeding against a promoter or co-promisor for refund is liable to be abated/stayed due to pendency of proceeding under the Code, 2016, against Jaypee Infratech Limited. Aforesaid provisions of the Code, 2016 bar suit etc. against corporate debtor only not against the appellant, who was not a corporate debtor.
14. No doubt, the plan of Suraksha Realty Limited dated on 07.06.2021, under which, home buyers would be given possession of their flat, has been approved by Committee of Creditors on 09.07.2021 but it is merely a proposal. Once the home buyer is refunded of his entire dues, then it is very well open to Jaypee Infratech Limited/Interim Resolution Professional to deny possession of the flat to him. Section-28 and 30 or any other provision of the Code, 2016 does not create any bar in this respect. The complainant submitted claim before Interim Resolution Professional under compulsion and he did not choose that remedy. The complaint against the appellant for refund is not liable to be abated/stayed due to order of National Company Law Tribunal, Allahabad, dated 09.08.2017, nor the remedy of the complainant against the appellant is not barred due to approval of plan.
15. Section 43 of the Contract Act, 1872 and the relevant provisions of the Real Estate (Regulation and Development) Act, 2016 are quoted blow:-.
"Section 43. Any one of joint promisors may be compelled to perform- When two or more persons make a joint promise, the promise may, in the absence of express agreement to the contrary, compel any [one or more] of such joint promisors to perform the whole of the promise.
Each promisor may compel contribution.- Each of two or more joint promisors may compel every other joint promisor to contribute equally with himself to the performance of the promise, unless a contrary intention appears from the contract.
Sharing of loss by default in contributions.- if any one of two or more joint promisors makes default in such contribution, the remaining joint promisors must bear the loss arising from such default in equal shares.
Explanation- Nothing in this section shall prevent a surety from recovering, from his principal, payments made by the surety on behalf of the principal, or entitle the principal to recover anything from the surety on account of payment made by the principal.
The Real Estate (Regulation and Development) Act, 2016
Section: 2 (zk) "promoter" means,--
(i) a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or
(ii) a person who develops land into a project, whether or not the person also constructs structures on any of the plots, for the purpose of selling to other persons all or some of the plots in the said project, whether with or without structures thereon; or
(iii) any development authority or any other public body in respect of allottees of-- (a) buildings or apartments, as the case may be, constructed by such authority or body on lands owned by them or placed at their disposal by the Government; or
(b) plots owned by such authority or body or placed at their disposal by the Government,
for the purpose of selling all or some of the apartments or plots; or (iv) an apex State level co-operative housing finance society and a primary co-operative housing society which constructs apartments or buildings for its Members or in respect of the allottees of such apartments or buildings; or
(v) any other person who acts himself as a builder, coloniser, contractor, developer, estate developer or by any other name or claims to be acting as the holder of a power of attorney from the owner of the land on which the building or apartment is constructed or plot is developed for sale; or
(vi) such other person who constructs any building or apartment for sale to the general public.
Explanation.--For the purposes of this clause, where the person who constructs or converts a building into apartments or develops a plot for sale and the person who sells apartments or plots are different person, both of them shall be deemed to be the promoters and shall be jointly liable as such for the functions and responsibilities specified under this Act or the rules and regulations made thereunder;"
Section 19. Rights and duties of allottees; (1) ............
(2) ....................
(3) .....................
(4) The allottee shall be entitled to claim the refund of amount paid along with interest at such rate as may be prescribed and compensation in the manner as provided under this Act, from the promoter, if the promoter fails to comply or is unable to give possession of the apartment, plot or building, as the case may be, in accordance with the terms of agreement for sale or due to discontinuance of his business as a developer on account of suspension or revocation of his registration under the provisions of this Act or the rules or regulations made thereunder.
16. Under Development Agreement dated 01.05.2009, task of development, construction, marketing, sale etc. of the various projects of Jaypee Infratech Limited were assigned to Jaiprakash Associates Limited, who was also sharing the profit on cost plus basis. Under Provisional allotment letter and Standard Terms and Conditions, Jaiprakash Associates Limited has power to cancel allotment of the home buyer. In paragraph-8 (ii) of the written reply filed in CC/347/2016, the appellant has stated that Jaypee Infratech Limited was its subsidiary company. In paragraph-2 of memorandum of appeal in FA/380/2019, the appellant claimed to be holding company of Jaypee Infratech Limited. However, the appellant argued that it was an agent of Jaypee Infratech Limited under Development Agreement.
17. The Real Estate (Regulation and Development) Act, 2016, has been enacted to provide better protection to the home buyers in efficient and transparent manner. The appellant falls within the definition of the promoter under this Act. The home buyer is entitled to claim refund of money with interest from the appellant under Section-19 (4) of the Real Estate (Regulation and Development) Act, 2016. The provisions of the Code, 2016 do not bar initiation of proceeding and its continuation for refund against the promoter. Real Estate (Regulation and Development) Act, 2016 is a special law. Even if, for the sake of arguments, it is taken that the appellant was an agent of Jaypee Infrateck Limited under the Development Agreement, then also the appellant is falling within the definition of "promoter" as given under Real Estate (Regulation and Development) Act, 2016. Special Law will prevail over general law as held by Supreme Court in Vodaphone Idea Cellular Ltd. Vs. Ajay Kumar Agrawal, (2022) 6 SCC 496. The position of the appellant as promoter and liability to refund Section-19 (4) of Real Estate (Regulation and Development) Act, 2016 will override over its position as an agent of Jaiprakash Infratech Limited. The appellant being a co-promisor is jointly and severally liable to refund the money to the home buyer under Section 43 of the Contract Act, 1872. In Pioneer Urban Land and Infrastructure Ltd. and Ors. Vs. Union of India, (2019) 8 SCC 416, held that RERA and IBC are parallel remedy.
18. Supreme Court in Bank of India Vs. Ketan Parekh, (2008) 8 SCC 148 and S. Vanitha Vs. Deputy Commissioner, Bengaluru, 2020 SCC OnLine SC 1023, held that the cases might arise, where both the enactments have the non-obstante clause, then in that case, proper perspective would be that one has to see the subject and the dominant purpose for which the special enactment was made and in case the dominant purpose is covered by that contingency then notwithstanding that the Act might have come at a later point of time, still the intension can be ascertain by looking to the objects and reasons.
19. Relying upon the judgments of this Commission in CC/1702/2016 Shalabh Nigam Vs. Orris Infrastructure Pvt. Ltd. and Ors. (decided on 06.05.2019) and CC/3879-3880/2017 Deepak Agrawal and Ors. Vs. Three C Shelters (decided on 21.01.2020) the counsel for the appellant submitted that the person who had received the money would be liable to refund. We respectfully disagree with it, inasmuch as it has not taken notice of Section 43 of the Contract Act, 1872, where co-promisor is jointly and severally liable, Section-19 of Real Estate (Regulation and Development) Act, 2016, where the promoter is individually liable and well settled principle of law of tort relating to vicarious liability. (See Canara Bank Vs. Canara Sales Corporation, (1987) 2 SCC 666 and Pradeep Kumar Vs. Post Master General, (2022) 6 SCC 351.) As such these cases are per in curium.
20. Suraksha Realty Limited in its Plan dated 09.07.2021 proposed the complete the project within 19 months and the home buyers would be given possession of their flats without any delayed compensation. Due date of possession was 27.02.2014 as per allotment letter dated 16.05.2012. Supreme Court in Banglore Development Authority Vs. Syndicate Bank, (2007) 6 SCC 442, Fortune Infrastructure Vs. Trevor D'Lima, (2018) 5 SCC 442, Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra, 2019 SCC OnLine SC 438 and Pioneer Urban Land & Infrastructure Ltd. Vs. Govind Raghavan, (2019) 5 SCC 725, held that a home buyer cannot be made to wait for possession of the flat for indefinite period.
21. In view of law laid down by Supreme Court, the home buyer is entitled to claim refund of his money along with interest in case of unreasonable delay in handing over possession. However, State Commission has awarded interest @18% per annum, which is on higher side. Compensation of Rs.20000/- for mental agony was also not payable. Supreme Court in Banglore Development Authority Vs. Syndicate Bank, (2007) 6 SCC 442, held that in the matter of contractual obligation, there is no scope for compensation for mental agony and harassment. In DLF Homes Panchkula Pvt. Ltd. Vs. D.S. Dhanda, II (2019) CPJ 117 (SC) held when interest is awarded as compensation in the cases of refund of money, then awarding additional compensation was not justified. Now Supreme Court in the cases of Ireao Grace Realteck (P) Ltd. Vs. Abhishek Khanna, (2021) 3 SCC 241 and Civil appeal No.2324 of 2021 M/s. Barnala Builders and Property Consultants Vs. Lt.Col. Sameer Balodi (decided on 06.06.2021), fixed the interest @9% per annum in the cases of refund.
ORDER
In view of the aforesaid discussions, the appeal is partly allowed. The order of State Commission dated 12.07.2019 is modified. The appellant is directed to refund entire amount deposited by respondents-1 to 3 with interest @9% per annum from the date of respective deposit till the date of actual payment, within a period of two months from the date of this judgment. Respondents-1 to 3 will also be entitled for a consolidated cost of Rs.20000/-.
...................... C. VISWANATH PRESIDING MEMBER ......................J RAM SURAT RAM MAURYA MEMBER