State Consumer Disputes Redressal Commission
Mandeep Singh vs Improvement Trust Patiala on 30 January, 2020
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.829 of 2019
Date of institution : 14.11.2019
Reserved On : 28.01.2020
Date of decision : 30.01.2020
Mandeep Singh son of Smt. Gurjeet Kaur, R/o H.No.82/1-F, Street
No.3, Pratap Nagar, Patiala, Punjab.
....Complainant
Versus
Improvement Trust, Patiala, through its Chairman, its Regd. Office at
Baradari, Patiala, Punjab.
E-mail ID:[email protected]
....Opposite Party
Consumer Complaint under Section 17 of
the Consumer Protection Act, 1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mr. Rajinder Kumar Goyal, Member
Mrs. Kiran Sibal, Member.
1) Whether Reporters of the Newspapers may be allowed to see the Judgment? Yes/No
2) To be referred to the Reporters or not? Yes/No
3) Whether judgment should be reported in the Digest? Yes/No Present:-
For the complainant : Sh. Dikshit Arora, Advocate For the opposite party : Ex parte.
JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT The complainant has filed this complaint, under Section 17 of the Consumer Protection Act, 1986 (in short, "the Act"), against the opposite party, seeking following directions to it:
i) to make payment of ₹15,43,500/- deposited with it, along with interest at the rate of 12% per annum till decision of the complaint;Consumer Complaint No.829 of 2019 2
ii) to pay ₹2,00,000/- on account of mental agony and harassment suffered by the complainant;
iii) to pay ₹1,00,000/- as litigation expenses;
iv) to pay ₹5,00,000/-, as escalation charges due to rise in cost of construction and land for a period of two and half years or from 22.06.2019 (i.e. date of draw) till date of refund of the amount by the opposite party; and
v) to pay ₹5,000/- as cost of tests conducted by the complainant;
Facts of the Complaint
2. Brief facts, as set out in the complaint, are that the opposite party issued advertisement in newspapers, regarding allotment of semi-furnished LIG & MIG flats in its upcoming schemes known as "Shaheed Sewa Singh Thikriwala Nagar, Patiala" & "Maharaja Yadvindra Enclave, Patiala" by way of draw of lots. As per the procedure, application form worth ₹100/- was to be purchased from the Bank and after completing the same, it was to be deposited up to 19.12.2016, along with earnest money of ₹50,000/-. The complainant applied for allotment of MIG flat under self-financed scheme, after completing all the formalities. The draw of lots was conducted on 23.12.2016, in which the complainant was allotted semi- furnished flat No.3, SF Block-2 in "Maharaja Yadvindra Enclave". Intimation about it was given to him, vide letter dated 22.02.2017, Ex.C-2. As per agreement, Ex.C-3, the complainant paid a sum of ₹15,43,500/-, vide receipts Ex.C-4 (colly.), as per details given in Para- 5 of the complaint. As per letter dated 19.12.2016, Ex.C-5, written to the Construction company, the work had to be completed within 24 Consumer Complaint No.829 of 2019 3 months from the date of agreement. Third instalment was payable on 22.06.2019. However, prior to that date, the complainant visited the site of the scheme regularly to know the status of the construction work and he found that the construction work had been stopped/halted for the last one and half years and only about 20% work was completed. However, the construction of structural elements, such as columns, beams and slab have not been completed. The complainant brought this fact to the notice of the opposite party and a news item was also published in the newspaper about it. The complainant is a qualified Civil Engineer and has vast knowledge in construction field. On visiting the site, he found that the quality of work done by the contractor was not up to the mark and as per the Indian Standard Specifications. The steel used in construction work was of lower quality, corroded and underweight; which is clear from the photographs annexed with the complaint. This fact was also reported to Chief Vigilance Officer, Local Government of Punjab, but no action has been taken/disclosed to the complainant. As per Indian Standard Specifications, a structure shall be designed and executed in such a way that it will, during its intended life with appropriate degrees of reliability, sustain all actions and influences likely to occur during execution and use and will remain fit for the use for which it is required. Technical guide regarding Steel Reinforcement Bars, Corrosion of Reinforcement Bars & Imperfection or Flaws in workmanship is annexed with the complaint as Ex.C-9. The complainant also wrote letter dated 12.06.2019 to the opposite party, bringing all the above noted things to its notice and requested to reply Consumer Complaint No.829 of 2019 4 within 7 days therefrom, as due date of payment of next instalment was 22.06.2019, but no reply was received. The complainant issued another letter dated 21.06.2019, Ex.C-11, as notice of cancellation of contract/agreement, on the aforesaid valid reasons and demanded refund of the amount deposited by him (till dated 21.06.2019), along with interest. However, when the complaint has been filed on 14.11.2019, so the interest at the rate of 12% may be calculated till 12.11.2019, as per details given in Para-12 of the complaint. Reminder dated 24.07.2019 was also sent, stating aforesaid reasons for cancellation. The complainant moved application under RTI Act, seeking information about the project, but the same was also not replied. The complainant got conducted testing of Steel Reinforcement Bars used in construction work of the project from a NABL Accredited Lab. A total number of 5 samples (bars of different diameters) were collected from site and bars of 0.5 meter cutting length were referred to the lab. for testing. As per detailed estimate of the project: C.T.D. Bars of Fe-500 grade as per IS:1786-1985 shall be used for R.C.C. works. As per test reports, out of 5 samples, 3 samples have failed or found not satisfying the yield strength requirements of Fe-500 grade steel as per Table-3 of IS:1786-2008. Copy of test report and bill are annexed with the complaint as Ex.C-14. Therefore, even if the construction is completed, even then it will not be fit to live in the said project, as there are various defects in basic construction. The aforesaid act and conduct of the opposite parties amount to deficiency in service. Earlier, the complainant filed complaint No.716 of 2019 before this Commission, but the same was dismissed as withdrawn, Consumer Complaint No.829 of 2019 5 vide order dated 16.10.2019, due to some technical defects therein, with liberty to file a fresh complaint on the same cause of action. Hence, the present complaint.
3. Upon notice, the opposite party did not appear despite its service and was proceeded against ex parte, vide order dated 10.01.2020.
Evidence of the Complainant
4. To prove his claim, the complainant filed his own affidavit, along with copies of documents i.e. Brochure Ex.C-1, letter dated 22.12.2017 Ex.C-2, agreement dated 22.01.2018 Ex.C-3, receipts Ex.C-4 (colly.), letter dated 19.12.2016 Ex.C-5, photographs Ex.C-6, newspaper report Ex.C-7, complainant's profile Ex.C-8, Steel Reinforcement Bars and its Important Characteristics Ex.C-9, letter dated 12.06.2019 Ex.C-10, cancellation notice dated 21.06.2019 Ex.C- 11, reminder dated 24.07.2019 Ex.C-12, RTI application dated 31.07.2109 Ex.C-13, test reports and bill Ex.C-14 (colly.), construction details Ex.C-15, instructions Ex.C-16, calculation sheet Ex.C-17 and certified copy of order dated 16.10.2019 Ex.C-18. Contentions of the Complainant
5. We have heard learned counsel for the complainant and have gone through the record carefully.
6. Learned counsel for the complainant argued on the lines of the complaint. It was further contended that the opposite parties failed to complete the construction of the project within the stipulated period, despite receipt of substantial amount towards the price of the unit allotted to the complainant and others. After making payment of Consumer Complaint No.829 of 2019 6 ₹15,43,500/-, the complainant kept on visiting the site regularly to know the status of construction and he found that the quality of construction was very low. The material used in the construction, specifically the steel was of low/less quality; as a result of which the building cannot sustain its normal life. The complainant also got tested the steel from the competent lab. and as per reports Ex.C-14, the steel used in the construction by the opposite party was not up to the mark. The complainant sent cancellation notice dated 21.06.2019, Ex.C-11, to the opposite party, requesting it to refund the entire amount deposited by him, along with interest and damages, but without any result. The deficiency in service and unfair trade practice on the part of the opposite party has been clearly proved and therefore the complainant is entitled to all the reliefs, as sought for in the complaint. Consideration of Contentions
7. We have given our thoughtful consideration to the contentions raised by the learned counsel for the complainant.
8. Undisputedly, the complainant was allotted semi-furnished MIG flat No.3 SF Block-2 in the scheme launched by the opposite party, namely "Maharaja Yadvindra Enclave Patiala", vide allotment letter dated 22.12.2017, Ex.C-2. The tentative cost of that flat was ₹33.50 lac. Agreement to Sell, Ex.C-3, was also executed between the parties. As per Clause 11(2) of the Brochure, Ex.C-1, the possession of the flat was to be delivered within two and half years after start of construction and no interest was chargeable during that period. However, the opposite party failed to complete the construction and deliver possession of the flat to the complainant within the stipulated Consumer Complaint No.829 of 2019 7 period, despite receipt of substantial amount. The complainant has produced map, along with photographs of the site of the project, Ex.C- 6 (colly.), which clearly proves that only semi constructed structure exists at the site and the development/construction work has been abandoned. A news item, Ex.C-7, was also published in newspaper regarding abandoned status of the project.
9. The whole purpose of pleadings is to give fair notice to each party of what the opponent's case is and to ascertain with precision the point(s) on which the parties agree and those on which they differ. The purpose is to eradicate irrelevancy. The complaint is a concise statement of facts and if no reply is filed to the complaint, the averments made therein are deemed to have been admitted. For the sake of repetition, it is relevant to mention that the opposite party failed to appear before this Commission, despite its service and, as such, it was proceeded against ex parte. Thus, all the averments made in the complaint are deemed to have been admitted by the opposite party and the evidence led by the complainant stands un-rebutted; for which an adverse inference is to be drawn against it.
10. It is also the specific case of the complainant that he is a Civil Engineer and he has also produced on record his profile Ex.C-8 to prove his qualifications. The complainant wrote letter dated 12.06.2019, Ex.C-10, to the opposite party, intimating it about the incomplete status of the project and defects in construction. He also requested it to restart the construction at the earliest and to communicate him within 7 days, as the next instalment was due on 22.06.2019. However, no reply was given to that letter by the opposite Consumer Complaint No.829 of 2019 8 party. Ultimately, he sent cancellation notice dated 21.06.2019, Ex.C- 11, seeking refund of the deposited amount, along with interest and compensation etc., but without any result. Reminder dated 24.07.2019, Ex.C-12, and RTI application Ex.C-13, sent in this regard also remained un-replied. The complainant got tested the steel used in the project of the opposite party from IMARAT Engineering Lab.; who issued reports Ex.C-14 (colly.) proving that the steel used in the project was not qualifying the permissible requirements. The complainant paid a sum of ₹4,130/- to the said Lab. as testing fee, vide Tax Invoice dated 03.08.2019, Ex.C-14 (colly.). This amount was spent by the complainant for proving the defects in the construction while using steel, which is not up to the mark and, as such, the same is liable to be paid by the opposite party to him. As the opposite party is ex parte, so there is no evidence on record, from which it can be proved that the necessary permissions/approvals were obtained by it from the competent authorities for setting up the said project. By not completing the project within time, so as to deliver possession of the flat to the complainant within the stipulated period, the deficiency in service on the part of the opposite party has been clearly proved on record.
11. The Act came into being in the year 1986. It is one of the benevolent pieces of legislation to protect the consumers from exploitation. The spirit of the benevolent legislation cannot be overlooked and its object is not to be frustrated. The complainant has made payment of substantial amount to the opposite party, with the hope to get the possession of the flat within a reasonable time. The Consumer Complaint No.829 of 2019 9 circumstances clearly show that the opposite party made false statement of facts about the goods and services i.e. allotment of land and development thereof within a stipulated period and ultimate delivery of possession. The act and conduct of the opposite party is a clear case of misrepresentation and deception, which resulted in injury and loss of opportunity to the complainant. There is escalation in the price of construction also. The builder is under obligation to deliver the possession of the flat within a reasonable period. From the facts and evidence brought on the record of the complaint, it is clearly made out that the opposite party knew from the very beginning that it had not complied with various provisions of the PAPRA and the Rules framed thereunder and would not be able to deliver the possession within the stipulated period and, thus, by misrepresentation induced the complainant to book the flat, due to which the complainant has suffered mental agony and harassment. It is the settled principle of law that compensation should be commensurate with the loss suffered and it should be just, fair and reasonable and not arbitrary. The builder is bound to compensate for the loss and injury suffered by the complainant for failure to deliver the possession, so has been held in catena of judgments by the Hon'ble Supreme Court and the Hon'ble National Commission. To get the relief, the complainant has to wage a long drawn and tedious legal battle. As such, the complainant was at loss of opportunities. In such circumstances, the complainant is entitled to the refund of the amount deposited by him, along with interest at the rate of 9% per annum from the date of respective deposit till realization and compensation.
Consumer Complaint No.829 of 2019 10
12. The complainant alleged that he deposited a total sum of ₹15,43,500/- with the opposite parties. To prove this fact, he has produced on record receipts Ex.C-4 (colly.). As per receipt dated 19.12.2016, a sum of ₹50,000/- was paid by the complainant as earnest money by way of demand draft No.306075 dated 19.12.2016. However, it needs to be noticed that this receipt is not signed by anybody on behalf of the opposite party. Be that as it may, it is pertinent to note that receipt dated 22.01.2018 for ₹9,91,000/- at page- 43 included various amounts under different heads and it is specifically mentioned that a sum of ₹50,000/- was deposited towards earnest money. After deducting the said amount of ₹50,000/- as earnest money, the receipt of total amount of ₹9,91,000/- was issued. Since the deposit of earnest money of ₹50,000/- has been duly admitted in receipt at page-43, so it stands proved that this amount was also received by the opposite party from the complainant. Otherwise also, it is a matter of common knowledge that name of an applicant is included in the draw of lots, only after deposit of earnest money. Therefore, as per receipts Ex.C-4 (colly.), it is clearly proved that a sum of ₹15,43,500/- stood deposited with the opposite party. So far the prayer of the complainant for awarding escalation charges is concerned, since the entire amount deposited by him is going to be refunded along with interest, so that will also take care of this prayer of the complainant.
13. In view of our above discussion, the complaint is allowed and following directions are issued to the opposite party: Consumer Complaint No.829 of 2019 11
i) refund the entire amount deposited by the complainant i.e. ₹15,43,500/-, along with compensation for causing financial loss and depriving the complainant of the use of the said amount during the period it remained with the opposite party at the rate of 9% per annum from the respective dates of deposit till realization;
ii) to refund the amount of ₹4,130/- paid by the complainant for testing the steel used in construction of the project, as per Tax Invoice Ex.C-14 (colly.);
iii) pay ₹22,000/-, as compensation for the harassment and mental agony suffered by the complainant, including cost of litigation.
14. The compliance of this order shall be made by the opposite party within a period of 30 days of the receipt of certified copy of the order.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (RAJINDER KUMAR GOYAL) MEMBER (MRS. KIRAN SIBAL) MEMBER January 30, 2020.
(Gurmeet S)