State Consumer Disputes Redressal Commission
Komal Gandhi vs M/S Omaxe Chandigarh Extension ... on 25 January, 2017
Daily Order STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T., CHANDIGARH Complaint case No. : 511 of 2016 Date of Institution : 29.08.2016 Date of Decision : 25.01.2017 Komal Gandhi wife of Sh.Aman Gandhi, resident of # 866, Sector 4, Panchkula, Haryana, currently residing in 8601-West-142nd Terrace, Overland Park, KS, 66223, United States of America, through her power of attorney holder, Sh.Bhagwaan Dass Gandhi son of Late Sh.Raja Ram Gandhi, resident of # 866, Sector 4, Panchkula, Haryana. ......Complainant V e r s u s M/s Omaxe Chandigarh Extension Developers Private Limited, SCO No.143-144, Sector 8-C, Madhya Marg, Chandigarh, through its Managing Director/Authorized Signatory. .... Opposite Party Complaint under Section 17 of the Consumer Protection Act, 1986. BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT. MR. DEV RAJ, MEMBER.
MRS. PADMA PANDEY, MEMBER Argued by: Sh.Savinder Singh Gill, Advocate for the complainant.
Sh.Ashim Aggarwal, Advocate for the opposite party.
PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT The complainant is an NRI. It is stated by her that she intended to purchase a residential plot measuring 301.88 square yards, for her family and her personal use, in a project, launched by the opposite party namely 'Omaxe Chandigarh Extension' at Mullanpur, Punjab. It is specifically stated by her that her father-in-law is residing in a rented accommodation at Panchkula. To settle him and also to keep her roots attached to the mother land, as she frequently visits India, the above said plot was purchased by her. She deposited an amount of Rs.14 lacs, through cheque, with the opposite party on 19.10.2011, towards booking amount, vide receipt Annexure C-1. The plot was booked under the down payment plan, price whereof was fixed at Rs.77,79,603.05Ps., which includes club charges, interest free maintenance security, preferential location charges, external development charges etc. On 28.02.2012, the complainant made another payment of Rs.15,40,000/- vide receipt Annexure C-3, towards abovesaid sale consideration. Subsequently, provisional allotment letter was issued in favour of the complainant on 17.03.2012. It is specifically alleged that in the said provisional allotment letter, time to hand over possession of a developed plot was not disclosed. By doing so, an unfair trade practice was adopted by the opposite party. The provisional allotment letter was issued with a delay of five months. On 16.04.2012, further amount of Rs.6,40,420/-, Rs.10 lacs and Rs.28 lacs, was paid by the complainant, vide receipts Annexure C-5 colly., to the opposite party. Allotment Letter/Agreement was issued on 31.10.2012, for plot no.OCE/II/122. As per Clause 24 (a) of the said Allotment Letter/Agreement, the opposite party undertook to complete the development work within 18 months or within extended period of six months, from the date of signing of the said Allotment Letter/Agreement. It was stated that in a very draconian manner, for delay, no provision was made to compensate the complainant. It was further stated that, by the time, this complaint was filed, the complainant had already paid an amount of Rs.73,80,420/-, to the opposite party. Possession was to be delivered on or before 30.10.2014. It was averred that all the payments were made at Chandigarh, as such, this Commission has territorial jurisdiction to entertain and decide this complaint. It was further stated that there is a violation of provisions of Section 6 of the Punjab Apartment and Property Regulation Act, 1995 (in short the PAPRA), as the opposite party failed to execute the Agreement, the moment they had received 25% of the total sale consideration. When despite requests made, possession of the plot was not delivered, the instant complaint was filed seeking refund of amount paid alongwith interest thereupon; compensation for mental agony & physical harassment etc. and litigation expenses.
Notice in this complaint was issued on 31.08.2016, upon which, reply was filed by the opposite party on 18.10.2016, raising many preliminary objections like as per Clause 44 (c) of the Allotment Letter/Agreement, this Commission has no jurisdiction, to entertain and decide disputes between the parties, because as per above said provision, the matter needs to be referred to an arbitrator for adjudication. It was averred in the joint written reply that the complainant did not fall within the definition of "consumer" as defined under Section 2(1)(d) of the Act, as she being an NRI had purchased the plot, in question, for commercial purpose i.e. for selling the same, as and when there was escalation in the prices of real estate, to gain huge profits. By placing reliance on the ratio of judgment of Larger Bench, passed by the National Consumer Disputes Redressal Commission, New Delhi (National Commission), titled as Ambrish Kumar Shukla and 21 ors. Vs. Ferrous Infrastructure Pvt. Ltd., Consumer Case No.97 of 2016, decided on 07.10.2016, pecuniary jurisdiction of this Commission was challenged stating that if interest claimed is added in other relief claimed, it fell beyond Rs.1 crore. Territorial jurisdiction of this Commission was also challenged, by stating that no cause of action, whatsoever, has accrued within the territorial jurisdiction of this Commission. As per Clause 44 (c) of the Allotment Letter/Agreement, the Courts at Punjab and Delhi, shall have territorial Jurisdiction, to entertain and adjudicate the complaint, and, as such, the Jurisdiction of this Commission was barred. Power of Attorney filed was also challenged by stating that this complaint filed is not proper. It was pleaded that the complaint filed is time barred.
Factual matrix of the case was not controverted. Price of the plot mentioned in the complaint and payments made by the complainant is not disputed. It is admitted that the complainant booked the plot in question and she was provisionally allotted the same. It was also not denied that there was delay in issuance of final Allotment Letter/Agreement, after receipt of huge amount. It was stated that as per Clause 24 (a) of the Allotment Letter/Agreement, it was agreed that the opposite party shall only make best efforts to complete development works within a maximum period of 24 months from the date of signing thereof (allotment letter). It was further stated that the said period was to be computed excluding Saturdays, Sundays and Bank Holidays, and only thereafter, possession of the plot was to be delivered, as such, no definite period was assigned for the same. It was further stated that even otherwise, since the disputed plot falls under the category of immoveable property, as such, in that event also, time was not the essence of contract. It was averred that the project of the opposite party is exempted from the provisions of PAPRA. It was stated that the opposite party is making earnest efforts to expedite development in the area, where plot of the complainant is located. Prayer was made to dismiss the complaint. At the time of arguments, Counsel for the opposite party stated that possession of developed plot is likely to be given in near future. However, no specific date was given.
On 18.10.2016, an application under Section 8 of the Arbitration and Conciliation Act, 1996, was also filed by the opposite party, stating that this Commission has no jurisdiction to entertain the consumer complaint and let the matter be referred to an arbitration for adjudication. The said application was disposed of vide order dated 20.10.2016, with the direction that question qua arbitration will be considered, at the time of final arguments in the main case.
In the rejoinder filed, the complainant reiterated all the averments, contained in the complaint and controverted those, contained in written version of the opposite party.
The parties led evidence in support of their case.
Counsel for the parties raised arguments, in tune of the facts narrated above.
We have heard Counsel for the parties and have gone through the evidence and record of the case, very carefully.
Before making any reference to the merits of the case, we will like to decide the objection raised by the opposite party that for want of pecuniary jurisdiction, it is not open to this Commission to entertain and adjudicate this complaint. As per admitted facts, the complainant has sought refund of amount paid i.e. Rs.73,80,420/- alongwith interest @18% p.a. from the respective date of deposits; compensation to the tune of Rs.5 lacs, for mental agony and physical harassment; and cost of litigation to the tune of Rs.1 lac. It is argued by Counsel for the opposite party that if the entire claimed amount is added, alongwith interest claimed, it will cross Rs.1 crore and in that event, it will not be open to this Commission to entertain and adjudicate this complaint, for want of pecuniary jurisdiction. To say so, reliance has been placed upon ratio of judgment of a Larger Bench of the National Commission, in the case of Ambrish Kumar Shukla (supra). This issue, whether interest is to be counted when looking into pecuniary jurisdiction of this Commission, came up for consideration in the case of Surjit Singh Vs. M/s Emaar MGF Land Pvt. Ltd. and another, Consumer Case no. 484 of 2016 decided on 15.12.2016, wherein, after noting similar objections it was observed as under:-
"In the first blush, if we look into the ratio of the judgment, referred to above, it appears that this Commission will not have pecuniary jurisdiction to entertain this complaint. However, on deep analysis, we are going to differ with the argument raised by Counsel for the opposite parties. Judgment in the case of Ambrish Kumar Shukla (supra) was rendered by Three Judges Bench of the National Commission, without noting its earlier view of the subject. This issue, whether, when determining pecuniary jurisdiction of the State Commission/ Consumer Foras, interest is to be added with other relief claimed or not, came up for consideration, before the Three Judges Bench of the National Commission in Shahbad Cooperative Sugar Mills Ltd. Vs. National Insurance Co. Ltd. And Ors., II 2003 CPJ 81 (NC). In the said case, noting similar arguments, it was observed as under:-
"3. Complaint (at pp 17-36) was filed with the following prayer :
"It is, therefore, respectfully prayed that the complaint be allowed and the opposite parties be directed to pay the claim to the tune of Rs. 18,33,000/- plus interest @ 18% from the date of claim till its realization. Also the suitable damages caused to the complainant be ordered to be paid to the complainant."
4. Bare reading of the prayer made would show that the interest claimed by appellant pertains to the period upto the date of filing complaint, pendente lite and future. Rate and the period for which interest has to be allowed, is within the discretion of State Commission and the stage for exercise of such a discretion would be the time when the complaint is finally disposed of. Thus, the State Commission had acted erroneously in adding to the amount of Rs. 18,33,000/- the interest at the rate of 18% per annum thereon till date of filing of complaint for the purpose of determination of pecuniary jurisdiction before reaching the said stage. Order under appeal, therefore, deserves to be set aside. However, in view of change in pecuniary jurisdiction w.e.f. 15.3.2003, the complaint is now to be dealt with by the District Forum instead of State Commission."
It was specifically stated that interest claimed by appellant/complainant pertained to the period upto the date of filing complaint, pendente lite and future, need not be added in the relief claimed, to determine pecuniary jurisdiction of the State Commission/ Consumer Foras. It was rightly said that the rate and period for which the interest has to be allowed, is within the discretion of the particular Consumer Fora, and the stage for exercise of such discretion would be the time, when final order is passed. We are of the considered opinion that the view taken is perfectly justified. There may be cases, where the complainant may not be entitled to claim any interest upon the amount paid, like the one, where he is rescinding his contract and further at what rate interest is to be granted will be determined by the competent Consumer Fora, by looking into the facts of each case. All cases cannot be put into a straitjacket formula, to add interest claimed, to determine pecuniary jurisdiction of the Consumer Foras. The interest, which is a discretionary relief, cannot be added to the value of the goods or services, as the case may be, for the purpose of determining the pecuniary jurisdiction of the Consumer Foras. As per provisions of the Consumer Protection Act, 1986 (Act) value of the goods purchased or services plus (+) compensation claimed needs to be added only, for determining pecuniary jurisdiction of the Consumer Foras.
As per ratio of the judgment of the Supreme Court in the case of New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd., Civil Appeal No.10941-10942 of 2013, decided on 04.12.2015, we would like to follow the view expressed by Three Judges Bench (former Bench) of the National Commission in Shahbad Cooperative Sugar Mills Ltd. case (supra), in preference to the ratio of judgment passed by a Bench of co-equal strength (subsequent Bench) of the National Commission in the case of Ambrish Kumar Shukla case (supra).
In New India Assurance Co. Ltd. case (supra), it was specifically observed by the Supreme Court that when a former Bench of co-equal strength has given a finding qua one legal issue, it is not open to the subsequent Bench of co-equal strength to opine qua that very legal issue and give a contrary finding. At the maximum, the subsequent Bench of co-equal strength can refer the matter to the President/Chief Justice of India to constitute a bigger Bench, to look into the matter and reconsider the legal proposition. It was further specifically held that, in case, there are two contrary views by the former and later co-equal strength Benches, the former will prevail. It was so said by looking into the ratio of judgment rendered by the Five Judges Bench of the Supreme Court of India, in Central Board of Dawoodi Bohra Community & Anr. Vs. State of Maharashtra & Anr. (2005) 2 SCC 673, wherein, when dealing with similar proposition, it was observed as under:-
"12. Having carefully considered the submissions made by the learned senior counsel for the parties and having examined the law laid down by the Constitution Benches in the abovesaid decisions, we would like to sum up the legal position in the following terms :-
(1) The law laid down by this Court in a decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or co-equal strength.
(2) A Bench of lesser quorum cannot disagree or dissent from the view of the law taken by a Bench of larger quorum. In case of doubt all that the Bench of lesser quorum can do is to invite the attention of the Chief Justice and request for the matter being placed for hearing before a Bench of larger quorum than the Bench whose decision has come up for consideration. It will be open only for a Bench of coequal strength to express an opinion doubting the correctness of the view taken by the earlier Bench of coequal strength, whereupon the matter may be placed for hearing before a Bench consisting of a quorum larger than the one which pronounced the decision laying down the law the correctness of which is doubted.
(3) The above rules are subject to two exceptions : (i) The abovesaid rules do not bind the discretion of the Chief Justice in whom vests the power of framing the roster and who can direct any particular matter to be placed for hearing before any particular Bench of any strength; and
(ii) In spite of the rules laid down hereinabove, if the matter has already come up for hearing before a Bench of larger quorum and that Bench itself feels that the view of the law taken by a Bench of lesser quorum, which view is in doubt, needs correction or reconsideration then by way of exception (and not as a rule) and for reasons given by it, it may proceed to hear the case and examine the correctness of the previous decision in question dispensing with the need of a specific reference or the order of Chief Justice constituting the Bench and such listing. Such was the situation in Raghubir Singh and Hansoli Devi."
In Ambrish Kumar Shukla case (supra), ratio of judgment- Shahbad Cooperative Sugar Mills Ltd. (supra) was not even discussed and considered. In view of above proposition of law laid down by the Five Judges Bench in Central Board of Dawoodi Bohra Community & Anr.`s and also Three Judges Bench of the Supreme Court, in New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd. case (supra), it is not open to the Bench of co-equal strength to give contrary findings, to the view already expressed by a Former Bench of same strength. In Shahbad Cooperative Sugar Mills Ltd. case (supra), decided on 02.04.2003, it was specifically observed by Three Judges Bench of the National Commission that when determining pecuniary jurisdiction of the Consumer Foras, interest component claimed by the complainant/party, is not to be added. We are of the considered view that in view of proposition of law, as explained above, the view taken in Shahbad Cooperative Sugar Mills Ltd. case (supra), to determine pecuniary jurisdiction without taking interest claimed, will prevail. As such, in the present case, we are not looking into the interest claimed by the complainant, when determining pecuniary jurisdiction of this Commission. If the interest part is excluded, the amount claimed in the relief clause fell below Rs.1 crore and above Rs.20 lacs. Hence, this Commission has pecuniary jurisdiction to entertain and decide the present complaint. In view of above, the objection raised by the opposite parties, in this regard, being devoid of merit, must fail and the same stands rejected. "
In view of above, objection raised by the opposite party stands rejected.
The next question that falls for consideration, is, as to whether, this Commission has territorial jurisdiction to entertain and decide the complaint or not.
According to Section 17 of the Act, a consumer complaint can be filed, by the complainant, before the State Consumer Disputes Redressal Commission, within the territorial Jurisdiction whereof, a part of cause of action arose to her. In the instant case, it is evident from the Allotment Letter/Agreement, containing detailed terms and conditions, that the same is executed between the parties at Chandigarh. Besides as above, various payments vide cheques (at pages14 to 16) Annexure C-5 colly., were received by the opposite party at Chandigarh, as the same bore the round seal/stamp of Chandigarh. Since, as per the documents, referred to above, a part of cause of action arose to the complainant, at Chandigarh, this Commission has got territorial Jurisdiction to entertain and decide the complaint. The objection taken by the opposite party, in its written version, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.
No doubt, in the written version, an objection was also taken by opposite party, that as per Clause 44 (c) of the Allotment Letter/Agreement, the Courts at Delhi and Punjab, shall have Jurisdiction, to entertain and adjudicate the complaint, and, as such, the Jurisdiction of this Commission was barred. It may be stated here that all the provisions of the Code of Civil Procedure are not applicable, except those, mentioned in Section 13 (4) of the Act, to the proceedings, in a Consumer Complaint, filed under the Act. For determining the territorial jurisdiction, to entertain and decide the complaint, this Commission is bound by the provisions of Section 17 of the Act. In Associated Road Carriers Ltd., Vs. Kamlender Kashyap & Ors., I (2008) CPJ 404 (NC), the principle of law, laid down, by the National Commission, was to the effect, that a clause of Jurisdiction, by way of an agreement, between the Parties, could not be made applicable, to the Consumer Complaints, filed before the Consumer Foras. It was further held, in the said case, that there is a difference between Sections 11/17 of the Act, and the provisions of Sections 15 to 20 of the Civil Procedure Code, regarding the place of jurisdiction. In the instant case, as held above, a part of cause of action arose to the complainant, within the territorial Jurisdiction of this Commission, at Chandigarh. In Ethiopian Airlines Vs Ganesh Narain Saboo, IV (2011) CPJ 43 (SC)= VII (2011) SLT 371, the principle of law, laid down, was that the restriction of Jurisdiction to a particular Court, need not be given any importance in the circumstances of the case.
In Cosmos Infra Engineering India Ltd. Vs Sameer Saksena & another I (2013) CPJ 31 (NC) and Radiant Infosystem Pvt. Ltd. & Others Vs D.Adhilakshmi & Anr I (2013) CPJ 169 (NC) the agreements were executed, between the parties, incorporating therein, a condition, excluding the Jurisdiction of any other Court/Forum, in case of dispute, arising under the same, and limiting the Jurisdiction to the Courts/Forums at Delhi and Hyderabad. The National Commission, in the aforesaid cases, held that such a condition, incorporated in the agreements, executed between the parties, excluding the Jurisdiction of a particular Court/Forum, and limiting the Jurisdiction to a particular Court/Forum, could not be given any importance, and the complaint could be filed, at a place, where a part of cause of action arose, according to Sections 11/17 of the Act. The principle of law, laid down, in the aforesaid cases, is fully applicable to facts of the instant case. It may also be stated here, that even if, it is assumed for the sake of arguments, that the complainant had agreed to the terms and conditions of the agreement, limiting the Jurisdiction to the Courts, referred to above, the same could not exclude the Jurisdiction of this Commission, at Chandigarh, where a part of cause of action accrued to her, to file the complaint. The submission of Counsel for the opposite party, in this regard, therefore, being devoid of merit, must fail, and the same stands rejected.
Another objection raised by Counsel for the opposite party that it was mentioned in the Allotment Letter/Agreement that the Company shall make its best efforts to deliver possession of the plot within a period of 18 months, with further grace period of six months, as such, time was not the essence of contract, is also devoid of merit. It may be stated here that it was clearly mentioned in Clause 24 (a) of the Allotment Letter/ Agreement that possession of the plot will be delivered by the opposite party, within a period of 18 months, with extended period of 6 months, by making best efforts, to the complete the development work, subject to force majeure circumstances or reason beyond the control of the opposite party. It is not the case of the opposite party that it encountered any force majeure circumstances, as a result whereof, it was legally entitled for extension of time for delivering possession of the plots to the allottees, including the complainant.
No doubt, at the time of arguments, it was also argued that, as per terms and conditions of the said Allotment Letter/Agreement, when computing the above said period, Sundays, Saturdays, Bank Holidays, etc. are to be ignored.
We feel that the contention raised is liable to be rejected. As stated above, in Clause 24(a) of the Agreement, it is stated that possession will be delivered within 18 months, from the date of allotment letter, with six months' extension. It is further stated that when computing the said period all Saturdays, Sundays and Bank Holidays will be excluded. A similar issue came up for consideration before this Commission qua another project of the opposite party, in the case of Dr.Divya Dahiya Vs. M/s Omaxe Chandigarh Extension Developers Private Limited and another, Consumer Complaint No.57 of 2016, decided on 15.07.2016, wherein, it was observed as under:-
"The first question, which falls for consideration, is, as to whether there was delay in offering possession of the plot, in question, and if so, to what extent. The allotment letter for independent floor in Row-Housing Project "Silver Birch" in the project of the Opposite Parties (Annexure C-4) was issued to the complainant on 30.08.2011. As per Clause 31(a) of the allotment letter, the Opposite Parties were to complete the development of the unit within 24 months or within an extended period of six months from the date of start of construction, subject to force majeure conditions. Since allotment letter is dated 30.08.2011, by computing 24 months plus 6 months' period, the Opposite Parties were bound to deliver possession of the plot, in question, by 01.03.2014. The Opposite Parties have stated that period was to be computed by excluding Sundays, Bank Holidays, enforced Govt. holidays and the days of cessation of work at site in compliance of order of any Judicial/concerned State Legislative Body. Apparently, for seeking six months extension beyond 24 months or beyond six months extended period, the Opposite Parties owe an explanation, if the delay was on account of force majure conditions but nothing by way of cogent evidence to this effect has been placed on record. Thus, when no explanation for extension of six months period has been furnished, the Opposite Parties at the most could be allowed one out of the two benefits i.e. either six months extension beyond 24 months or period on account of Sundays/Holidays etc. This Commission in Consumer Complaint No.153 of 2015 titled ' Mr. Madan Lal Taneja and another Vs. M/s Omaxe Chandigarh Extension Developers P. Ltd.' decided on 03.11.2015, facts of which were almost identical, held that Opposite Parties were to hand over possession within 30 months from the date of start of construction. Thus, the possession of the unit, in question, was to be delivered by 01.03.2014."
Similar view was reiterated by this Commission, in a case titled as Sudesh Rani Vs. Omaxe Chandigarh Extension Developers Pvt. Ltd. and another, Consumer Case No.178 of 2016, decided on 16.08.2016. It was specifically held that when there is no explanation of getting extension of 6 months' period to deliver possession beyond the stipulated date, the benefit of exclusion of Saturdays, Sundays, Bank Holidays etc. cannot be given. Thus, under these circumstances, since as per Clause 24 (a) of the Allotment Letter/Agreement, the opposite party was bound to deliver possession of the developed plot, within a maximum period of 24 months from the date of execution of the same i.e. on or before 30.10.2014, as such, time was unequivocally made the essence of contract.
At the same time, the opposite party also cannot evade its liability, merely by saying that since it was mentioned in the Allotment Letter/Agreement, that it shall put its best efforts for delivery of possession of the plot, as such, time is not to be considered as essence of the contract. Non-mentioning of exact date of delivery of possession of the unit(s) in the Allotment Letter/Agreement, is an unfair trade practice, on the part of the Builder. The builder is bound to mention the exact/specific date of delivery of possession of the unit(s) to the allottees/purchasers thereof. It was so said by the Hon`ble National Commission, in Rajeev Nohwar & Anr. V/S Sahajanand Hi Tech Construction Pvt Ltd, 2016 (2) CPR 769. Relevant portion of the said case reads thus:-
"Merely making endeavour to deliver possession by a particular date will also not meet the requirement of law and the promotor is under a legal mandate to stipulate a specific date for delivery of possession of the flat in the agreement which he executes with the flat buyer".
In view of above, the plea of the opposite party in this regard also stands rejected.
The next question, that falls for consideration, is, as to whether, the complainant fell within the definition of a consumer, as defined by Section 2 (1) (d) (ii) of the Act, or not. It may be stated here that the mere objection of the opposite party that since the complainant is a Non-Resident Indian (NRI), as such she had purchased the plot, by way of investment, to gain huge profits, by selling the same, as and when there was escalation in prices, does not carry any weight and is liable to be rejected. It has been mentioned by the complainant, in para no.1 of her complaint that her father-in-law is residing in a rented accommodation at Panchkula. To settle her father-in-law and also to keep her roots attached to her motherland, as she frequently visits India, the above said plot was purchased by her. On the other hand, nothing contrary to this, has been proved by the opposite party, by placing on record, any document. Even otherwise, the mere fact that it was a residential plot, which was allotted, in favour of the complainant, was sufficient to prove that it was to be used for the purpose of residence, by the complainant, might be on or off while she visits to India or her family. There is nothing, on the record, that the complainant is a property dealer, and deals in the sale and purchase of property. No evidence was also produced, by the opposite party, to prove that the complainant owned a number of other residential properties, in the tricity, and, as such, the plot, in question, was purchased by her, by way of investment, with a view to resell the same, as and when, there was escalation in the prices thereof. At the same time, no law debars an NRI, who basically belonged to India, to purchase a residential property in India. Under similar circumstances, the Hon`ble National Commission, in a case titled as Smt. Reshma Bhagat & Anr. Vs. M/ s Supertech Ltd. Consumer Complaint No. 118 of 2012, decided on 04 .01. 2016 , held as under:-
"We are unable to clap any significance with these faint arguments. It must be borne in mind that after selling the property at Bangalore, and in order to save the money from riggers of capital gain tax, under Section 54 of the Income Tax Act, 1961, there lies no rub in getting the property, anywhere, in whole of India. There is not even an iota of evidence that they are going to earn anything from the flat in dispute. From the evidence, it is apparent that the same had been purchased for the residence of the complainants. Moreover, Sh. Tarun S. Bhagat, who is an independent person. It cannot be made a 'rule of thumb' that every NRI cannot own a property in India. NRIs do come to India, every now and then. Most of the NRIs have to return to their native land. Each NRI wants a house in India. He is an independent person and can purchase any house in India, in his own name."
Furthermore, in a case titled as Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developer Pvt. Ltd. 2016 (1) CPJ 31, by the National Consumer Disputes Redressal Commission, New Delhi, it was held that the buyer(s) of the residential unit(s), would be termed as consumer(s), unless it is proved that he or she had booked the same for commercial purpose. Similar view was reiterated by the National Commission, in DLF Universal Limited Vs Nirmala Devi Gupta, 2016 (2) CPJ 316. Thus, in the absence of any cogent evidence, in support of the objection raised by the opposite party, mere bald assertion to that effect, cannot be taken into consideration. The complainant, thus, falls within the definition of a 'consumer', as defined under Section 2(1)(d) of the Act. Such an objection, taken by opposite party, therefore, being devoid of merit, is rejected.
Another objection taken by the opposite party that since the plot, in question, falls under the category of immovable property, as such, in that event also, time is not to be considered as essence of the contract, is also bereft of merit, in view of ratio of judgment titled as Saradamani Kandappan vs S. Rajalakshmi & Ors., Civil Appeal Nos. 7254-7256 of 2002 & and Contempt Petition (C) No. 28-29 of 2009, decided on 4th July, 2011, wherein the Hon`ble Supreme Court held as under:-
"A correct perspective relating to the question whether time is not of the essence of the contract in contracts relating to immovable property, is given by this court in K.S. Vidyanadam and Others vs. Vairavan - (1997) 3 SCC 1 (by Jeevan Reddy J. who incidentally was a member of the Constitution Bench in Chand Rani). This Court observed:
"It has been consistently held by the courts in India, following certain early English decisions, that in the case of agreement of sale relating to immovable property, time is not of the essence of the contract unless specifically provided to that effect.
In the case of urban properties in India, it is well-known that their prices have been going up sharply over the last few decades - particularly after 1973. .........We cannot be oblivious to the reality and the reality is constant and continuous rise in the values of urban properties - fuelled by large scale migration of people from rural areas to urban centres and by inflation.
Indeed, we are inclined to think that the rigor of the rule evolved by courts that time is not of the essence of the contract in the case of immovable properties - evolved in times when prices and values were stable and inflation was unknown - requires to be relaxed, if not modified, particularly in the case of urban immovable properties. It is high time, we do so."
(emphasis supplied) Therefore there is an urgent need to revisit the principle that time is not of the essence in contracts relating to immovable properties and also explain the current position of law with regard to contracts relating to immovable property made after 1975, in view of the changed circumstances arising from inflation and steep increase in prices. We do not propose to undertake that exercise in this case, nor referring the matter to larger bench as we have held on facts in this case that time is the essence of the contract, even with reference to the principles in Chand Rani and other cases. Be that as it may."
It is apparent on record that huge amount of Rs.14 lacs was deposited by the complainant on 19.10.2011. Thereafter, on 28.02.2012, she deposited an amount of Rs.15,40,000/- vide receipt Annexure C-3. On 16.04.2012, further amount of Rs.6,40,420/-, Rs.10 lacs and Rs.28 lacs, was paid by her. Allotment Letter/Agreement was issued only on 31.10.2012. Such like Allotment Letter/Agreement, is supposed to be presented within, say two to three months, from the date of booking, but it is not so done. As such, it can safely be said that Allotment Letter/Agreement was got signed belatedly. The said act would amount to unfair trade practice on the part of the opposite party. It was also so said by this Commission in Sudesh Rani Vs. Omaxe Chandigarh Extension Developers Pvt. Ltd. and another, Consumer Case No.178 of 2016, decided on 16.08.2016. However, since we are ordering refund of the amount paid, alongwith interest, from the respective dates of deposits, as such, we are not granting any additional compensation, for the said delay, on the part of the opposite party.
The next question, that falls for consideration, is, as to whether, the complainant is entitled to refund of the amount of Rs.73,80,420/-, deposited by her. It is an admitted fact that the opposite party is unable to deliver possession of the plot, in question, for want of development and basic amenities etc. and firm date of delivery of possession of the plot, could not be given to her (complainant). Promised date to deliver possession of the plot was 30.10.2014 and now it is January 2017. Even at the time of arguments, no commitment was made by the opposite party, as to on which date, possession of the developed plot, can be delivered to the complainant. It was only said that the opposite party is making best efforts, to complete the development work. The complainant cannot be made to wait for an indefinite period, for delivery of possession of the plot purchased by her. Non-delivery of possession of the plot, in question, by the stipulated date, is a material violation of the terms and conditions of the Allotment Letter/Agreement, on the part of the opposite party. Recently in a case titled as Aashish Oberai Vs. Emaar M GF Land Limited, Consumer Case N o .70 of 2015, decided on 14 Sep 2016, under similar circumstances, the National Commission negated the plea taken by the builder, while holding as under:-
"I am in agreement with the learned senior counsel for the complainants that considering the default on the part of opposite parties no.1 and 2 in performing its contractual obligation, the complainants cannot be compelled to accept the offer of possession at this belated stage and therefore, is entitled to refund the entire amount paid by him along with reasonable compensation, in the form of interest."
Not only this, in a case titled as Brig Ajay Raina (Retd.) and another Vs. M/s Unitech Limited, Consumer Complaint No. 59 of 2016, decided on 24.05.2016, wherein possession was offered after a long delay, this Commission, while relying upon the judgments rendered by the Hon`ble National Commission, ordered refund to the complainants, while holding as under:-
"Further, even if, it is assumed for the sake of arguments, that offer of possession, was made to the complainants, in July 2015 i.e. after a delay of about three years, from the stipulated date, even then, it is not obligatory upon the complainants to accept the same. It was so held by the National Commission in Emaar MGF Land Limited and another Vs. Dilshad Gill, III (2015) CPJ 329 (NC). Recently also, under similar circumstances, in the case of M/s. Emaar MGF Land Ltd. & Anr. Vs. Dr.Manuj Chhabra, First Appeal No.1028 of 2015, decided on 19.04.2016, the National Commission, held as under:-
"I am of the prima facie view that even if the said offer was genuine, yet, the complainants was not obliged to accept such an offer, made after a lapse of more than two years of committed date of delivery".
However, in the present case, the situation is worst, as possession has not been even offered to the complainant, what to speak of delay in offer thereof. In view of above, it is held that since there was a material violation on the part of the opposite party, in not offering and handing over possession of the developed plot by the stipulated date or even till date, the complainant was at liberty to seek refund of the amount deposited, alongwith interest and compensation, by way of filing the instant complaint.
In view of above facts of the case, the opposite party is also under an obligation to compensate the complainant, for inflicting mental agony and causing physical harassment to her, as also escalation in prices.
It is to be further seen, as to whether, interest, on the amount refunded, can be granted, in favour of the complainant. It is not in dispute that an amount of Rs.73,80,420/-, was paid by the complainant, without getting anything, in lieu thereof. The said amount has been used by the opposite party for its own benefit. There is no dispute that for making delayed payments, the opposite party was charging heavy rate of interest 18% p.a. for the first month and thereafter @24% p.a., as per Clause 14 of the Allotment Letter/Agreement, for the period of delay in making payment of instalments. It is well settled law that whenever money has been received by a party and when its refund is ordered, the right to get interest follows, as a matter of course. The obligation to refund money received and retained without right implies and carries with it, the said right. It was also so said by the Hon`ble Supreme Court of India, in UOI vs. Tata Chemicals Ltd (Supreme Court), (2014) 6 SCC 335 decided on March 20th, 2014 (2014) 6 SCC 335). In view of above, the complainant is certainly entitled to get refund of the amount deposited by her, to the tune of Rs.73,80,420/- alongwith interest, from the respective dates of deposits till realization.
Counsel for the opposite party also argued that in view of Section 8 of the Arbitration and Conciliation Act, 1996, this Commission has no jurisdiction to entertain the consumer complaint and let the matter be referred to an arbitration for adjudication. We are not going to agree with the argument raised. Reply in this case was filed on 18.10.2016. Thereafter, an application was filed in the matter, which was disposed of on 20.10.2016, ordering that question qua applicability of provisions of Arbitration and Conciliation Act, 1996, will be taken up at the time of final hearing of dispute. At that stage, whether such application lies or not is a moot question. Be that as it may, this question has already been elaborately dealt with by this Commission in case titled ' Sarbjit Singh Vs. Puma Realtors Private Limited', IV (2016) CPJ 126. Paras 25 to 35 of the said order, inter-alia, being relevant, are extracted hereunder:-
25. The next question, that falls for consideration, is, as to whether, in the face of existence of arbitration Clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint.
26. To decide above said question, it is necessary to reproduce the provisions of Section 3 of the Consumer Protection Act 1986 (in short the Act), which reads as under;
"3. Act not in derogation of any other law.--
The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force."
27. It is also desirable to reproduce unamended provisions of Section 8 of 1996 Act, which reads thus:-
"8. Power to refer parties to arbitration where there is an arbitration agreement.--
(1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.
(2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.
(3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made."
28. Many a times, by making reference to the provisions of Section 8 of 1996 Act, in the past also, such objections were raised and the Hon'ble Supreme Court of India, when interpreting the provisions of Section 3 of 1986 Act, in the cases of Fair Air Engg. Pvt. Ltd. & another Vs. N. K. Modi (1996) 6 SCC 385, C.C.I Chambers Coop. Housing Society Ltd. Vs Development Credit Bank Ltd. (2003) 7 SCC 233, Rosedale Developers Private Limited Vs. Aghore Bhattacharya and others, ( Civil Appeal No.20923 of 2013) etc., came to a conclusion that the remedy provided under Section 3 of 1986 Act, is an independent and additional remedy and existence of an arbitration clause in the agreement, to settle disputes, will not debar the Consumer Foras, to entertain the complaints, filed by the consumers.
29. In the year 2015, many amendments were effected in the provisions of 1996 Act. After amendment, Section 8 of 1996 Act, reads as under:-
"8. Power to refer parties to arbitration where there is an arbitration agreement.--
(1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists."
30. Now it is to be seen, whether, after amendment in Section 8 of the principal Act, any additional right has accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling the disputes through an Arbitrator, the Consumer Foras have no jurisdiction to entertain a consumer complaint. As has been held by Hon'ble Supreme Court of India, in various cases, and also of the National Commission, in large number of judgments, Section 3 of the 1986 Act, provides additional remedy, notwithstanding any other remedy available to a consumer. The said remedy is also not in derogation to any other Act/Law.
31. Now, we will have to see what difference has been made by the amendment, in the provisions of Section 8 of 1996 Act. After amendment, it reads that a Judicial Authority is supposed to refer the matter to an Arbitrator, if there exists an arbitration clause in the agreement, notwithstanding any judgment, decree, order of the Hon'ble Supreme Court of India, or any other Court, unless it finds that prima facie, no valid arbitration agreement exists. The legislation was alive to the ratio of the judgments, as referred to above, in earlier part of this order. Vide those judgments, it is specifically mandated that under Section 3 of 1986 Act, an additional remedy is available to the consumer(s), which is not in derogation to any other Act. As and when any argument was raised, the Hon'ble Supreme Court of India and the National Commission in the judgments, referred to above, have made it very clear that in the face of Section 8 of 1996 Act and existence of arbitration agreement, it is still opened to the Consumer Foras to entertain the consumer complaints. None of the judgments ever conferred any jurisdiction upon the Consumer Foras to entertain such like complaints. Only the legal issues, as existed in the Statute Book, were explained vide different judgments. If we look into amended provisions of Section 8 of the principal Act, it explains that judicial Authority needs to refer dispute, in which arbitration agreement exist to settle the disputes notwithstanding any judgment/decree or order of any Court. That may be true where in a case, some order has been passed by any Court, making arbitration Agreement non-applicable to a dispute/parties. However, in the present case, the above said argument is not available. The jurisdiction of Consumer Foras to entertain consumer complaints, in the face of arbitration clause in the Agreement, is in-built in 1986 Act. It was not given to these Foras, by any judgment ever. The provisions of Section 3 of 1986 Act interpreted vide judgments vis a vis Section 8 of un-amended 1996 Act, were known to the legislature, when the amended Act 2015 was passed. If there was any intention on the part of the legislature, then it would have been very conveniently provided that notwithstanding any remedy available in 1986 Act, it would be binding upon the judicial Authority to refer the matter to an Arbitrator, in case of existence of arbitration agreement, however, it was not so said.
32. We can deal with this issue, from another angle also. If this contention raised is accepted, it will go against the basic spirit of 1986 Act. The said Act (1986) was enacted to protect poor consumers against might of the service providers/multinational companies/traders. As in the present case, the complainant has spent his life savings to get a unit, for his residential purpose. His hopes were shattered. Litigation in the Consumer Fora is cost effective. It does not involve huge expenses and further it is very quick. A complaint in the State Commission can be filed, by making payment between Rs.2000/- to Rs.4000/- (in the present case Rs.4000/-). As per the mandate of 1986 Act, a complaint is supposed to be decided within three months, from the date of service to the opposite party. In cases involving ticklish issues (like the present one, maximum not more than six months to seven months time can be consumed), whereas, to the contrary, as per the principal Act (1996 Act), the consumer will be forced to incur huge expenses towards his/her share of Arbitrator's fees. Not only as above, it is admissible to an Arbitrator, to decide a dispute within one year. Thereafter, the Court wherever it is challenged may also take upto one year and then there is likelihood that the matter will go to the High Court or the Hon'ble Supreme Court of India. Such an effort will be a time consuming and costly one. Taking note of fee component and time consumed in arbitration, it can safely be said that if the matter is referred to an Arbitrator, as prayed, in the present case, it will defeat the very purpose of the provisions of 1986 Act.
33. The 1986 Act provides for better protection of interests and rights of the consumers. For the said purpose, the Consumer Foras were created under the Act. In Section 3 of 1986 Act, it is clearly provided that the said provision is in addition to and not in derogation of any provisions of any other law, for the time being in force. The 1986 Act is special legislation qua the consumers. The poor consumers are not expected to fight the might of multinational companies/traders, as those entities have lot of resources at their command. As stated above, in the present case, the complainant has spent his entire life earnings to purchase the plot, in the said project, launched by the opposite party. However, his hopes were shattered, when despite making substantial payment of the sale consideration, he failed to get possession of the plot, in question, in a developed project. As per ratio of the judgments in the case of Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (2004) 1 SCC 305 and United India Insurance Co. Ltd. Vs. M/s Pushpalaya Printers, I (2004) CPJ 22 (SC), and LIC of India and another Vs. Hira Lal, IV (2011) CPJ 4 (SC), the consumers are always in a weak position, and in cases where two interpretations are possible, the one beneficial to the consumer needs to be accepted. The opinion expressed above, qua applicability of Section 8 (amended) of 1996 Act, has been given keeping in mind the above said principle.
34. Not only this, recently, it was also so said by the National Commission, in a case titled as Lt. Col. Anil Raj & anr. Vs. M/s. Unitech Limited, and another, Consumer Case No.346 of 2013, decided on 02.05.2016. Relevant portion of the said case, reads thus:-
"In so far as the question of a remedy under the Act being barred because of the existence of Arbitration Agreement between the parties, the issue is no longer res-integra. In a catena of decisions of the Hon'ble Supreme Court, it has been held that even if there exists an arbitration clause in the agreement and a Complaint is filed by the consumer, in relation to certain deficiency of service, then the existence of an arbitration clause will not be a bar for the entertainment of the Complaint by a Consumer Fora, constituted under the Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force. The reasoning and ratio of these decisions, particularly in Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (Dead) Through LRs. & Others - (2004) 1 SCC 305; still holds the field, notwithstanding the recent amendments in the Arbitration and Conciliation Act, 1986. [Also see: Skypak Couriers Ltd. Vs. Tata Chemicals Ltd. - (2000) 5 SCC 294 and National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr. - (2012) 2 SCC 506.] It has thus, been authoritatively held that the protection provided to the Consumers under the Act is in addition to the remedies available under any other Statute, including the consentient arbitration under the Arbitration and Conciliation Act, 1986."
35. In view of the above, the plea taken by the opposite party, that in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint, being devoid of merit, is rejected."
In view of the above, the plea taken by the opposite party in this regard, being devoid of merit, is rejected.
To defeat the claim of the complainant, an objection was also raised that the complaint filed through Power of Attorney Holder is not maintainable. We are not going to agree with the contention raised. Copy of Power of Attorney has been placed on record, authorizing Sh.Bhagwaan Dass Gandhi (Father-in-Law of the complainant), to file this complaint. Even otherwise, the proceedings before the Consumer Fora, are summary, in nature. The Consumer Protection Act, 1986, is a beneficial legislation, to provide speedy, inexpensive and hassle free redressal to the grievance of the consumers. The provisions of the Code of Civil Procedure, except the one, provided under Section 13(4) of the Act, and the Evidence Act are not applicable to the consumer disputes. The Consumer Foras are to evolve their own procedure, for adjudicating the consumer disputes, by resorting to the principles of natural justice, but are not required to enter into technicalities, with a view to deny the substantial justice. In view of above, the plea taken by the opposite party stands rejected.
The next question, that falls for consideration, is, as to whether, the complaint filed by the complainant, was within limitation or not. It may be stated here that since it is an admitted case that offer of possession of the plot, in question, could not be made till date for want of development works, and on the other hand, amount deposited was also not refunded to the complainant alongwith interest, as such, there is continuing cause of action, in her favour, in view of principle of law laid down, in Lata Construction & Ors. Vs. Dr. Rameshchandra Ramniklal Shah and Anr., II 2000 (1) CPC 269=AIR 1999 SC 380 and Meerut Development Authority Vs. Mukesh Kumar Gupta, IV (2012) CPJ 12 (SC). Under these circumstances, it is held that the complaint is not at all barred by limitation. The submission of Counsel for the opposite party, in this regard, being devoid of merit, must fail, and the same stands rejected.
No other point, was urged, by the contesting parties.
For the reasons recorded above, the complaint is partly accepted, with costs. The opposite party is directed as under:-
To refund the amount Rs.73,80,420/-, to the complainant, alongwith interest @12% p.a., from the respective dates of deposits onwards.
To pay compensation, in the sum of Rs.2.50 lacs, for causing mental agony and physical harassment, to the complainant, as also escalation in prices.
To pay cost of litigation, to the tune of Rs.50,000/- to the complainant.
The payment of awarded amounts mentioned at sr.nos.(i) to (iii), shall be made, within a period of 02 (two) months from the date of receipt of a certified copy of this order, failing which, the amount mentioned at sr.no.(i) shall carry penal interest @15% p.a., instead of @12%, from the respective dates of deposits onwards, and interest @15% p.a., on the amounts mentioned at sr.nos.(ii) and (iii), from the date of filing of this complaint, till realization.
However, it is made clear that, if the complainant has availed loan facility from any banking or financial institution, for making payment of installments towards the said plot, it will have the first charge of the amount payable, to the extent, the same is due to be paid by her (complainant).
Certified Copies of this order be sent to the parties, free of charge.
The file be consigned to Record Room, after completion.
Pronounced.
25.01.2017 Sd/-
[JUSTICE JASBIR SINGH (RETD.)] PRESIDENT Sd/-
(DEV RAJ) MEMBER Sd/-
(PADMA PANDEY) MEMBER Rg