State Consumer Disputes Redressal Commission
Anurag Singla vs M/S N.H.Matcon on 23 February, 2018
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.
Consumer Complaint No.383 of 2017
Date of Institution : 19.05.2017
Order reserved on: 22.02.2018
Date of Decision : 23.02.2018
1. Anurag Singla S/o Sh. Ved Parkash,
2. Kanchan Singla W/o Anurag Singla,
both residents of Wellington Estate Dhakoli, Zirakpur, Distt.
Mohali, Punjab.
.....Complainants
Versus
1. M/s N.H. Matcon (Aero Homes), a partnership firm registered
under the partnership Act, having registered office at SCO-3,
Level One, Royale Estate, Chandigarh-Ambala Highway, Near
IDBI Bank, Zirakpur, Mohali, Punjab, through its partner Shri
Nitin Bansal.
2. Sh. Nitin Bansal, partner of M/s N.H. Matcon (Aero Homes),
having residence at House no.1704, Sector 21, Panchkula,
Haryana.
.....Opposite Parties
Complaint U/s 17(1)(a) of the Consumer
Protection Act, 1986 (as amended up to
date).
Quorum:-
Shri J. S. Klar, Presiding Judicial Member.
Smt. Surinder Pal Kaur, Member.
Present:-
For the complainants : Sh. Sanjeev Sharma, Advocate For the opposite parties : Sh. Ashutosh Gupta, Advocate ................................................................................................. J. S. KLAR, PRESIDING JUDICIAL MEMBER:-
The complainants have filed this complaint U/s 17(1)(a) of the Consumer Protection Act 1986 (in short the "Act"), against opposite parties (OPs) on the averments that they were allured by various advertisements given by OPs through newspaper, media, marketing emails etc. regarding their project 'Aero Homes, Gazipur, Consumer Complaint No.383 of 2017 2 Zirakpur, SAS Nagar Mohali and booked an apartment with OPs in 'Aero Rise' project in the year 2012. The OPs incorporated a clause for awarding compensation in the standard terms of agreement of provisional allotment. It was specifically conveyed by OPs that possession would be delivered to allottee on 30.06.2013 complete in all respect with completion certificate. The complainants paid an amount of Rs.one lakh on 22.10.2012, as booking amount of apartment, vide receipt no.1073. They opted for down payment plan. They paid further payments of Rs.3,50,000/- on 31.10.2012 and Rs.1,65,000/- on 05.11.2012. They submitted the application form and OPs stated to them that the apartment will be allotted to them within few days from the date of submission of application form and buyers agreement will be executed within a month. Vide allotment letter dated 21.11.2012, OPs allotted apartment no.703, having tentative super area of 1760 square feet at Aero Homes to complainants. The basic sale price of the said apartment was fixed at Rs.41,90,000/- including club fee. The complainants paid the sale consideration to OPs in good faith on their assurances, but they failed to deliver the complete possession of the apartment with amenities to complainants. They made total payment of Rs.43,33,546/- by means of cheques towards the consideration of apartment, but complete possession was not delivered to them by OPs in this case. The buyers agreement has been drafted by OPs strongly in their favour prejudicial to the interest of the allottees by exercising their dominant position. As per clause 20 of the buyers Consumer Complaint No.383 of 2017 3 agreement, in case of default of terms and conditions by allottee, the OPs have been given the right to forfeit the earnest money. Clause 12 of the agreement further prejudices the interest of the allottee to the effect that the developer will have the right to terminate the agreement on breach of the condition of delayed payment or interest. Clause 4(b) of agreement assured the allottee to pay compensation with interest @Rs.5/- per square feet, enumerated per month, which comes to Rs.8800/- for the period of delay in handing over the possession. Clause 2(c) of the agreement enjoins upon the complainants to pay interest @18% per annum compounded quarterly in the event of failure to pay balance amount. The buyers agreement has been strongly printed in favour of OPs and biased against the interest of allottee. As per clause 4(a) of the agreement, OPs committed to deliver the possession of the apartment to allottee by 30.06.2013 of the allotted apartment subject to force majeure circumstances. The OPs held out to complainants that they have obtained all necessary approvals and sanctions at the time of booking of above apartment for this project. The OPs issued possession letter dated 28.06.2013 just to avoid their liability, because there was no complete possession with them without any occupancy certificate. This offer of possession letter by OPs is only a paper transaction without any substance in it. The complainants visited the spot on 21.07.2013 after receipt of above letter of possession and were surprised to find that lot of construction, development and furnishing work were still pending. The flats were Consumer Complaint No.383 of 2017 4 nowhere near completion. Even water supply, electricity supply and sewer connection were not there. Most of the basic amenities were not existing on the spot. Construction of the club has not yet started.
The demands raised by OPs were illegal and were not payable by the allottee. The quality of the flat was also compromised like samsung door security system, marble of the kitchen, shower and kitchen cabinet and they were changed from the position, as shown in the sample flat. The complainants wrote letter to OPs pointing out the defective quality and defective construction of the apartment. The complainants have obtained home loan of Rs.25 lakhs and Rs.4,89,030/- approximately from Indiabulls and have been paying regular monthly installments. The complainants were also forced to get the said apartment insured for which they had to spend Rs.76,750/- for getting apartment insured. They have deposited the amount of Rs.43,33,546/- with OPs, as sale consideration with expectation of getting physical possession by the agreed date i.e. 30.06.2013. The OPs have not offered the possession of the apartment complete in all respect, despite efflux of agreed date of delivery of possession by 30.06.2013. They visited the office of OPs in November 2016 for refund of the amounts paid by them, but to no effect. The complainants further averred that on 26.02.2016, the Municipal Council Zirakpur issued notice to Aero Homes regarding various illegalities and also called upon them to remove violations and also apply for completion certificate under PAPRA Act. One Subrat Kumar Pardhan sought information under RTI Act from Consumer Complaint No.383 of 2017 5 Municipal Council Zirakpur regarding the above project of OPs. Vide letter dated 12.04.2017, Municipal Council Zirakpur supplied the information that the project of OPs has not been issued completion certificate till date. The complainants have thus prayed for below noted directions;
(a) Refund of entire deposited amount of Rs.43,33,546/- alongwith interest thereon alongwith interest @18% annum with quarterly rests from the date of deposits till actual realization without deduction of TDS;
(b) to refund Rs.76,750/- spent by them on insurance of above apartment;
(c) to pay Rs.6,00,000/- as compensation for mental harassment;
(d) to pay Rs.50,000/- as litigation expenses.
2. Upon notice, OPs appeared and filed written version contesting the complaint of the complainants. Preliminary objections were raised by them in the written versions that complainants have not approached the Forum with clean hands. The complainants have their own house at F 341, Block E Wellington Estate Dhakoli, Zirakpur, Punjab. They have concealed this fact from the Forum and as such are not the consumers of OPs. The allegations of complainants regarding incomplete project and quality of construction are baseless. Buyers agreement was executed between the parties containing clause of arbitration and as such the Consumer Forum, in the presence of Arbitration Clause is not competent to decide the case. The complainants have filed the Consumer Complaint No.383 of 2017 6 complaint after four years of taking the possession of the apartment. The complainants attached the letter of offer of possession dated 28.06.2013 with the complaint. The complainants have not contributed to the maintenance agency, as OPs are not maintaining the society now. No question arises to pay Rs.8800/- to complainants, because possession was offered to them by OPs on 28.06.2013, but they have not taken the possession till date. The complainants have not paid the full and final payment towards the price of apartment in question, as mentioned in the agreement and the allotment letter. The payment of installments within time by the allottees is the essence of the agreement, as per clause 2(d) of the agreement. The complainant have not paid the outstanding amount of Rs.7,50,000/- approximately inclusive of EEC, EDC, interest and late payment charges. The OPs are ready to get the conveyance deed executed/registered in the name of complainants on full and final payment by complainants to them. Notice was sent to complainants on 17.08.2013 for clearance of pending due payments as per terms and conditions of agreement, but to no effect. As per clause 2(f), the developer has right to forfeit the entire amount of earnest/registration money deposited by purchaser in case of non- payment of installments within time. The complainants are liable to pay external electrification charges, as per clause 5(d) of the agreement. On merits, it was averred that complainants got the loan sanctioned from Indiabulls on 21.11.2012. Loan cannot be disbursed without submission of allotment letter and buyers agreement by the Consumer Complaint No.383 of 2017 7 financer. This fact is clear that complainants have not made the timely payments to OPs. The OPs prayed for dismissal of the complaint.
3. The complainant tendered in evidence affidavit of Anurag Singla complainant no.1 Ex.C-A alongwith copies of documents Ex.C-1 to C-13 and closed the evidence. As against it, OPs tendered in evidence affidavit of Darshan Gupta, GPA Ex.OP-A alongwith copy of document Ex.OP-B, Ex.OP-1 to Ex.OP4(d), and Mark A and closed the evidence.
4. We have heard the learned counsel for the parties and have also examined the evidence on the record. Evidence on the record has been perused by us with the able assistance of counsel for the parties. The complainants paid the amount of Rs.one lakh on 22.10.2012 to OPs towards booking amount of above apartment vide Ex.C-1. Another receipt for payment of Rs.two lakh on 31.10.2012 is Ex.C-2. The payment of Rs.1,50,000/- was received by OPs on 31.10.2012 from the complainants vide Ex.C2(a). Vide Ex.C2(b) OPs received Rs.1,65,000/- on 05.11.2012 from complainants. Ex.C-3 is the copy of application form for allotment of flat in Aero Homes at Gazipur, Zirakpur Punjab of complainants. Ex.C-4 is the copy of allotment letter dated 21.11.2012 issued by OPs to complainants alloting flat no.703, 7th floor, Tower B having super area of 1760 square feet for total price of Rs.41,90,000/-. It contained the terms and conditions as laid down in it. Clause 8 of allotment letter lays down that physical possession of flat shall be handed over to the Consumer Complaint No.383 of 2017 8 buyer upto 30.06.2013 subject to force majeure clause incorporated universally only after full payment is made to the promoter, as per the terms and conditions set out in the agreement. Agreement to sell was executed between the parties in this case incorporated in Ex.C-5. This is the vital document in determining the relationship of the parties. Clause 4(a) of buyers agreement pertains to delivery of possession by OPs by 30.06.2013 to the allottee of this apartment. The complainants also paid the amounts to OPs, as evidenced by receipts Ex.C6(a) to Ex.C6(k) on the record. The OPs wrote letter of offer of possession to complainants on 28.06.2013 vide Ex.C-7 in this case. The genuineness of this offer of possession would be considered infra by us. The complainants wrote letter to OPs on 23.07.2013 vide Ex.C8(a) pointing out the deficiencies of OPs indicating the offer of possession as un-genuine by OP. The loan sanction letter is Ex.C-9 by Indiabulls to the tune of Rs.25,00,000/- to complainants for this apartment. The loan document is Ex.C-10. The information was taken under right to information Act by one Subrat Kumar Pradhan from Municipal Council Zirakpur vide Ex.C-12(a) to the effect that no licence has been issued to builder of this project by the Municipal Council Zirakpur. The Aero Homes Group Housing Project, which is the project in dispute in this case, has not been yet completed. The copy of letter dated 26.02.2016 issued by Municipal Council Zirakpur to OPs is Ex.C-13, which has been relied upon by complainants to the effect that basic facilities in the project have not been completed by OPs. No completion certificate has been issued Consumer Complaint No.383 of 2017 9 to OPs by the authorities till 26.02.2016. The pending work has not bee completed by OPs in the project. Show cause notice was issued by Executive Officer of Municipal Council Zirakpur on 26.02.2016 to OPs for deficiencies and illegalities on their part. The complainants also tendered in evidence affidavit of Anurag Singla complainant no.1 Ex.C-A in support of their averments on the record.
5. The OPs also tendered in evidence affidavit of Darshan Gupta on behalf of OPs Ex.OP-A. This witness has deposed that he has been authorized by OPs vide Ex.OP-B on the record to pursue the case. He further stated that complainants are not the consumers of OPs. There is arbitration clause in the agreement, hence the complaint is not maintainable. He further deposed that complainants filed the complaint after four years from the date of offer of possession and it is barred by time. He further stated that payment of the installments was the essence of the agreement and complainants have violated the same. The OPs have right to forfeit the earnest money of the complainants on default of making payment of any installment in time. This witness further stated that the necessary permissions are Ex.OP-4. He further deposed that as per clause 5 (d) of the agreement, the allottee is liable to pay external electrification charges. The complainants paid the payment after disbursal of loan and committed default in making payment of installments in time. The documents relied upon by OPs have been duly considered by us. The final outstanding amount report dated 25.01.2018 is Ex.OP-1 on the record. This document proves that Consumer Complaint No.383 of 2017 10 OPs received Rs.43,33,5466/- from the complainants and an amount of Rs.9,57,501/- (including interest on due payment @1.5% from 30.06.2013 till 25.09.2017 for 51 months) is outstanding from complainants to OPs till date. Ex.OP-2 is the copy of postal receipt. Ex.OP-3 is the copy of application for issuance of occupation certificate for the project of Aero Homes written by OPs to the Executive Officer, Municipal Council Zirakpur. The completion certificate has not yet been issued by the competent authority to OPs and no such completion certificate is on the record led by OPs in this case. Ex.OP-4 is copy of environmental clearance certificate issued by State Level Environment Impact Assessment Authority, Punjab, Government of India, Ministry of Environment and Forests, dated 18.09.2012 to OPs regarding above project. Ex.OP4(a) is the copy of letter regarding no objection certificate issued by Air Headwuarters Vayu Bhavan, Rafi Marg New Delhi on 07.12.2011. Ex.OP4(b) is the copy of structure safety certificate of above project. Ex.OP4(c) is the copy of fire safety certificate issued by Fire Station, Dera Bassi (SAS Nagar) to OPs. Vide Ex.OP4(d), OPs applied for partially occupancy certificate of Aero Homes to Executive Officer, Municipal Council, Zirakpur.
6. From critical analysis of entire evidence on the record and hearing the respective submissions of counsel for the parties, we have reached this conclusion that undoubtedly there was clause in the agreement to sell that timely payment by the allottee is the essence of the agreement and the developer shall be entitled to Consumer Complaint No.383 of 2017 11 forfeit the earnest money on the default of allottee in this regard. No such amount of the complainants have been forfeited in this case by the OPs. The first point of controversy is as to whether the complainants are the consumers of OPs or not. We have come to this conclusion after perusal of pleadings and evidence on the record that complainants purchased this residential apartment from OPs. There is nothing on the record that they are property dealers or they have purchased it for resale purposes. They are husband and wife and consequently part of one family. It cannot be said that they are not the consumers and purchased this property for the purpose of resale only. The second point raised by OPs is that there is arbitration clause in the agreement and as such the consumer complaint is not maintainable. We are not swayed by this plea of OPs in this case. The matter has been settled so by the Apex Court in "National Seeds Corporation Limited Vs. M. Madhusudhan Reddy and another" 2012(2)CLT-382/383 and in Fair Air Engineers (P) Ltd. vs. N. K. Modi (1996) 6 SCC 385. It has been held by the Apex Court that Section 3 of C.P.Act gives additional remedy to consumers to avail of his remedy as per his choice. In view of Section 3 of C.P. Act conferring the additional remedy on the consumers, we find no force in the plea of OPs. The third point raised by counsel for OPs is that complaint is time barred, as complainants have filed it after four years. OPs have proved on record account statement of complainants vide Ex.OP-1, which shows the outstanding amount of Rs.9,57,501/- towards Consumer Complaint No.383 of 2017 12 complainants. In our view, the OPs have not delivered physical possession of the above apartment to the complainants complete in all respect and hence cause of action is continuing one in this. Hence, we repel this submission of counsel for the OPs.
7. The agreement to sell categorically stipulates the date of delivery of possession to complainants by 30.06.2013. The year 2018 has started running and 4-5 years have elapsed and as per the case of complainants, complete possession of the apartment has not been delivered by OPs. This fact is evident on the record by the information supplied by Executive Officer Municipal Council Zirakpur to Subrat Kumar Pradhan that completion certificate for this project has not been issued to OPs till 12.04.2017 vide Ex.C-12(a) even after about four years from the agreed date of delivery of possession. The information contained in Ex.C-12(a) pertains to this project only and this fact is thus established on record that OPs have not yet obtained the completion certificate uptil 12.04.2017 from the authorities under Section 14 of PAPRA Act, 1995. This information has further proved that builder's licence has not been issued by the Municipal Council Zirakpur in this case for completing the above project to OPs. On 26.02.2016, Municipal Council Zirakpur issued notice to OPs pointing out lack of basic facilities and amenities in the project by OPs and in not obtaining the completion certificate for this project. Certain omissions and illegalities have been pointed out on the part of OPs in this letter by Municipal Council Zirakpur. Any supervening event can be duly taken note of by this Commission for Consumer Complaint No.383 of 2017 13 arriving at correct conclusion in the case. The application of the complainant for additional evidence to prove them is accepted, because it relates to supervening events and this document can be duly taken into note of by us.
8. The OPs have not forfeited any such amount of the complainants for not depositing the amounts within time. The OPs might have waived this objection and have not taken this step accordingly. The complainants have paid most of the amounts to OPs in the year 2012 before the date fixed for delivery of possession. There is no evidence by OPs on the record that sewage connection has been released in this project, roads have been completed in the project, drainage system has been operationalized in the project. No such no objection certificates issued by competent authorities has been placed on the record. The completion certificate is always issued on completion of the basic amenities by the competent authority under Section 14 of PAPRA Act 1995 only. The non-issuance of completion certificate by competent authority under PAPRA Act points out that OPs have not completed the project and gave the offer of possession of incomplete possession only. The offer of incomplete possession without any occupancy certificate therewith issued by competent authorities is mere eye wash and no offer of complete possession. The OPs are, thus, deficient in service in not offering the possession to complainant within agreed time for want of completion certificate under Section 14 of PAPRA Act 1995 for want of basic amenities like sewage connection, drainage Consumer Complaint No.383 of 2017 14 connection, road and so on therein. The agreed date for delivery of possession has expired about four years ago, but even till date completion certificate has not yet been issued for this project by competent authorities to OPs, which indicates that the project has not yet been completed by the OPs. Without basic amenities and without completion certificate, the mere offer of possession is no possession in the eye of law.
9. The submission of counsel for complainants that OPs have changed the quality material like samsung door security system was not used, marble of the kitchen was changed with inferior quality, showers were changed and were not of jaguar company and so on. There is mere affidavit of complainant no.1 on the record to this effect, which has been equally rebutted by OPs. There is no report of any architect on the record to this effect nor there are any such photographs to establish this fact on the record. Consequently, in the absence of any solid proof of this fact by complainants, this finding cannot be recorded that OPs have changed the above referred materials.
10. The complainants have also challenged the demands towards external electrification charges, as illegal by OPs. The OPs controverted this averment of the complainants. The matter can be settled by reference to buyers agreement Ex.C-5 on the record. The demand raised by OPs towards external electrification charges is covered by clause 5(d) of the agreement. With regard to payment of water and sewer consumption charges and connection charges, Consumer Complaint No.383 of 2017 15 clause 5(d) enjoins the purchaser to bear the water and sewer consumption charges. Consequently, it cannot be said that they are beyond the terms of buyers agreement in this case and are unauthorized.
11. As a result of our above discussion, we have, thus, come to this conclusion that despite receipt of substantial consideration amount by OPs from complainants, they have not completed the project and they have failed to deliver the complete legal possession of the apartment to the complainants by the agreed date 30.06.2013. What to talk of the agreed date 30.06.2013, even the year 2018 has started running, but still no completion certificate has been obtained by the OPs nor it has been shown to us in this case during arguments. Consequently, without occupancy certificate, offer of possession is no possession in the eye of law. Withholding of legal possession to the allottee tantamounts to unfair trade practice on the part of developer justifying the refund of the deposited amount by the complainants with interest @12% per annum under Section 12 and Rule 17 of PAPRA Act, 1995.
12. As a result of our above discussion, we accept the complaint of the complainants and direct OPs to refund the entire deposited amount of Rs.43,33,546/- with interest @ Rs.12% p.a. from the date of their deposits till actual payment to complainants; further to pay Rs.70,000/- as compensation for mental harassment and Rs.30,000/- as litigation expenses. The above amounts shall be Consumer Complaint No.383 of 2017 16 payable by OPs to complainants within two months from the date of receipt of certified copy of the order.
13. Arguments in this complaint were heard on 22.02.2018 and the order was reserved. The certified copies of the order be communicated to the parties, as per rules.
14. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(J. S. KLAR) PRESIDING JUDICIAL MEMBER (SURINDER PAL KAUR) MEMBER February 23, 2018.
(MM)