State Consumer Disputes Redressal Commission
Gaurav Prehar vs Altus Space Builder Private Limited on 9 June, 2021
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
Consumer Complaint No.853 of 2019
Date of institution : 28.11.2019
Reserved On : 07.06.2021
Date of decision : 09.06.2021
Gaurav Prehar son of Sh. Raj Prehar, resident of House No.10, Sector
10, Chandigarh.
....Complainant
Versus
1. Altus Space Builders Private Limited, Registered Office at SCF-
22, 1st Floor, Phase-10, S.A.S. Nagar, Mohali, through Mr.
Harpreet Singh, its Authorized Signatory.
E-mail ID:[email protected]
2. The Greater Punjab Officer's Co-operative House Building
Society, C/o Altus Space Builders Private Limited, Sector 3-C &
4-C, Mullanpur, S.A.S. Nagar, Mohali, through its
President/Authorized Representative.
3. M/s Ajeet Associates, R/o 2741, Sector-69, S.A.S. Nagar,
Mohali, through Sh. Jatinder Pal Singh, its CEO.
....Opposite Parties
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
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 Argued By:
For the complainant : Sh. Varun Bhardwaj, Advocate For OP No.1 : Sh. R.S. Pandher, Advocate For OPs No.2 & 3 : Ex parte.Consumer Complaint No.853 of 2019 2
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 parties, seeking following directions to them:
i) to refund the principal amount of ₹50,05,000/-, along with interest at the rate of 8% per annum (₹33,14,684/- up to 10.11.2019) from respective dates of deposits till the date of actual refund. The total amount, along with interest up to 10.11.2019, comes to ₹83,19,684/-;
ii) to pay compensation of ₹1,00,000/- on account of mental and physical harassment as well as monetary loss suffered by the complainant;
iii) to pay ₹1,00,000/- on account of escalation of prices and construction material;
iv) to pay ₹55,000/- towards litigation expenses;
Totaling: ₹85,74,684/-.
v) It has also been prayed that compensation under Section 14 (hb) of the Act may also be awarded, on account of unfair trade practice adopted by the opposite parties with large number of persons; and
vi) to award any other relief, as may be deemed fit and proper in view of the facts and circumstances of the present case. Facts of the Complaint
2. Brief facts, as set out in the complaint, are that opposite parties No.1 & 2 launched a Mega Residential Housing Project in the revenue estates of villages Salamatpur, Dhodemajra & Saini Majra in Mullanpur Planning Area, GMADA, S.A.S. Nagar. The application submitted by opposite parties No.1 & 2 for grant of package of incentives for setting up that project was considered by the Consumer Complaint No.853 of 2019 3 Empowered Committee, Punjab under Industrial Policy, 2009 and, accordingly, the project was approved by that Committee on 21.06.2010. Letter of Intent dated 25.05.2011 was issued by the Chief Administrator, Punjab Urban Planning and Development Authority, Mohali (in short, "PUDA") for 168.64 acres of land, jointly in the names of opposite parties No.1 & 2. Thereafter, Change of Land Use (CLU) dated 17.11.2011 for 229.77 acres of land was issued to them. Additional CLU dated 14.05.2012 was issued for 26.41 acres of land. Another additional CLU dated 25.06.2013 was issued for 23.75 acres of land. In this process, the CLU for 279.93 acres of land was issued jointly in the names of opposite parties No.1 & 2. Against that CLU, layout of 276.61 acres was approved by the Chief Town Planner, Mohali, vide letter dated 08.05.2014. Thereafter, the Government of Punjab issued Notification dated 06.08.2014, vide which the project area to the extent of 219.92 acres was exempted from provisions of Punjab Apartment and Property Regulation Act, 1995 (in short, "PAPRA"), except Sections 5(9), 6 to 20 and 32 to 39. Against the approval of layout of 276.61 acres, opposite parties No.1 & 2 were permitted to develop an area only to the extent of 219.92 acres of land. Thus, an area of 56.69 acres of land has not been exempted from provisions of PAPRA. Plot of the complainant falls in Phase-II of the said project. As per Clause No.4 (v) of the Letter of Intent dated 25.05.2011, opposite parties No.1 & 2 were specifically restrained from not advertising/launching and collecting money from the general public till the layout plan is cleared by the competent authority and exemption Consumer Complaint No.853 of 2019 4 under Section 44 of PAPRA is issued by the Government. As per Clause No.8 of the Layout Plan dated 08.05.2014 also, opposite parties No.1 & 2 were directed to develop the site, sell the plots, advertise the project etc. only after obtaining the exemption from provisions of PAPRA. Environmental Clearance for the said project has been granted only on 16.01.2015 by State Level Environment Impact Assessment Authority (SEIAA), Punjab; that too for Phase-I and not Phase-II. Thus, till 16.01.2015, the opposite parties were not competent to break/dig the earth and commence development at the site. However, in violation of aforesaid letters and notification, the opposite parties launched the project namely "Muirwoods", Eco-City, New Chandigarh and started receiving money from the buyers. Opposite parties No.1 & 2 not only advertised their project in the year 2010, but also fleeced the general public to enter into Agreements to Sell with opposite party No.3, who in turn entered further agreements with the general public, including the complainant. Being allured by the representations made by the opposite parties in the advertisements, he executed a pre-printed Proposal Form and Agreement to Sell dated 05.05.2011 with opposite party No.3, regarding booking of a plot measuring 350 sq.yds. in that project at the rate of ₹12,900/- per sq.yd.; which was inclusive of EDC and IDC. Against that, the complainant made full and final payment of ₹45,15,000/-. Besides this, he also made another payment of ₹2,45,000/- towards charges of CLU and Licence Fee. A cheque bearing No.952803 dated 05.05.2011 amounting to ₹47,60,000/- against the price of that plot was also Consumer Complaint No.853 of 2019 5 issued by him, which was duly encashed by the opposite parties. That amount is also mentioned in the Agreement to Sell dated 05.05.2011. Thereafter, on demand raised by the opposite parties, the complainant further paid a sum of ₹2,45,000/- towards EDC, through cheque No.133954 dated 10.06.2014, vide receipt dated 13.06.2014 issued by opposite party No.3. Thus, a total sum of ₹50,05,000/- stood paid by the complainant towards the price of the plot etc. as per table given in Para-8 of the complaint. In-spite of receipt of huge amount, the opposite parties remained silent about development of the site and possession of the plot. The complainant had booked the said plot, exclusively to own independent house for him and for his family's residence, by paying his lifelong savings, but even after lapse of eight years from the date of booking, the physical possession of the plot has not been offered. The opposite parties flouted the terms and conditions of the LoI, approval of layout plan etc. issued from time to time, while launching the project. Vide letter dated 26.09.2013, the opposite parties devised a novel way to fleece the general public, by misrepresenting that they are going to start the process of executing Buyer-Seller Agreements and asked the buyers to reconcile the accounts and make pending payments, whereas the layout plans were approved only on 08.05.2014. However, the execution of agreement, draw of lots and allotment of plots took place only in the year 2015. Further, vide letters dated 12.02.2014 and 15.05.2014, it was informed that the layout plans for Phase-II of the project were in final stages of approval at that time. Even the draw of lots for allotment of plot Consumer Complaint No.853 of 2019 6 numbers was held on 30.08.2015 i.e. after a gap of two years. The complainant visited the offices of the opposite parties various times to know the status of development, allotment and possession of the plot, but there was no development at the site. Pre-printed Plot Buyer's Agreements were sent to various buyers in the month of July, 2015, with a direction to send the same back after signing without any amendment. However, the complainant has not received any such agreement till the date of filing of the complaint. He had already deposited the EDC with the opposite parties. Even otherwise, the complainant would not have signed the agreement after reading the terms and conditions, specifically Article 5, as per which possession of the unit was to be delivered within a period of 30 months (with extended period of six months). It means that the possession of the unit was to be delivered in the year 2018. However, in the Agreement to Sell, no such promise to deliver possession within 36 months from 05.05.2011 was given. The opposite parties utilized the hard earned money of the complainant for such a long period without carrying out any kind of development at the site. It is further averred that one plot was purchased by the brother of the complainant, independently and separately in that project and photocopy of Buyer's Agreement dated 14.07.2015 received by his brother is annexed with the complaint as Ex.C-9. The opposite parties provisionally allotted plot No.88, Phase-II, "Muirwood" Eco City, New Chandigarh to the complainant, but no size and dimensions of the plot were mentioned. Even the actual date of delivery of possession of the plot was not disclosed. The opposite Consumer Complaint No.853 of 2019 7 parties violated various provisions of PAPRA. The complainant was shocked to visit the site and see that there is no proper access to the site, as per the approved layout plan and only agricultural fields are existing at the site. There is no development and only signboards are standing/affixed. There are no swings, no community centre, no recreational infrastructure, no complete roads etc. There is no sewerage system or Sewerage Treatment Plant (STP), no overhead/underground tanks for supply of potable water or tubewells. Even the plot, in question, is 1 ft. to 2 ft. deep from the level of natural earth at the site. The basic amenities have also not been provided at the site. Vide letter dated 15.12.2107, the opposite parties intimated that 'offer of possession' for plots has been commenced for Pocket-C in Phase-I and around 200 plots in Phase-II and possession of remaining plots in both Phases would be offered soon. It means that the entire infrastructure was not completed as on 15.12.2017. Possession of the plot, in question, has not been offered till the date of filing of the complaint. The complainant served legal notice dated 07.08.2019 upon the opposite parties, but to no effect. The aforesaid act and conduct of the opposite parties amount to deficiency in service and unfair trade practice. Hence, the present complaint. Defence of the Opposite Parties
3. Upon notice, opposite party No.1 appeared and filed reply to the complaint, whereas opposite parties No.2 & 3 failed to appear despite their service and were proceeded against ex parte, vide orders dated 22.09.2020 and 28.02.2020 respectively.
Consumer Complaint No.853 of 2019 8
4. Opposite party No.1, in its reply, raised preliminary objections that the project of opposite party No.1 is a Residential Housing Project, duly approved by the Government, regarding which CLU was approved on 10.09.2012 for 127.58 acres of land. Prior to that, CLU for 229.77 acres of land was granted on 17.11.2011, CLU for 26.41 acres was granted on 14.05.2012 and CLU for 23.75 acres was granted on 25.06.2013 for the first phase of the project. The layout plan was approved on 08.05.2014. Subsequently, the layout plan submitted on 07.02.2015 was cleared by Chief Town Planner, Punjab on 31.03.2015. Copies of CLUs and layout plan are Ex.OP-1/1 to Ex.OP-1/6. Plot Buyer's Agreement (in short, agreement") dated 14.07.2015, Ex.C-9, was executed between the complainant and opposite party No.1. As per Clause 5.1 (a) of the said agreement, the seller was to put its best efforts to complete the development of the said plot/project within 30 months with extended period of 6 months from the date of signing the agreement. As per Clause 5.1 (d) of the agreement, in the event of default of the purchaser in fulfillment of terms and conditions of the agreement, the developer was entitled to reasonable extension in offering/delivery of possession of plot. Clause 9.4 of the agreement provides that the said agreement constitutes the entire agreement between the parties and supersedes all previous agreements, oral, written or implied. Hence, terms and conditions of the said agreement are binding on the parties. Possession of the plot became due on completion of terms and conditions of the agreement and payment of balance amount by the complainant. The development Consumer Complaint No.853 of 2019 9 work of the project is at final stage and opposite party No.1 is ready to hand over possession of the plot to the complainant. Photographs of the development at the site are Ex.OP-1/7 (colly.). As per Clause 5.1
(c) of the agreement, opposite party No.1 is liable to pay ₹5/- per sq.yd. per month of the area of the plot for the period of delay in offering the possession of the said plot, beyond the stipulated period. However, the complainant failed to make due payments and has filed this complaint for refund of the deposited amount, on account of slump in the real estate market. The Plot Buyer's Agreement also provides that the buyer may opt for cancellation only within three months from the receipt of said agreement in person and in case the allotment is cancelled at the behest of the buyer, then the developer is authorized to forfeit the earnest money, along with interest thereon and the amount, if any, paid over and above the interest shall be refunded without any interest after resale of the plot by the developer. Opposite party No.1 has got environmental clearance as well as other required clearances from the Government authorities and the project is registered with the Real Estate Regulatory Authority (RERA), SAS Nagar, Punjab. As per Article 13 of the agreement, the dispute between the parties is liable to be referred for arbitration. The complainant does not fall under the definition of 'consumer', as he purchased the plot for investment purpose only. On merits, contents of para Nos.1, 2, 2(a) to 2(n), 3, 4 & 5 have been denied to be wrong. Contents of Para No.6 to 8 regarding payment of amount are stated to be matter of record. It is further pleaded that the development works at Consumer Complaint No.853 of 2019 10 the project site are at final stages and opposite party No.1 is ready to hand over possession of the plot to the complainant. The complainant has intentionally placed on record old photographs of the site. The latest photographs of development of the site are Ex.OP-1/7 (colly.). All other allegations levelled in the complaint were denied and it was prayed that the complaint be dismissed.
Evidence of the Parties
5. To prove his claim, the complainant filed his own self- attested affidavit, along with copies of documents i.e. Letter of Intent dated 25.05.2011 Ex.C-1, Agreement to Sell (Full and Final) dated 05.05.2011 Ex.C-2, Calculation Sheet Ex.C-3, cheques Ex.C-4 and Ex.C-5, receipt dated 13.06.2014 Ex.C-6, letter dated 26.09.2013 Ex.C-7, letter dated 12.02.2014 Ex.C-8, unsigned Plot Buyer's Agreement Ex.C-9, photographs Ex.C-10 (colly.), letter dated 15.12.2017 Ex.C-11, legal notice dated 29.06.2019 Ex.C-12 and original postal receipts Ex.C-13.
6. Opposite party No.1, in support of its defence, filed affidavit of Sh. Jaswinder Singh, Authorized Signatory, along with copies of documents i.e. CLU dated 17.11.2011 Ex.OP-1/1, CLU dated 14.05.2012 Ex.OP-1/2, CLU dated 25.06.2013 Ex.OP-1/3, CLU dated 10.09.2012 Ex.OP-1/4, approval of layout plan dated 08.05.2014 Ex.OP-1/5, letter dated 20.07.2015 Ex.OP-1/6, photographs Ex.OP-1/7 (colly.) and letters dated 22.11.2017 and 14.12.2017 issued by RERA, Punjab Ex.OP-1/8 (colly.) Consumer Complaint No.853 of 2019 11 Contentions of the Parties
7. We have heard learned counsel for the complainant and opposite party No.1, as opposite parties No.2 & 3 are ex parte. We have also gone through the written arguments submitted on behalf of the complainant and opposite party No.1 and record carefully.
8. The written arguments submitted on behalf of the complainant are on the lines of averments made in the complaint. The sum and substance of oral and written arguments is that the opposite parties failed to deliver possession of the plot, in question, within the reasonable period, despite receipt of substantial amount towards the price thereof. They failed to carry out any development works at the site and utilized the amount received from the allottees, including the complainant, for their own purpose. The opposite parties violated various provisions of PAPRA. The opposite parties committed violation of Section 6(1) of PAPRA, by not executing the Plot Buyer's Agreement before receipt of more than 25% of sale consideration of the plot. Only an unsigned and pre-printed copy of the agreement was sent to the brother of the complainant who also booked a plot with them, but no Plot Buyer's Agreement has been executed between the complainant and the opposite parties regarding the plot, in question. The project was launched, advertisements were got published and amounts were received from the buyers by the opposite parties, prior to receiving the necessary permissions from the competent authorities, which is also against the provisions of PAPRA. It has been further contended that there is no development at all and even there is no Consumer Complaint No.853 of 2019 12 access to the project site. No basic amenities or other facilities have been provided. The deficiency in service and unfair trade practice on the part of the opposite parties have been proved on record and the complainant is entitled to all the reliefs, as prayed for in the complaint.
9. The written arguments submitted on behalf of the opposite party No.1 are on the lines of pleadings made in its reply. The sum and substance of oral and written arguments is that the project of opposite party No.1 has been duly approved and CLUs, as discussed above, have been issued by the competent authorities. As per Clause 5.1 of the agreement, in the event of default of the purchaser in fulfillment of terms and conditions of the agreement, the developer shall be entitled to reasonable extension of time for offering/delivering possession. Thus, the delay in delivery of possession is duly covered under this Clause, on account of non-payment of balance amount by the complainant. The complainant did not pay the instalments, as per terms of the agreement, regularly. The project is at final stage, as is apparent from photographs, Ex.OP-1/7 (colly.), and opposite party No.1 is ready to deliver possession of the plot. As per Clause 5.3 (c) of the agreement, if the developer fails to deliver possession of the plot, it may offer the purchaser an alternative property or refund the full deposited amount along with interest at the rate of 9% per annum without any further liability. The complainant purchased the plot for investment purpose and hence he does not fall under the definition of 'consumer'. He has filed this complaint due to slump in the real estate market. It has been further contended that the complaint is time Consumer Complaint No.853 of 2019 13 barred, as the Plot Buyer's Agreement, Ex.C-9, was executed on 14.07.2015, whereas the complaint has been filed in the year 2019. As per arbitration clause in the agreement, the dispute between the parties is liable to be referred to arbitration. There is no deficiency in service on the part of opposite party No.1 and the complaint is liable to be dismissed.
Consideration of Contentions
10. We have given our thoughtful consideration to the respective contentions raised by the learned counsel for the parties.
11. Firstly, we would like to dispose of preliminary objection raised by opposite party No.1 in its reply that the complainant does not fall under the definition of "consumer" as defined in the Act, on the ground that he purchased the plot for commercial purpose.
12. In this regard, it needs to be mentioned that there is no evidence led by the opposite parties to prove that the complainant is indulging in sale/purchase of property for commercial purpose. Therefore, simple assertion in this regard in the reply of opposite party No.1, without any cogent and convincing evidence in support thereof, is not sufficient to prove this fact. Hon'ble National Commission in M/s IREO FIVERIVER PVT. LTD. v. SURINDER KUMAR SINGLA & OTHERS First Appeal No.1358 of 2016, decided on 29.11.2016, while relying upon its earlier decision in KAVITA AHUJA & OTHERS v. SHIPRA ESTATE LTD. & JAI KRISHNA STATE DEVELOPERS PVT. LTD. & OTHERS Consumer Case No.137 of 2010, decided on 12.02.2015, held the complainants as consumers, observing that the Consumer Complaint No.853 of 2019 14 appellant failed to show any cogent evidence, which may indicate that the respondents/complainants or any of them has been indulging in sale/purchase of the properties or that the complainants or any one of them had booked the subject plots in the development project undertaken by the appellant with the intention to sell the plot on subsequent date for earning profit. The Hon'ble National Commission in III (2015) CPJ 63 (NC) Beatty Tony versus Prestige Estate Projects Pvt. Ltd., also held that merely on booking of the plot it cannot be presumed that it is booked for 'commercial purpose' and the complainant was considered as a 'consumer'. In the instant case also, as already discussed above, there is no evidence led by the opposite parties to prove that the complainant indulged in sale/purchase of properties or that he purchased the plot, in question, for further sale or for earning profits. Accordingly, the above said objection/contention of opposite party No.1 is rejected and the complainant is held to be 'consumer', under the Act.
13. So far as the other objection of opposite party No.1 that as per Arbitration Clause in the agreement, the matter between the parties is liable to be resolved through arbitration, is concerned, it is relevant to mention here that the Larger Bench of the Hon'ble National Commission, vide order dated 13.07.2017, passed in Consumer Complaint No.701 of 2015 titled as Aftab Singh v. EMAAR MGF Land Limited & Anr., also held that an Arbitration Clause in the afore- stated kind of Agreements between the Complainants and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, Consumer Complaint No.853 of 2019 15 notwithstanding the amendments made to Section 8 of the Arbitration Act, 1996. The Civil Appeal No.(s) 23512-23513 of 2017 (M/s EMAAR MGF Land Limited & Anr. Vs. Aftab Singh) filed against the said order of the Hon'ble National Commission has also been dismissed by the Apex Court, vide order dated 13.02.2018. Review Petition (C) Nos. 2629-2630 of 2018 in Civil Appeal Nos. 23512-23513 of 2017 filed against the above said order dated 13.02.2018 was also dismissed by the Hon'ble Supreme Court, vide order dated 10.12.2018. Consequently, the existence of an Arbitration Clause in the agreement is not a bar to resolve this dispute by this Commission. Accordingly, the said objection of opposite party No.1 is also rejected.
14. So far as the plea of learned counsel for opposite party No.1 regarding limitation is concerned, first of all opposite party No.1 is relying upon an unsigned and unexecuted agreement, Ex.C-9, on which only date '14.07.2015' has been typed and all other columns are lying blank. Furthermore, it is the specific plea of the complainant that his brother has also booked a plot in the project, in question, and copy of unsigned agreement, Ex.C-9, has been received by his brother. Therefore, the agreement, Ex.C-9, cannot be taken into consideration in any manner. Be that as it may, the fact remains that admittedly the complainant has paid huge amount of ₹50,05,000/- towards the sale price of the plot, in question, etc. but neither the possession of the plot has been delivered, nor the amount deposited by him has been refunded till date. It is now well settled that in such cases there is a continuous cause of action till the possession is delivered or the Consumer Complaint No.853 of 2019 16 amount is refunded along with interest, compensation and costs etc. Hon'ble National Commission in "Navin Sharma (Dr.) & others v. Unitech Reliable Projects Pvt. Ltd. & Anr." 2016(2) CLT 457 has held that unless or until the complainants get possession of the flats, they have got continuous cause of action. In para 8 of the said judgment it has been observed by the Hon'ble National Commission as under:-
"8. The first submission made by the counsel for the opposite party was that the case is barred by time. This argument was raised merely for the sake of cavil. It is now well settled that unless or until the complainants get the possession of the flats, they have got continuous cause of action. This view finds support from this authority reported in "Raghava Estates Ltd. v. Vishnupuram Colony Welfare Association" Special Leave to Appeal (Civil) No.35805 of 2012, decided on 07.12.2012."
15. In another case Satish Kumar Pandey & Anr. v. M/s Unitech Ltd. 2015 (3) CPJ 440 (NC), the Hon'ble National Commission held in Para-17 as follows:
"17. It was next contended by the learned counsel for the respondent that since the last date stipulated in the buyers agreement for giving possession of the flat to them expired more than two years ago, the complaint is barred by limitation prescribed in Section 24A of the Consumer Protection Act. It is now settled legal proposition that failure to deliver possession being a continuous wrong it constitutes a recurrent cause of action and, therefore, so long as the possession is not delivered to him the buyers can always approach a Consumer Forum. It is only when the seller flatly refuses to give possession that the period of limitation prescribed in Section 24A of the Consumer Protection Act would begin to run. In that case, the complaint has to be filed within two years from the date on which the seller refuses to deliver possession of the flats to the complainants at any point of time and, therefore, the cause of action continues to subsist in favour of the complainants. Reliance in this regard may be placed upon the decision of the Hon'ble Supreme Court in Meerut Development Authority v. M.K. Gupta IV (2012) CPJ 12, Consumer Complaint No.853 of 2019 17 where the Hon'ble Supreme Court held that in such a case the buyer has a recurrent cause for filing a complaint for non- delivery of possession of the plot."
Similarly, in the present case, there is no denial on the part of opposite parties No.1 & 3 to deliver the possession. Since neither possession has been delivered nor the amount deposited by the complainant has been refunded till date, so in view of the ratio of the law laid down in the above noted authorities, it is a continuous cause of action and the complaint filed by the complainant is within limitation.
16. Now, coming to merits of the case, at the outset, it is relevant to mention that the merits of the present complaint are squarely covered by the earlier verdicts given by this Commission in following cases:
i) Consumer Complaint No.633 of 2019 (Mr. Navdeep Singh Sohi v. Altus Space Builders Private Limited & Ors.) decided, vide order dated 31.08.2020;
ii) Consumer Complaint No.85 of 2020 (Mr. Rohit Garg v. Altus Space Builders Private Limited & Ors.) decided, vide order dated 31.08.2020;
iii) Consumer Complaint No.113 of 2020 (Dr. Neelam Kumar Garg v. Altus Space Builders Private Limited) decided, vide order dated 31.08.2020;
iv) Consumer Complaint No.435 of 2019 (Simmi Gurjeet Singh & Ors. v. M/s Altus Space Builders Private Limited & Ors.) decided, vide order dated 06.12.2019;
v) Consumer Complaint No.433 of 2019 (Anil Kumar Sharma v.
M/s Altus Space Builders Private Limited & Ors.) decided, vide order dated 17.10.2019; and
vi) Consumer Complaint No.350 of 2018 (Indra Singla v. M/s Altus Space Builders Private Limited & Ors.) decided, vide order dated 15.10.2018.
Consumer Complaint No.853 of 2019 18So, we proceed to dispose of the present complaint, in view of the decisions given in the above noted cases.
17. Admittedly, the complainant booked a plot, measuring 350 sq.yds., in the aforesaid project of opposite parties No.1 & 3 and Agreement to Sell (Full and Final), Ex.C-2, was executed between opposite party No.3-M/s Ajeet Associates and the complainant on 05.05.2011. The price of the said plot was fixed as ₹12,900/- per sq.yd., excluding CLU, EDC, IDC or other Government charges etc. The complainant paid a total sum of ₹50,05,000/- towards the price of the plot to opposite party No.1, vide cheques/receipt Ex.C-4 to Ex.C-6.
18. 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 opposite party No.3 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 it and the evidence led by the complainant stands unrebutted; for which an adverse inference is to be drawn against opposite party No.3.
19. So far as the complaint against opposite party No.2-The Greater Punjab Officer's Co-operative House Building Society is concerned, although opposite party No.2 did not appear despite its Consumer Complaint No.853 of 2019 19 service and was proceeded against ex parte; however, it needs to be mentioned that the agreement, Ex.C-2, regarding allotment of the plot, in question, was executed between opposite party No.3 and the complainant. Payment of ₹50,05,000/- was made by the complainant to opposite party No.1, through cheques/receipt Ex.C-4 to Ex.C-6. Mere issuance of LoI, CLUs and approval of layout plans Ex.OP-1/1 to Ex.OP-1/3 and Ex.OP-1/5 in the names of opposite party No.1 and opposite party No.2 does not mean that any contract was executed between the complainant and opposite party No.2. The contract for sale of the plot has been executed by way of agreement, Ex.C-2, only between the complainant and opposite party No.3 and payment of aforesaid amount was made to opposite party No.1. Opposite party No.2 is nowhere a party to that agreement, nor any amount was received by it from the complainant. In the absence any specific contract between opposite party No.2 and the complainant, no liability can be fastened upon it. Therefore, the complaint against opposite party No.2 is liable to be dismissed.
20. Opposite party No.1 has wrongly pleaded that Plot Buyer's Agreement, Ex.C-9, was executed between it and the complainant on 14.07.2015. The complainant has specifically pleaded that his brother had also booked a plot in the project of opposite parties No.1 & 3 and copy of Plot Buyer's Agreement Ex.C-9 was received by his brother. Be that as it may, the fact remains that the agreement, Ex.C-9, is only a printed form and it is not signed by the buyer or opposite parties No.1 & 3. Thus, the same has no evidentiary value. Opposite party Consumer Complaint No.853 of 2019 20 No.1 is wrongly relying upon an unsigned document. The same cannot be relied upon. The fact remains that opposite parties No.1 & 3 have failed to enter into written Plot Buyer's Agreement or issue specific allotment letter to the complainant. Section 6 (1) of PAPRA reads as under:
6.(1) Notwithstanding anything contained in any other law for the time being in force, a promoter who intends to construct or constructs a building of apartments, all or some of which are to be taken or are taken on ownership basis, or who intends to offer for sale plots in a colony, shall, before he accepts any sum of money as advance payment or deposit, which shall not be more than twenty five percent of the sale price, enter into a written agreement for sale with each of such persons who are to take or have taken such apartments, or plots, as the case may be, and the agreement shall be in the prescribed with together with prescribed documents and shall be registered under the Registration Act, 1908 (Central Act no. 16 of 1908).
Provided that, if only a refundable application fee is collected from the applicant before draw of lots for allotment, such agreement will be required only after such draw of lots."
21. Perusal of above reproduced Section 6 (1) of PAPRA shows that before accepting 25% of the sale price, the builder/developer shall enter into a Written Agreement/Plot Buyer's Agreement, containing all the relevant terms and conditions for sale of property with the buyer. However, opposite parties No.1 & 3 failed to enter into written Plot Buyer's Agreement or issue allotment letter for sale of the plot, in question, despite receipt of aforesaid huge amount of ₹50,05,000/- from the complainant. The Agreement to Sell, Ex.C-2, executed between the complainant and opposite party No.3 cannot be said to be a comprehensive agreement, as it does not contain the stipulated period for delivery of possession and other relevant clauses Consumer Complaint No.853 of 2019 21 etc. Thus, it is held that opposite parties No.1 & 3 committed violation of Section 6 (1) of PAPRA, by not entering into written Plot Buyer's Agreement for Sale of the plot with the complainant and also failed to get it registered. This amounts to unfair trade practice and deficiency in service on their part.
22. It also needs to be emphasized that no stipulated period for delivery of possession has been provided in the Agreement to Sell (Full and Final) dated 05.05.2011, Ex.C-2, executed between the complainant and opposite party No.3, who is partner of opposite party No.1. However, it is a matter of common knowledge that the possession of a plot/flat etc. is to be delivered within a reasonable period of three years from the date of execution of agreement between the parties. Thus, we infer that possession of the plot, in question, was to be delivered within a period of three years from the date of execution of Agreement to Sell Ex.C-2, i.e. up to 04.05.2014. Opposite party No.1 pleaded in its reply that development work of the project is at final stage and it is ready to hand over possession of the plot to the complainant. It has got environmental clearance as well as other required clearances from the Government authorities. Opposite party No.1, vide letter dated 15.12.2017, Ex.C-11, also intimated the buyers that the offer of possession of plots had been commenced with Pocket-C in Phase-I and around 200 plots in Phase-II and offer of possession of remaining plots in both the phases would be offered progressively. However, no evidence has been led by opposite party No.1 to show any kind of development at the site. Moreover, Section Consumer Complaint No.853 of 2019 22 14 of PAPRA deals with responsibility of the builder/promoter to obtain Completion and Occupation Certificate from the competent Authority, which reads as under:
14. It is the responsibility of the promoter-
(i) in the case of apartments, to obtain from the authority required to do so under any law completion and occupation certificates for the building and if a promoter, within a reasonable time, after the construction of the building, does not apply for an occupation certificate from the aforesaid authority, the allottee of an apartment may apply for an occupation certificate from the said authority; and
(ii) in the case of a colony, to obtain completion certificate from the competent authority to the effect that the development works have been completed in all aspects as per terms and conditions of the licence granted to him under section 5.
(2) The authority referred to in sub-section (1) shall, after satisfying itself about the agreement of sale between the promoter and the allottee, and the compliance of the building regulations and all other formalities, issue an occupation certificate."
23. Further, Clause 3.12 (i) of the Notification dated 07th July, 2015 published in the Punjab Government Gazette Extraordinary by Department of Local Government (Town Planning Wing), which is applicable to the properties falling within the Municipal Limits, provides as under:
"No person shall occupy or allow other person to occupy any new building or part of a new building for any purpose whatsoever until such building or part thereof has been certified by the local authority or of any person authorized by it in this behalf to be in every respect completed according to the sanctioned plan and fit for the use for which it is erected."
24. A reference can also be made to Section 272 of The Punjab Municipal Corporation Act, 1976, which reads as under:- Consumer Complaint No.853 of 2019 23
"272. Completion Certificate. -
(1) Every person who employs a licensed architect or engineer or a person approved by the Commissioner to design or erect a building or execute any work shall, within one month after the completion of the erection of the building or execution of the work, deliver or send or cause to be delivered or sent to the Commissioner a notice in writing of such completion accompanied by a certificate in the form prescribed by byelaws, made in this behalf and shall give to the Commissioner all necessary facilities for the inspection of such building or work.
(2) No person shall occupy or permit to be occupied any such building or use or permit to be used any building or a part thereof effected by any such work until permission has been granted by the Commissioner in this behalf in accordance with bye-laws made under this Act: Provided that if the Commissioner fails within a period of thirty days after the receipt of the notice of completion to communicate his refusal in grant such permission, shall be deemed to have been granted."
25. The Hon'ble National Commission in its order dated 13.06.2018 passed in First Appeal No.855 of 2018 (Vision India Realtors Pvt. Ltd. & Anr. v. Sanjeev Malhotra), categorically held that legal possession cannot be delivered in the absence of Completion Certificate issued by the Competent Authority. It was held in Para No.5 as follows:
5. During the course of hearing, it was submitted by the learned counsel for the appellant that the completion certificate in respect of the project was obtained by the appellant on Consumer Complaint No.853 of 2019 24 15.03.2016. A copy of the communication dated 15.03.2016 from Municipal Council, Kharar has been placed on record. It is therefore, evident that the completion certificate having been received only on 15.03.2016, the appellant could not have offered legal possession of the apartment to the complainant at any time before that date. As noted earlier, the amount of Rs.1,81,375/- was demanded on 20.04.2015 and the amount of Rs.2,12,489/- was demanded on 06.02.2016. The complainant was requested to pay the aforesaid amount so that the appellant could offer the possession of the flat. The said offer of possession was meaningless being unlawful as the requisite completion certificate had not been obtained by that date......."
26. However, no Completion/Occupation Certificate issued by the competent authority has been produced by opposite parties No.1 & 3 on the record, which itself is violation of above reproduced Section
14 of PAPRA and Clause 3.12 (i) of the Notification dated 7th July, 2015 published in the Punjab Government Gazette Extraordinary by Department of Local Government (Town Planning Wing) as well as Section 272 of The Punjab Municipal Corporation Act, 1976, reproduced above. Thus, in view of the law laid down by the Hon'ble National Commission in the above noted authority, in the absence of Completion/Occupation Certificate issued by the competent authority, the photographs, Ex.OP-1/7(colly.) produced by opposite party No.1 are of no help to it. It is not proved on record by way of cogent and convincing evidence that the development at the site has been completed in all respects and that opposite parties No.1 & 3 are in a position to deliver physical possession of the plot to the complainant. Consumer Complaint No.853 of 2019 25 When opposite parties No.1 & 3 themselves failed to carry out any kind of development at the site and deliver possession of the plot within a reasonable period of three years from the date of execution of agreement, Ex.C-2, then the complainant was justified in withholding the remaining amount, if any.
27. Opposite party No.1 pleaded in its reply that CLU for 229.77 acre of land was granted on 17.11.2011, vide letter Ex.OP-1/1; CLU for 26.41 acres was granted on 14.05.2012, vide letter Ex.OP- 1/2; CLU for 23.75 acres was granted on 25.06.2013, vide letter Ex.OP-1/3 for the first phase of the project and the CLU was approved on 10.09.2012 for 127.58 acres of land, vide letter Ex.OP-1/4 and the layout plan was approved on 08.05.2014, vide letter Ex.OP-1/5. However, we find that the said CLUs/layout plans were granted/sanctioned, subject to compliance of various terms and conditions mentioned therein, such as obtaining of NOC from PPCB under the Water (Prevention and Control of Pollution) Act, 1974, Municipal solid Waste Management and Handling Rules, 2008, approval/NOC from Competent Authority to fulfill the requirement of Notification dated 14.09.2006 of the Ministry of Environment and Forest, Government of India, permission from Forest Deptt. under Forest Act, 1980 and P.L.P. Act etc. However, opposite party No.1 has failed to bring any evidence on record to prove that it has complied with the terms and conditions mentioned in the above said letters, in letter and spirit. In the absence of such evidence, an adverse inference is to be drawn against opposite parties No.1 & 3 that they have not Consumer Complaint No.853 of 2019 26 complied with those terms and conditions. Besides this, opposite parties No.1 & 3 have also violated various provisions of PAPRA.
28. As per Section 3 (General Liabilities of Promoter) of the PAPRA, opposite parties No.1 & 3 were required to make full and true disclosure of the nature of their title to the land, on which such colony is developed or such building is constructed or is to be constructed, make full and true disclosure of all encumbrances on such land, including any right, title, interest or claim of any party in or over such land. They were also required to give inspection on seven days' notice or demand of the layout of the colony and plan of development works to be executed in a colony as approved by the prescribed authority in the case of a colony. However, opposite parties No.1 & 3 failed to lead any evidence to prove that they have complied with Section 3 of the PAPRA.
29. As per Section 5 (Development of land into Colony) of PAPRA, a builder/developer is liable to obtain permission from the competent authority for developing the colony. However, opposite parties No.1 & 3 have also not led any evidence to prove that they have obtained the requisite permission/approvals etc. from the competent authorities before setting up their project. Thus, they violated Section 5 of PAPRA.
30. As per Section 9 of PAPRA, every builder is required to maintain a separate account in a scheduled Bank, for depositing the amount deposited by the buyers, who intend to purchase the plots/flats, but no evidence has been led on the record by the opposite Consumer Complaint No.853 of 2019 27 parties No.1 & 3 to prove that any account has been maintained by them in this respect. As such, they also violated Section 9 of the PAPRA.
31. 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 opposite parties No.1 & 3, with the hope to get the possession of the plot within a reasonable time. The circumstances clearly show that opposite parties No.1 & 3 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 opposite parties No.1 & 3 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 plot within a reasonable period. From the facts and evidence brought on the record of the complaint, it is clearly made out that opposite parties No.1 & 3, i.e. builders, knew from the very beginning that they 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 plot, due to which he has suffered mental agony and harassment. It is the settled principle of law that compensation should be commensurate with the Consumer Complaint No.853 of 2019 28 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.
32. In view of our above discussion, it is proved that opposite parties No.1 & 3 failed to deliver possession of the plot, in question, within a reasonable period of three years from the date of execution of Agreement to Sell, Ex.C-2; which was executed on 05.05.2011. The deficiency in service and unfair trade practice on the part of opposite parties No.1 & 3 have been clearly proved on record. The complainant has prayed for refund of the deposited amount along with interest at the rate of 8% per annum etc. Thus, opposite parties No.1 & 3 are liable to refund the entire amount deposited by the complainant with them, i.e. ₹50,05,000/- (Rupees Fifty Lac and Five Thousand only), along with compensation, on account of financial loss suffered by the complainant for depriving him of the utilization of the said amount during the period it remained with opposite parties No.1 & 3, calculated at the rate of 8% per annum from the respective dates of deposit till realization. Besides this, the complainant is also entitled to suitable compensation for the mental agony and harassment suffered by him, on account of deficiency in service and unfair trade practice adopted Consumer Complaint No.853 of 2019 29 by opposite parties No.1 & 3, including litigation costs and other expenses.
33. So far as the prayer of the complainant, regarding award of compensation on account of escalation of prices and building material, is concerned, since the entire amount deposited by him is going to be refunded along with interest, so the same will take care of that prayer of the complainant.
34. Accordingly, the complaint filed by the complainant is partly allowed against opposite parties No.1 & 3 and the same is dismissed against opposite party No.2. Following directions are issued to opposite parties No.1 & 3:
i) to refund the entire amount deposited by the complainant, i.e. ₹50,05,000/- (Rupees Fifty Lac and Five Thousand only), along with compensation, on account of financial loss suffered by the complainant for depriving him of the utilization of the said amount during the period it remained with opposite parties No.1 & 3, calculated at the rate of 8% per annum from the respective dates of deposit till realization; and
ii) to pay ₹50,000/- (Rupees Fifty Thousand only) as compensation for the mental agony and harassment etc. suffered by the complainant, including litigation costs and other expenses.
35. The compliance of this order shall be made by opposite parties No.1 & 3 within a period of 30 days of the receipt of certified copy of the order.
Consumer Complaint No.853 of 2019 30
36. The complaint could not be decided within the statutory period due to heavy pendency of court cases and the pandemic of COVID-19.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (RAJINDER KUMAR GOYAL) MEMBER June 09, 2021.
(Gurmeet S)