National Consumer Disputes Redressal
Faridkot Improvement Trust & Anr. vs Navdeep Goyal & Anr. on 16 August, 2022
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 1342 OF 2018 (Against the Order dated 28/03/2018 in Complaint No. 478/2017 of the State Commission Punjab) 1. FARIDKOT IMPROVEMENT TRUST & ANR. THROUGH ITS CHAIRMAN FARIDKOT 2. THE FARIDKOT IMPROVEMENT TRUST THROUGH ITS EXECUTIVE OFFICER, FARIDKOT ...........Appellant(s) Versus 1. NAVDEEP GOYAL & ANR. S/O. SH. DEPUTY SINGH GOYAL, THROUGH ITS GENERAL POWER OF ATTORNEY SHRI DEPUTY SINGH GOYAL, R/O. PETROL PUMP WALI GALI, BHAN SINGH COLONY, FARIDKOT 2. STATE OF PUNJAB THROUGH ITS PRINCIPAL SECRETARY, DEPARTMENT OF LOCAL BODIES PUNJAB CHANDIGARH ...........Respondent(s)
BEFORE: HON'BLE MRS. JUSTICE DEEPA SHARMA,PRESIDING MEMBER
For the Appellant : Mr.Shubham Bhalla and Mr.Deepak
Samota, Advocates For the Respondent : Mr.Kapil Sharma and Mr.Pranjal Vats
Advocates for R-1
Ms.Ranjeeta Rohatgi, Advocate for R-2
Dated : 16 Aug 2022 ORDER
1. Final arguments have been heard in this matter.
2. The present Appeal has been filed against the order dated 28.03.2018 in Complaint No. 478 / 2017 whereby the State Commission vide the impugned order had issued the following directions :
"i. To refund entire deposited amounts to complainant with interest @ 12% p.a. from the date of their respective deposits till actual payment.
ii. to pay Rs.75,000/- as compensation and Rs.20,000/- as costs of litigation. Compliance of the order be made within 45 days by OPs from receipt of certified copy of this order."
3. It is argued on behalf of the Appellant that there was no deficiency in service on their part and, therefore, findings of the State Commission on this count is illegal. It is also submitted that order of grant of interest @ 12% as compensation is also towards higher side. It is also argued that grant of Rs.75,000/- as compensation ought not have been granted in view of the fact that already compensation in terms of interest has been granted to the respondent. It is argued that clause 3 of the Allotment Letter dated 02.04.2014 has been wrongly construed by the State Commission. It is submitted that Appellant had not promised vide this letter to hand over the possession within one month.
4. It is submitted on behalf of the respondent that till the filing of the complaint in the year 2017, no development work had taken place at the site and that is why vide order dated 15.07.2019 in the matter of Revision Petition No. 2023 of 2017 titled Faridkot Improvement Trust &Ors. Vs. Naresh Kumar, this Commission had ordered the Appellant to complete the development work in all respects within one year from the date of delivery of possession. It is argued that argument of learned counsel for the Appellant has no merit.
5. The admitted facts of the case are that a scheme was floated by the Appellants for development of the plots at Baba Jeevan Singh Nagar, Ferozepur Road and Pakhi Road, Faridkot and Appellants invited applications during the period 10.07.2013 to 09.08.2013 for allotment of plots of various sizes. The respondent ( hereinafter referred to as 'complainant' ) applied for allotment of plot of 300 sq. yds plot vide application and also deposited the earnest money of Rs.2,47,500/-. The draw of lots took place on 26.11.2013 and complainant was successful drawee and plot no. 132 measuring 300 sq.yds was allotted to him in the said development scheme. An allotment letter dated 02.04.2014 was issued to him. The total consideration price of the plot was Rs.24,75,000/-. After receiving the allotment letter, complainant deposited balance amount of Rs.22,84,688/- on 29.04.2014. Subsequently, on 30.05.2014, an agreement was signed between the parties in respect of the said plot. In the said agreement, rate of plot was shown as Rs.8250/ per sq. yds. It was contended in the complaint that despite allotment of the plot, no development work had been carried out at the site by the Appellant nor any plot number had been shown or mentioned at the site. There was no provision of water and sewerage as no such lines had been laid. There was no provision of electricity supply at the site. Also high tension wires were passing through the land of the development scheme. No roads have been built. No Objection Certificate had also not been obtained from the Pollution Control Department. It has also come to the notice of the complainant that Appellant had also not deposited the requisite money for the water supply and sanitation with the appropriate Authority. No objection certificate was also not obtained from the District Town Planner, Forest Department and PWD Department for carving out the passages in the said colony. The Appellant failed to stop the polluted water which used to flow from the surrounding area towards the land of the colony. On these contentions, the complaint was filed with the prayer to refund the amount of Rs.24,75,000/- along with interest. Various other reliefs were also sought in the complaint.
6. The appellants were duly served of the complaint. The parties also filed their written statements wherein preliminary objections were taken. It is submitted that complainant has violated the terms and conditions of agreement to sell as complainant after getting the possession was required to get the proposed site plan sanctioned from the office of Appellant but had not applied for the same intentionally. It was denied that no development work had taken place at the site. It was contended that complainant was required to submit an application for seeking water connection or electricity to respective departments before starting the construction but complainant neither submitted the site plan nor has submitted any application for temporary connections from electricity and water supply department. It was contended that development work of the construction of roads had been completed and even possession was also offered to the complainant. It was submitted that there was no deficiency and prayed that complaint be dismissed.
7. Parties have led their evidences before the State Commission. However, after going through the evidence on record and hearing the arguments of learned counsel on behalf of the parties, the impugned order had been passed wherein the State Commission had observed as under :
"4. We have heard learned counsel for the parties and have also examined the record of the case. Ex.C-1 is the allotment letter of the plot issued to complainant in general category by OPs. OPs received amount of Rs.24,75,000/- from complainant through bank draft no. 626352. Ex.C-2 is receipt of this amount issued by OPs. Ex.C-3 is acknowledgment of this amount. The complainant served legal notice Ex.C-4 upon OPs to the effect that despite payment of most of the amounts by him, OPs have not developed this project and are not able to deliver the possession within scheduled time. Ex.C-4-A is allotment letter, vide memo no. 181 dated 02.04.2014 on the record. It is stated in clause 6 of this allotment letter that construction would be raised by the buyer within three years period from sanctioning of the site plan after allotment. The complainant wrote letter to Executive Officer Improvement Trust Faridkot Ex.C-5 for payment of draw of scheme dated 26.11.2013. Another letter was issued by complainant to Executive Officer Improvement Trust is Ex.C-5/A dated 29.04.2014 for issuance of due clearance certificate. Agreement of sale was executed between the parties on 30.05.2104, vide Ex.C-6. The total sale price of this plot is Rs.24,75,000/-. Letter issued by Environment Engineer Regional office Faridkot to Deputy Singh Goel dated 06.04.2017 is Ex.C-7 to the effect that NOC has not been issued from this office to Development Scheme Baba Jiwan Singh Nagar Ferozepur Road Pakki Road Faridkot. Ex.C-7/A is information addressed to complainant by Environment Engineer Faridkot to the effect that No Objection Certificate has been issued to this project of OPs. Ex.C-8 is information supplied by Executive Engineer and Sanitation Mandal Faridkot to complainant, that no amount has been deposited for the development of Baba Jiwan Singh Nagar Ferozepur Pakki Road Faridkot. Ex.C-8/A is the information supplied by Executive Engineer Water Supply & Sanitation Faridkot that no amount was deposited by OPs for this project with them. The complainant also relied upon the photographs Ex.C-9 to Ex.C-12 to the effect that OPs have not completed the project and it is lying in Ex.C-9 in vacant condition and in Ex.C-10 and Ex.C-11 in incomplete condition. The complainant served legal notice dated 01.05.2017 is Ex.C-13 to OPs that they have not developed the project within time.
5. To counter this evidence, OPs tendered in evidence affidavit of Gobind Kumar Assistant Improvement Trust Faridkot. He has admitted this fact that complainant booked plot no. 132 of Baba Jiwan Singh Nagar situated at Ferozepur Road. The allotment letter was issued to him on 02.04.2014. As per clause 15 of the agreement of sell, the dispute is liable to be referred to Arbitrator Secretary Local Government Department of Punjab only. The complainant neither approached the OPs for seeking possession of the plot nor for getting demarcation thereof. The complainant has filed this frivolous complaint to seek refund of the amount only. The work of construction of roads is in progress and in most area of the roads had already been made. Tenders for construction of boundary wall of scheme for commercial parking have been invited for 31.05.2016 and given to Contractors and construction of the boundary wall is in progress. Trust had passed a resolution for laying of water pipe lines in the scheme and the same has been approved by the government and now the work is in progress. For laying the sewerage pipes in the scheme area, a considerable amount is being given to the department of sewerage board to carry out the work in the scheme area. OPs denied the assertion of the complainant and have not completed the project. This witness stated that they have done considerable development in the area and hence the complainant is not entitled to any relief. Ex.OP-1 is copy of advertisement. Ex.OP-2 is letter dated 20.04.2015 regarding allotment of the work for construction of roads in the development scheme Baba Jiwan Singh Nagar at Faridkot. Ex.OP-3 is tender invited by OPs. Ex.OP-4 is letter dated 22.06.2016 regarding allotment of the work of construction of commercial parking in trust development scheme Baba Jiwan Singh Nagar at Faridkot. Ex.C-6 is letter dated 22.06.2016 regarding allotment of work for construction of boundary wall of trust development scheme Baba Jiwan Singh Nagar at Faridkot. Ex.OP-7 is resolution passed by the improvement trust. Ex.OP-9 is specimen affidavit of the complainant. Ex.OP-10 is letter addressed by Executive Engineer Sewerage to Executive Officer of OPs. The submission of counsel for OPs is that assertion of complainant is not correct to the effect that they have not completed the project.
6. The first point raised by OPs is that there is an arbitration clause in the plot buyer's agreement between the parties and hence consumer complaint is not maintainable. We find no force in this submission of OPs. The matter has been settled by larger bench of Hon'ble National Commission in consumer complaint no.701 of 2015, decided on 13.07.2017 titled as "Aftab Singh Vs. EMAAR MGF Land Limited and another". The National Commission has held in this authority that an arbitration clause in the afore-stated kind of Agreements between the complainants and the builder cannot circumscribe the jurisdiction of a Consumer Forum, notwithstanding the amendments made to Section 8 of the Arbitration Act, 1996. Against this order of the National Commission, Civil Appeal nos.23512-23513 of 2017 titled as EMAAR MGF Land Limited and another Vs. Aftab Singh" was filed by OPs before the Top Court, which has been recently dismissed by the Apex Court, vide order dated 13.02.2018. Consequently, the existence of an arbitration clause is not a bar to resolution of this dispute by the Consumer Forum. Even otherwise, the Apex Court has also so held 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 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 this submission of OPs and repel the submission of OPs.
7. Now, we touch this point, as to whether OPs have completed this project or not. We find that photographs Ex.C-9 to Ex.C-12 corroborate the case of the complainant regarding non-completion of construction work by OPs thereat. It has been shown in incomplete form. Even from the various tenders sent by OPs to different persons. it can be easily inferred that OPs have not completed the construction and development of the project within scheduled time. The complainant has deposited huge amount of Rs.24,75,000/- to OPs, but still development work is not complete as it is at initial stage only. The complainant tendered his affidavit Ex.C-A stating that OPs have not completed the construction work within scheduled time. Neither water pipes nor sewerage pipes are laid down in the development area nor any provision of electricity supply has been provided. There are high tension wire passing through the land of the above said development scheme, which are yet to be removed, neither any roads have been laid nor NOC from the Pollution Control Department has been taken in respect of the above said scheme. Possession of the plot was not handed over to complainant despite lapse of three years. This witness relied upon Ex.C-7 to Ex.C-8 to the effect that OPs have not yet completed the NOC from for development of this project. He served legal notice upon OPs, vide Ex.C-13 in this regard supported by postal receipts Ex.C-14 to Ex.C-16. The matter in this project as launched by OPs has been decided by this Commission in Consumer Complaint no. 499 of 2017 titled as Raj Kumar versus State of Punjab and others through its Principal Secretary Department of Local Bodies Punjab at Chandigarh and others decided on 08.11.2017, wherein with regard to this project of Baba Jiwan Singh Nagar situated at Faridkot, it has been held by this Commission that OPs received substantial amounts from the complainant. The construction was to be completed within three years from the date of agreement by OPs. However, OPs have not completed the construction work and hence possession of the plot was not delivered to the complainant within the scheduled time period, which is clear deficiency in service on the part of OPs. No basic amenities like roads, water and sewerage pipes have been provided on the spot by OPs. No NOC from Pollution Control Board and other competent authorities have been obtained by OPs of this project. No amount was deposited with Water Supply and Sanitation MandalFaridkot for supply of water, which is pre-requisite for development of the colony. OPs failed to stop the polluted water flow from the surrounding area. OPs have not removed the high-tension wires passing over the land of the above said scheme. OPs have not obtained No Objection Certificate from District Town Planner Forest Department and PWD Department for carving passage to the above-said colony. The observation of this Commission in the above-referred case helps the complainant in coming to this conclusion in this case that OPs have not completed the project within the scheduled time justifying the refund of the deposited amounts to complainant with interest @ 12% p.a from the date of their deposits till realization under Section 12 and Rule 17 of PAPRA Act 1995. The counsel for OPs could not distinguish this authority of this Commission, which is directly applicable to the facts and circumstances of the case, as the project launched by OPs in both the cases is identical.
8. It is clear that while allowing the Appeal, the State Commission had considered all the evidences on record and had reached to the conclusion that there was deficiency in service on the part of the opposite party i.e. the Appellant.
9. It is argued by learned counsel for the Appellant that as per clause 3 of the allotment letter dated 02.04.2014, the agreement to sell was to be executed within one month and there was no promise to hand over the possession of the plot within a month and, therefore, there was no delay and deficiency on the part of the Appellant to hand over the possession. On enquiry as to which is the clause of this agreement, which makes them accountable about the period within which possession had to be given, learned counsel for the Appellant submits that there is no such clause and, therefore, appellant could have taken reasonable period within which the possession could have been offered to the complainant. On enquiry as to what would be the reasonable period during which the possession would be offered, he submits that there is no such clause in the allotment letter.
10. Any such agreement which is vague in nature has to be construed in favour of the consumer. When I perused clause 3 of the Allotment letter along with clause 2 of the Agreement to Sell, the only interpretation that could be given is that possession had to be handed over within one month of the execution of the agreement to sell.
11. Clause 3 of the Allotment Letter dated 02.04.2014 reads as under :
3. That with in the period of one month of receiving of this letter, you will have to execute an agreement to sell on the stamp paper of Rs.2000, the content of the agreement can be obtained during the working days from office. The possession of site will be given after the execution of the said agreement to sell.
12. Clause 2 of Agreement for Sale dated 30.05.2014 reads as under :
2. Erection of Building and Time Limit During the ensuring 36 months to be reckoned from the __________________ day of _____________the intended vendee shall be and will at his own expense erect upon the land in a substantial and to workman like manner a building in accordance with plans sections, frontage, elevation and designs which shall have been previously approved by the Trust in writing or by any authority empowered by the Trust in this behalf. After expiry of 36 calender months, extension for construction may be granted on payment of extension fees fixed by Govt. from time to time.
13. As per clause 2 of the Agreement to Sell, the allottee i.e. the complainant was required to complete the construction of the plot within 36 months of execution of allotment letter. The only interpretation that can be given is that possession was required to be given within one month of the allotment letter. Without the possession to be handed over along with agreement to sell to the allottee, naturally he could not have been expected to complete the construction of his house at the said plot within 36 months.
14. It is further argued by learned counsel that as per the memo no. 5/74/95-4LGII/18367 issued by Government of Punjab, dated 26.10.2004, in terms of clause 2, the allotee who failed to construct the dwelling units due to non provision of basic infrastructure has to be referred to the Government for prior approval after the Trust has passed a resolution, which it is argued, further shows that there was no promise on the part of the Appellant to hand over the possession within one month of the allotment letter.
15. I have perused clause 2 of the said Policy which reads as under "Allottees of plots in Improvement Trust Schemes, who failed to construct their respective dwelling units / SCOs/SCFs/Flats due to non-provision of basic infrastructure like water supply, sewerage, approach roads shall be allowed a period of two years for the completion of the building from the date certified by the respective Improvement Trust ( s) basic infrastructure has been laid down. However, all such cases will be referred to the Government for prior approval after the Trust has passed a resolution to that effect."
16. From bare reading of this clause, it is apparent that this clause comes into operation only when the allottee fails to construct their respective dwellings. Obviously, the allottee can be expected to have failed to construct their plot only when the possession is handed over to him. Therefore, argument of learned counsel for the Appellant that they had never promised to hand over the possession within one month of the execution of the agreement to sell has no merit. It is also apparent from the order of this Commission in the case Revision Petition No. 2023 of 2017 tilted Faridkot Improvement Trust and Ors. Vs. Naresh Kumar decided on 15.07.2019 that the development work had not been completed by the Appellant even by 15.07.2019 on which date the said order had been passed. This further confirms the contention of the complainant that opposite party had failed to complete the development work.
17. I found no merit in the findings of the State Commission qua deficiency in service on the part of the Appellant.
18. The State Commission has awarded refund of the entire amount along with rate of interest @ 12% and had also awarded compensation of Rs.75,000/-. Keeping in view the observations of the Hon'ble Supreme Court in (2020) 16 SCC 318 titled DLF Homes Panchkula Pvt. Ltd. & Anr. Vs. D.S Dhanda Etc. Etc, it is apparent that where the interest is awarded on the refunded amount, no separate compensation under different head is to be granted.
19. I, therefore, modify the directions issued by the State Commission and issue the following directions:
1. The Appellant is directed to refund the entire deposited amount along with interest @ 10% p.a. from the date of deposits till actual refund of the said amount.
2. Cost of litigation to the tune of Rs.50,000/- is also awarded to the complainant.
3. The entire payment shall be paid within 8 weeks failing which the amount shall attract interest @ 12% p.a.
20. It is requested by learned counsel for the complainant that pursuant to the order dated 14.12.2018, the Appellant has deposited 50% of the decretal amount in terms of the order of this Commission before the State Commission and that that same be released to the complainant. I found no reason not to order release of this deposited amount to the complainant.
21. The State Commission is directed to release the said amount along with interest accrued on it to the complainant immediately on moving appropriate application. For the balance money, the complainant can file execution before the State Commission.
22. With these observations, the Appeal stands disposed of ......................J DEEPA SHARMA PRESIDING MEMBER