State Consumer Disputes Redressal Commission
Vikas Bajpai vs M/S Country Colonisers Pvt. Ltd. on 19 March, 2018
2nd Additional Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH
Consumer Complaint No. 192 of 2017
Date of Institution : 03.04.2017
Date of Reserve : 07.03.2018
Date of Decision : 19.03.2018
Vikas Bajpai son of Sh. K.S. Bajpai, resident of House No. 157,
Sector-10, Panchkula.
....Complainant
Versus
1. M/s Country Colonisers Private Limited, having project by the
name of Wave Gardens, Site Office, Sector 85, Mohali 160062
through its Project Manager.
2. M/s Country Colonisers Private Ltd., Registered Office - Post
Office Rayon and Silk Mills, Adjoining Coca Cola Depot, GT Road,
Chheharta, Amritsar, through its Managing Director.
....Opposite parties
3. HDFC Limited, SCO No. 153-155, Sector 8-C, Madhya Marg,
Chandigarh through its Branch Manager.
...Performa Opposite Party
Consumer Complaint under Section 17 of
the Consumer Protection Act, 1986.
Quorum:-
Shri Gurcharan Singh Saran, Presiding Judicial Member.
Shri Rajinder Kumar Goyal, Member
Consumer Complaint No. 192 of 2017 2
Present:-
For the complainant : Sh. Bhupender Singh, Advocate
For opposite parties No.1&2: Sh. Tejeshwar Singh, Advocate
For opposite party No.3: Sh. Sekhar Verma, Advocate
GURCHARAN SINGH SARAN, PRESIDING JUDICIAL MEMBER
ORDER
Complainant has filed this complaint against the opposite parties (hereinafter referred as Ops) under Section 17 of the Consumer Protection Act, 1986 (for short the Act) on the averments that Op Nos. 1 & 2 launched their integrated residential township under the name and style of 'Wave Gardens', Sector 85, SAS Nagar, Mohali. Allured by the advertisement and the facilities provided under the project, he booked one apartment with Ops with basic sale price of Rs. 4150/- per sq. ft. having super area of 700 sq. ft. with covered parking charges of Rs. 75,000/- and interest free maintenance security @ Rs. 50/- per sq. ft i.e. Rs. 33,10,250/-. The complainant was also apprised at the time of booking that the complainant can get the financial assistance, accordingly, he applied for the loan with Op No. 3 after getting the apartment to mortgage with permission of Op Nos. 1 & 2, therefore, tripartite agreement was executed between the parties on 10.3.2013 and a sum of Rs. 24,40,000/- was sanctioned by Op No. 3. After paying a booking sum of Rs. 1,40,568/-, another payment of Rs. 5,85,683/- was made by Op No. 3 to Op Nos. 1 & 2 on 4.4.2013 as per the demand raised by them. Thereafter, there was complete silence on Consumer Complaint No. 192 of 2017 3 the part of Op Nos. 1 & 2 qua any payment to be made by the complainant or by the financial institution. Whenever the complainant approached the officials at the site office either telephonically or personally, he was assured that the possession of the allotted unit shall be handed over as per the time schedule in the buyer's agreement, which was executed between the parties on 17.10.2012. According to the agreement, the possession was to be delivered within 30 months, which expired on 17.4.2015. The complainant again approached Op Nos. 1 & 2 in May 2015, he was stated that Clause 5.1 provides an extension period of 6 months, therefore, he will have to wait for another 6 months. The complainant waited for another 6 months and approached the Ops in December 2015 and at that time even basic structure was not complete. He again approached Op Nos. 1 & 2 in April 2016 to know the status of the apartment. He was asked to wait for another 6 months and he was further intimated that he will be paid 15% interest on the deposited amount. The payment plan opted by the complainant was construction link plan as per Annexure-II. The financial institution was to release the amount only after verifying the exact status of the construction at the spot. Lastly the complainant went to the office of Ops on 2.2.2017, the official present there misbehaved stating that no fixed date of possession can be given as no further installment is being demanded from you, therefore, he has no right to come and make hue and cry. Seeing the conduct of the Ops, the complainant requested to refund the amount alongwith interest @ 18% p.a. but to no effect. Alleging Consumer Complaint No. 192 of 2017 4 deficiency in services on the part of Ops, this complaint has been filed by the complainant to direct the Ops to refund the amount deposited i.e. Rs. 10,26,251/- alongwith interest @ 18% p.a., direct the Ops to clear the outstanding amount due towards Op No. 3, pay compensation to the tune of Rs. 5 Lacs for inconvenience, mental harassment and damages, pay Rs. 1 Lac towards cost of litigation and any other relief available to the complainant.
2. Upon notice, Ops appeared. Op Nos. 1 & 2 filed their written reply through Raghav Sharma and in the preliminary submissions stated that the complainant is not a consumer as defined under Section 2(1)(d)(ii) of the Act as he has already a big residential unit at House No. 157, Sector 10, Panchkula and now due to slump in the market, the complainant is no more interested in retaining the unit; there is arbitration clause No. 13 in the buyer's Apartment Allottee Arrangement, accordingly, the complaint before this Commission is not maintainable; the complainant failed to adhere to the payment plan, there is outstanding amount of Rs. 9,18,886.81p against the complainant and demand notices were issued to the complainant but despite that he failed to make the payment, therefore, he himself is a defaulter, therefore, he cannot impugne deficiency in services on the part of Ops. In case the complainant is a defaulter under Clause 4.2 and 4.4 of the Apartment Allottee Arrangement, Ops have unfettered right to cancel the booking and forfeit the earnest money and the complainant is also liable to pay the delayed interest amount. His amount of Rs. 4,35,750/- i.e. 15% of the BSP, Rs. 2,78,404/- Consumer Complaint No. 192 of 2017 5 payment towards interest, Rs. 1,45,250/- on account of brokerage and Rs. 17,953/- as taxes of brokerage, total Rs. 8,77,357/-. The loan was disbursed to the complainant on 16.4.2013 on the basis of tripartite agreement under which Ops were liable to bear pre-EMI interest amount till 15.4.2013 i.e. 24 months after 16.4.2013 and the liability of the complainant to pay Pre-EMI interest was irrespective and not upto the stage of construction. The Ops had extended the subvention scheme upto June, 2018. They paid a sum of Rs. 1,40,568/- on behalf of the complainant to the bank, therefore, the complainant will not be entitled to the amount asked for in the complaint. Further the Ops had entered into memorandum of agreement (in short 'MoA') dated 3.2.2006 with the State Government of Punjab wherein as per Clause 5(e) of the MoA, the State Government was to acquire land under the provisions of Land Acquisition Act, 1894 and transfer the same to the Ops for development, however, the State Government has failed to acquire any land for the Ops, which falls within the critical area due to that the laying of lines for basic services are not complete. Further GMADA was to provide external access roads to the project upon execution of land use agreements with the local farmers but the GMADA has failed to do it even till date, however, Op No. 1 has entered into land use agreement with the local farmers from whose land an access road has been laid for proper access to the project. Due to inaction on the part of GMADA to provide proper external road to the project, the trucks carrying raw material for construction faced several road blocks from the local Consumer Complaint No. 192 of 2017 6 farmers, therefore, delay, if any, caused in completion of the apartment is due to the reason beyond the control of these Ops. The complainant had signed the apartment allottee arrangement and agreed to the terms and conditions contained in it, therefore, now he cannot challenge the terms and conditions of the apartment allottee arrangement; the Commission does not have the jurisdiction to entertain and decide the present complaint as intricate questions of law and facts are involved and he should file the suit under the specific relief Act and the Indian Contract Act and that the Commission does not have the pecuniary jurisdiction as the relief claimed is less than Rs. 20 Lacs and that there is no deficiency in services on the part of Ops. On merits, launching of the project by the Ops as referred in the complaint is a matter of record. It is also a matter of record that complainant had booked one apartment with the Ops. The amount claimed by the complainant as referred in the complaint i.e. Rs. 10,26,251/- is also a matter of record. However, the complainant failed to make further payment as per demand notice issued by the Op. Execution of the tripartite agreement between the complainant, these Ops and Op No. 3 is also a matter of record under which these Ops were to pay pre-EMI interest for the period of 24 months under which they have already paid a sum of Rs. 1,40,568/-. The apartment could not be completed for want of payment and inaction on the part of GMADA or the State Government to acquire the land as detailed above in the preliminary objections. It was denied that there was any deficiency in service on the part of Ops. The complainant is not Consumer Complaint No. 192 of 2017 7 entitled to the claim as demanded in the complaint. Some of the amount is liable to be forfeited as per the terms and conditions of the apartment allottee agreement. No deficiency in services on the part of this Op. Complaint is without merit, it be dismissed.
3. Op No. 3 in its written reply took the preliminary objections that grievances of the complainant are against Op Nos. 1 & 2. This Op has just advanced the loan to the complainant after mortgaging of the apartment in favour of Op No. 3 under the tripartite agreement. The loan account of the complainant is regular. On merits, the averments of the complaint were denied for want of knowledge as these pertain to Op Nos. 1 & 2. There is no deficiency in service on the part of this Op. Complaint is without merit, it be dismissed.
4. The parties were allowed to lead their respective evidence in support of their complaint. Complainant in his evidence has tendered affidavit of Sh. Vikas Bajpai as Ex. CW/A and documents Exs. C-1 to C-11. On the other hand, Ops No. 1 & 2 have tendered affidavit of Raghav Sharma, Authorized Signatory as Ex. OP1/A and documents Exs. Op-1/1 to Ex.Op-1/14.
5. We have heard the counsel for the parties and have carefully gone through the averments made in the complaint, written replies filed by the Ops, evidence and documents on the record.
6. An objection has been taken by the counsel for Op Nos. 1 & 2 that complainant is not a consumer because he has a big residential unit at Panchkula i.e. House No. 157, Sector 10, Consumer Complaint No. 192 of 2017 8 therefore, this apartment was booked by him for investment purposes. Being slump in the market, he did not pay the demanded amount and wanted to dispose of the apartment and to get the refund now. However, the complainant in his complaint has specifically mentioned that the apartment was booked only for residential purposes. With regard to ownership of the complainant of House No. 157, Sector 10, Panchkula as alleged n the written reply, no doubt that the address of the complainant as mentioned in the complaint is the same as referred in the preliminary submissions of Op Nos. 1 & 2 but there is no document that the complainant is owner of the said unit. Even if for the sake of arguments, it is taken that the complainant is the owner of the said house, there is no legal bar that for the use of his family, he cannot book another apartment. No documentary evidence has been placed on the record by Op Nos. 1 & 2 that previously the complainant was trading in real estate. In the absence of any transaction in the real estate in the past, it cannot be said that the apartment was booked for investment purposes. In this regard, a reference can be given to the judgment 2017(3) CLT 459 "Pranab Basak versus Suhas Chatterjee". In that case, two flats were booked by the complainant and a plea was taken that the complainant had booked these flats for investment purposes. It was observed by the Hon'ble National Commission that unless it is established that the complainant is dealing in sale and purchase or his real intention in booking the flat was to sell the same on profit, on appreciation of the value of the real estate. Further in "Kavita Consumer Complaint No. 192 of 2017 9 Ahuja versus Shipra Real Estate Ltd." and Jai Krishna Estate Developer Pvt. Ltd.", 2016 (1) CPJ 31 it was held by the Hon'ble National Commission that buyers of the residential unit would be termed as consumer unless it is proved that he/she had booked the same for commercial purposes. Therefore, we are of the opinion that the plea taken by the Ops that the apartment was booked by the complainant for investment purposes and cannot be entertained.
7. Another objection has been taken by the Op Nos. 1&2 that as per Clause 13 of the Apartment Allottee Arrangement, the matter be referred to the Arbitrator. In this regard, miscellaneous application No. 1078 of 2017 filed by Op Nos. 1 & 2 had already been dismissed of by this Commission vide order dated 26.5.2017.
8. Another objection taken by Ops Nos. 1 & 2 is with regard to complicated questions of law and facts involved, therefore, the matter be referred to the Civil Court. In case we go through the pleadings of the parties, the complainant booked one apartment with Ops and had paid a sum of Rs. 10,26,251/-. In this case, there is no complicated question of law and facts involved as it is only the interpretation of documents and then to see whether there is any deficiency in service on the part of Ops. We do not see that any complicated questions of law and facts are involved, which cannot be adjudicated by this Commission. The benches of this Commission are headed by retired High Court Judges/retired District & Session Judges, who have long experience at their back and are fully competent to decide such like matters. In this regard, Consumer Complaint No. 192 of 2017 10 we are fortified by the judgment of "Dr. J.J. Merchant and others Vs. Shrinath Chaturvedi", 2002(6) SCC 635 wherein it was held that 'the State Commission and District Forum are headed by retired High Court Judges and officers of District Judge level and in our view, this is not such a case which cannot be decided by the 'Consumer Fora' after obtaining evidence and if need be after getting an expert opinion'. Further reference can be made to "Shiv Kumar Agarwal versus Arun Tandon and another", 2007(2) CLT 287, decided by the Hon'ble National Commission. In that case a plea that case involves complicated questions of fact and law and will need expert evidence, which is not possible in the summary proceedings adopted by the Consumer Fora repelled - Consumer Forum which is headed by Senior Judicial Officers, are capable of dealing with even complex questions. Therefore, we are of the opinion that this Commission is fully competent to decide this complaint and no cause of action is made out to refer the case to the Civil Court.
9. It has been argued by the counsel for Op Nos. 1 & 2 that complaint is no fall within the pecuniary jurisdiction of this Commission as the relief claimed by the complainant is less than Rs. 20 Lacs whereas the pecuniary jurisdiction of this Commission starts from Rs. 20 Lacs onwards upto Rs. 1 Crore. No doubt that the complainant had paid Rs. 10,26,251/- and the total amount recoverable from the Ops may be less than Rs. 20 Lacs but for the purpose of pecuniary jurisdiction, total sale consideration plus compensation, if any, is to be taken in view of the judgment of the Consumer Complaint No. 192 of 2017 11 Hon'ble National Commission in 2017(1) CPJ 1 "Ambrish Kumar Shukla Vs. Ferrous Industries Pvt. Ltd.". As per the agreement the total sale price of the apartment is Rs. 33,10,250/-, which is more than Rs. 20 Lacs and after adding the interest or compensation on the paid amount, it will be less than Rs. 1 crore, therefore, we do not agree with the plea raised by the counsel for Op Nos. 1 & 2 that the complaint does not fall within the pecuniary jurisdiction of this Commission.
10. As per the pleadings of the parties, the complainant had booked one apartment with Op Nos. 1 & 2 by paying the booking amount of Rs. 3 Lacs vide receipt dated 4.8.2012 Ex. C-1. Then apartment allottee arrangement dated 17.10.2012 was executed between the parties. Alongwith that the payment plan as per Annexure-II was given to the complainant, which reads as under:-
Payment Plan Subvention Linked Plan On Booking 3.0 Lacs for 2BHK, 5.0 Lacs for 3BHK & 3+S BHK Within 45 days of booking 15% of Sale 15% Price less Booking Amt.
Excavation of footing 25%
On completion of Fourth Floor roof slab 25% + 100% of PLC
On completion of Super Structure / 25%
Brick Work
On completion of Internal Plastering + 100% of car parking
On offer of Possession 10% + other applicable
charges + Stamp Duty &
Registration charges
100%
According to that after paying booking amount, the complainant was required to pay 15% within 45 days, which was paid by him.
After that on 10.3.2013, there was tripartite agreement between the Consumer Complaint No. 192 of 2017 12 complainant, Op Nos. 1 & 2 and Op No. 3 under which a loan of Rs. 24.40 Lacs was sanctioned by Op No. 3 in favour of the complainant and a sum of Rs. 7,26,251/- was disbursed to the Op through complainant on 2.4.2013. This fact also stand admitted by the Ops, however, the problem arose when the complainant did not make any further payment. The case of Op Nos. 1 & 2 is that when on 2.12.2015 Ex. Op-1/6 payment demand notice was issued by Op Nos. 1 & 2 in favour of the complainant, it is attached with the postal receipt. Then a reminder was issued on 14.1.2016 Ex. Op- 1/7 demanding the due payment of Rs. 9,18,886.81p, it is also attached with the postal receipt. Then another reminder dated 14.4.2016 Ex. Op-1/8 was issued. It is attached with the courier receipt. Then another reminder was issued on 29.6.2016 Ex. Op- 1/9 vide which again the demand of Rs. 9,18,886.81p was reiterated, it is also attached with the courier receipt. The complainant in his complaint has stated that these notices were not received by him but mere denial is not sufficient. The counsel for Ops has placed on the record the letters alongwith postal receipts and reminder receipts and the address given in the letters is the same as referred in the complaint. Therefore, when there is sufficient documentary evidence on the record to post these letters in favour of the complainant then mere bald statement of the complainant in the complaint or in the affidavit cannot be accepted. Therefore, we are of the opinion that notices were issued to the complainant to make payment of Rs. 9,18,886.81p but the complainant failed to make that payment. The counsel for the Ops Consumer Complaint No. 192 of 2017 13 further referred to Clause 6 of the tripartite agreement under which the loan was to be disbursed at the request of the borrower. The letters were to be sent only to the complainant and not directly to Op No. 3.
11. Counsel for Op Nos. 1 & 2 has referred to Clause 4.2 & 4.4 of the agreement, which reads as under:-
"The Allottee(s) agrees to pay an amount equivalent to 15% of the BSP of the said "Apartment" Earnest Money. The Allottee(s) further agrees and undertakes to pay the "BSP"
including charges as described in this Apartment Allottee(s) Arrangement in the manner and in accordance with the time schedule provided in the Payment Plan annexed as Annexure II, and maintenance as per the Maintenance Agreement to be signed prior to handing over the possession "Apartment", and failure to pay these sums within the specified dates shall make the Allotted to pay simple interest @ 18% per annum till the date of actual payment.
xxx xxx xxx xxx 4.4 It is understood and agreed by the Allottee(s) that making payment of maintenance charges Consideration as aforesaid in accordance with the payment plan and due dates as per the call or otherwise together with applicable simple interest at the rate of 18% per annum is the ___ this Apartment Allottee(s) Arrangement. In the event, the Allottee(s) fails to make payment on dates as aforesaid and is in default for a period exceeding 2 (Two) months, the Consumer Complaint No. 192 of 2017 14 Developer shall unfettered right to cancel the allotment and forfeit the earnest money equivalent to 15% of the same and also recover arrears on account of accrued interest, brokerage and any other expenses so incurred and accordingly refund the balance to the Allottee(s). The Developer shall have the said "Apartment" for recovery of its dues, without prejudice to any legal remedy / right to the Developer.
In case the sum paid by the Allottee(s) falls short of Developer's claim, as aforesaid, the Developer shall have the right to recover the balance from the Allottee(s) upon or on cancellation.
The Allottee(s) understands the implications of the cancellation and agrees with the Developer Allottee(s) shall have no claim, whatsoever, on the said "Apartment" which shall stand resume Developer and that the Developer shall have the right to deal with the said "Apartment" in any thereafter as it thinks appropriate."
According to Clause 4.4, Op Nos. 1 & 2 is entitled to forfeit earnest money equal to 15% of the BSP. As per the agreement the total price of the apartment is Rs. 33,10,250/- and its 10% will come to Rs. 3,10,025/-.
12. The flat was booked by the complainant on 4.8.2012 and buyer's agreement was executed on 17.10.2012 and as per Annexure II, 15% of the payment was to be given within 45 days of the booking. Buyer's agreement was not executed within 45 days, Consumer Complaint No. 192 of 2017 15 therefore, it was not possible for the complainant to make this payment within 45 days from the date of booking, therefore, 45 days will be calculated from the date of execution of the agreement, therefore, it was due as on 1.12.2012 whereas the payment of Rs. 7,26,251/- was made on 4.4.2013. Therefore, there is delay of approximately 4 months in making the payment of 15% of the amount. Therefore, the Ops will be entitled to deduct the interest @ 18% on a sum of Rs. 7,26,251/- and the remaining amount is required to be paid by Op Nos. 1 & 2 to the complainant alongwith interest. It was observed by the Hon'ble National Commission reported in IV (2016) CPJ 415 (NC) "Harjinder S. Kang versus EMAAR MGF Land Ltd." that Ops were fully justified in terminating the agreement the agreement and forfeiting the earnest money. However, amount exceeding 10% of the total price of property cannot be forfeited as earnest money. Therefore, earnest money equal to 10% of the total sale price can be forfeited. Further the Hon'ble National Commission in I (2015) CPJ 323 (NC) "Girish K. Vora versus Hongkong and Shanghai Banking Corporation Ltd. & Ors." in Revision Petition No. 3860 of 2014, decided on 6.1.2015 gave the observation that an agreement for forfeiting more than 10% of the sale price, in our view, would be invalid since it would be contrary to the established legal principle that only a reasonable amount can be forfeited in the event of default on the part of the Buyer.
Consumer Complaint No. 192 of 2017 16
13. What will be the rate of interest? In the case of refund, Rule 17 of the PAPRA Rules provides to pay interest @ 12% and the same is reproduced as under:-
"17. Rate of Interest on refund of advance money upon cancellation of agreement. - The promoter shall refund full amount collected from the prospective buyers under sub- section (1) of section 6 together with interest thereon at the rate of twelve per cent per annum payable from the date of receipt of amount so collected till the date of re-payment."
Therefore, the complainant will be entitled to interest @ 12% p.a. from the various dates of deposit till payment minus pre-EMI interest paid by Op Nos. 1 & 2 in favour of Op No. 3, which comes to Rs. 1,40,568/- as per letter Ex. Op-1/5. What is the amount outstanding to Op No. 3 as per their letter Ex. Op-3/4, upto 31.7.2017 Rs. 6,37,191/- is outstanding towards Op No. 1, therefore, what amount is to be paid to the complainant by Op Nos. 1 & 2. The amount outstanding in the accounts of Op No. 3 will be cleared first and in case any balance amount is there, the same is payable to the complainant. Upto date statement of account has not been placed on the record by counsel for Op No. 3 but it is made clear that the account of Op No. 3 will be cleared upto date and only balance payments will be made to the complainant.
14. No other point was argued.
15. Sequel to the above, we dispose of the complaint and direct Op Nos. 1 & 2 as under:-
Consumer Complaint No. 192 of 2017 17
i) Op Nos. 1 & 2 will refund a sum of Rs.
10,26,251/- alongwith interest @ 12% p.a. from the various dates of deposit till payment after deducting a sum of Rs. 3,10,025/- i.e. earnest money equal to 10% of the BSP, interest @ 18% on a sum of Rs. 7,26,251/- for a period of 4 months for delayed payment of EMI and Rs. 1,40,568/- paid as pre-EMI interest by Op Nos. 1 & 2 to Op No. 3.
ii) Ops shall further pay a sum of Rs. 50,000/- as compensation on account of mental agony and harassment suffered by the complainant.
iii) pay Rs. 21,000/- towards litigation expenses. The above directions be complied by Ops No. 1 & 2 within a period of 45 days from the date of receiving of the copy of the order, failing which the complainant will be at liberty to execute the order by filing application under Sections 25 & 27 of the CP Act against the Ops.
16. The consumer complaint could not be decided within the statutory period due to heavy pendency of Court cases.
17. The counsel for the parties / concerned parties are directed to collect free certified copy of the order from the office of the Commission within a period of 15 days from the date of pronouncement.
(GURCHARAN SINGH SARAN)
PRESIDING JUDICIAL MEMBER
March 19, 2018. (RAJINDER KUMAR GOYAL)
as MEMBER
Consumer Complaint No. 192 of 2017 18