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Structured Summary of the Opinion — State Consumer Disputes Redressal Commission, Punjab, Chandigarh (06.04.2017)

Factual and Procedural Background

Two consumer complaints (No.275 of 2015 and No.223 of 2015) filed under Section 17 of the Consumer Protection Act, 1986 were heard together because they involved substantially similar facts and legal questions. Both matters were decided on 06.04.2017 by a Bench comprising Justice Paramjeet Singh Dhaliwal (President) and Mr. Harcharan Singh Guram (Member).

Consumer Complaint No.275 of 2015 (instituted 19.11.2015) arose from allotment of flat No.G-1-302 (super built-up area 1565 sq.ft.) in the "Shourya Greens" project to complainants Kapil Jindal and Shelza Gupta. The flat was allotted by opposite parties (Nitishree Infrastructure Ltd./Shourya Towers Pvt. Ltd. and related entities — Opposite Parties No.1-3). A Flat Buyers Agreement dated 28.01.2011 fixed the possession date as December 2012. Complainants paid a total of 30,21,760/- (including amounts disbursed by HDFC Ltd., Opposite Party No.4) but possession was not delivered; revised plans were pending approval; completion certificates were not obtained; inspections by the Improvement Trust showed incomplete towers. The complainants sought refund with interest, compensation for mental harassment, and litigation costs.

Consumer Complaint No.223 of 2015 (instituted 07.09.2015) concerned different complainants (Charanji Lal Gupta and Adarsh Gupta) who had paid 22,13,575/- across different allotments and transfers for flats in the same project and who had repeatedly been offered different units and faced delayed possession and alleged unlawful additional demands. They sought refund with interest, compensation and litigation expenses.

Procedurally, both complaints proceeded on affidavits and documentary evidence. Opposite parties No.1-3 filed replies in No.275 (raising contractual allocation of construction responsibility to a developer and time-bar plea); Opposite Party No.4 (HDFC) raised rights under the Tripartite Agreement and loan default. In No.223 opposite parties failed to file a reply within the statutory period; evidence of complainants remained largely unrebutted. The matters were argued and decided together on the merits.

Legal Issues Presented

  1. Whether the opposite parties (builders/promoters) were guilty of deficiency in service for failing to complete construction and failing to deliver possession of allotted flats within the contracted period.
  2. Whether a contract between the promoter and a third-party developer (Joint Venture/contract assigning construction) absolves the promoter (opposite parties No.1–3) of liability towards allottee-purchasers under the Buyers Agreement.
  3. Whether the complaints were time-barred or constituted a continuous cause of action such that the delayed completion meant the complaints were maintainable in 2015.
  4. What remedies (refund, interest, compensation and costs) are appropriate where a promoter fails to deliver possession and is found deficient in service.
  5. What are the rights of the financier (Opposite Party No.4, HDFC) under the Tripartite Agreement and loan documents when the unit is cancelled or the project is not completed, and what is the financier's position vis-à-vis recovery from complainants.

Arguments of the Parties

Complainants' Arguments

  • Flat allotments were made and Flat Buyers Agreements were executed (Ex.C-3 in No.275 and analogous documents in No.223) fixing possession dates (e.g., December 2012 for No.275 and various dates in No.223) which the opposite parties failed to meet.
  • Complainants paid substantial amounts (30,21,760/- in No.275; 22,13,575/- in No.223) including amounts disbursed by HDFC; possession was not delivered; construction remained incomplete as evidenced by photographs and communications from the Improvement Trust.
  • Opposite parties revised layout plans and proceeded without requisite approvals; completion plans were returned by the Trust; RTI responses showed revised plans pending as of 24.03.2015.
  • There is deficiency in service entitling complainants to refund with interest, compensation for mental harassment and litigation costs; the complainants relied on several precedents (including EMAAR MGF cases and DR. RAMAKRISHNA DELAMATI) to support entitlement to relief.

Opposite Parties No.1–3 (Promoters/Builders) — Arguments

  • Clause 10 of the Flat Buyers Agreement (Ex.C-3) allowed the promoters to enter into a contract (dated 12.01.2010) with M/s Novena Builders & Developers Pvt. Ltd. (the developer) and, under that contract, the developer was exclusively responsible for construction, development and handing over possession; liability for delay or damages rested on the developer (clause 22).
  • The complainants' funds (including loan proceeds) were received in the promoter's escrow account and transferred to the developer's bank account (No.02.18805), implying the developer is the appropriate party and a necessary party to adjudicate claims for refund/damages.
  • The complaint is time-barred (agreement dates in 2011; complaint filed in 2015) and the complainants have suppressed material facts; the complaint therefore should be dismissed.
  • The promoters denied deficiency in service on merits and characterized the complaint as false and vexatious.

Opposite Party No.4 (Housing Development Finance Corporation Ltd.) — Arguments

  • No deficiency in service alleged specifically against HDFC; the rights of HDFC and the inter se obligations are governed by the Tripartite Agreement (Annexure R-4/1) and the loan agreement (Annexure R-4/2).
  • Under the Tripartite Agreement, in case of cancellation or termination of the developer-buyers agreement, HDFC has the first right to seek apportionment of its dues. The loan account was in default and HDFC reserved its right to proceed as per loan/mortgage terms.
  • HDFC asked that complaint against it be dismissed as it had contractual remedies against the complainants and priority under the Tripartite Agreement.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
EMAAR MGF LAND LTD. & ANR. v. DILSHAD GILL III (2015) CPJ 329 (NC) Cited to show that where possession is not offered within the period prescribed in the agreement, promoters have violated material conditions regarding handing over possession. The Court referenced this decision to support the proposition that promoters who do not offer possession within the contractual period cannot insist on further payments; it was relied upon in finding the promoters had violated material terms and could not demand additional sums.
EMAAR MGF LAND LTD. & ANR. v. DYAL SINGH, GURDEV SINGH BADIAL IV (2015) CPJ 294 (NC) Cited by complainant's counsel in support of complainant's case (precise principle not separately enumerated in the opinion beyond reliance). The opinion records that this authority was relied upon by complainants; the Court's findings on liability and relief were consistent with the legal approach reflected in the cited authorities.
DR. RAMAKRISHNA DELAMATI & ANR. v. MARUTHI CORPORATION LTD. & ANR. IV (2015) CPJ 25 (NC) Cited for the proposition that complainants are not required to pay amounts until possession has been handed over to them. The Court expressly referred to this case (also referred to later as DR. RAMAKRISHNA VELAMATI) to reinforce the principle that a builder cannot demand payment until physical possession is delivered; this supported refusal to entertain the promoters' later demand and validated refund/relief to purchasers.
LIBERTY INVESTMENT PVT. LTD. v. NADIA APARTMENT CO-OP. SOC. LTD. I (2015) CPJ 545 (NC) Cited by complainant's counsel (specific rule referenced in the opinion is not separately detailed). The Court noted reliance on this authority by complainant's counsel; the opinion does not provide a separate granular application of this specific precedent beyond using it as part of the body of authorities supporting the complainants' position.

Court's Reasoning and Analysis

The Court undertook a fact- and document-driven analysis, summarised stepwise below based on the opinion's findings:

  1. Evidence and Corroboration: The Court found that the complainants' affidavits and documentary evidence (Ex.C-1 to Ex.C-14, ledger Ex.C-7, completion correspondence Ex.C-9, Ex.C-8 and RTI reply Ex.C-11, and photographs Ex.C-13) established the essential factual matrix: allotment, payment, contractual possession date(s), and incomplete construction. The Court observed that opposite parties failed to produce evidence showing delay was due to non-availability of materials or labour (a contractual exception in Clause 9).
  2. Deficiency in Service: Given the promoters had not obtained requisite approvals, had revised layout plans still pending approval, and Trust inspections had found fewer completed towers than claimed, the Court concluded the promoters were unable to deliver possession. This inability to deliver possession within the agreed period was held to constitute deficiency in service under the Consumer Protection Act.
  3. Joint Venture/Developer Contract: The Court rejected the promoters' contention that a contract with M/s Novena Builders (the developer) absolved them of liability to allottees. The reasoning was that the inter se allocation of responsibilities between promoter and developer does not discharge the promoters of their contractual and statutory liabilities to the purchasers under the Buyers Agreement. Promoters may engage third parties for performance but remain liable to the allottees for breaches of the Buyers Agreement.
  4. Time-bar and Continuous Cause of Action: The Court addressed the time-bar defense by treating the failure to deliver possession as a continuing cause of action. The correspondence (Ex.C-10 dated 07.02.2014 and RTI reply Ex.C-11 dated 24.03.2015) and continuing incompletion until 2015 meant the cause of action continued; thus the complaints filed in 2015 were not time-barred.
  5. Reliance on Precedents: The Court noted authorities (e.g., DILSHAD GILL and DR. RAMAKRISHNA decisions) establishing that where possession is not offered as per agreement, promoters cannot demand further payments and purchasers are not obliged to pay until possession is delivered. These authorities were used to reinforce the legal proposition that promoters who fail to perform cannot insist on additional payments and are liable to refund and compensation.
  6. Bank's Position: With regard to Opposite Party No.4 (HDFC), the Court recognized HDFC's contractual rights under the Tripartite Agreement and loan documents, including priority to seek apportionment of dues in case of cancellation. The Court observed complainants remain liable to repay their loan as per loan terms and that HDFC reserves remedies in accordance with law.
  7. Remedial Approach and Quantum: The Court applied principles of consumer protection as a benevolent legislation and the settled principle that compensation ought to be just, fair, and commensurate with loss suffered. The Court took into account loss of opportunity, escalation in construction cost, harassment, and litigation burden in assessing compensation.

Holding and Implications

Holding:

In Consumer Complaint No.275 of 2015 (Kapil Jindal & Anr. v. Nitishree Infrastructure Ltd. & Others), the Court allowed the complaint and issued the following directions:

  • To refund the amount of 30,21,760/- to the complainants, with interest at the rate of 12% per annum from the dates of deposit until realization.
  • To pay 3,00,000/- as compensation for mental tension and harassment.
  • To pay 30,000/- towards litigation costs.
  • Compliance period: opposite parties to comply within 30 days of receipt of certified copy; failing which the compensation will carry interest at 12% from the date of the order until realization.

In Consumer Complaint No.223 of 2015 (Charanji Lal Gupta & Anr. v. M/s Nitishree Infrastructure Ltd. & Others), the Court allowed the complaint and issued the following directions:

  • To refund 22,13,575/- to the complainants, with interest at the rate of 12% per annum from the dates of respective deposits until realization.
  • To pay 2,00,000/- as compensation for mental pain and harassment.
  • To pay 20,000/- as litigation expenses.
  • Same compliance timeframe and consequence for delay: 30 days to comply; compensation carries interest at 12% from date of order if not complied with.

Implications

- Direct effect: The promoters (Opposite Parties No.1–3) are ordered to refund the amounts paid by the complainants, pay statutory interest (12% p.a.), awarded compensation for mental anguish and litigation costs. The financiers (Opposite Party No.4) retain contractual rights under the Tripartite Agreement and loan documents; complainants remain bound to their loan obligations and HDFC may pursue remedies under the loan/mortgage terms.

- Legal principle reaffirmed: The decision reiterates that promoters cannot escape liability to allottees by pointing to contracts with third-party developers; promoters remain responsible under the Buyers Agreement. The opinion also follows authorities that purchasers are not obliged to pay further sums until possession is actually handed over.

- Precedential impact: The Court applied established principles from prior decisions and the Consumer Protection Act's remedial scope. The opinion enforces existing consumer-protection norms rather than announcing a novel legal doctrine; it therefore primarily provides application of settled law to the facts at hand and directs specific monetary relief to the complainants.

Note: This summary is strictly based on the content and language of the provided opinion and does not add or infer facts or legal conclusions beyond those stated in the opinion.

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    Kapil Jindal v. Nitishree Infrastructure Ltd.

    STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB, CHANDIGARH.

    1) Consumer Complaint No.275 of 2015 Date of institution : 19.11.2015 Date of decision : 06.04.2017

    1. Kapil Jindal;

    2. Shelza Gupta wife of Sh. Kapil Jindal; Resident of R-17, Naveen Shahadra, Delhi. .Complainants Versus

    1. Nitishree Infrastructure Ltd./Shourya Towers Pvt. Ltd., Sector D- 2, Group-II, Kundli, Gharoli, Mayour Vihar, Phase-3, Delhi- 110096, through its Authorized Representative.

    2. Nitishree Infrastructure Ltd./Shourya Towers Pvt. Ltd., B-III, Sector-5, Noida, U.P., through its Authorized Representative.

    3. Nitishree Infrastructure Ltd./Shourya Towers Pvt. Ltd., Shourya Greens, Surya Enclave, Amritsar Bypass Road, near Trinity College, Jalandhar, through its Authorized Representative.

    4. Housing Development Finance Corporation Ltd., 5-Link Road, Model Town, Jalandhar, through its Branch Manager. .Opposite Parties

    2) Consumer Complaint No.223 of 2015 Date of institution : 07.09.2015 Date of decision : 06.04.2017

    1. Charanji Lal Gupta son of late Sh. Rattan Chand, resident of House No.792, Sector 43-A, Chandigarh.

    2. Adarsh Gupta wife of Charanji Lal Gupta, resident of House No.792, Sector 43-A, Chandigarh. .Complainants Versus

    1. M/s Nitishree Infrastructure Ltd., Shourya Towers Pvt. Ltd., B- 111, Sector-5, Noida-201301. Consumer Complaint No.275 of 2015

    2. Managing Director, Sh. Ankur Jain, M/s Nitishree Infrastructure Ltd., Shourya Towers Pvt. Ltd., B-111, Sector-5, Noida-201301.

    3. General Manager, Shourya Towers Pvt. Ltd., B-111, Sector-5, Noida-201301.

    4. General Manager, Shourya Greens, Shourya Enclave, Amritsar Bypass Road, near Trinity College, Jalandhar, Punjab. .Opposite Parties Consumer Complaints under Section 17 of the Consumer Protection Act, 1986. Quorum:- Honble Mr. Justice Paramjeet Singh Dhaliwal, President Mr. Harcharan Singh Guram, Member Present:- For the complainants : Sh. Mukand Gupta, Advocate For opposite parties No.1-3: Sh. Ramneek Gupta, Advocate For opposite parties No.4 : Ms. Anjali Moudgil, Advocate for Sh. Shekhar Verma, Advocate. JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT : This order will dispose of the above mentioned two Consumer Complaints filed by the complainants, under Section 17 of the Consumer Protection Act, 1986 (in short, the Act), as the facts and the questions of law involved in these complaints are the same. The facts are taken from Consumer Complaint No.275 of 2015. Consumer Complaint No.275 of 2015:

    2. Brief facts, as set out in the complaint, are that in the year 2005, the opposite parties, in pursuance of the tenders floated by the Improvement Trust Jalandhar (in short, the Trust), gave bid to develop 16.52 acre of land. The tender of the opposite parties was accepted and they were given possession of the land by the Trust. The opposite parties were also given the construction and development rights to develop mega housing project namely Shourya Green, for which they had entered into a Memorandum of Understanding (in Consumer Complaint No.275 of 2015 short, MoU) with the Trust on 05.08.2005. As per the MoU, the opposite parties were required to construct the flats according to the plan approved by the Trust and thereafter were required to obtain completion certificate from the Trust and only thereafter the possession of the constructed flat was to be delivered by the opposite parties. In pursuance of the MoU, the opposite parties issued advertisement/distributed brochures from time to time in public for allotment of flats. The complainants applied for allotment of a flat measuring 1565 sq.ft. with the opposite parties in the above project i.e. Shourya Green, for the basic sale price of 33,64,750/-. Accordingly, they were allotted flat No.G-1-302, having super built up area of 1565 sq.ft. at the rate of 2,150/- per sq.ft., vide allotment letter dated 24.01.2011. Besides this, the opposite parties demanded 78,250/- towards EEC and IFMS charges, thereby making total price of the flat as 34,43,000/-. Flat Buyers Agreement was entered into the parties on 28.01.2011. The complainants opted Cash Down payment plan, as per which 15% of the basic sale price was to be paid by them at the time of booking and balance 85% was to be paid within 30 days and other compulsory charges were to be paid at the time of delivery of possession. As per the Buyers Agreement, the possession of the flat was to be delivered by December, 2012.

    3. In order to purchase the flat in question, the complainants raised home loan from Housing Development Finance Corporation Ltd., opposite party No.4 to the tune of 27,00,000/-, vide Account No.601181608). Opposite party No.4 charged interest at the rate of 11% and subsequently 10.80% per annum and permission to Consumer Complaint No.275 of 2015 mortgage the property was given by the opposite parties to the Bank on 28.01.2011. Thereafter, opposite party No.4 disbursed 25,21,760/- out of the above amount. In this regard, a Tripartite Agreement was executed between the parties.

    4. The complainants deposited 30,21,760/- with the opposite parties, out of which 5,00,000/- was deposited on 28.01.2011 and remaining 25,21,760/- was deposited by opposite party No.4 with the other opposite parties. Thus, 90% of the basic sale price of the flat has been paid by the complainants, but the opposite parties have failed to complete the construction of the flat or to deliver the possession thereof. The opposite parties even revised the layout plans, which were still pending for approval, though they had started the construction of the flats, as per the revised drawings. The Trust issued a letter to opposite parties No.1 to 3, stating that they had submitted the documents of completion plan of total ten towers in Phase-I, but on inspection, it was found by the Trust officials that only eight towers existed, which were incomplete. On further inspection, the Trust officials found that only four towers have been completed and directed these opposite parties to complete the remaining towers and only then to submit the completion plan. Further as per MoU, the opposite parties were required to deposit the charges for water and sewerage supply after getting the approval, so that they could develop the project, but the opposite parties have not deposited the said charges. As such, the Trust, vide its letter dated 07.12.2014, asked them to get approval for water and sewerage supply, in order to construct/complete the flats. One of the allottees sought information Consumer Complaint No.275 of 2015 under RTI Act, 2005 from the Trust, who informed that the opposite parties have got all the drawings approved in the year 2006-07, but the revised drawings were pending for approval and till the year 2015, the opposite parties had not completed the construction and had not obtained the completion certificate. The complainants clicked the photographs, which show that the construction is incomplete, flooring has not been laid down and kitchen work etc. has not been completed. The complainants approached the opposite parties to deliver the possession of the flat, but they failed to complete the construction or to obtain the completion certificate. Accordingly, the complainants have sought the following directions to opposite parties No.1 to 3:

    i) to refund 30,21,760/- deposited by the complainants, along with interest at the rate of 24% per annum from the date of deposit till realization; ii) to pay compensation of 10,00,000/- for causing mental tension and harassment to the complainants and escalation of construction cost; and iii) to pay 50,000/-, as litigation expenses.

    5. The complaint was contested by the opposite parties. Opposite parties No.1 to 3, in their reply, took objections that in view of clause 10 of the Flat Buyers Agreement dated 28.01.2011, they entered into contract dated 12.01.2010 with M/s Novena Builders & Developers Pvt. Ltd. (in short, the developer) and construction, development and handing over of possession of the flat in question to the complainants exclusively lie with the said developer, who is a necessary party to the complaint. In view of above clause, opposite Consumer Complaint No.275 of 2015 parties No.1 to 3 stood absolved to perform the contract as per the agreement. No cause of action has arisen to the complainants against them. Further as per clause 22 of the contract dated 12.01.2010, liability to pay damages for delay in construction lies with the said developer. M/s Novena Builders & Developers is having Director in the name of Sh. Vijay Gupta and complainant-Kapil Jindal is real son-in- law (damaad) of said Vijay Gupta. Hence, the present complaint has been filed in collision with the Director of the said developer. As per clause 13 of the said agreement with the developer, opposite parties No.1 to 3 received the loan amount and payment of booking amount from the complainant in Nitishree Infrastructure Ltd.-Escrow Bank Account and thereafter transferred the same in the Bank Account of the said developer bearing No.02.18805. Further the funds received in respect of the flat in question were also transferred to the account of the developer-M/s Novena Builders & Developers Pvt. Ltd. They also transferred the amount of loan obtained by the complainants from HDFC to the account of the said developer. The alleged deficiency in services and the disputes arisen in this case cannot be effectively adjudicated in the absence of the said developer, since the said developer is liable for refund of the amount deposited by the complainants. The complaint is time barred. The dispute relates to agreement dated 20.01.2011, whereas the complaint was filed in the year 2015. The complainants have suppressed material facts. On merits, it is pleaded that the complainants have presented the distorted version regarding the project and obligation between the Trust and opposite parties No.1 to 3. It was further pleaded that the construction Consumer Complaint No.275 of 2015 of the project is under supervision of empowered committee of Punjab Govt., which contains high rank IAS Officers and entire construction and stages of phase of project are submitted to the said committee as well as to the Trust. Clause 10 of the contract executed between the complainants and opposite parties No.1 to 3 clearly provides for right to the opposite parties to enter into contract with the third party and the complainants further contracted that opposite parties No.1 to 3 shall be absolved from the performance of the said flat buyer agreement and the same shall be performed by the developer. The complaint is false and vexatious. Other allegations were denied and it was prayed that the complaint be dismissed, as per Section 26 of the Act.

    6. Opposite party No.4, in its reply, took objections that the grievance of the complainants is only against opposite parties No.1 to 3, who allegedly failed to comply with the terms of the agreement. There is no allegation of deficiency in service against opposite party No.4. As regards the finance advanced by HDFC Limited is concerned, the rights of the parties to the present lis are governed by the Tripartite Agreement Annexure R-4/1. As per the terms of this agreement, in case of cancellation of the unit or in the contingency of termination of the developer buyer agreement, the HDFC Limited has the first charge/right to seek apportionment of its dues. The inter-se obligations of the complainants and opposite party No.4 are governed by the terms of the loan agreement Annexure R-4/2. The loan account of the complainants is in default and opposite party No.4 reserves its right to proceed in accordance with the terms of the permission to mortgage Consumer Complaint No.275 of 2015 and loan agreement. It was prayed that the complaint against opposite party No.4 be dismissed.

    7. To prove their claim, the complainants tendered in evidence affidavit of Kapil Jindal, complainant No.1, as Ex.CW-A, along with documents Ex.C-1 to Ex.C-14.

    8. On the other hand, opposite parties No.1 to 3 tendered affidavit of Sh. Vijay Inder Pratap Ex.OP-A, along with documents Ex.OP-1 to Ex.OP-6. Opposite party No.4 tendered affidavit of Sh. Nandan Singh Rawat, Manager, as Ex.R-4/A, along with documents Ex.R-4/1 and Ex.R-4/2.

    9. We have heard learned counsel for the parties and have gone through the record carefully.

    10. Learned counsel for the complainants has vehemently contended that the complainants were allotted flat no.G-1-302, measuring 1565 sq.ft. for basic price of 33,64,750/- and Flat Buyers Agreement Ex.C-3 was executed between the parties on 28.01.2011. Against the total cost of the flat, the complainants deposited 30,21,760/-, out of which 25,21,760/- was disbursed by HDFC to opposite parties No.1 to 3; from whom the complainants availed home loan. The possession of the flat was agreed to be delivered by December, 2012. However, opposite parties No.1 to 3 failed to construct the flat or to complete the project. Even they have not obtained requisite permission/ sanctions from the competent authorities for developing their project. These opposite parties even revised the layout plan, which was pending for approval with the competent authorities and without the approval thereof, they Consumer Complaint No.275 of 2015 proceeded to make construction; which is still incomplete. On account of their failure to complete the flat in question and to hand over its possession, the opposite parties cannot raise any kind of demand from the complainants. There is deficiency in service on the part of the opposite parties and the complainants are entitled to the refund of the amount deposited by them, along with interest and compensation. In support of his arguments, he relied upon the following cases:

    i) EMAAR MGF LAND LTD. & ANR. v. DILSHAD GILL III (2015) CPJ 329 (NC); ii) EMAAR MGF LAND LTD. & ANR. v. DYAL SINGH, GURDEV SINGH BADIAL IV(2015) CPJ 294 (NC); iii) DR. RAMAKRISHNA DELAMATI & ANR. v. MARUTHI CORPORATION LTD. & ANR. IV(2015) CPJ 25 (NC); and iv) LIBERTY INVESTMENT PVT. LTD. v. NADIA APARTMENT CO-OP. SOC. LTD. I (2015) CPJ 545 (NC).

    11. Per contra, learned counsel for opposite parties No.1 to 3 contended that in view of clause 10 of Buyers Agreement Ex.C-3, opposite parties No.1 to 3 entered into contract dated 12.01.2010 Annexure-1 with M/s Novena Builders & Developers Pvt. Ltd.(developer) and as per the said contract, for the construction, development and handing over possession of flat to the complainants as well as delay in handing over of possession, the said developer is liable, who has not been made a party to the complaint. In view of above contract, opposite parties No.1 to 3 stand absolved from any kind of liability as per the Buyers Agreement. He further contended that the loan amount, as well as other amount, received by opposite Consumer Complaint No.275 of 2015 parties No.1 to 3 from the complainants towards the cost of the flat was further transferred by them in account No.02.18805 of the said developer. He further contended that the complaint is time barred, as the present dispute relates to the year 2011, whereas the complaint was filed in the year 2015. There is no deficiency in service on the part of opposite parties No.1 to 3 and the complaint is liable to be dismissed.

    12. Learned counsel for opposite party No.4 contended that as regards the finance advanced by HDFC Limited (opposite party No.4) is concerned, the rights of the parties are governed by the Tripartite Agreement Annexure R-4/1. In terms of the said agreement, in case of cancellation of the unit or in the contingency of termination of the developer buyer agreement, the HDFC Limited has the first right to seek apportionment of its dues. She further submitted that the loan account of the complainants is in default and opposite party No.4 reserves its right to proceed in accordance with the terms of the agreement.

    13. We have given thoughtful consideration to the contentions raised by the learned counsel for the parties.

    14. All the allegations made in the complaint stand proved from the affidavit of complainant No.1, Ex.CW/A. The evidence produced by the complainants by way of affidavit stands corroborated by the documents Ex.C-1 to Ex.C-14. Undisputedly, vide Flat Buyers Agreement Ex.C-3, the flat in question was allotted to the complainants. The basic sale price of the same was 33,64,750/-, against which the complainants deposited 30,21,760/-, as per ledger Consumer Complaint No.275 of 2015 account Ex.C-7. As per Clause-9 of the Agreement Ex.C-3, the possession was to be delivered by December 2012, with a grace period of three months, subject to the delays due to non-availability of construction materials and labour etc. The opposite parties failed to produce any evidence on the record to show that there was delay due to non-availability of construction materials and labour etc. The opposite parties even revised the layout plans, without giving any notice to the complainants and the said revised layout plans were still pending for approval with the competent authorities. The completion plan submitted by the opposite parties was returned by the Trust due to non-completion of the flats as per the agreement, vide letter dated 11.01.2013 Ex.C-9. Initially, the opposite parties proposed ten towers in their project, but in the original drawing, only eight towers were mentioned, as is evident from letter dated 19.12.2012 Ex.C-8. One of the allottees sought information under RTI Act from the Trust; who, vide letter dated 24.03.2015 Ex.C-11, informed that the revised layout plans submitted by the opposite parties were not still approved and were pending with the competent authorities.

    15. In fact, on account of the non-completion/non-development of the project, in which the flat in question was located, the opposite parties were not in a position to deliver the possession to the complainants. This clearly amounts to deficiency in service on their part. It is very much clear from the evidence produced on the record that the opposite parties are still not in a position to deliver the possession of the flat in dispute to the complainants.

    16. Opposite parties No.1 to 3 took a plea that as Joint Venture Consumer Complaint No.275 of 2015 Agreement, Annexure-1, executed between them and M/s Novena Builders and Developers Pvt. Ltd. (developer), they are not liable for construction, development etc and the said developer is responsible for the same. This plea of opposite parties No.1 to 3 is not tenable, as it is the inter-se relationship between them. They may obtain services of other concerns for developing the project in question, but that does not mean that opposite parties No.1 to 3 are absolved from their liability, as contemplated in the Buyers Agreement Ex.C-3. For non- compliance of the terms and conditions of Buyers Agreement Ex.C-3, opposite parties No.1 to 3 cannot escape their liability towards the complainants and other consumers. They failed to complete the construction of the project/flat, as is evident from the photographs Ex.C-13 (colly.), and to hand over the possession of the flat to the complainants within the agreed period.

    17. The opposite parties have also taken the plea that the complaint is time barred, as the dispute relates to agreement dated 20.01.2011 and the complaint was filed in the year 2015. This plea of the opposite parties does not stand on its legs, because as per clause

    9 of the agreement Ex.C-3, the possession of the flat was to be given by December, 2012. However, the opposite parties failed to deliver the same by that period. Even they failed to complete the project/flat, as is evident from the photographs Ex.C-13 (colly.). Perusal of letter Ex.C- 10, which is dated 07.02.2014, itself shows that correspondence was going on between the opposite parties and the Improvement Trust, Jalandhar with regard to approval of water supply and sewerage supply system. Further letter dated 24.03.2015 Ex.C-11 proves that the Consumer Complaint No.275 of 2015 revised layout plans submitted by the opposite parties to the Improvement Trust were still pending till that date. All these facts sufficiently prove that the opposite parties themselves failed to complete/development the project/flat till the year 2015. Thus, it is a continuous cause of action in favour of the complainants/purchasers. Therefore, it cannot be said that the complaint was time barred in any manner.

    18. We would further like to observe that the opposite parties had been collecting huge amounts from the buyers for the development of the project. They are not to play the game at the cost of others. When they insist upon the performance of the promise by the consumers, they are to be bound by the reciprocal promises of performing their part of the Agreement. Thus, the delay in not delivering the possession of plot within the agreed period amounts to deficiency in service on the part of the opposite parties, for which the complainants are to be suitably compensated.

    19. The Consumer Protection Act came into being in the year 1986. It is the benevolent piece 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 complainants have made payment of substantial amount to the opposite parties, with the hope to get the possession of the flat in a reasonable period. The circumstances clearly show that the opposite parties made false statement of facts about the goods and services i.e. allotment of plot and construction in a stipulated period and ultimate delivery of possession. The act and conduct of the opposite parties is a clear Consumer Complaint No.275 of 2015 case of misrepresentation and deception, which resulted in the injury and loss of opportunity to the complainant. Had the complainants not invested his money with the opposite parties, they would have invested the same elsewhere. There is escalation in the price of construction also. The complainants have suffered loss, as discussed above. The builder is under obligation to deliver the possession of the plot/unit/flat within a reasonable period. The complainants cannot be made to wait indefinitely to get possession of the flat booked. It is the settled principle of law that compensation should be commensurate with the 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 complainants for failure to deliver the possession, so has been held in catena of judgments by the Honble Supreme Court and the Honble National Commission. To get the relief, the complainants have to wage a long drawn and tedious legal battle. As such, the complainants were at loss of opportunities. In such circumstances, ever increasing cost of construction and the damages for loss of opportunities caused which resulted in injury to the complainants, are also required to be taken into consideration for awarding compensation. In addition to that they are also entitled to the compensation for the harassment, mental agony and wasting of time and money in litigation for redressal of their grievance, on account of the betrayal by the opposite parties in shattering his hope of getting the flat by waiting for all this period. For non-delivery of possession, the complainants are entitled to the refund of the amount deposited by them. Consumer Complaint No.275 of 2015

    20. Opposite party No.4 took a plea that as per Tripartite Agreement Ex.C-4, in case of cancellation of residential unit, the builder is liable to make payment of amount due to it. It is relevant to mention that the complainants are liable to repay the loan amount to the financer as per the agreed terms and conditions. In case of their failure to repay the loan amount, the financer i.e. opposite party No.4 can avail remedy available to it, in accordance with law, for recovering the loan amount from the complainants.

    21. The sum and substance of above discussion is that the opposite parties are deficient in rendering services, by not delivering the possession of the allotted flat to the complainants, despite receiving 30,21,760/-. For non-delivery of possession of the flat in question, opposite parties No.1 to 3 are liable to refund the amount deposited, along with interest and compensation.

    22. Accordingly, the complaint is allowed and the following directions are issued to the opposite parties:

    i) to refund the amount of 30,21,760/- to the complainants, along with interest @ 12% per annum from the date of deposit of the respective amounts till realization, ii) to pay 3,00,000/- as compensation for mental tension and harassment suffered by the complainants; and iii) to pay 30,000/- towards costs of litigation.

    23. The opposite parties shall comply the order within 30 days of the receipt of certified copy of the order, failing which the compensation amount shall also carry interest at the rate of 12% from the date of this order till realization. Consumer Complaint No.275 of 2015 Consumer Complaint No.223 of 2015

    24. Similarly, in Consumer Complaint No.223 of 2015, initially flat No.204, 2nd Floor, Block C-8, Shourya Greens, Jalandhar was booked by one Sh. Chavi Agarwal. He intended to sell the said flat and, as such, the said flat was booked in favour of complainants and their daughter Ms. Prerna Mahajan. Basic sale price of the flat measuring 1565 sq. ft. was 21,20,575/-, out of which 4,00,000/- was paid, vide acknowledgment Ex.C-3. The complainants also paid preferential location charges for park facing to the tune of 54,775/- and IMFS 15,650/-. Letter for change of right to purchase dated 15.10.2005 is Ex.C-1. Thereafter allotment letter Ex.C-2 was issued in their favour. The possession of the said flat was to be delivered in the year 2007, but the same was not given. As the amount of the complainants was stuck with the opposite parties, so they has no option but to accept the option given by opposite parties to take a flat in another dwelling unit which was likely to be completed shortly. Accordingly, they gave option to purchase flat No.101, 1st floor in Block E-6 of Shourya Greens, having 1565 sq.ft. at the rate of 1,355/-. The basic sale price of the flat was 21,20,575/-. Besides this, 54,775/- were to be paid as preferential location charges; 54,775/- as park facing charges; 15,650/- as IMFS; 25,000/- as open car parking; and 20,000/- towards power backup were payable. Thus, total price of the flat came to 22,90,775/-. The complainants paid 8,00,000/- on the date of issuance of allotment letter dated 12.05.2007 Ex.C-5. The possession of the said flat was also delayed. The opposite parties further allotted flat No.104 in Block E-2, vide agreement dated Consumer Complaint No.275 of 2015 21.02.2009, for basic sale price of 20,93,475/-. In para No.1 of the agreement, it was mentioned that the complainant already paid 11,29,000/-. As per clause 9 of the agreement dated 21.02.2009 Ex.C-7, the possession of flat No.104 was to be given in December, 2009, with grace period of three months. After including preferential location charges, car parking, power backup, IMFS charges, the grand total charged was 22,63,475/-. The opposite parties also failed to deliver possession of this flat and in place of the same, allotted another flat No.201, Block B-4, regarding which agreement dated 27.03.2011 was executed between the parties. Complainant No.2 i.e. mother of Ms. Prerna Mahajan entered into the shoes of Ms. Prerna Mahajan. Date of delivery of possession was fixed as December, 2009, with grace period of three months. Grand total price of the said flat was 27,13,575/-. Allotment letter dated 27.03.2011 was issued in favour of the complainants, mentioning that 17,66,448/- already stood paid by them and out of balance amount of 9,47,127/-, 5,00,000/- was to be paid at the time of possession. 4,47,127/- were payable as per payment plan, as per allotment letter Ex.C-9. The opposite parties also failed to deliver possession of this flat. Rather they issued letter dated 12.11.2013 Ex.C-12, raising an illegal demand of 7,80,371/-. Complainant No.1, vide letter dated 15.11.2013 Ex.C-13, replied that as per allotment letter dated 27.03.2011, the complainants were required to pay 5,00,000/- only at the time of possession. However, the opposite parties further raised this demand vide letter dated 16.12.2013. The act and conduct in not delivering the actual and physical possession of the allotted flat, complete in all respects, Consumer Complaint No.275 of 2015 amounts to deficiency in service. Accordingly, the complainants prayed for issuance of following directions to the opposite parties:

    i) to refund 22,13,575/- received towards the price of the flat in question, along with interest at the rate of 24% per annum, or in the alternative to give actual and legal physical possession thereof, complete in all respects; ii) to pay 8,00,000/-, as compensation for the mental agony and harassment suffered by the complainants; and iii) to pay 1,50,000/-, as litigation expenses.

    25. Upon notice, opposite parties appeared through counsel on 09.03.2016 and were afforded opportunity to file reply to the complaint and the case was fixed for 11.05.2016. However, no reply was filed on behalf of the opposite parties within the stipulated period of 45 days.

    26. To prove their case, the complainants tendered their affidavits Ex.C-A and Ex.C-B, along with documents Ex.C-1 to Ex.C-

    23. On the other hand, the opposite parties tendered affidavit of Sh. Vijay Inder Pratap Ex.OP-A, along with documents Ex.OP-1 and Ex.OP-2.

    27. The whole purpose of pleadings is to give fair notice to each party of what the opponents case is and to ascertain with precision the point(s) on which the parties argue 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. No amount of evidence can be looked into upon a plea, which was never put forward in pleadings. A party cannot adduce evidence and set Consumer Complaint No.275 of 2015 case inconsistent to the pleadings. No amount of proof can substitute pleadings, which are the foundation of the claim of the parties. When there is no pleading, the party is precluded from adducing evidence. In the present case, the opposite parties have failed to file reply to the complaint within the statutory period. As such, the evidence adduced by them cannot be taken into consideration and the evidence adduced by the complainant remains unrebutted.

    28. The complainants have already deposited 22,13,575/- (16,66,448/-, as per allotment letter dated 27.03.2011 Ex.C-9 and 4,47,127/- vide receipt dated 30.09.2011) with the opposite parties. The opposite parties had been allotting different flats to the complainants, on account of their failure to deliver the allotted flats to the complainants. The opposite parties kept on changing the flats as per their own wishes and caused unnecessary harassment to the complainants. Their demand of 7,80,371/- raised, vide letter dated 12.11.2013 Ex.C-12, is not tenable, in view of the fact that they themselves have failed to comply with the terms and conditions of all the agreements executed by them with the complainants. Honble National Commission in case DILSHAD GILLs case (supra), observed that the appellants did not offer possession within the period prescribed under agreement and as such they have violated material conditions with regard to handing over of possession. Now, it does not lie in their mouth to demand further payment from the respondent. In DR. RAMAKRISHNA VELAMATIs case (supra), the Honble National Commission held that the complainants are not required to pay the Consumer Complaint No.275 of 2015 amount, until or unless possession of premises is handed over to them.

    29. In view of the above discussion as well as the discussion held in Consumer Complaint No.275 of 2015 (Kapil Jindal & Anr. Vs. Nitishree Infrastructure Ltd. & Others), this complaint i.e. Consumer Complaint No.223 of 2015 (Charanji Lal Gupta Vs M/s Nitishree Infrastructure Ltd. & Others), is allowed and the following directions are issued to the opposite parties:

    i) to refund 22,13,575/- to the complainants, along with interest at the rate of 12% per annum from the dates of respective deposits till realization; ii) to pay 2,00,000/-, as compensation for causing mental pain and harassment to the complainants; and iii) to pay 20,000/-, as litigations expenses.

    30. The opposite parties shall comply the order within 30 days of the receipt of certified copy of the order, failing which the compensation amount shall also carry interest at the rate of 12% from the date of this order till realization.

    31. The complaints could not be decided within the stipulated timeframe, due to heavy pendency of Court cases. (JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (HARCHARAN SINGH GURAM) MEMBER April 06, 2017. (Gurmeet S)

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    Kapil Jindal v. Nitishree Infrastructure Ltd.
    (Apr 6, 2017)