The sum and substance of the improvement trust's contention was that the complainant failed to make the payment of the instalments in time. Hon'ble High Court granted stay on dispossession of the land owners with respect to part of the land wherein the subject plot was situated. The improvement trust subsequently allotted an alternative plot to the complainant. The complainant is not entitled for refund of her deposited amount or compensation or cost of litigation.

6. The f. a. no. 995 of 2017 filed by the improvement trust (Jalandhar Improvement Trust & Anr. vs. Pooja Garg) was within limitation. The delay of 18 days in filing the cross-appeal by the complainant [f. a. no. 1268 of 2017 (Pooja Garg vs. Jalandhar Improvement Trust & Anr.)] was overlooked.

7. On 07.02.2019, after hearing arguments of both sides and perusing the material on record,

we passed the following Order:

Dated: 07.02.2019

ORDER

Heard the learned senior counsel for the Improvement Trust and the learned counsel for the complainant, and perused the material on record. The impugned Order of the State Commission is partially modified as below:

The principal amount (total Rs. 38,99,638/-) deposited by the complainant with the Improvement Trust shall be refunded with interest from the respective date / s of deposit till the date / s of realization. The rate of interest shall be the rate for house building loan in the corresponding period of a scheduled nationalized bank (take, State Bank of India). If 'floating'/varying/different rates of interest were prescribed in the corresponding period, the higher rate shall be taken for this instant computation.

In addition, compensation for loss and injury, harassment and difficulty, uncertainty and helplessness, shall remain Rs. 3,00,000/-, and cost of litigation shall remain Rs. 20,000/- (as awarded by the State Commission).

All payments shall be made within four weeks of the date of pronouncement of the reasoned judgment.

Failure in timely compliance shall attract higher/penal interest and other compensation/costs (which shall be determined by this Commission in the facts and specificities of that contingency if it so arises).

Reasoned judgment to follow.

Till the pronouncement of the reasoned judgment execution proceedings shall remain stayed.

3

We are giving our reasons hereinafter.

8. The State Commission had allowed the complaint vide its impugned Order dated 07.03.2017. The State Commission had heard both sides, appraised the evidence, and passed a reasoned Order. In addition to deficiency in service, the State Commission had also given clear findings of unfair trade practice.

9. The relevant chronology, material to adjudicate this matter, is as below:

(i) Acquisition of land under the Punjab Town and Improvement Trust Act, 1922 was undertaken by the improvement trust for implementation of its subject development scheme. The land acquisition proceedings with respect to a part of the project land (32 acres) was challenged in Hon'ble High Court on 23.02.2011. Subsequently Hon'ble High Court vide its order dated 26.09.2012 granted stay on dispossession of the land owners. (Declaration of award was not stayed.) Award for acquisition of land for the total area of 94.97 acre was passed on 31.05.2011. Advertisement for booking freehold residential plots in the said development scheme of the improvement trust on the total area of 94.97 acre of the project land was issued on 08.08.2011. The complainant applied for allotment of a plot and deposited earnest money (Rs. 4,25,000/-) on 05.09.2011. The complainant was allotted the subject plot in the development scheme vide its letter dated 23.12.2011. The subject plot was situated in the part of the land (32 acres) that was in litigation before Hon'ble High Court and on which Hon'ble High Court subsequently granted stay on dispossession of the land owners. As per the terms and conditions of the allotment, the complainant had to deposit 1/4^thprice of the subject plot plus cess charges and site plan and agreement fee & photograph fee (Rs. 9,31,700/-) within 30 days and an agreement to sale was to be then executed between the improvement trust and the complainant within the said 30 days. Clause 5, clause 6 and clause 7 of the allotment letter dated 23.12.2011 read as below:

5) Agreement to sale shall be executed within 30 days from the issuance of this letter on the stamp paper of Rs. 500/- in the name of Chairman Improvement Trust Jalandhar and shall come to the office of Trust along with two witnesses for the computerized photograph.

6) If you did not complete the conditions as mentioned above within 30 days from the issuance of allotment letter of the plot under subject and if you did not deposit 1/4 th amount of the plot in time, then the Trust the full right to forfeit the plot without issuance of any letter and the initial amount deposited by the allottee shall deemed to be forfeited.

7) Development facilities under the scheme shall be completed within the period of installments time of two and half years and you can take the possession after executing the agreement to sell with the trust.

(as per the translated copy furnished by the improvement trust)

(ii) The complainant deposited the requisite Rs. 9,31,700/- with the improvement trust on 19.01.2012 i.e. within 30 days from the issuance of the allotment letter dated 23.12.2011. Agreement to sale was not executed by the improvement trust within the stipulated period of 30 days.

4

(iii) The complainant subsequently deposited Rs. 7,01,250/-, Rs. 7,01,250/-, Rs. 3,34,000/- and Rs. 8,06,438/- with the improvement trust on 04.07.2012, 17.12.2012, 14.01.2013 and 03.06.2013. In all, the complainant deposited Rs. 4,25,000/- (earnest money) + Rs. 9,31,700/- (deposited within 30 days of allotment) + Rs. 25,42,938/- (subsequent instalments) totalling Rs. 38,99,638/- against the total cost of Rs. 44,37,950/- of the subject plot, that is, the complainant deposited close to 88% of the total cost. The agreement to sale, which was to be executed within 30 days of the allotment (23.12.2011), i.e. by 22.01.2012, on the complainant depositing an amount of Rs. 9,31,700/- (which she deposited on 19.01.2012), was not executed at all, and moreso not executed even after the complainant had further deposited an amount of Rs. 25,42,938/- spread between 04.07.2012 to 03.06.2013.

(iv) As per the terms and conditions of the allotment, possession of the subject plot was to be delivered by the improvement trust within 2 ½ years (co-terminus with the time-frame for payment of the subsequent instalments after the making of the deposit of the Rs. 9,31,700/- which was the condition precedent for execution of the agreement to sale). The possession had to be delivered after 30 days plus 2 ½ years, that is, on or before 22.07.2014. The possession of the duly and fully developed subject plot was not delivered within the assured period.

(v) A consumer complaint no. 155 of 2014 was filed by the complainant before the State Commission on 18.09.2014, that is, after about 32 months of the stipulated date of execution of the agreement to sale (22.01.2012) and after about 2 months of the assured date of delivery of possession of the subject plot (22.07.2014).

(vi) The improvement trust subsequently expressed its inability to deliver possession of the subject plot to the complainant in view of the stay on dispossession granted by Hon'ble High Court and allotted an alternative plot to the complainant vide its letter dated 12.06.2015:

Office of Jalandhar Improvement Trust, Jalandhar

To

Smt. Pooja Garg wife of Sh. Vijay Garg,

C/o M/s Mohan Lal Tarsem Chand Karyana Merchant

Dhuri Gate, Sangrur.

Letter No. JIT/1183 Dated: 12.06.2015

Subject: Regarding Plot No. 159-D, Development Scheme 94.97 acres. You are informed vide this letter that the place / Khasra where your plot No. 159-D is situated is under stay granted from the Hon'ble Punjab and Haryana High Court and therefore, you cannot be given possession of the same. Therefore, you are allotted plot No. 212-D in place of Plot No. 159-D on the same terms and conditions as given in the allotment letter. The possession of the same is with the Trust. Sd/-

5

Executive Engineer, Jalandhar Improvement Trust, Jalandhar (as per the translated copy furnished by the improvement trust)

(vii) The said letter dated 12.06.2015 was issued after about 41 months of the stipulated date of execution of the agreement to sale (22.01.2012), and after about 11 months of the assured date of possession (22.07.2014), and after about 9 months of the complaint being filed before the State Commission (18.09.2014).

(viii) The concerned writ petitions were dismissed by Hon'ble High Court vide its judgment dated 22.12.2015.

(ix) The improvement trust issued a general public notice for allotment of alternative plots to all affected on 20.01.2016.

10. We note the chronology:

6

(total deposited = Rs. 38,99,638/-; total cost = Rs. 44,37,950/-) 19.01.2012 (deposit as

condition

precedent to

agreement to sale);

04.07.2012;

17.12.2012;

14.01.2013;

03.06.2013

(subsequent installments)

11. We specifically note the following:

(i) The litigation apropos land acquisition went before Hon'ble High Court on 23.02.2011.

(ii) Without taking into consideration (without the requisite due administrative prudence and without the requisite due application of mind and without the requisite due diligence), and albeit ignoring, the pending litigation before Hon'ble High Court, the total area (94.97 acres), inclusive of the part area (32 acres) under litigation before Hon'ble High Court, was advertised on

7

08.08.2011 to the general public for making application and depositing earnest money for allotment of plots.

(iii) It was not informed in the advertisement dated 08.08.2011 to the general public that part of the project land (32 acres) was under litigation before Hon'ble High Court.

(iv) The part area under litigation was included in the said advertisement, without any distinction being made between the land under litigation and the land not under litigation.

(v) The complainant was allotted the subject plot on 23.12.2011 in that part of the project land that was under litigation since 23.02.2011 and on which Hon'ble High Court then also subsequently passed an interim order on 26.09.2012 for stay on dispossession of the land owners.

(vi) The complainant dutifully made deposit of the requisite amount of Rs. 9,31,700/- with the improvement trust on 19.01.2012 towards 1/4^thprice of the subject plot plus cess charges and site plan and agreement fee & photograph fee, within the stipulated period of 30 days, which was the condition precedent to execution of the agreement to sale.

(vii) The agreement to sale was not executed by the improvement trust within the stipulated period of 30 days.

(viii) The improvement trust continued to take the subsequent installments from the complainant during the pendency of the litigation before Hon'ble High Court and then also during the Hon'ble High Court's interim order being passed and being in place.

(ix) As already said, the improvement trust did not execute the agreement to sale within the stipulated period of 30 days as per the terms and conditions in the allotment letter after receiving the requisite amount of Rs. 9,31,700/- from the complainant within the stipulated time. The fact of the matter is that the improvement trust could not execute the agreement to sale having regard to the pending litigation in Hon'ble High Court and then, specifically, having regard to the subsequent interim order of stay on dispossession (such latter act would have been unlawful and contemptuous). The improvement trust's defence that the complainant did not come forth to execute the agreement to sale fails on two points, one, that when the complainant had duly made deposit of the requisite Rs. 9,31,700/- that was the condition precedent to execution of the agreement to sale, it belies any reason or logic that she did not come forth for execution of the document, and, two, the improvement trust was not in a position to execute any agreement to sale etc. on the subject plot first in the light of the pending litigation and then, specifically, in the light of the subsequent interim order of Hon'ble High Court.

(x) Possession of the duly and fully developed subject plot was not delivered to the complainant by 22.07.2014 i.e. the stipulated 2 ½ year period after the initial 30 day period for execution of the agreement to sale. The fact of the matter here too is that the improvement trust could not have delivered possession because till the expiry of the said 2 ½ years after 30 days the litigation was still pending and Hon'ble High Court's interim order of stay on dispossession had also come in place. Neither could the improvement trust have been able to in any manner enter into and develop the subject plot (the land owners were in possession, not the improvement trust). On the plain facta of the litigation pending before Hon'ble High Court, and then of Hon'ble High Court's interim order also being passed and coming in place, the whole defence of

8

the improvement trust fails on reason of, one, it was not lawfully feasible to develop the subject plot in 2 ½ years after 30 days, two, it was not lawfully feasible to hand over possession in 2 ½ years after 30 days.

(xi) The complainant went to the State Commission on 18.09.2014 i.e. after about 32 months of the stipulated date for execution of the agreement to sale (22.01.2012) and after about 2 months of the assured date of delivery of possession (22.07.2014).

(xii) During the pendency of the writ petitions before Hon'ble High Court and during the pendency of the proceedings before the State Commission, the improvement trust allotted an alternative plot to the complainant vide its letter dated 12.06.2015. This was, one, after about 41 months of the stipulated date of execution of the agreement to sale, two, after about 11 months of the assured date of delivery of possession, three, arbitrary and one-sided, four, heavily belated (on the face of it itself).

(xiii) The complainant had deposited Rs. 38,99,638/-, which was close to 88% of the total cost of Rs. 44,37,950/-, and there is nothing on record to show that she was not ready and willing to deposit the balance cost with interest or penal interest if any, provided that the subject plot was duly and fully developed within the assured period and was not unreasonably delayed (reasonable delay here would connote such delay as a reasonable man of normal intelligence would not normally agitate).

12. The material facts and consequences relating to availability of land / litigation apropos acquisition of land were not brought to the notice of the general public (including the complainant) at the time of advertising the subject development scheme. In the absence of the facts and the consequences thereof being specifically and explicitly brought to their notice, the buyers - consumers would reasonably (and correctly) understand that all aspects of project planning, execution and completion, inclusive of availability of land, at the due time, are the responsibility of the improvement trust and have been / are being / would be duly taken care of by the improvement trust, without cost or time overruns.

13. The improvement trust was required and expected to have the due pragmatic and realistic assessment and preparation of the project planning, execution and completion. It was the prime responsibility of the improvement trust to ensure that it was in a position to deliver the possession of subject plot / s to the buyer / s. Planning, execution and completion were its responsibility, and not of the consumer.

(Normal) impediments or problems that arise in planning, execution and completion were its responsibility, and not of the consumer.

Specifically, availability of land, at the due time, being a fundamental basic requirement of a residential project, were decidedly the improvement trust's primary responsibility, and not of the consumer.

Cost or Time overruns were its responsibility, not of the consumer.

14. We may make it explicit that mere allotting an alternative plot (arbitrarily, one-sidedly, belatedly) vide letter dated 12.06.2015 does not in any manner dilute the improvement trust's

9

responsibilities towards project planning, execution and completion, including availability of land, at the due time, without cost or time overruns, and of executing the agreement to sale within the stipulated period, and of delivering the duly and fully developed subject plot within the assured period, without unreasonable delay, which responsibilities qua the complainant arose on issuance of the allotment letter and retaining the earnest money (Rs. 4,25,000/-) and taking the payment of the Rs. 9,31,700/- for execution of the agreement to sale of the subject plot.

15. Not executing the agreement to sale on the complainant making good her part of depositing the amount of Rs.9,31,700/- towards 1/4^thprice of the subject plot plus cess charges and site plan and agreement fee & photograph fee within the stipulated period of 30 days and not delivering possession of the subject plot within the assured period of 2 ½ years after the 30 day period for execution of the agreement to sale and unreasonable delay beyond the assured date of delivery of possession constitute deficiency in service within the meaning of section 2 (1)(g) and

(o) of the Act 1986.

16. Advertising allotment of plot / s on land under litigation before Hon'ble High Court and not disclosing this fact upfront in its advertisement to the general public and (then) not being in a position to (lawfully) take possession and develop the land and (still) retaining the earnest money of Rs. 4,25,000/-, taking deposit of Rs. 9,31,700/- re the condition precedent to execution of the agreement to sale, taking further deposits of Rs. 25,42,938/- (in instalments) and (then) arbitrarily, one-sidedly and belatedly allotting an alternative plot after about 41 months of the stipulated date of execution of the agreement to sale and after about 11 months of the assured date of delivery of possession are deceptive and unfair acts and constitute unfair trade practice within the meaning of section 2(1)(r) of the Act 1986.

17. Two rights accrued to the consumer - complainant:

one: the option to either wait for the subject plot to be delivered (if and when the litigation ended in favour of the improvement trust), or to take possession of an alternative plot offered by the improvement trust at her considered wisdom and discretion, and in addition seek just and equitable compensation under the Act 1986 for unreasonable delay and loss and injury. two: to claim refund of the principal amount, with interest thereon, lumpsum compensation and cost of litigation.

That is, the consumer - complainant had both options available, one, to obtain possession of the subject plot or alternative plot at her considered wisdom and discretion if and when offered by the improvement trust and to in addition seek just and equitable compensation under the Act 1986 for unreasonable delay in possession and the loss and injury, and, two, to opt for a fair amount from the improvement trust comprising refund of the deposited amount, with interest thereon, lumpsum compensation and cost of litigation.

18. It is seen that of the two options available to the consumer - complainant, she opted for a fair amount from the improvement trust. The said amount has to be equitable and just.

19. To sum up, we find, both, deficiency in service within the meaning of section 2(1)(g) & (o), and unfair trade practice within the meaning of section 2(1)(r), to be well and truly evident on the part of the improvement trust.

10

In remedy, it is just, equitable, appropriate and necessary to direct the improvement trust to refund the principal amount deposited by the complainant with the improvement trust with interest as well as to pay lumpsum compensation and cost of litigation to the complainant.

20. In so far as refund of the amount deposited with the improvement trust is concerned, there can be no two opinions. The refund in full has necessarily to be made by the improvement trust to the complainant.

21. In respect of the interest on the amount deposited, it is always desirable and preferable, to the extent feasible and appropriate in the facts and specificities of a case, that some objective logical criteria be identified and adopted to determine an apt rate of interest. The rate of interest cannot be arbitrary or whimsical, some reasonable and acceptable rationale has to be evident, subjectivity has to be minimized.

We feel it appropriate that, considering that the subject plot in question is a residential plot, in a residential development scheme, the rate of interest for house building loan for the corresponding period in a scheduled nationalized bank (take, State Bank of India) would be appropriate and logical, and, if 'floating' / varying / different rates of interest were / are prescribed, the higher rate of interest should be taken for this instant computation.

22. The lumpsum compensation in addition for loss and injury, for mental agony and physical harassment, hardship and difficulty, uncertainty and helplessness, can be neither meagre nor exorbitant, it has to be just and equitable, commensurate with the loss and injury. We feel the lumpsum compensation awarded by the State Commission does not require interference by this Commission in the given facts and specificities of the case.

23. In respect of cost of litigation, too, just and equitable cost is necessary (this by its very nature, needs no elaboration).

We feel that the cost of litigation awarded by the State Commission needs no interference by this Commission.

24. We may also note that once the amount awarded for deficiency in service and unfair trade practice is adjudicated and determined, the onus is on the improvement trust to be prompt and dutiful in making the necessary payments within the stipulated time. Creating yet further harassment, difficulty and helplessness for the ordinary simple consumer by delaying payments or making reduced payments etc. (if the adjudication is not stayed or quashed or modified by a higher authority / court) will be an unacceptable situation, to be viewed seriously - the harassment, difficulty and helplessness of the consumer should end promptly and fully, the chapter should close. Therefore, if the improvement trust delays the adjudicated payments beyond the time stipulated, it would and should attract higher / penal interest and other compensation / costs, which will be determined by this Commission if the contingency so arises.

25. We firm-up the award as below:

(i) The principal amount (total Rs. 38,99,638/-) deposited by the complainant with the improvement trust shall be refunded with interest from the respective date / s of deposit till the date / s of realization. The rate of interest shall be the rate for house building loan in the

11

corresponding period of a scheduled nationalized bank (take, State Bank of India). If 'floating' / varying / different rates of interest were prescribed in the corresponding period, the higher rate shall be taken for this instant computation.

(ii) In addition, compensation for loss and injury, harassment and difficulty, uncertainty and helplessness, shall remain Rs. 3,00,000/-, and cost of litigation shall remain Rs. 20,000/- (as awarded by the State Commission).

All payments shall be made within four weeks of the date of pronouncement of the reasoned judgment.

Failure in timely compliance shall attract higher / penal interest and other compensation / costs (which shall be determined by this Commission in the facts and specificities of that contingency if it so arises).

26. Needless to add that the State Commission shall undertake execution as per the law after expiry of the four weeks' period from the date of pronouncement of this Order.

27. Furthermore, specifically for indulging in unfair trade practice, we put the improvement trust through its chief executive to stern advice of caution. We are consciously refraining from imposing cost on the improvement trust / its chief executive / its functionaries on this count (i.e. re unfair trade practice) considering that the improvement trust is a government organization intended for overall public good. We would but advise the senior officer / s in the state government responsible for the functioning of the improvement trust to take note of the fundamental flaws in its functioning as brought out in this judgment and to take the necessary appropriate steps for systemic improvements for future.

28. We request learned senior counsel for the improvement trust, and we direct the chief executive of the improvement trust, to bring para 27 of this Order to the notice of the secretary- in-charge in the state government (civil secretariat) charged with the responsibility of the functioning of the improvement trust.

29. A copy of this Order may be sent to the State Commission by the Registry within ten days in reference to para 26.

......................

DR. S.M. KANTIKAR

PRESIDING MEMBER

......................

DINESH SINGH

MEMBER

12