STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB, CHANDIGARH Consumer Complaint No. 462 of 2019 Date of Institution : 31.05.2019 Date of Reserve : 04.10.2019 Date of Decision : 31.10.2019 Bhupinder Paul Singh S/o Late Shri Agya Pal Singh resident of House No.1559, Sector 18-D, Chandigarh. Email id:cjbakshi.advocate@gmail.com .Complainant Versus
1. Best Zone Builders & Developers C/o Orchid Greens, Kharar- Landran Road, Sector-115, Mohali, Punjab through its Director. Also having its Corporate Office at SCO No.517, Second Floor, Sector 70, Mohali.
2. Best Zone Builders and Developers Pvt. Ltd., through its Managing Director, Shop No.1-2-3, Orchid Greens, Kharar- Landran Road, Sector-115, Mohali, Punjab. Email id: info@bestzonebuilders.com
3. India Bulls Housing Finance Limited through its Managing Director, having its registered office at M-62 & 63 First Floor, Connaught Place, New Delhi-110001.
4. Branch Manager, India Bulls Housing Finance Limited, SCO No.347-348, Sector 35-B, Chandigarh. .Opposite parties Consumer Complaint under Section 17 of the Consumer Protection Act, 1986. Quorum:- Honble Mr. Justice Paramjeet Singh Dhaliwal, President Mr.Rajinder Kumar Goyal, Member, Present:- For the complainant : Sh.C.S.Bakshi, Advocate For opposite parties No.1&2: Sh.Chaman Lal, Advocate For opposite parties No.3&4: Ms.Niharika Goel, Advocate RAJINDER KUMAR GOYAL, MEMBER The complainant has filed this complaint, under Section 17 of the Consumer Protection Act, 1986 (in short the Act) seeking following directions to the opposite parties No.1 & 2: Consumer Complaint No.462 of 2019 a. to handover the vacant possession of the flat as per the terms and conditions of the agreement within a stipulated period and if they fail to deliver the possession of the said flat as per the terms and conditions of the agreement and as per the approved plans within the stipulated period, then they be directed to refund the entire amount of Rs.24,76,497/- along with interest 18% rate of interest; b. to pay Rs.13,37,308/- as interest on the money deposited by the complainant with opposite parties No.1 & 2; c. the opposite parties No.1 & 2 be directed to pay the damages to the tune of Rs.5,00,000/- for the inexplicable harassment suffered by the complainant; d. the opposite parties No.1 & 2 be directed to pay Rs.55,000/- as the cost of litigation; e. the opposite parties No.1 & 2 be directed to obtain all the necessary sanctions and permissions from the competent authorities within a stipulated time and handover the vacant possession as per the approved plans; f. any other relief be given to which the complainant is found entitled to. Facts of the Complaint
2. Brief facts, as averred in the complaint are that the complainant applied for 2BHK Apartment with opposite parties Consumer Complaint No.462 of 2019 No.1 & 2. An amount of Rs.5,05,141/- was paid by cheques bearing No.933898 and 475346 dated 22.10.2013. Thereafter, an agreement was executed between the parties on 10.01.2014. As per the agreement the complainant was allotted Apartment No.F- 202, Block-F, Second Floor, Type 2 BHK Apartment in Orchid Greens for a total price of Rs.24,50,000/-. The unit was financed by opposite parties No. 3 & 4 and a Tripartite Agreement dated 02.06.2014 was executed. The total sale consideration has been paid by the complainant to opposite parties No.1 & 2 as per the account statement of opposite parties No.3 & 4 and the amount paid at the time of booking in addition to some other charges. Another payment of Rs.11,356/- was made by the complainant by cheque to the opposite parties No.1&2 on 20.06.2014. Vide letter dated 16.10.2017, the complainant apprised opposite parties No.1 & 2 about the fact that the apartment was not ready. Opposite parties No.3 & 4 issued a notice to the complainant for Non- Creation of Security. The complainants sister-in-law who also booked a flat with the opposite parties sought information from Municipal Corporation, Kharar through RTI Act vide letter dated 01.12.2016. In reply to that it has been stated that the opposite parties No.1 & 2 had not applied for any Completion Certificate. As per agreement the apartment was to be handed over within a period of 36 months from the date of signing of the agreement with an extended period of 6 months. However, the possession has not been delivered to the complainant and complainant is paying the EMIs to opposite parties No.3 & 4. The pre EMI as per agreement Consumer Complaint No.462 of 2019 for the delay period was to be paid by opposite parties No.1 & 2 to opposite parties No.3 &4 till offer of possession, however, the offer given is not as per provisions of the agreement. As per clause 4.8 of the Tripartite Agreement and Buyers Agreement the opposite parties No.1 & 2 are to pay monthly interest on the EMI directly into the borrowers loan account. However, to cover up their lapse, they issued a false and frivolous possession letter without completing the building as per plan and not having complied with the requirements of the authorities. Even, the opposite parties No.1 & 2 are not in possession of electric connection and are working on temporary connection only. It has been further averred that sewerate treatment has neither been constructed nor installed in the premises. Also, the boundary wall of the site is incomplete and there is no security provided to the allottees. The complainant has been running from pillar to post to resolve the issues but to no avail. The opposite parties No.1 & 2 have been completely failed to deliver the actual physical possession of the flat and retained the money of the complainant illegally for almost three years which amounts to deficiency in service and unfair trade practice on the part of opposite parties No.1 & 2. Alleging deficiency in service and unfair trade practice on the part of the opposite parties No.1 & 2, the complainant filed the complaint seeking the above mentioned reliefs. Defence of the Opposite Parties
3. Upon notice, the opposite parties appeared and filed their respective written statements. Consumer Complaint No.462 of 2019
4. The opposite parties No.1 & 2 and appeared and filed their written statement by taking preliminary objections that the complaint is not maintainable in the present form. The complainant has not approached this Commission with clean hands and suppressed the material facts in the complaint. The complainant does not fall within the ambit of consumer. On merits, it is admitted that the complainant booked Apartment No.F-202, Block- F, Second Floor, Type 2 BHK Apartment in Orchid Greens for a total sale consideration of Rs.24,50,000/-. It is also admitted that a sum of Rs.5,05,141/- was paid by the complainant at the time of booking. It is contended that the flat is complete in all respects and the demand raised by the opposite parties is genuine. The complainant instructed the Indiabulls to release the remaining amount of the loan as the complainant had taken the loan from Indiabulls. It is contended that the complainant has not got executed the sale deed in his favour, therefore, the completion certificate could not be issued by the M.C. Kharar. The flat is complete in all respects including electricity connection. There is no deficiency in service or unfair trade practice on the part of the opposite parties. Rest all the averments as averred by the complainant in their complaint were denied and prayed to dismiss the complaint being devoid of merits.
5. On the other hand, opposite parties No.3 & 4 filed their written statement taking preliminary objections that the opposite parties No.3 & 4 are not necessary and proper party and they just acted merely a role of lending financial institution. The complainant Consumer Complaint No.462 of 2019 approached the answering opposite parties to avail loan facility to the tune of Rs.19,60,000/- for Unit No.F-202, admeasuring 950 sq.ft. in residential colony named Orchid Greens, Sector 115, SAS Nagar, Mohali. Accordingly, a Tripartite Agreement was executed among the complainant, opposite party No.1 and answering opposite parties. There is no deficiency in service or unfair trade practice on the part of the answering opposite parties. On merits, it has been stated by opposite parties No.3 & 4 that the averments as averred by the complainant are matter of record and denied for want of knowledge. It was finally prayed to dismiss the complaint qua opposite parties No.3 & 4 and the latter be deleted from the array of parties.
6. Replication to the written statement was filed by the complainant, wherein the complainant denied all the contentions as taken by the opposite parties No.1 & 2 in their written statement and reiterated the averments made in the complaint and prayed to allow the complaint. Evidence of the Parties
7. To prove his claim, the complainant has filed his affidavit along with photostat documents as Ex.C-1 Aadhaar Card, Ex.C-2 application for purchase dated 22.10.2013, Ex.C-3 Apartment Allotment Agreement dated 10.01.2014, Ex.C-4 Tripartite Agreement dated 02.06.2014, Ex.C-5 Account Statement dated 22.04.2019, Ex.C-6 Letter dated 16.10.2017, Ex.C-7 Notice dated 19.02.2019, Ex.C-8 Reply dated 18.03.2019, Ex.C-9 Order dated Consumer Complaint No.462 of 2019 12.11.2018, Ex.C-10 RTI dated 01.12.2016, Ex.C-11 Order dated 17.01.2019.
8. Opposite parties No.1 & 2 filed the affidavit of Sh.Manmohan Singh, Director, Best Zone Builders & Developers along with documents Annexure R-1 photograph of STP, Annexure R-2, photograph of transformer along with its bill dated 12.01.2016.
9. Opposite parties No.3 & 4 have filed the affidavit of Sanjeev Kumar S/o Sh.Sham Lal, Regional Legal Manager along with documents as Ex.OP-2/1 Loan Agreement dated 28.06.2014, Ex.OP-2/2 Tripartite Agreement dated 02.06.2014, Ex.OP-2/3 Statement of Account dated 05.08.2019. Contentions of the Parties
10. We have heard the learned counsel for the parties and have carefully gone through the record.
11. It has been vehemently argued by the learned counsel for the complainant that the complainant got booked an Apartment No.F-202, Type 2 BHK in the project named Orchid Greens for a total amount of Rs.24,50,000/- and agreement was executed between the parties. To make the timely payments, the complainant availed housing loan from India Bulls Housing Finance Limited and a Tripartite Agreement was executed between all the three parties on 02.06.2014. As per the Apartment Allottee(s) Arrangement agreement, the unit was to be delivered within 36 months from the date of execution of the agreement or start of construction. The complainant has also made the total sale consideration of the unit, in question. In the RTI, it came to the Consumer Complaint No.462 of 2019 knowledge of the complainant that the opposite parties No.1 & 2 were not having any completion certificate and reason detailed in their reply for not issuing the completion certificate is an abuse of process of law. The opposite parties No.1 & 2 till today have failed to hand over the possession complete in all respects as per the agreement executed. The Opposite parties No.1 & 2 have also not complied with the provisions of PAPRA which amounts to deficiency in service and unfair trade practice on their part. It is prayed to allow the complaint and the reliefs as prayed be allowed in the favour of the complainant.
12. Per contra, learned counsel for the opposite parties No.1 &
2 argued that the complainant does not fall within the ambit of consumer. The opposite parties No.1 & 2 have completed the project, in question, and offered the possession to the complainant after completing all the works. It is argued that the completion certificate could not be issued to the complainant as he has not come forward to execute the sale deed in his favour. All the internal and external facilities are complete. There is no deficiency in service or unfair trade practice on the part of the opposite parties and prayed to dismiss the complaint.
13. On the other hand, learned counsel for opposite parties No.3 & 4 argued that the opposite parties No. 3 & 4 have sanctioned the loan to the complainant only after verifying his eligibility documents and the parties are governed by the Tripartite Agreement executed. A sum of Rs.19,60,000/- has already been disbursed to the opposite parties No.1 to 2 for the apartment, in Consumer Complaint No.462 of 2019 question. The Loan account of the complainant has already been closed as the complainant has repaid all amounts. The complainant has sought no relief against opposite parties No.3 & 4. Accordingly, the complaint filed against opposite parties No.3 & 4 be dismissed. Consideration of the Contentions
14. We have given our thoughtful consideration to the respective contentions raised by the learned counsel for the parties.
15. The only objection raised by the opposite parties No.1 & 2 is that the complainant does not fall within the ambit of Consumer. In this regard, it is relevant to mention that there is no evidence from the side of the opposite parties No.1 & 2 to prove that the complainant is indulging in sale/purchase of property for commercial purpose and simple assertion in this regard in the reply of the opposite parties is not sufficient to prove this fact. Honble National Commission in M/s IREO FIVERIVER PVT. LTD. v. SURINDER KUMAR SINGLA & OTHERS First Appeal No.1358 of 2016, decided on 29.11.2016, while relying upon its earlier decision in KAVITA AHUJA & OTHERS v. SHIPRA ESTATE LTD. & JAI KRISHNA STATE DEVELOPERS PVT. LTD. & OTHERS Consumer Case No.137 of 2010, decided on 12.02.2015, held the complainants as consumers, observing that the appellant failed to show any cogent evidence, which may indicate that the respondents/complainants or any of them has been indulging in sale purchase of the properties or that the complainants or any one of them had booked the subject plots in the development project Consumer Complaint No.462 of 2019 undertaken by the appellant with the intention to sell the plot on subsequent date for earning profit. In the instant case also, as already discussed above, there is no evidence led by the opposite parties No.1 & 2 to prove that the complainant indulged in sale/purchase of properties or that he purchased the unit, in question, for further sale or for earning profits or for investment purposes. Accordingly, the above said objection/contention of opposite parties No.1 & 2 is rejected and the complainant is held to be consumer, under the Act.
16. Admittedly, the complainant booked one 2 BHK apartment with opposite parties No.1 & 2 vide application (Ex.C-2) and paid a sum of Rs.5,05,141/- vide cheque No.933898, 425346, dated 22.10.2013. Thereafter an agreement was executed between the parties on 10.01.2014 (Ex.C-3), wherein Apartment No.F-202, Block No.F, Second Floor, Type 2 BHK in Group Housing development named Orchid Greens having super area of approx
950 sq. ft. and as per agreement the opposite parties promised to deliver the apartment within a period of 36 months with an extended period of six months from the date of execution of the agreement or the start of construction, which expired on 10.07.2017. To make the timely payments, the complainants availed a housing loan of Rs.19,60,000/-. The complainant in his complaint has averred that he has paid Rs.24,76,497/- to opposite parties No.1 & 2. However, as per Ex.C-2; application form and Ex.C-5 (statement of account) the complainant has paid only Rs.24,65,141/-. With regard to payment of Rs.11,356/- to opposite Consumer Complaint No.462 of 2019 parties No.1 & 2 no document has been placed on the record by the complainant. Accordingly, the Rs.24,65,141/- is considered as paid to opposite parties No.1 & 2. The complainant chose Subvention Plan and as per clause 4.8 of the agreement, the interest part Till the offer of possession against the loan was to be paid by the builder on monthly basis directly into the Borrowers Loan Account. However, the opposite parties have failed to give any pre-EMI interest on the loan amount of Rs.19,60,000/-. Moreover, the opposite parties No.1 & 2 have not able to prove that they are having the requisite approvals. No Completion Certificate or Occupation Certificate has been produced on the record by opposite parties No.1 & 2. To prove this fact, the complainant has produced on record reply dated 19.01.2017 [Ex.C-10 (colly)] to the RTI which proves that the builder has not applied for any Completion Certificate.
17. The complainant contended in his complaint that the flat allotted to him is not as per layout plan shown to them. As per clause E of the agreement, that the location allotted to the Allottee(s) is tentative and is subject to change till the final layout / Building Plans and demarcation the Apartment. The relevant clause E is reproduced hereunder:- E. The Allottee(s) agree and understands that the area of the Apartment subject matter of this Apartment Allottee(s) Arrangement and its location allotted to the Allottee(s) tentative and is subject to change till the final layout/Building Plans and demarcation the Apartment before handing over the possession is completed by the Developer. Consumer Complaint No.462 of 2019
18. From the perusal of the above, the contention of the complainant for not allotting the apartment, as per plan shown to them, is hereby rejected.
19. Further, in the agreement there is no penalty clause incorporated by the opposite parties on the point that if the builder fails to handover the possession to the complainants within the prescribed period then how they would be compensated. The terms and conditions of the agreement are unilateral just to deprive the valuable rights of the complainant by the opposite parties. We are fortified with the judgment passed by the Honble Supreme Court, reported in II(2019) CPJ 34 titled as Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, Geetu Gidwani Verma & Anr. wherein it has been held that the Builder could not seek to bind flat purchaser with such one sided contractual terms. The relevant para of the judgment is reproduced hereunder:- 6.7 A term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder. The contractual terms of the Agreement dated 8.5.2012 are ex facie one-sided, unfair, and unreasonable. The incorporation of such one-sided clauses in an agreement constitutes an unfair trade practice as per Section 2(r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling the flats by the Builder. XX XX XX XX XX XX
9. We see no illegality in the impugned dated 23.10.2018 passed by the National Commission. The Appellant-Builder failed to fulfill his contractual obligation of obtaining the Consumer Complaint No.462 of 2019 Occupancy Certificate and offering possession of the flat to the Respondent-Purchaser within the time stipulated in the Agreement, or within a reasonable time thereafter. The Respondent-Flat Purchaser could not be compelled to take possession of the flat, even though it was offered almost 2 years after the grace period under the Agreement expired. During this period, the Respondent-Flat Purchaser had to service a loan that he had obtained for purchasing the flat, by paying Interest @10% to the Bank. In the meanwhile, the Respondent-Flat Purchaser also located an alternate property in Gurugram. In these circumstances, the Respondent Flat Purchaser was entitled to be granted the relief prayed for i.e. refund of the entire amount deposited by him with Interest. It amounts to unfair trade practice to impose one sided contractual terms upon the purchasers.
20. The amount has been utilized by the opposite parties No.1 & 2, which is trust money, for earning profits in their business. Moreover, the complainant had already paid the more than 90% but there was no development at the site. There is no fun in first paying the instalments and thereafter seeking refund of the same. Opposite parties No.1 & 2 had also violated the provisions of the PAPRA by not obtaining the necessary sanctions/permissions from the competent authority before launching the scheme and collecting money from the people. Therefore, opposite parties No.1 & 2 violated Sections 3, 5, 9 and 12 of PAPRA.
21. The opposite parties had been collecting huge amounts from the buyers for the development of the Project. The amount received from the complainant-buyer was required to be deposited Consumer Complaint No.462 of 2019 in the schedule Bank, as per Section 9 of PAPRA and we wonder where that amount had been going. They are not to play the game at the cost of others. When they insist upon the performance of the promise by the consumers, it is to be bound by the reciprocal promises of performing their part of the Agreement.
22. 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 complainant has made payment of substantial amount to opposite parties No.1 & 2 with the hope to get the possession of the unit in a reasonable period. The circumstances clearly show that the opposite parties No.1 & 2 made false statement of facts about the goods and services i.e. allotment of unit and delivery of possession in a stipulated period. The act and conduct of the opposite parties No.1 & 2 is a clear case of misrepresentation and deception, which resulted in the injury and loss of opportunity to the complainant. Had the complainant not invested his money with opposite parties No.1 & 2, he would have invested the same elsewhere. There is escalation in the price of construction also. The builder is under obligation to deliver the possession of the plot/unit/flat within a reasonable period. From the facts and evidence brought on the record of the complaint, it is clearly made out that the opposite parties i.e. builder knew from the very beginning that they had not complied with the provisions of the PAPRA and Rules and would not be able to complete the unit and to deliver the possession Consumer Complaint No.462 of 2019 within the stipulated period, thus by misrepresentation induced the complainant to book the unit, due to which the complainant has suffered mental agony and harassment. 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 complainant 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 complainant has to wage a long drawn and tedious legal battle. As such, the complainant was 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 complainant, are also required to be taken into consideration for awarding compensation.
23. Now the point is to decide from which date the complainant is entitled to interest on the deposited amount. It is not disputed that the complainant chose Subvention Plan and as per clause 4.8 of the agreement the interest part was to be paid by the builder till the offer of possession. However, he has failed to pay the interest on the loan amount sanctioned by opposite party No.3. The relevant clause 4.8 is reproduced hereunder:- 4.8 In Subvention Plan, the interest part Till the offer of possession against the loan will be paid by the builder on monthly basis directly into the Borrowers Loan Account. As the opposite parties No.1 & 2 have failed to pay the pre- EMI interest on the loan amount availed by the complainant and Consumer Complaint No.462 of 2019 now the Loan Account of the complainant has been closed as per Ex.OP-2/3, accordingly, the complainant is entitled to the interest at the rate of 12% per annum on the amount deposited amount from their respective dates of deposit, as per Rule 17 of PAPRA.
24. The complainant has not claimed any relief against opposite parties No.3 & 4 and has not alleged any deficiency in service or unfair trade practice on the part of opposite parties No.3 & 4. Accordingly, the complaint is hereby dismissed against opposite parties No.3 & 4
25. In view of the above, the complaint filed by the complainant is partly allowed and the following directions are issued against the opposite parties No.1 & 2:-
i) to handover the possession of Apartment No.F-202, Block No.F, Second Floor, Type 2 BHK in Orchid Greens, complete in all respects as per agreement, subject to the balance sale consideration, if any, without interest and penalty and along with Completion and Occupation Certificate, within a period of 45 days. ii) to pay 12% interest on the deposited amount from the respective dates of deposit till the handing over of the possession as per relief (i). iii) to pay Rs.40,000/- as compensation on account of mental agony and harassment as well as litigation expenses. It is made clear that the balance amount towards sale consideration payable by the complainant shall be adjusted from Consumer Complaint No.462 of 2019 the above said liability of the opposite parties No.1 & 2 and after the said adjustment, they shall pay the remaining amount, if any, as directed above, to the complainant. In case the opposite parties No.1 & 2 fail to deliver the possession within 45 days, as ordered above, then in the alternative:
i) to refund the amount of Rs.26,65,141/- along with compensation at the rate of 12% per annum from the respective dates of deposit till realization; ii) to pay Rs.40,000/- as compensation on account of mental agony and harassment as well as litigation expenses.
20. The complaint could not be decided within the statutory period due to heavy pendency of court cases. (JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (RAJINDER KUMAR GOYAL) MEMBER October 31st ,2019 parmod