FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
CHANDIGARH.
Consumer Complaint No.244 of 2016 Date of institution : 04.08.2016 Reserved on : 14.02.2020 Date of decision : 19.02.2020 Mrs. Seema Rani w/o Mr. Vijay Kumar, Resident of H.No.347, B-2, Shiv Colony, Pinjore, District Panchkula (Haryana). …….Complainant
Versus
1. M/s Barnala Builders & Property Consultants through its Partner Mr. Satish Jindal, having its Registered Address at SCO No.1, Opposite Yes Bank, Zirakpur-Patiala Road, Zirakpur, Punjab.
2. Mr. Satish Jindal, Partner, M/s Barnala Builders & Property Consultants, having Registered Address at SCO No.1, Opposite Yes Bank, Zirakpur-Patiala Road, Zirakpur, Punjab.
3. State Bank of India through its General Manager having RACPC Branch, SCO No.99-107, Sector-8, Chandigarh. ……..Opposite Parties
Consumer Complaint under Section
17(1)(a)(i) of the Consumer Protection Act,
1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President Mr. Rajinder Kumar Goyal, Member
Mrs. Kiran Sibal, Member
Present:-
For the complainant : None.
For opposite party Nos.1&2 : Shri Ambrish Sharma, Advocate For opposite party No.3 : Ex parte.
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JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT:
The complainant, Seema Rani, has filed this complaint under Section 17(1)(a)(i) of the Consumer Protection Act, 1986 (in short,
"C.P. Act") for the issuance of following directions to opposite parties Nos.1 and 2:-
i) to refund ₹30,40,860/- i.e. the entire amount paid by the complainant to opposite parties Nos.1 and 2 along with interest at the rate of 20% per annum, without deduction of TDS, from the dates of respective deposits till its actual realization;
ii) to pay ₹5,00,000/-, as compensation and damages for mental agony/torture and physical harassment caused to the complainant; and
iii) to pay ₹1,00,000/- towards litigation/counsel fee. Facts of the Complaint:
2. Brief facts, as set out in the complaint, are that opposite parties Nos.1 and 2 floated scheme for allotment of apartments in their project Maya Garden City located at Zirakpur-Ambala Highway, NAC Zirakpur, Tehsil Derabassi, District SAS Nagar, Mohali. The complainant had pre-booked an Apartment in view of the allurements given by them of not linking the said customers with any payment plan and further prioritizing them of suitable location of the flats. The complainant paid an amount of ₹1,00,000/-, vide cheque No.399226 dated 28.6.2011 drawn on Punjab National Bank, Pinjore towards registration/booking of flat/apartment along with application form.
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However, no agreement was signed or receipt was issued for the amount received by opposite parties Nos.1 and 2. Thereafter letter of offer of allotment dated 27.7.2011, Annexure C-3, was issued to the complainant allotting Flat bearing No.403, 4thFloor, Block E-2 having super area of 1152 square feet at the rate of ₹2,750/- per square foot for a total sale consideration of ₹31,68,000/-. As per the allotment letter the time for completion and possession was mentioned as April 2014 and the said letter did not mention any payment plan as promised by opposite parties Nos.1 and 2. It was further assured in the said allotment letter that flat/apartment would be having all the basic amenities of good quality and design in all the rooms, fully finished bathrooms with latest designer tiles etc. It is further averred that opposite parties Nos.1 and 2 did not issue any letter or executed any buyer builder agreement on the date of booking of the flat. Thus, the Offer Letter of Allotment is the only document which can be termed as contract. However in the year 2013 opposite parties Nos.1 and 2 called the complainant in their office and got the signatures of the complainant on the Builder Agreement, which is shown to be as Agreement to Sell duly executed on 11.12.2013, which was blank format on the date of signature but filled later on. Copy of the said Agreement to Sell/Buyer Builder Agreement is Annexure C-4. In the said Agreement to Sell alleged to be executed disclosed the date of execution of sale deed as 30thNovember 2014, although as per offer of allotment the period was mentioned as April 2014. The total amount of the flat/apartment has also been mentioned as ₹25,42,800/- out of which an amount of ₹4,75,000/-
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was already paid and as per Letter of Allotment an amount of ₹31,68,000/- was mentioned. Thus, the said Agreement to Sell is not enforceable and binding between the parties. It is further averred that as per the receipts and statement provided by opposite parties nos.1 and 2 the complainant paid an amount of ₹30,40,860/-, in all, out of the total payment of ₹31,68,000/-. Thus, a sum of ₹1,27,140/- was due towards the complainant against the cost of the flat/apartment in question. It is further averred that even till the end of 2014 the opposite parties failed to hand over the possession of the apartment/flat booked and, as such, the complainant had no interest in getting the possession of the same and that factum was duly conveyed to the opposite parties well in time. However, without considering the request of the complainant and in flagrant violation of the Agreement in which the time was essence of the contract, opposite parties Nos.1 and 2 offered possession of the flat/apartment on 2.3.2015, Annexure C-6 (Ex.C-9) and demanded the balance amount besides the interest of ₹3,32,463/- and ₹1,14,048/-, as One Time Maintenance Charges, although it was never the part of the original allotment letter. Thereafter the complainant visited the office of opposite parties Nos.1 and 2 a number of times but they demanded exorbitant amount on the pretext of charging of compound interest on account of late payment and One time Maintenance Charges, although the said charges were never the part of any Agreement between the parties. In-spite of visiting so many times to the office of opposite parties Nos.1 and 2, they failed to deduct the illegal charges and, as such, the
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complainant was left with no other alternative but to issue legal notice of demand, Annexure C-7 (Ex.C-11), asking them to accept the balance payment of ₹1,27,140/- and to hand over possession of flat/apartment. However, they failed to hand over the same till the date of filing of the complaint. There is no such clause or term or condition in the allotment letter dated 27.7.2011, Annexure C-3 (Ex.C-5), regarding payment of interest or maintenance charges. It is further averred that opposite parties Nos.1 and 2 failed to complete the said flat/apartment in all respects within the contractual period, which they were bound to at all reasonable times. However instead of completing the flat/apartment and delivering the possession of the flat/apartment, opposite parties Nos.1 and 2 issued offer of possession letter dated 2.3.2015, Annexure C-6 (Ex.C-9) demanding hefty amount of ₹6 lakh on account of interest for delayed payment and One Time Maintenance Charges on flimsy grounds and in violation of original allotment letter Annexure C-3. It is further averred that there are no amenities or infrastructure. No completion is there for handing over possession. Faced with such a scenario the complainant is not interested in taking possession of the flat/apartment in question and is seeking refund of the amount. Since opposite parties Nos.1 and 2 are charging/claiming interest @ 20% per annum compounded from its customers, so, the complainant is also entitled to refund of her amount along with interest @ 20% per annum from the dates of deposits of different amounts till actual realization. However, opposite parties Nos.1 and 2 failed to refund the amount along with interest till the date of filing
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of the complaint. Alleging deficiency in service and adoption of unfair trade practice the complainant filed the present complaint for issuance of above mentioned directions to opposite parties Nos.1 and 2.
3. Notices were sent to opposite parties. Opposite parties Nos.1 and 2 appeared through counsel. Opposite parties Nos.1 and 2 filed M.A. No.1826 of 2019 for impleading opposite party No.3 as party respondent, which was allowed and opposite party No.3 was made a party, vide order dated 22.10.2019. Notice was ordered to be issued to opposite party No.3 but opposite party No.3 did not appear despite service and was, thus, proceeded against ex parte, vide order dated 18.12.2019.
Defence of opposite parties Nos.1 and 2:
4. Upon notice opposite parties Nos.1 and 2 appeared and filed their joint reply taking preliminary objections to the effect that the complainant has no cause of action to file the complaint. This Commission does not have pecuniary jurisdiction. The complaint is not maintainable in the eyes of law as not filed in proper Forum. The Real Estate (Regulation and Development) Act, 2016 being a special statute took precedence over the C.P. Act. The Government has established the Real Estate Regulatory Authority for regulation and promotion of the real estate sector and to ensure sale of plot, apartment or building, as the case may be, or sale of real estate project in an efficient and transparent manner and to protect the interest of consumers in the real estate project and to establish an adjudicating mechanism for speedy dispute redressal and also to
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establish the Appellate Tribunal to hear appeals from the decisions, directions or orders of the Real Estate Regulatory Authority and the adjudicating officer and for matters connected therewith or incidental thereto. In view of Section 80 of RERA it was open to this Commission to entertain and decide the present complaint. Sufficient safeguard is provided under the provisions of RERA and if the complainant feels aggrieved by any action on the part of opposite parties Nos.1 and 2 she may approach the Real Estate Regulatory Authority under the provisions of RERA and not under the C.P. Act. The verification of the complaint is also defected and not in accordance with the provisions of law. The nature of dispute is an inter-se dispute between the parties based on a contract i.e. Agreement to Sell. In view of the settled terms and conditions specified in application form and clause 29 of the Agreement to Sell, any dispute between the parties qua the flat in question, at first instance, shall be settled amicably by mutual discussion, failing which the same shall be settled through arbitration proceedings, which shall be governed under the Arbitration & Conciliation Act, 1996 at Zirakpur but in the present complaint, the complainant straightway approached this Commission without complying with the agreed terms and conditions. It was also pleaded that the complainant indulged into "suppressio veri" and "suggestio falsi" and has not approached this Commission with clean hands. The complainant concealed material facts from this Commission and the contents contained in the body of complaint amount to falsification. The complainant also filed one false affidavit, which contains so
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many false facts and the same amounts to criminal act. As such, the complainant is liable to be prosecuted in view of the relevant provisions of IPC and Cr.P.C. The complaint is not maintainable in the eyes of law as not filed in proper form. The present complaint has been filed by the complainant with mala fide intention and bad motive just to get undue advantage against the opposite parties and, as such, the same deserves to be dismissed with costs. On merits, the facts regarding the purchase of the flat/apartment in question and the payment of ₹30,40,860/- in the manner stated in the complaint have been admitted. It is averred that the complainant made delayed payment, so she is liable to pay interest as calculated on delayed payments. The complainant is defaulter in making the payment. The project is very much complete in all respects and the MC, Zirakpur also issued 'Partial Completion Certificate' to the housing project in question. In view of the settled terms and conditions it was the duty of the complainant to get executed the Agreement to Sell within 30 days from the date of allotment letter but she did not come forward for execution thereof. As and when the complainant approaches opposite parties nos.1 and 2 for execution of the Agreement to Sell, they will execute the same and hand over the possession of the flat/apartment to her. The complainant availed the loan facility from State Bank of Patiala now State Bank of India by mortgaging the said flat/apartment. As per the settled terms and conditions, opposite parties Nos.1 and 2 offered possession of the flat/apartment on 2.3.2015 to the complainant but instead of taking over the possession, she filed the present complaint. The
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complainant is defaulter and is liable to pay agreed interest @ 20% per annum on late payments. Therefore, in offer of possession letter opposite parties Nos.1 and 2 rightly demanded interest from her and there is no illegality in demanding interest. The complainant is required to clear their all dues before taking over the possession of the flat and without clearance of all the dues opposite parties Nos.1 and 2 are not bound to execute the sale deed of the flat in her favour. It is further averred that at no stage the complainant demanded the 'completion certificate' from opposite parties Nos.1 and 2 and they have already applied for the same with the concerned authority. As and when opposite parties Nos.1 and 2 will get the 'completion certificate', copy of the same will be provided to the complainant. It is further averred that in compliance of the terms and conditions of the Agreement to Sell, opposite parties Nos.1 and 2 issued offer of possession dated 2.3.2015 to the complainant but she did not come forward to take over the possession of her flat. Therefore, opposite parties Nos.1 and 2 have already shown their good intention to deliver the possession of flat to the complainant by issuing offer of possession and it is the complainant, who is not interested to take over the possession of the flat and not ready to execute the sale deed. It is further averred that opposite parties Nos.1 and 2 had started giving possession of flats on 10.11.2014 and till the date of filing of reply, possession of almost 1500 flats had been delivered to their respective allottees out of 1600 allottees. At present the entire housing project is fully equipped with all the facilities like water, electricity, lifts and other basic amenities. It is the
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mere excuse of the complainant to take over the possession of the flat. If the complainant is ready to take over the possession of her flat, they undertake to hand over the flat in question, complete in all respects, to full satisfaction of the complainant. The complainant is not entitled to any refund of her deposited amount along with interest and compensation, as till date she has not got cancelled the flat in question by submitting the required documents and as the complainant herself has backed out from the deal, so opposite parties Nos.1 and 2 are entitled to deduct 10% of deposited amount in view of clause 9 of the Agreement to Sell. The complainant neither wants to take over the possession of the flat nor she is interested in cancelling the same which shows that she is not ready to fulfill her part of the contract. Denying all other averments made in the complaint a prayer for dismissal of the complaint has been made. It is also prayed that the complainant be prosecuted under the relevant provisions of IPC and Cr.P.C for filing the false affidavit in judicial proceedings. Denying all other averments made in the complaint and denying any deficiency in service or adoption of unfair trade practice a prayer for dismissal of the complaint was made. Evidence of the Parties:
5. To prove her case, the complainant tendered in evidence her own affidavit dated 21.1.2020 as Ex.CA along with documents i.e. copy of receipt dated 13.7.2011 as Ex.C-1, copy of application form as Ex.C-2, copy of letter of offer of Allotment dated 13.7.2011 as Ex.C-3, copy of Agreement to Sell dated 11.12.2013 as Ex.C-4, copy of Agreement to Sell dated Nil as Ex.C-4A, copy of allotment letter
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dated 27.7.2011 as Ex.C-5, copy of receipt dated 27.7.2011 as Ex.C-6A, copy of receipt dated 6.4.2012 as Ex.C-6B, copy of receipt dated 27.12.2012 as Ex.C-6C, copy of receipt dated 23.1.2013 as Ex.C-6D, copy of receipt dated 20.7.2013 as Ex.C-6E, copy of receipt dated 6.4.2012 as Ex.C-6F, copy of receipt dated 24.1.2013 as Ex.C-6G, copy of receipt dated 5.7.2013 as Ex.C-6H, copy of cheque dated 11.12.2013 as Ex.C-6I, copy of statement of account dated nil as Ex.C-7, copy of letter dated 12.3.2014 as Ex.C-8, copy of letter of offer of possession dated 2.3.2015 as Ex.C-9, copy of letter dated 23.11.2015 as Ex.C-10, copy of Legal Notice dated 27.11.2015 as Ex.C-11, copy of postal receipt dated 27.11.2015 as Ex.C-12, photographs as Ex.C-13 to Ex.C-16 and copy of Bank Statement dated 21.1.2020 as Ex.C-17.
6. On the other hand, opposite parties Nos.1 and 2 tendered in evidence affidavit of Sanjeev Chaudhary, Accounts Head dated 1.2.2020 as Ex.OP1-A along with documents i.e. copy of application form dated 30.6.2011 as Ex.OP-1, copy of allotment letter dated 13.7.2011 as Ex.OP-2, copy of Agreement to Sell dated 11.12.2013 as Ex.OP-3, copy of acknowledgement letter dated 11.2.2016 as Ex.OP-4, copy of Partial Completion Certificate dated 8.12.2016 as Ex.OP-5, copy of Fire NOC dated 1.3.2018 as Ex.OP-6, copy of Pollution NOC dated 10.10.2014 as Ex.OP-7, copy of letter dated 25.10.2018 as Ex.OP-8, copy of statements of accounts dated nil as Ex.OP-9, copy of offer of possession letter dated 2.3.2015 as Ex.OP10 and copy of Legal Notice dated 22.1.2016 as Ex.OP-11.
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Contentions of the Parties
7. We have heard learned counsel for opposite parties Nos.1 and 2, as none appeared for the complainant and opposite party No.3 was proceeded against ex parte, vide order dated 18.12.2019 and have carefully gone through the records of the case.
8. It was vehemently argued by learned counsel for opposite parties Nos.1 and 2 that earlier this complaint was dismissed by the 2ndAdditional Bench of this Commission on the ground that the complaint with regard to the refund only is not maintainable in accordance with the terms and conditions of the agreement between the parties, vide order dated 7.9.2016. The complainant filed First Appeal No.1366 of 2016 challenging the said order, which was allowed by the Hon'ble National Commission, vide order dated 30.4.2019 and set aside the order passed by the 2ndAdditional Bench of this Commission. The matter was remanded to the State Commission to restore the complaint to its original number and to decide the complaint afresh as per provisions of C.P. Act. It was further argued that the rights of the complainant are very much protected under the provision of the Arbitration and Conciliation Act, 1996 and the dispute in the present case is liable to be referred to an Arbitrator. It was further argued that in clause no.18 of the Application Form it has been very much clear that the possession of flat will be delivered to the complainant only on the clearance of all the dues. The complainant is required to clear all her dues before taking over the possession of the flat/apartment. Opposite parties Nos.1 and 2 are not bound to execute the sale deed of the
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flat/apartment in favour of the complainant without getting all the dues from her. In view of clause (iv) of the Application Form, it was the duty of the complainant to furnish all necessary details and documents for execution of Agreement to Sell within 30 days from the date of allotment but she failed to comply with the said clause and not executed the Agreement to Sell within fixed time. Moreover, the complainant did not make the payments in accordance with the payment plan. As such, in view of clause 4 and 17 of the Agreement to Sell the complainant is liable to pay agreed interest on late deposits. Opposite parties Nos.1 and 2 sent letter of offer of possession dated 2.3.2015 as Ex.OP-10 to the complainant to take possession of the flat/apartment after making payment of due amounts mentioned in the said letter. However, the complainant did not turn up and filed the present complaint before this Commission. In the offer of possession letter opposite parties Nos.1 and 2 rightly demanded interest from her and there is no illegality in the demand of interest. The complainant is a defaulter in making the payment towards the price of the flat and for want of payment the possession could not be delivered to her. It is the complainant, who is not interested in taking possession of the flat and to execute the sale deed. Even in the present complaint the complainant is not seeking any direction against opposite parties Nos.1 and 2 for delivery of possession of the flat, which clearly shows her bad intention. He has further argued that opposite parties Nos.1 and 2 had already applied for the permissions/sanctions of the competent authorities regarding completion and occupancy certificate and, as such, there is no
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violation on their part. It has been prayed that there is no merit in the present complaint and the same be dismissed with costs. Consideration of Contentions
9. We have given our thoughtful consideration to the contentions raised before us by the learned counsel for opposite parties Nos.1 and 2.
10. This complaint was earlier dismissed by the Second Additional Bench on the ground that the complaint with regard to refund only is not maintainable in accordance with the terms and conditions of the Agreement between the parties, vide order dated 7.9.2016. The complainant challenged the same by way of filing First Appeal No.1366 of 2016, which was allowed by Hon'ble National Commission, vide order dated 30.4.2019. The order passed by Second Additional Bench was set aside and the matter was remanded to this Commission to restore the complaint to its original number and to decide the complaint afresh as per provisions of C.P. Act.
11. So far as the objection of opposite parties Nos.1 and 2 that in view of Section 80 of RERA, the jurisdiction of this Commission to entertain and decide the present complaint is barred and the complainant should approach RERA for redressal of her grievances, is concerned, it is relevant to mention that as per Section 3 of the C.P. Act, the provisions of the C.P. Act are in addition to and not in derogation of the provisions of any other law for the time being in force. By introduction of RERA, the jurisdiction of the C.P. Act is not
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specifically ousted. The scope and reach of the C.P. Act of 1986 has been considered by the Hon'ble Supreme Court in catena of judgments, some of the important ones are: Lucknow Development Authority v. M.K Gupta .. Gupta (1994) 1 SCC 243, Fair Air Engineers (P) Ltd. vs. N. K. Modi (1996) 6 SCC 385, Skypak Couriers Ltd. v. Tata Chemicals Ltd. . (2000) 5 SCC 294, State of Karnataka vs. Vishwabharathi House Building Cooperative Society (2003) 2 SCC 412, CCI Chambers Cooperative Housing Society Limited Vs. Development Credit Bank Limited (2003) 7 SCC 233, Secretary, Thirumurugan Cooperative Agricultural Credit Society Vs. M. Lalitha (2004) 1 SCC 305, H.N. Shankara Shastry Vs. Assistant Director of Agriculture, Karnataka (2004) 6 SCC
230.
12. In M.Lalitha's case (supra), Hon'ble Supreme Court noticed the background, the object and reasons and the purpose for which the Act of 1986 was enacted. After referring to its earlier judgments in M.K. Gupta's case (supra) and N.K. Modi's case (supra), the Hon'ble Supreme Court observed as under:-
"11. The preamble of the Act declares that it is an Act to provide for better protection of the interest of consumers and for that purpose to make provision for the establishment of Consumer Councils and other authorities for the settlement of consumer disputes and matters connected therewith. In Section 3 of the Act in clear and unambiguous terms it is stated that the provisions of the 1986 Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.
12. From the Statement of Objects and Reasons and the scheme of the 1986 Act, it is apparent that the main objective of the Act is to provide for better protection of the interest of the consumer and for
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that purpose to provide for better redressal, mechanism through which cheaper, easier, expeditious and effective redressal is made available to consumers. To serve the purpose of the Act, various quasi-judicial forums are set up at the district, State and national level with wide range of powers vested in them. These quasi-judicial forums, observing the principles of natural justice, are empowered to give relief of a specific nature and to award, wherever appropriate, compensation to the consumers and to impose penalties for non- compliance with their orders."
13. In Kishori Lal Vs. Chairman, Employees' State Insurance Corporation 2007(5) Recent Apex Judgments (R.A.J.) 68, the Hon'ble Supreme Court held as under:-
"17.......... The trend of the decisions of this Court is that the jurisdiction of the Consumer Forum should not and would not be curtailed unless there is an express provision prohibiting the Consumer Forum to take up the matter which falls within the jurisdiction of civil court or any other forum as established under some enactment. The Court had gone to the extent of saying that if two different fora have jurisdiction to entertain the dispute in regard to the same subject, the jurisdiction of the Consumer Forum would not be barred and the power of the Consumer Forum to adjudicate upon the dispute could not be negated."
14. Further in National Seeds Corporation Limited Vs. M. Madhusudhan Reddy & Anr. (2012) 2 SCC 506, it has been authoritatively held by the Hon'ble Supreme Court that the protection provided to the consumers under the Act is in addition to the remedies available under any other Statute.
15. Similarly, State Consumer Disputes Redressal Commission Chandigarh, U.T. Chandigarh in Consumer Case No.659 of 2017 (Veena Ghai & Anr. v. Manohar Infrastructure & Constructions Pvt. Ltd.), which was decided along with bunch of similar other
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cases, vide order dated 28.06.2018, observed that RERA and PAPRA will not debar the jurisdiction of th Consumer Fora in entertaining the complaints filed by a consumer alleging deficiency in providing service, negligence and adoption of unfair trade practice, on the part of the opposite parties. It has been held as follows:
"Further contention was raised by Counsel for the opposite parties that in the face of provisions of the RERA, under which the opposite parties have registered the project, in question, on 15.09.2017, it was not open to this Commission, to entertain and decide the present complaint. He further asserted that sufficient safeguard is provided under the provisions of RERA and if the complainants are feeling aggrieved of any action, on the part of the opposite parties, they may approach under the said Act (RERA) and not under the Act, 1986.
We are not inclined to accept this argument. At the time of arguments, it is very fairly admitted by Counsel for the contesting parties, that the provisions of RERA are prospective in nature. It was also so said by the High Court of Bombay in the case of NeelKamal Realtors Suburban Pvt. Ltd. and anr. Vs. Union of India and ors. 2018 (1) R.C.R. (Civil)
298. It is on record that under the RERA, the opposite parties got themselves registered their project, only on 15.09.2017. It is also on record that some of the provisions of RERA came into operation on 01.05.2016 and even the remaining of it, in May 2017. In all, the grievance has been raised by the complainants qua wrongful act/mistake done leading to deficiency in providing service and adoption of unfair trade practice, in selling the project by the opposite parties without sanctions/approvals, before coming into existence of RERA. Reading of the provisions of Section 88 of RERA makes it
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very clear that the same are in addition and not in derogation of the provisions of any other law for the time being in force. Section 79 of the RERA further makes it very clear that jurisdiction of only the Civil Court to entertain a suit or proceedings qua action taken as per the provisions of the said Act, is barred.
It may be stated here that the Consumer Foras under the Act , 1986 despite having some trappings of a Civil Court are not the Civil Courts. As such, the jurisdiction of the Consumer Foras is not debarred, to entertain the complaints filed by consumers, alleging deficiency in providing service, negligence and adoption of unfair trade practice against the opposite parties. Intention of the framers of law has been made clear by the concerned Department i.e. Ministry of Housing and Urban Property Alleviation, Government of India in its website www.mygov.in/group/ministry-housing-and- urban-poverty-alleviation. Under Frequently Asked Questions (FAQ), at Sr.nos. 85 and 86, it was observed as under:-
" 85. Are the civil courts and consumer forums barred from entertaining disputes under the Act?
As per section 79 of the Act civil courts are barred from entertaining disputes (suits or proceedings) in respect of matters which the Authority or the adjudicating officer or the Appellate Tribunal is empowered under the Act to determine. However, the consumer forums (National, State or District) have not been barred from the ambit of the Act. Section 71 proviso permits the complainant to withdraw his complaint as regards matters under section 12, 14, 18 and section 19, from the consumer forum and file it with the adjudicating officer appointed under the Act.
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86 . Can a complainant approach both the Regulatory Authority / adjudicating officer and the consumer forums for the same disputes?
The laws of the country do not permit forum shopping, thus, an aggrieved can only approach one of the two for disputes over the same matter."
It was also so said by the State of Punjab in its Official Website Portal rera.punjab.gov.in. The above fact clearly indicates that in the face of provisions of the RERA, any action taken under the provisions of Act 1986 is not debarred. ……………………..
In view of above findings, we can safely say that RERA and PAPRA will not debar the jurisdiction of this Commission in entertaining the complaints filed by a consumer alleging deficiency in providing service, negligence and adoption of unfair trade practice, on the part of the opposite parties.
16. In view of law laid down in the above noted authorities, it is held that this Commission is competent to entertain and decide the present complaint and the provisions of RERA do not bar the jurisdiction of the Consumer For a under the C.P. Act. Accordingly, the objection raised by opposite parties Nos.1 and 2 in this regard stands rejected.
17. The further objection of opposite parties Nos.1 and 2 is that as per Arbitration Clause No.29 in the Agreement to Sell dated 2.3.2015, Ex.OP-3, the matter between the parties is triable by the Arbitrator.
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18. In this regard, it is relevant to mention here that the Larger Bench of the Hon'ble National Commission, vide order dated 13.07.2017, passed in Consumer Complaint No.701 of 2015 titled as Aftab Singh v. EMAAR MGF Land Limited & Anr., held that an Arbitration Clause in the afore-stated kind of Agreements between the Complainants and the Builder cannot circumscribe the jurisdiction of a Consumer Fora, notwithstanding the amendments made to Section 8 of the Arbitration Act, 1996. The Civil Appeals No.(s) 23512-23513 of 2017 (M/s EMAAR MGF Land Limited & Anr. Vs. Aftab Singh) filed against the said order of the Hon'ble National Commission have also been dismissed by the Apex Court, vide order dated 13.02.2018. Review Petitions (C) Nos. 2629-2630 of 2018 in Civil Appeal Nos. 23512-23513 of 2017 filed against the above said order dated 13.02.2018 were also dismissed by the Hon'ble Supreme Court, vide order dated 10.12.2018. Consequently, it is held that the existence of an Arbitration Clause is not a bar to resolve this dispute by this Commission. Accordingly, the said objection of opposite parties Nos.1 and 2 is also rejected.
19. Now, coming to the merits of the case, the complainant was allotted 2BHK flat bearing No.403, measuring 1152 square feet, 4th Floor in the project of opposite parties Nos.1 and 2 for value of ₹31,68,000/-, vide offer of allotment dated 27.7.2011 Ex.C-3. Agreement to Sell dated 11.12.2013, Ex.C-4, in respect of the said Flat/Apartment was also executed between the complainant and opposite parties Nos.1 and 2. Admittedly the complainant deposited a sum of ₹30,40,860/-, in all, vide receipts/cheques Ex.C6A to
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Ex.C6I and Statement of Account as Ex.C-7. As per terms and conditions of the offer of allotment letter dated 27.7.2011, Ex.C-5, the possession of the flat/apartment, complete in all respects, was to be delivered by April 2014, subject to clearance of dues by the allottee. Against the settled price of the flat, in question, i.e. ₹31,68,000/-, the complainant has already paid a total sum of ₹30,40,860/-, meaning thereby only ₹1,27,140/- remains payable towards the price of the flat/apartment. Opposite parties Nos.1 and 2 offered possession thereof, vide letter dated 2.3.2015, Ex.OP-10, whereby they also raised the demand of balance amount of ₹5,78,224/- i.e. ₹1,27,140/- towards the balance cost of flat, ₹3,32,463/- towards interest till that date, ₹4,573/- towards the Service Tax and ₹1,14,048/- towards the one time maintenance charges for three years plus three years free. This figure has been increased to ₹11,57,279/- in the reminder dated 23.11.2015, Ex.OP10 (colly) for offer of possession.
20. Now, we have to ascertain, whether opposite parties Nos.1 and 2 were in a legal position to deliver possession of the flat/apartment, in question, on 2.3.2015 or on 23.11.2015 when they sent offer of possession and reminder for the same, Ex.OP-10?
Opposite parties Nos.1 and 2 alleged that their project is complete, with all the agreed facilities and the flat/apartment in question was ready for delivery; however, the complainant did not turn up to get the possession after depositing the balance amount demanded in the offer of possession Ex.OP-10. However, we find that only Partial Completion Certificate was issued to them, vide letter dated
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08.12.2016 and 12.03.2018, Ex.OP-5 (colly.), that too subject to compliance of certain terms and conditions mentioned therein. However, there is no evidence on record that they have complied with those terms and conditions. Section 14 of Punjab Apartment and Property Regulation Act, 1995 (in short, "PAPRA") deals with responsibility of the promoter to obtain Completion and Occupation Certificate from the competent Authority, which reads as under:
14. It is the responsibility of the promoter-
(i) in the case of apartments, to obtain from the authority required to do so under any law completion and occupation certificates for the building and if a promoter, within a reasonable time, after the construction of the building, does not apply for an occupation certificate from the aforesaid authority, the allottee of an apartment may apply for an occupation certificate from the said authority; and
(ii) in the case of a colony, to obtain completion certificate from the competent authority to the effect that the development works have been completed in all aspects as per terms and conditions of the licence granted to him under section 5.
(2) The authority referred to in sub-section (1) shall, after satisfying itself about the agreement of sale between the promoter and the allottee, and the compliance of the building regulations and all other formalities, issue an occupation certificate."
21. Further, Clause 3.12 (i) of the Notification dated 07thJuly, 2015 published in the Punjab Government Gazette Extraordinary by Department of Local Government (Town Planning Wing), which is applicable to the properties falling within the Municipal Limits, provides as under:
"No person shall occupy or allow other person to occupy any new building or part of a new building for any purpose whatsoever until such building or part thereof has been certified by the local authority or of any person authorized by it in this behalf to be in every
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respect completed according to the sanctioned plan and fit for the use for which it is erected."
22. A reference can also be made to Section 272 of The Punjab Municipal Corporation Act, 1976, which reads as under:-
"272. Completion Certificate. -
(1) Every person who employs a licensed architect or engineer or a person approved by the Commissioner to design or erect a building or execute any work shall, within one month after the completion of the erection of the building or execution of the work, deliver or send or cause to be delivered or sent to the Commissioner a notice in writing of such completion accompanied by a certificate in the form prescribed by byelaws, made in this behalf and shall give to the Commissioner all necessary facilities for the inspection of such building or work.
(2) No person shall occupy or permit to be occupied any such building or use or permit to be used any building or a part thereof effected by any such work until permission has been granted by the Commissioner in this behalf in accordance with bye- laws made under this Act: Provided that if the Commissioner fails within a period of thirty days after the receipt of the notice of completion to communicate his refusal in grant such permission, shall be deemed to have been granted."
23. The Hon'ble National Commission in Sanjeev Malhotra's case (supra), categorically held that legal possession cannot be delivered in the absence of Completion Certificate by the Competent Authority. It was held in Para No.5 as follows:
5. During the course of hearing, it was submitted by the learned counsel for the appellant that the completion certificate in respect of the project was obtained by the appellant on 15.03.2016. A copy of the communication dated 15.03.2016 from Municipal Council, Kharar has been placed on record. It is therefore, evident that the completion certificate having been received only on 15.03.2016, the appellant could not have offered legal possession of the
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apartment to the complainant at any time before that date. As noted earlier, the amount of Rs.1,81,375/- was demanded on 20.04.2015 and the amount of Rs.2,12,489/- was demanded on 06.02.2016. The complainant was requested to pay the aforesaid amount so that the appellant could offer the possession of the flat. The said offer of possession was meaningless being unlawful as the requisite completion certificate had not been obtained by that date……."
24. There is no evidence on record to prove that the flat, in question, or a part thereof has been got certified by opposite parties Nos.1 and 2 from the local/competent authority, so as to deliver its complete possession to the complainant for her occupation. However, no Completion/Occupation Certificate issued by the competent authority has been produced by opposite parties Nos.1 and 2 on the record, which itself is violation of above reproduced Section 14 of PAPRA and Clause 3.12 (i) of the Notification dated 07thJuly, 2015 published in the Punjab Government Gazette Extraordinary by Department of Local Government (Town Planning Wing) as well as Section 272 of The Punjab Municipal Corporation Act, 1976, reproduced above. Even till today, no
Completion/Occupation Certificate has been produced before this Commission. Thus, in view of the law laid down by the Hon'ble National Commission in the above noted authority, without issuance of such a certificate by the competent authority, opposite parties Nos.1 and 2 cannot be said to be in a legal position to hand over possession of a particular flat/apartment, in question, to the complainant. Thus, without Completion/Occupation Certificate, the
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possession of the flat offered to the complainant on 2.3.2015 and on 23.11.2015, vide Ex.OP-10 (colly) was just a paper possession. In such circumstances, it is held that opposite parties Nos.1 and 2 failed to deliver possession of the flat/apartment, complete in all respects, to the complainant within the stipulated period, as per terms and conditions of the allotment letter.
25. As already discussed above, the opposite parties demanded ₹1,14,048/- towards the maintenance charges as per offer of possession, Ex.OP-10. It is settled that the maintenance charges can be levied only after delivery of complete possession, with 'Completion Certificate'. At the sake of repetition, it is relevant to mention that since opposite parties Nos.1 and 2 have not been issued 'Completion Certificate' by the competent authority, so the offer of possession sent on 2.3.2015 and 23.11.2015 was only a paper possession. Hon'ble National Commission has categorically in Sanjeev Malhotra's case (supra), held in Para No.6 as follows:
"6. It has also been noticed by the State Commission that as per the agreement between the parties, the IFMS (Interest Free Maintenance Security) was payable within 30 days from the offer of possession. Since the possession could not have been offered vide letters dated 20.04.2015 and 06.02.2016, the demand of IFMS contained in the aforesaid letters would also be illegal and unjustified."
In view of the law laid down by the Hon'ble National Commission in the above noted case, the demand raised by opposite parties Nos.1 and 2 for maintenance charges in the offer of possession, Ex.OP-10, is not maintainable, since valid possession with Completion
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Certificate has not yet been delivered. However, it is made clear that they can raise the demand of maintenance charges, if any, only after delivery of complete possession, along with all the agreed facilities and Completion Certificate issued by the competent authorities regarding the flat/project, in question.
26. So far as the demand of opposite parties Nos.1 and 2 regarding Service Tax to the tune of ₹4,573/- is concerned, the same will be payable, if permissible under law, at the time of delivery of complete possession of the flat, in question, along with all the agreed facilities and Completion Certificate. Opposite parties Nos.1 and 2 are not entitled to charge interest on the alleged ground of delay in depositing the instalments, as out of the total cost of the flat, question, i.e. ₹31,68,000/-, the complainant has already paid a huge sum of ₹30,40,860/- i.e. only a meagre sum of ₹1,27,140/- remained to be paid on that count. As per allotment letter dated 27.7.2011, Ex.C-3, the project was to be completed and the possession of the flat was to be delivered in April 2014. However, since opposite parties Nos.1 and 2 themselves failed to complete the project and to deliver the possession of the flat, in question, within the said stipulated period, therefore it cannot be said that there was any delay in payment of instalments, specifically when huge amount of ₹30,40,860/- has already been paid by the complainant. All these facts and circumstances clearly prove that opposite parties Nos.1 and 2 were not having requisite permissions/approvals of the Competent Authorities, before setting up their project.
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27. As per Section 5 (Development of land into Colony) of PAPRA, opposite parties Nos.1 and 2 were liable to obtain permission from the competent authority for developing the colony, but they failed to produce on record any such permission. So, they also violated Section 5 of PAPRA.
28. As per Section 3 (General Liabilities of Promoter) of the PAPRA, they were required to make full and true disclosure of the nature of their title to the land, on which such colony is developed or such building is constructed or is to be constructed, make full and true disclosure of all encumbrances on such land, including any right, title, interest or claim of any party in or over such land. It was also required to give inspection on seven days' notice or demand of the layout of the colony and plan of development works to be executed in a colony as approved by the prescribed authority in the case of a colony. However, opposite parties Nos.1 and 2 failed to comply with Section 3 of the PAPRA.
29. As per Section 9 of PAPRA, every builder is required to maintain a separate account in a scheduled Bank, for depositing the amount deposited by the buyers, who intend to purchase the plots/flats, but no evidence has been led on the record by opposite parties Nos.1 and 2 to prove that any account has been maintained by them in this respect. As such, they also violated Section 9 of the
PAPRA.
30. Opposite parties Nos.1 and 2 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
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the performance of the promise by the consumers, they are to be bound by the reciprocal promises of performing their part of the agreement. Opposite parties Nos.1 and 2 have failed to comply with the aforementioned provisions of PAPRA, while launching and promising to develop their project. Thus, the delay in not delivering the possession of flat/apartment within the agreed period amounts to deficiency in service on their part, for which the complainant is to be suitably compensated.
31. The C.P. Act came into being in the year 1986. It is one of the benevolent pieces 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. There is not an iota of evidence led by opposite parties Nos.1 and 2 to rebut the averments made in the complaint by way of authenticated documentary evidence. The complainant has purchased the flat/apartment in question from opposite parties Nos.1 and 2 with the hope to get the possession of the same in a reasonable time. The circumstances clearly show that opposite parties Nos.1 and 2 made false statement of facts about the goods and services i.e. completion of the project and delivery of flat/apartment in question complete in all respects in a stipulated period and ultimate delivery of possession thereof. The act and conduct of opposite parties Nos.1 and 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 her money with opposite parties Nos.1 and 2, she would have invested the same elsewhere. There is escalation
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in the price of construction also. The complainant has suffered loss, as discussed above. From the facts and evidence brought on the record of the complaint, it is clearly made out that opposite parties Nos.1 and 2 i.e. builder knew from the very beginning that they had not complied with the provisions of the PAPRA and the Rules framed thereunder and would not be able to develop the plot/project in question and deliver the possession within the stipulated period, thus by misrepresenting induced the complainant to purchase the flat/apartment, 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 amount paid by the complainant is a deposit held by opposite parties Nos.1 and 2 in trust of complainant and it should be used for the purpose of developing the project, as mentioned in Section 9 of PAPRA. 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 Hon'ble Supreme Court and the Hon'ble National Commission. There is no likelihood of completion of the project and delivery of possession of the flat in question in near future. The complainant cannot be made to wait indefinitely for delivery of possession of the flat in question, complete in all the respects. In these circumstances, the complainant is held entitled to the refund of the amount deposited by her along with compensation for causing financial loss and depriving her of the use of the said amount at the rate of 12% per annum from the different dates of
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deposits of different amounts till the date of actual payment as per Rule 17 of the Punjab Apartment and Property Regulation Rules, 1995 along with litigation expenses.
32. In view of our above discussion, this complaint is allowed and following directions are issued to opposite parties Nos.1 and 2:-
(i) to refund the amount of ₹30,40,860/- along with compensation for causing financial loss and depriving the complainant of the use of the said amount at the rate of 12% per annum with effect from the different dates of deposits of different amounts till the date of actual payment; and
(ii) to pay ₹50,000/-, as composite compensation, on account of physical and mental harassment and agony suffered by the complainant including litigation costs.
33. Opposite parties shall comply with these directions within a period of two months from the date of receipt of certified copy of the order. However, they will first clear the loan account of State Bank of India by depositing the whole outstanding amount, if any, and thereafter will refund the remaining amount to the complainant.
34. The complaint could not be decided within the statutory period as earlier this complaint was dismissed by the Second Additional Bench of this Commission, vide order dated 7.9.2016 on the ground that the complaint with regard to the refund only is not maintainable in accordance with the terms and conditions of the Agreement between the parties and the complainant filed First Appeal No.1366
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of 2016, which was allowed vide order dated 30.4.2019 by the Hon'ble National Commission by setting aside the said order and remanding the case back to this Commission for deciding the same afresh on merits.
(JUSTICE PARAMJEET SINGH DHALIWAL)
PRESIDENT
(RAJINDER KUMAR GOYAL)
MEMBER
(MRS. KIRAN SIBAL)
MEMBER
February 19, 2020 Bansal