Summary of Opinion: National Consumer Disputes Redressal Commission — Consumer Case No. 310 of 2019

Factual and Procedural Background

The complainants booked a residential flat in the project "Ramprastha Skyz" (Sector-37D, Gurgaon) and executed an Apartment Buyers Agreement with the opposite parties (OPs) on 13.09.2011. The agreed price of the flat was Rs.88,92,282/-. Clause 15(a) of the Agreement provided that possession was to be delivered by 31.08.2014. The complainants paid Rs.80,03,055/- but were not offered possession and therefore filed the consumer complaint seeking refund of the amount paid along with compensation.

The OPs admitted allotment, the agreement and receipt of payments but resisted the complaint, asserting delay due to circumstances beyond their control and various operational difficulties. OP No.2 additionally claimed to be merely a financier and not liable for construction. The Commission heard submissions, considered related prior decisions, and rendered an order dated 23 Nov 2020 disposing of the complaint with directions for refund with interest, litigation costs, and joint and several liability.

Legal Issues Presented

1. Whether the delay in offering possession entitled the complainants to refund of the amounts paid and compensation (including the appropriate rate of interest) given the contractual timelines.
2. Whether the reasons relied upon by the OPs (approvals delay, labour/material/water shortages, court orders, demonetisation, etc.) fall within the scope of the contractual "Force Majeure" clause (Clause 31) and therefore excuse delay.
3. Whether the Consumer Forum has jurisdiction to entertain the complaint in view of RERA and related statutory regime.
4. What rate of interest/compensation should be awarded if refund is directed, considering precedents and the principle of restitutio in integrum.

Arguments of the Parties

Complainants' Arguments

• The complainants were not offered possession despite payment of Rs.80,03,055/-, entitling them to refund and compensation.
• The issues raised are covered by this Commission's prior decision in Mohit Sharma & Anr. Vs. M/s Ramprastha Promoters and Developers Pvt. Ltd. & Anr. (Consumer Complaint No. 2384 of 2017), where similar claims were allowed.
• To avoid further litigation the complainants ultimately restricted their claim to refund of the principal with simple interest at 8% per annum (in view of the Supreme Court decision in Puri Constructions Vs. Harish Chawla).

Opposite Parties' (OPs') Arguments

• OPs admitted allotment, agreement and payments but contended delay was due to circumstances beyond their control (approvals delay from authorities; shortage of labour due to schemes such as NREGA and JNNURM; acute shortage of water following the Punjab & Haryana High Court order dated 16.07.2012; shortage of building material on account of the Supreme Court order in Deepak Kumar Vs. State of Haryana SLP Civil Nos. 19628-29 of 2009; and demonetisation in Nov 2016).
• OPs relied on the Agreement's Clause 31 (Force Majeure) and Clause 15(b) to claim automatic extension of possession date for reasons beyond control.
• OPs asserted that, where delay occurred, compensation was limited to mutually agreed Rs.5 per sq. ft. per month under Section 17(a) of the Agreement.
• OP No.2 asserted it was only a financer under a Joint Development Agreement and not the owner or liable for construction, seeking deletion from array of parties.
• OPs argued that RERA affects jurisdiction (OP No.2 relied on RERA to contest the Commission's jurisdiction).
• OP No.1 argued that interest awarded by this Commission in Mohit Sharma was on higher side and pointed to Supreme Court decision in Puri Constructions awarding only 8% p.a.

Table of Precedents Cited

Court's Reasoning and Analysis

The Commission proceeded by addressing the principal contentions raised and the contractual provisions relied upon by the parties. Its analysis can be summarized in the following steps, based strictly on the materials recorded in the opinion:

1. Interpretation of Force Majeure (Clause 31) and Extension Clause (Clause 15(b)):

   The OPs claimed the delay fell within Clause 31 (Force Majeure) and Clause 15(b) which allow extension where completion is delayed due to non-availability of materials, water, labour, or by any cause beyond developers' control. The court examined the material on record and concluded that the reasons pleaded by the OPs were not established to fall within the scope of Force Majeure. Crucially, the Commission observed there was no documentary evidence to support OPs' contentions that the specific reasons invoked constituted Force Majeure.

2. Evidence and Burden:

   The court emphasized the lack of documentary evidence from the OPs to substantiate claims of non-availability of materials, water, or labour shortages. Because these claims were not supported by documentary proof, they could not be accepted as excusing the delay under the contractual force majeure clause.

3. Construction-linked Payments and OPs' Laches:

   The payment schedule was noted to be construction-linked. The Commission found the OPs' contention that some amounts remained due unacceptable in the face of the payment schedule and the fact that the complainants had paid substantial sums. The court underlined that the complainants should not be made to suffer due to the alleged laches of the OPs.

4. Jurisdictional Objection under RERA:

   The Commission held that RERA does not oust the jurisdiction of consumer fora. It relied on the Commission's earlier decision in Ajay Nagpal and the Supreme Court decision in Imperial Structures to conclude that consumer jurisdiction survives even where projects are covered under

   Summary of Opinion: National Consumer Disputes Redressal Commission — Consumer Case No. 310 of 2019

   Factual and Procedural Background

   The complainants booked a residential flat in the project "Ramprastha Skyz" (Sector-37D, Gurgaon) and executed an Apartment Buyers Agreement with the opposite parties (OPs) on 13.09.2011. The agreed price of the flat was Rs.88,92,282/-. Clause 15(a) of the Agreement provided that possession was to be delivered by 31.08.2014. The complainants paid Rs.80,03,055/- but were not offered possession and therefore filed the consumer complaint seeking refund of the amount paid along with compensation.

   The OPs admitted allotment, the agreement and receipt of payments but resisted the complaint, asserting delay due to circumstances beyond their control and various operational difficulties. OP No.2 additionally claimed to be merely a financier and not liable for construction. The Commission heard submissions, considered related prior decisions, and rendered an order dated 23 Nov 2020 disposing of the complaint with directions for refund with interest, litigation costs, and joint and several liability.

   Legal Issues Presented

   1. Whether the delay in offering possession entitled the complainants to refund of the amounts paid and compensation (including the appropriate rate of interest) given the contractual timelines.
   2. Whether the reasons relied upon by the OPs (approvals delay, labour/material/water shortages, court orders, demonetisation, etc.) fall within the scope of the contractual "Force Majeure" clause (Clause 31) and therefore excuse delay.
   3. Whether the Consumer Forum has jurisdiction to entertain the complaint in view of RERA and related statutory regime.
   4. What rate of interest/compensation should be awarded if refund is directed, considering precedents and the principle of restitutio in integrum.

   Arguments of the Parties

   Complainants' Arguments

   • The complainants were not offered possession despite payment of Rs.80,03,055/-, entitling them to refund and compensation.
   • The issues are covered by this Commission's decision in Mohit Sharma & Anr. Vs. M/s Ramprastha Promoters and Developers Pvt. Ltd. & Anr. (Consumer Complaint No. 2384 of 2017), where similar complaints were allowed.
   • To avoid further litigation the complainants restricted their claim to refund of the principal with simple interest at 8% per annum (referring to the Supreme Court decision in Puri Constructions Vs. Harish Chawla).

   Opposite Parties' (OPs') Arguments

   • Delay was due to circumstances beyond their control: delays in receiving approvals, labour shortages (citing NREGA/JNNURM), acute shortage of water following the Punjab & Haryana High Court order dated 16.07.2012, shortage of building material on account of the Supreme Court order in Deepak Kumar Vs. State of Haryana (SLP Civil Nos. 19628-29 of 2009), and demonetisation announced in Nov 2016.
   • Clause 31 (Force Majeure) and Clause 15(b) of the Agreement entitled the developers to extensions of time where completion was delayed for causes beyond their control.
   • Allottees were entitled only to the mutually agreed compensation of Rs.5 per sq. ft. per month under the Agreement.
   • OP No.2 contended it was only a financer and not liable for construction or owner of the land, seeking relief from being a party.
   • OPs contended the Commission should consider RERA implications and that interest awarded previously by the Commission was on the higher side; relied on Puri Constructions which awarded 8% interest.

   Table of Precedents Cited

   Precedent	Rule or Principle Cited For	Application by the Court
   Mohit Sharma & Anr. Vs. M/s Ramprastha Promoters and Developers Pvt. Ltd. & Anr. (Consumer Complaint No. 2384 of 2017)	Several consumer complaints in the same project were allowed; refund and related reliefs were granted.	The Commission relied on that common decision as being squarely applicable given the same project, similar agreements and same OPs, treating it as persuasive precedent supporting relief.
   Ajay Nagpal Vs. Today Homes and Infrastructure Pvt. Ltd. (CC/1764/2017)	Held that RERA does not bar the jurisdiction of Consumer Fora.	The Commission cited this decision to reject the OPs' contention that RERA ousted consumer forum jurisdiction.
   Deepak Kumar Vs. State of Haryana (SLP Civil Nos. 19628-29 of 2009 and connected matters)	Referred to by OPs as causing shortage of building materials in the market.	The court noted the OPs relied on this order to justify material shortage but found no documentary evidence to treat it as a force majeure cause.
   Order of the National Green Tribunal dated 18.12.2017	Referenced as a regulatory/event order affecting construction practices.	The Commission held this order was subsequent to filing of the complaint and therefore could not be construed as a force majeure condition for the delay between 31.08.2014 and the date of filing the complaint.
   Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra (Civil Appeal No. 3182/2019)	Supreme Court observation: a buyer can be expected to wait a reasonable period; seven years is beyond what is reasonable and refund may be appropriate.	The Commission relied upon this principle to underscore that excessive delay justifies refund and that buyers should not be non-suited merely on procedural bases.
   Ghaziabad Development Authority Vs. Balbir Singh	Power to award compensation does not mean awarding a uniform 18% p.a. in all cases; discretion must be exercised.	The court used this principle to avoid applying a rigid uniform rate and to apply the restitution/integral compensation approach appropriate to the facts.
   M/s Imperial Structures Ltd. Vs. Anil Patni & Anr. (Civil Appeal No. 3581/2020, dated 02.11.2020)	Supreme Court upheld jurisdiction of Consumer Forum even for projects covered under RERA.	The Commission relied on this recent Supreme Court decision to affirm its jurisdiction to hear the present complaint despite RERA coverage.
   Puri Constructions Vs. Harish Chawla (Civil Appeal No. 4472 of 2019, dated 07.05.2019)	Supreme Court awarded interest at 8% per annum in that matter.	The OPs cited this decision to argue for a lower rate of interest; the complainants accepted 8% p.a. simple interest to avoid further litigation, and the Commission awarded interest at that rate.

   Court's Reasoning and Analysis

   The Commission's reasoning focused on the contractual clauses, evidentiary record, relevant precedents and equitable principles. The analysis proceeded as follows:

   1. Force Majeure and Contractual Interpretation:

      The OPs relied on Clause 31 (Force Majeure) and Clause 15(b) to claim entitlement to extensions. The Commission examined those clauses as reproduced in the opinion and concluded that the material on record did not establish that the reasons pleaded fell within the scope of Force Majeure. The court emphasized that documentary evidence was lacking to substantiate the OPs' assertions (non-availability of steel/cement, water shortage, labour shortage, etc.), and therefore these grounds could not be accepted to excuse delay.

   2. Evidentiary Requirement and Burden:

      The Commission required proof to support claims that the delay was caused by factors beyond the developer's control. In the absence of documentary evidence from OPs, the claimed causes could not be treated as a contractual exemption. The court thus rejected the OPs' justification for delay on evidentiary grounds.

   3. Payments and Developer's Laches:

      The payment schedule being construction-linked made the OPs' contention of unpaid amounts unacceptable. The Commission held that the complainants, having paid substantial sums, should not be penalized for the developers' delays or laches.

   4. Jurisdiction under RERA:

      The court addressed the OPs' plea that RERA affects jurisdiction. It relied on the Commission's earlier decision in Ajay Nagpal and the Supreme Court's decision in Imperial Structures to affirm that the Consumer Forum retains jurisdiction to entertain such complaints even where projects fall under RERA.

   5. Reliance on Precedents and Equitable Principles:

      The Commission placed reliance on the Supreme Court's observation in Kolkata West (that waiting seven years is beyond reasonable) to underscore that excessive delay warrants relief. It also considered Ghaziabad Development Authority to recognize that there is no hard and fast rule mandating 18% p.a. in all cases; instead courts exercise discretion and apply restitutio in integrum to restore the injured party as nearly as possible to the pre-wrong position.

   6. Interest Rate Determination:

      While noting that the first OP had earlier offered refund with 10% interest, the complainants declined and, on instructions, limited their claim to simple interest at 8% p.a., referencing Puri Constructions. Considering the facts and relevant precedents, the Commission awarded simple interest at 8% per annum on the principal amount from the date of each payment till the date of refund.

   Holding and Implications

   Holding: The Consumer Complaint was disposed of in favour of the complainants with the following core directions:

   • The OPs shall refund the entire principal amount of Rs.80,03,055/- to the complainants along with compensation in the form of simple interest at 8% per annum from the date of each payment until the date of refund.
   • The OPs shall pay Rs.25,000/- as litigation costs to the complainants.
   • The liability of the OPs is declared to be joint and several.
   • Payment in terms of the order is to be made within three months from the date of the order.

   Implications:

   - Direct effect: The OPs are required to refund the principal sum paid by the complainants with simple interest at 8% p.a., pay costs, and bear joint and several liability; payments to be made within three months.

   - Broader legal implications discussed in the opinion: The Commission reaffirmed that RERA does not oust the jurisdiction of consumer fora (citing Ajay Nagpal and Imperial Structures), emphasized that developers relying on force majeure must substantiate claims with evidence, and followed Supreme Court guidance that excessive delays justify refund remedies. The Commission also applied the principle that awarding compensation requires factual discretion (referring to Ghaziabad Development Authority) rather than a blanket rate.

   - The opinion does not purport to set a universally binding new legal rule beyond applying and following existing precedents; it applies established principles to the facts of the case to reach the relief awarded.

   Delivered by: V.K. Jain, Presiding Member (Oral Order dated 23 Nov 2020)