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Smart Summary

Structured Summary of the Opinion — Manoj Kumar v. Punjab Urban Planning & Development Authority (PUDA)

Factual and Procedural Background

The complainant, Manoj Kumar, purchased a freehold residential plot interest originally applied for by Charan Singh under a PUDA scheme launched on 27.9.2012 for PUDA Enclave, Budhlada. Applications required 10% earnest money. Charan Singh applied for a 300 sq. yard plot (Application No.1300) and paid Rs.1,80,000 as earnest money. A draw was conducted on 15.1.2013 and Charan Singh was successful; a letter of intent was issued on 26.2.2013. Charan Singh paid a further 15% (Rs.2,70,000) as per scheme terms, then transferred the plot to the complainant for consideration. The complainant alleges that site development was not completed as required by the scheme, constituting deficiency in service and unfair trade practice.

Key dates and events in the procedural history:

  • Scheme launch: 27.9.2012; draw: 15.1.2013.
  • Letter of intent: 26.2.2013.
  • Allotment letter (first issued by OP): 19.9.2016 (noted as issued after 4 years).
  • Re-allotment / change of plot number by OP: 8.2.2018 (complainant contends this change occurred without consent and contrary to brochure/letter of intent).
  • Complainant sought refund; OP issued cheque dated 21.5.2020 for Rs.4,50,000 (principal), but did not include interest. Complainant protested receipt and demanded interest by e-mail dated 6.8.2020.

Procedural posture: The complainant filed the consumer complaint before this forum seeking interest on Rs.4,50,000 @ 18% p.a., Rs.50,000 as compensation and Rs.20,000 as costs. OP contested the complaint through written reply, raised legal objections (including limitation, estoppel, arbitration clause), asserted it refunded Rs.4,50,000 and that possession and allotment were delivered in time, and sought dismissal. Both parties filed evidence and written arguments; the forum heard counsel and rendered the decision on 19th October 2021.

Legal Issues Presented

  1. Whether, in view of the delay by OP in issuing the allotment letter and completing site development, the complainant is entitled to refund of the amounts deposited along with interest for the period OP retained those funds.
  2. Whether there was deficiency in service and unfair trade practice by OP for failing to develop the site and hand over possession within the timeframes specified by the scheme/brochure (allotment within one year from draw; possession after development or within 18 months from allotment letter).
  3. Whether the complainant is entitled to compensation for the alleged delays and non-provision of basic amenities.

Arguments of the Parties

Complainant's Arguments

  • Complainant (Manoj Kumar) purchased the plot transferred by Charan Singh after Charan Singh's success in the draw and payment of amounts demanded by OP.
  • Site was not fully developed as required by the scheme; allotment letter was delayed (allotment letter for Plot No.1005/PF issued on 19.9.2016 — after several years); OP later changed plot number to No.884/PF by a letter dated 8.2.2018 without complainant's consent, which was contrary to brochure and letter of intent.
  • OP failed to complete development work and basic amenities (water, boundary wall on one side, etc.), and therefore failed to hand over possession within reasonable time; as a result, complainant sought refund with interest.
  • Complainant asked for interest on Rs.4,50,000 @ 18% p.a., compensation of Rs.50,000 and costs of Rs.20,000.
  • Evidence filed included self-declaration of complainant and documents Ex.C-1 to Ex.C-7, including the cheque copy Ex.C-5 and e-mail/communication Ex.C-6 (request for refund and protest) and documents Ex.C-3 and Ex.C-4 supporting non-development (letter dated 11.4.2019 re water-lines and RTI reply dated 22.2.2019 acknowledging boundary wall pending due to dispute with farmers).

OP's Arguments

  • OP raised legal objections: intricate questions, estoppel, limitation, vexatious/false complaint, and an arbitration clause.
  • OP submitted that upon receiving a refund request, it issued cheque dated 21.5.2020 for Rs.4,50,000 and that cheque was received by the complainant without objection; complainant accepted the amount.
  • OP contended possession of plot had been delivered to the complainant in time and that allotment letter had been issued as per scheme terms; OP denied deficiency in service and sought dismissal.
  • OP pointed out that the complainant had paid Rs.4,50,000 which was less than 25% of tentative plot price (tentative price noted as Rs.18,90,000) and had not paid installments as per allotment schedule; OP argued the complainant could not receive double benefit and that refund was made per PUDA terms and procedure.
  • OP tendered evidence including a self-declaration by Amarinder Singh Tiwana (Estate Officer) and photographs Ex.OP-1 and Ex.OP-2.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
PUDA v. Amrik Singh, RP No.500 of 2017 (decided 28.05.2017) Whether clause permitting possession after development work or within 18 months allows indefinite delay; principle that possession cannot be delayed indefinitely and that allottees are entitled to relief where authority delays beyond reasonable limits. The forum relied on this decision as supporting the view that OP cannot delay delivery of possession for an indefinite period and that delay may entitle the allottee to refund and interest. The opinion expressly states it is supported by this case (citing Para 8 of that decision).
Bangalore Development Authority v. Syndicate Bank, II 2007 CPJ 17 (SC) When possession of an allotted plot/flat/house is not delivered within the specified time, the allottee is entitled to refund with reasonable interest from the date of payment until refund. The court cited this Supreme Court authority to establish the general principle that delay in possession entitles the allottee/consumer to refund with reasonable interest; the principle was applied in deciding that the complainant was entitled to interest on the refunded amount.
PUDA v. Darshan Kumar, RP No.2804 of 2018 (decided 24.1.2020) Similar facts concerning delayed possession and entitlement to interest and compensation. The forum noted that similar facts were dealt with in that National Commission decision and relied on it to support the conclusion that the complainant is entitled to interest on the principal amount and compensation.

Court's Reasoning and Analysis

The court's analysis proceeded by examining the timeline of events, the scheme's stipulated time limits, the state of site development, the conduct of the parties, the documentary evidence on record, and applicable precedents.

  1. Timeline and contractual timelines:
    • The scheme was launched on 27.9.2012 and the draw took place on 15.1.2013. The scheme terms required issuance of allotment letters within one year from the date of draw. The allotment letter in this case was issued on 19.9.2016, i.e., after a delay of approximately three and a half years from the draw.
    • Per the scheme terms, possession was to be handed over after completion of development works or within 18 months from allotment letter (whichever earlier). Thus, possession in a developed site should have been handed over by 19.3.2018.
  2. Evidence of non-development and disputed possession:
    • OP claimed possession was given on 8.2.2018, but complainant produced Ex.C-3 (letter of 11.4.2019 from Divisional Engineer requesting permission to lay water lines) and Ex.C-4 (RTI reply dated 22.2.2019 admitting boundary wall pending due to dispute with farmers), which the court found to "satisfactorily show" that the site was not developed before the due date of delivery.
    • The court observed that had allotment and development been done within prescribed times, the plot would have become complainant's property by 19.3.2018, but in reality even after 7–8 years the plot was not in a liveable, developed condition.
  3. Retention of funds and equitable considerations:
    • OP had received the complainant's funds in 2012–2013 and retained them until refund by cheque dated 21.5.2020; the court noted OP had been enjoying and gaining profit on the complainant's money during that period.
    • The court referred to principles of natural justice requiring action within a reasonable time and held that the complainant could not be forced to wait for an indefinite period for allotment or possession.
  4. Reliance on authority:
    • The court relied on National Commission precedent (PUDA v. Amrik Singh) and Supreme Court authority (Bangalore Development Authority v. Syndicate Bank) to support the proposition that delayed possession entitles the allottee to refund with reasonable interest.
    • The court also referenced a similar National Commission decision (PUDA v. Darshan Kumar) to reinforce its conclusion that interest and compensation are appropriate remedies in comparable circumstances.
  5. Conclusion of liability:
    • Given the delayed allotment, incomplete development before the expiry of the contractual timeframes, and retention of funds by OP for over seven years, the court concluded there was deficiency in service by OP and that the complainant was entitled to interest on the refunded principal and to compensation (though lesser than sought by complainant).

Holding and Implications

Holding: The complaint was partly accepted. The forum held that the complainant was entitled to interest on the principal sum of Rs.4,50,000 and to compensation.

Specific orders and direct consequences for the parties (as stated in the opinion):

  • OP was directed to pay interest on the principal amount of Rs.4,50,000 at the rate of 9% per annum from the dates on which the OP received the amounts from the complainant at different intervals, up to the date of actual realization.
  • OP was directed to pay consolidated costs and compensation of Rs.3,000 to the complainant.
  • OP was required to comply with the order within 45 days from receipt of a copy of the order.

Broader implications and precedent: The opinion applied established principles (as cited) that public authorities cannot indefinitely retain consumers' funds and that delay in possession warrants refund with interest. The judgment did not announce a broader novel legal principle beyond applying and following the cited authorities; the immediate effect is remediation in this specific dispute (payment of interest and nominal compensation). The opinion did not state that a new binding precedent was created beyond its reliance on existing case law.

Other Procedural Notes

The court observed that the complaint could not be decided within the statutory time period due to heavy pendency of cases. Copy of the order was to be sent to parties free of cost, and the file was to be consigned to record. The order was pronounced on 19th October, 2021.

Sources for this summary: Facts, arguments, analysis and orders were taken exclusively from the provided opinion text and cited exhibits and authorities therein.

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    Manoj Kumar v. PUDA

    R.L. Mittal, President This is the complaint filed by Manoj Kumar (hereinafter referred to as Contd........2 : 2 : the complainant) against the Punjab Urban Planning & Development Authority (hereinafter referred to as OP).

    2. Briefly stated, case of the complainant is that OP launched a scheme on 27.9.2012 in which the OP allotted freehold residential plots at PUDA Enclave, Budhlada. For this purpose, applications were demanded with 10% earnest money of the total amount. Complainant purchased the plot from Charan Singh, who had applied for a plot of 300 square yards vide application No.1300 and Rs.1,80,000/- were paid as earnest money to the OP. As per scheme, draw of plots was conducted on 15.1.2013 at Budhlada. Charan Singh was successful in the draw of residential plot and thereafter OP issued letter of intent dated 26.2.2013. Charan Singh paid next 15% of the total amount of Rs.2,70,000/- as per the terms and conditions of the scheme. Thereafter, Charan Singh transferred the plot in the name of the complainant after taking full consideration and OP accepted this and complainant became the owner of the said plot.

    3. It is further mentioned that till date site was not fully developed as per the scheme, which amounts to deficiency in service and unfair trade practice on its part. Allotment letter for allotment of Plot No.1005/PF measuring 300 sq yards was issued on 19.9.2016 i.e. after 4 years. OP issued another letter dated 8.2.2018 vide which plot was changed to No.884/PF without the consent of complainant which is wrong and illegal and against the terms and conditions of the brochure and letter of intent. OP failed to complete the development work, basic amenities etc and to hand over the possession of the plot within a reasonable time, therefore, the complainant wrote a letter to the OP and requested for refund of the entire deposited amount with interest. In reply to this letter, OP sent cheque dated Contd.........3. : 3 : 21.5.2020 for refund of Rs.4,50,000/- as principal amount but no interest was given by the OP. Complainant sent an email to OP intimating that he has kept the amount under protest and demanded interest from OP as it had retained the amount for more than 7 years. Hence this complaint. Complainant has prayed for direction to the OP to pay interest on Rs.4,50,000/- @ 18% p.a., besides Rs.50,000/- as compensation and Rs.20,000/- as costs.

    4. Upon notice, OP appeared through counsel and contested the complaint by filing written reply. OP raised legal objection on the ground of intricate questions, estoppel, beyond limitation, false, vexatious complaint, Arbitration Clause etc. It is further submitted that on receipt of an application from the complainant for refund after surrendering the plot, OP had sent cheque dated 21.5.2020 amounting Rs.4,50,000/- to the complainant, which has been received by the complainant without any objection/protest and got the amount of the cheque. Possession of the plot has been delivered to the complainant well in time and plot number was also allotted to the complainant in time. Complainant cannot get double benefit. The tentative price of the plot was Rs.18,90,000/-. Complainant had paid Rs.4,50,000/- which was less than even towards 25% of the price of the plot. Complainant did not deposit installment of the plot as scheduled in allotment letter. Complainant has no right to file the present complaint. Refund of Rs.4,50,000/- was made as per the terms and conditions and procedure of PUDA.

    5. On merits, OP has reiterated its version as taken in the legal objections and as detailed above. It is further submitted that possession of plot has been delivered to the complainant as per letter dated 8.2.2018 Contd........4 : 4 : Allotment letter has been issued as per the terms and conditions of the scheme. There is no deficiency on the part of the OP. Denying all the other allegations of the complainant OP prayed for dismissal of the complaint.

    6. Complainant has also filed rejoinder. On being called upon by this forum, to do so, learned counsel for the complainant has tendered Self Declaration of the complainant alongwith documents Ex.C-1 to C-7 and closed the evidence. On the other hand, ld. Counsel for the OP tendered into evidence self declaration of Amarinder Singh Tiwana, Estate Officer and photographs Ex.OP-1 and Ex.OP-2 and closed evidence. Written arguments submitted by the parties have also been taken on record.

    7. Parties have reiterated the same things as stated in their respective pleadings. We have heard the learned counsels of the parties and gone through the oral and documentary evidence, with their kind assistance.

    8. Admittedly, OP has made a refund of Rs.4,50,000/- vide cheque dated 21.5.2020, copy of which is placed on file as Ex.C-5. It is also not disputed that immediately after receipt of cheque, complainant lodged his objection regarding the receipt of only principal amount vide his request/ email dated 6.8.2020 Ex.C-6. Admittedly, OP has received the amount of Rs.4,50,000/- in the year 2012-2013 and has been enjoying and gaining profit on the hard earned money of complainant till its refund on 21.5.2020. Letter of intent is dated 26.2.2013, first allotment letter is dated 19.9.2016 and re-allotment letter is dated 8.2.2018. The question is whether the complainant can be forced to wait for indefinite period for allotment of the plot number. Principles of natural justice provide that OP should have acted in a reasonable time.

    9. Perusal of the file reveals that the complainant applied for Contd..........5. : 5 : refund of the amount deposited by him with the OP vide E-mail dated 6.8.2020 Ex.C-6. On receipt of this E-mail, OP made a refund of Rs.4,50,000/- through cheque dated 21.5.2020 (copy Ex.C-5). On receipt of cheque, complainant lodged his protest and requested for interest on the entire deposit. Perusal of the file further reveals that OP had failed to handover the possession of the plot within specified period and kept the money of the complainant for more than 7 years. Scheme for the draw/allottment of free hold residential plots was launched on dated 27.9.2012. The draw of plots was conducted on 15.1.2013 at Budhlada. As per the terms and conditions of the scheme, the allottment letter was to be issued to the successful applicants within one year from the date of draw. But the Allottment Letter was issued by the OP on dated 19.09.2016 i.e after a delay of three and a half years. Further, as per the terms and conditions of the scheme possession of the plots after completing all the necessary development works at the site ( i.e basic facilities such as water, electrcity, roads, swerage system, boundaries etc. which are like sine qua non for bare survival, safety and security) should have been handed over to the complainant/allottee within a maximum period of 18 months from the date of issuance of allottment letter. That means plot in a developed site should have been handed over by 19.3.2018. ( i.e 18 montsh from allotment letter). OP has claimed that the possession of the plot was given to the complainant on dated 8.2.2018 but the complainant has stated that OP till date has not provided Drinking water facility/connection at the concerned site and boundary wall of one side has not been constructed till date due to the dispute of the OP with the adjoining land owners/Farmers. Complainant has placed on record Ex. C-3 and C-4 in support of these assertions. Ex. C-3 Contd..........6. : 6 : is a letter of dated 11.4.2019 in which the Divisional Engineer of the OP is requesting the Executive Engineer, Patiala to give permission to lay the water lines at the concerned site from Biroke Branch Miner No.4. So that the facility of water might be arranged for the allottees as soon as possible. Ex. C-4 is a reply of dated 22.2.2019 an RTI application in which OP itself has admitted that boundary wall towards Budhlada was pending due to a dispute with farmers. Ex. C-3, C-4 satisfactorily show that the concerned site was not developed by the OP before the due date of delivery of permission of the plots to the allottes. If the allotment had been done within the prescribed time ( within 1 year from draw ) and possession after necessary development works had also been delivered within the agreed time limit ( i.e within 18 months from the allotment) then by 19.3.2018 the concerned plot would have become the property of the complainant but in the present case, even after 7 to 8 years the OP has not developed the site so as to give possession of a plot in a living able area. Thus there is deficiency in service on the part of the OP. It is a clear cut case of refund of amount for non-delivery of the possession of plot in reasonable time alongwith interest. In taking this view we are supported from case law PUDA v. Amrik Singh RP No.500 of 2017 decided on 28.05.2017 whereby Honble National Commission, in Para No.8 held as follows: No doubt, clause 12 of Letter of Intent do provide that the possession of the plot shall be handed over to the allottee after the completion of the development work at the site or within 18 months from the date of issue of allotment letter, whichever is earlier. It is also true that neither the development work has been completed as yet nor any allotment letter has Contd..........7. : 7 : been issued in favour of the complainant who deposited the demanded 15% of the consideration amount in furtherance of Letter of Intent. The question is does this mean that by providing the stipulation in clause 12,

    21 & 22 of Letter of Intent, the opposite party can delay the delivery of possession of subject plot to the complainant for indefinite period ? ...................................

    10. Honble Supreme Court has held in many cases that if there is a delay in possession, the allottee or consumer is entitled for refund with a reasonable interest. Public authorities cannot frisk with the hard- earned money of consumers. In Bangalore Development Authority v. Syndicate Bank ., II 2007 CPJ 17 (SC), Honble Supreme Court held that: when possession of the allotted plot/flat/house is not delivered within the specified time, the allottee is entitled to refund with reasonable interest from the date of payment till the date of refund.

    11. Similar facts and same questions of law were dealt by the Hon'ble National Commission in RP No.2804 of 2018 in PUDA vs Darshan Kumar decided on 24.1.2020. Hence complainant is held entitled for interest on the principal amount of Rs.4,50,000/- alongwith compensation.

    12. Resultantly, complaint is partly accepted with consolidated costs and compensation of Rs.3,000/-. OP is directed to pay interest on principal amount of Rs.4,50,000/- @ 9 % p.a. from the date of receipt of amounts from the complainant at different intervals, till the date of actual realization. Compliance of the order be made by OP within 45 days from the date of receipt of the copy of the order. Contd..........8. : 8 :

    13. The complaint could not be decided within the statutory time period due to heavy pendency of cases.

    14. Copy of the order be sent to the parties concerned free of cost and file be consigned to the record. PRONOUNCED: 19th Day of October, 2021. Su raj Goyal R.L.Mittal, Member. Pre sident. *krishan*

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    Comments

    Manoj Kumar v. PUDA
    (Oct 19, 2021)