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ANIL AGARWALLA & ANR. v. IMPERIAL HOUSING VENTURES PVT. LTD. & ANR.
Structured Summary of the Opinion
Factual and Procedural Background
The complainants booked a 3BHK flat in the "Paras Tierea" project (Sector-137, Noida) on 29.07.2012 and paid instalments totalling Rs. 7,631,013/- by 30.01.2016. The allotment was of Unit No. T-28-2305 (super area 1592 sq.ft.; total sale price Rs. 7,863,888/-). Possession was due on 28.07.2015 with a six-month grace period expiring in January 2016. The complainants received various communications from the builder, including a demand dated 28.06.2016 for Rs. 293,053/-, a possession-related communication dated 28.04.2016 indicating nearing completion, and a letter dated 20.09.2017 with a statement of account showing outstanding dues and demands.
The complainants repeatedly sought information about the status of the flat and the existence of an Occupation Certificate (OC) and were denied a copy of the OC and permission to inspect the flat, according to the complaint. After these events, the complaint alleging deficiency in service and seeking refund/compensation was filed on 13.11.2017 in the National Consumer Disputes Redressal Commission.
The builder filed its written reply (06.02.2018) asserting (inter alia) that the period of possession was three years from an agreement dated 17.05.2013, that extensions under the agreement were available for certain causes, that an Occupation Certificate had been obtained on 18.09.2017 and possession was offered on 20.09.2017 subject to payment of outstanding dues and completion of formalities, and that many other home buyers had taken possession after 18.09.2017. The complainants filed rejoinder (05.03.2018) reiterating that the flat was for residential use, that they had paid over 95% of the price by 30.01.2016, that the OC was not produced and inspection was refused, and that the 20.09.2017 letter did not state that an OC had been obtained.
Both sides filed affidavits of evidence and short synopses. The matter was heard before Hon'ble Mr. Justice Ram Surat Ram Maurya, Presiding Member, and the Commission delivered an order on 12 Jan 2022.
Legal Issues Presented
- Whether the complainants are entitled to refund of the amounts paid (Rs. 7,631,013/-) with interest because the builder failed to hand over possession within the promised period or within a reasonable time.
- Whether the complaint is maintainable in view of the builder's contention that possession was offered on 20.09.2017 and that the complainants were in arrears in payment.
- Whether denial of a copy of the Occupation Certificate and refusal to permit physical inspection of the flat amount to deficiency in service and unfair trade practice by the builder.
- Whether the Commission has pecuniary jurisdiction given the total sale price of the flat and the reliefs claimed.
Arguments of the Parties
Complainants' Arguments
- The flat was booked for residential use and possession was promised within 36 months with an additional six-month grace period (i.e., by January 2016), but possession was not delivered by that time.
- They paid Rs. 7,631,013/- (more than 95% of sale price) by 30.01.2016 and therefore were entitled to timely possession or refund with interest and compensation.
- The demand of Rs. 293,053/- dated 28.06.2016 was illegal and was protested.
- The builder's 20.09.2017 letter did not state that an Occupation Certificate had been obtained; the builder refused to provide a copy of the OC and denied physical inspection of the flat, creating reasonable doubt about completion.
- The alleged agreement dated 17.05.2013 was not executed by the complainants (it does not bear their signatures) and therefore could not be relied upon by the builder.
- They claimed deficiency in service and unfair trade practice and sought refund, interest and compensation; they also argued that the Commission had pecuniary jurisdiction based on the total valuation of reliefs claimed.
Opposite Parties' (Builder's) Arguments
- The period of possession was three years from the agreement dated 17.05.2013 and the agreement allows extensions for force majeure and other causes; the builder had employed requisite manpower and completed construction.
- An Occupation Certificate had been obtained on 18.09.2017 and possession was offered to the complainants by letter dated 20.09.2017, subject to payment of balance amount and completion of formalities (including conveyance deed formalities).
- The finishing works are customarily completed after final payment so that nothing remained incomplete at the time of taking possession, and the complainants did not make the final payment but instead filed the complaint.
- The complainants were alleged to be defaulters in payment, with reminders having been issued (dates cited), and therefore could not raise the issue of delay; by their conduct, the complainants were said to be investors and not consumers.
- The builder contended that about 2,124 home buyers had taken possession after 18.09.2017 and that the Commission lacked pecuniary jurisdiction because the total value of the flat was Rs. 78,63,888/-.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Fortune Infrastructure Vs. Trevor D' Limba, (2018) 5 SCC 442 | Buyers cannot be made to wait for an unlimited period for possession; where there is inordinate delay, the buyer may be entitled to refund of money. | The Court cited this authority to support the principle that inordinate delay in offering possession can entitle buyers to refund. |
| Pioneer Urban Land & Infrastructure Ltd. Vs. Govind Raghavan, (2019) 5 SCC 725 | Same principle: inordinate delay in handing over possession entitles buyer to remedies including refund. | Used by the Court to reinforce the position that a buyer should not be kept waiting indefinitely and that refund remedies are available for prolonged delay. |
| Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra, 2019 (6) SCALE 462 | Same category of authority establishing that buyers cannot be kept waiting indefinitely for possession; reliefs for inordinate delay are available. | Cited to demonstrate established precedent that prolonged delay merits refund relief. |
| Wg. Cdr. Arifur Rahman Khan Vs. DLF Southern Homes Pvt. Ltd., (2020) 16 SCC 512 | Reiterates that inordinate delay in offering possession can entitle the buyer to refund of money. | Relied upon to support the award of refund where delay was found to be inordinate. |
| Ireo Grace Realtech Vs. Abhishek Khanna, (2021) 3 SCC 241 | In a case where delay in offering possession was seven months, the Supreme Court held the buyer was obligated to take possession. | The Court distinguished this precedent on the basis of the short delay (seven months) and treated it as not directing a refund in that factual matrix. |
Court's Reasoning and Analysis
The Commission reviewed the record, the pleadings, affidavits and arguments. It noted that:
- The complainants had paid Rs. 7,631,013/- by 30.01.2016 (over 95% of sale price) and possession was contractually due by July 2015 with a six-month grace period expiring in January 2016.
- There were communications from the builder seeking additional payments and a letter dated 20.09.2017 that did not indicate the existence of an Occupation Certificate; the complainants had repeatedly requested a copy of the OC and permission to inspect the flat, which they alleged were refused.
- The builder asserted that an Occupation Certificate had been obtained on 18.09.2017 and that possession was offered on 20.09.2017, but the offer was conditioned on payment of outstanding dues and completion of formalities; the builder also argued that finishing works are completed after final payment and that some reminders for unpaid instalments existed.
- The Commission found that the 20.09.2017 letter did not expressly state that an Occupation Certificate had been obtained, and that the denial of a copy of the OC and refusal to permit inspection raised reasonable doubts in the complainants' minds as to completion. The Commission observed that the builder was bound to disclose the OC and permit inspection.
- Applying Supreme Court authorities that a buyer cannot be made to wait indefinitely and that inordinate delay in offering possession entitles the buyer to refund, the Commission compared the instant facts with the cited precedents. The Commission also noted the Ireo Grace Realtech decision as an example where a seven-month delay led to the buyer being obliged to take possession, distinguishing that factual scenario from the present case.
- Weighing the evidence and precedents, the Commission concluded the complainants' grievance was maintainable and that refund relief was warranted given the delay and the circumstances (including the complainants' payment of the major portion of the price and the alleged refusal to produce OC/permit inspection).
Holding and Implications
Holding: The complaint is allowed.
The Commission directed the opposite parties (the builder) to refund the entire amount of Rs. 7,631,013/- to the complainants along with interest at the rate of 9% per annum from the date of each deposit until actual payment. The refund was ordered to be made within two months from the date of the judgment.
Implications:
- Direct effect: The builder is required to make the specified refund with interest to the complainants within the two-month timeframe stated in the order.
- Broader implications: The decision applies established Supreme Court principles cited in the opinion (that buyers should not be kept waiting indefinitely and may be entitled to refund in case of inordinate delay). The opinion does not state that it establishes a new legal principle beyond applying those precedents.
Decision rendered by Hon'ble Mr. Justice Ram Surat Ram Maurya, Presiding Member, National Consumer Disputes Redressal Commission (order dated 12 Jan 2022).
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
NEW DELHI
CONSUMER CASE NO. 3321 OF 2017
1. ANIL AGARWALLA & ANR. ...........Complainant(s) Versus
1. IMPERIAL HOUSING VENTURES PVT. LTD. & ANR. Room No.205, Welcome Plaza S-551, School Block (11) ,Shakarpur,
Delhi-110092
2. IMPERIAL HOUSING VENTURES PVT.LTD.
11th Floor, Paras Twin Tower (Tower-B) Secror-54 Golf Cours Road,
Gurgaon-122002
HARYANA ...........Opp.Party(s)
BEFORE:
HON'BLE MR. JUSTICE RAM SURAT RAM MAURYA,PRESIDING MEMBER
For the Complainant : Mr. Anil Agarwalla, Advocate :Ms. Neha Sharma, Advocate
For the Opp.Party : Mr. Jay Savla, Sr. Advocate :Mr. Akshay Sharma, Advocate
Dated : 12 Jan 2022
ORDER
1. Heard Mr. Anil Agarwalla and Ms. Neha Sharma, Advocate, for the complainants and Mr. Jay Savla, Sr. Advocate assisted by Mr. Akshay Sharma, for the opposite parties.
2. The complainants have filed the aforementioned complaint for directing the opposite parties (hereinafter referred to as the builder) (i) to refund their principal amount of Rs.7631013/- along with interest @18% per annum, (amounting to Rs.27/- lacs i.e. from the date of respective deposits till filing of the complaint), in the event the builder failed to handover possession of the flat to the complainants, complete in all respect, within 15 days of the filing of the complaint (ii) to pay Rs.15/- lacs as the compensation, (iii) Rs.5/- lacs as the compensation for mental agony and harassment, (iv) Rs.50000/- as cost of the litigation and (v) any other relief, which is deemed fit and proper in the facts and circumstances of the case.
3. The facts, as stated in the complaint are that the builder was a company, engaged in the business of development and construction of residential and commercial buildings and selling its unit to the prospective buyers. In the year 2010, the builder launched a project of group housing in the name of "Paras Tierea" in Sector-137, NOIDA, district Gautam Budh Nagar, Uttar Pradesh. On coming to know about this project, the complainants visited the office and site of the builder and discussed about the project. The representative of the builder showed a sample flat and the amenities and facilities provided to it. He assured that the project would be completed and possession be given to the buyers within 3 years. Believing upon the assurance,
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the complainants booked a 3BHK flat on 29.07.2012 and gave a cheque of Rs.710668/-. The builder allotted Unit No. T-28-2305, Tower No.-28, (super area 1592 sq.ft., basic sale price Rs.71.64/- lacs, (total sale price of Rs.7863888/- inclusive of Lease rent, Car Parking charge, Interest Free Maintenance Security Deposit and Internal Development Charge), on 29.08.2012. Along with Booking Application Form, "Construction Linked Payment Plan" was supplied. The complainants deposited instalments as per demand notices served upon them. The complainants paid Rs.710668/- on 18.08.2012, Rs.722132/- on 27.11.2012, Rs.44274/- on 27.11.2012, Rs.716400/- on 22.06.2013, Rs.22136/- on 22.06.2013, Rs.731151/- 26.03.2014, Rs.7386/- on 26.03.2014, Rs.548530/- on 30.07.2014, Rs.731373/- on 03.09.2014, Rs.551861/- on 05.09.2014, Rs.17982/- on 06.09.2014,Rs.179832/-on 26.11.2014, Rs.548364/- on 15.04.2015, Rs.792717/- on 01.07.2015, Rs.755474/- on 26.12.2015 and Rs.550733/- on 30.01.2016 (total Rs.7631013/-). Due date of possession was 28.07.2015 and with six month grace period was January, 2016. The complainants received a letter dated 28.04.2016, informing that the construction was in advance stage of finishing work of Tower-28 and possession would be offered till end of the year. The complainants received a demand letter dated 28.06.2016, demanding Rs.293053/-, in head of "on completion of electrical conduiting & wiring and previous dues". The complainants vide letter dated 05.07.2016, protested the demand as this instalment has already been paid in March, 2015 and sought for information regarding status of his flat and date of delivery of possession. The builder did not respond satisfactorily. The complainants again wrote letter dated 28.03.2017 and email dated 01.04.2017, seeking for information relating to delivery of possession. The builder sent an email dated 04.04.2017 that possession was likely to be given in June-July, 2017. Thereafter, the builder wrote another letter dated 09.05.2017, stating that possession would be delivered soon. The complainants, vide letter dated 22.05.2017, sought for information of actual position of the construction of his flat. The complainants received a letter dated 20.09.2017, giving statement of the account of the complainants, showing dues of Rs.836777/- under various heads. The complainants vide letter dated 25.09.2017, sought for information, as to whether,
"Occupation Certificate" had been obtained. The builder, vide email dated 26.09.2017, sent a vague reply. The builder even did not permit to see the flat. The complainants wrote letter dated 27.09.2017 and reminders dated 06.10.2017 and 24.10.2017, demanding the documents, relating to completion of the construction but no reply was given. Then the complaint was filed on 13.11.2017, complaining deficiency in service.
4. The builder filed its written reply on 06.02.2018, in which, material facts have not been denied. It has been stated that the period of possession was three years from the date of agreement, which was executed on 17.05.2013. Under the terms of the agreement, the builder was further entitled for extension of the period of construction for the force majeure and other causes mentioned in the agreement. The builder employed the requisite man power for the construction of the building and completed it and obtained Occupation Certificate on 18.09.2017. The builder offered possession to the complainants, vide letter dated 20.09.2017 and asked to pay the balance amount and complete the formalities. Instead of paying balance amount, the present complaint was filed on 13.11.2017, which was not maintainable. The complainants were defaulter in payment of instalment earlier also for which reminders letter dated 12.01.2015, 14.01.2016 and 28.06.2016 were issued to them. Since the complainants were themselves defaulter, as such, they cannot raise the issue in respect of delay of completion of the constructions. After 18.09.2017 about 2124 home buyers have taken possession in the flats allotted to them. The complainants are making excuse for not taking
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possession by writing one or other letters. The builder has given suitable reply of the letters/queries made by the complainants. The conduct of the complainants shows that they had purchased the flat for investment purpose and due to down fall in the market of Real Estate, now they want refund of their money as such they are not consumers. The total value of the flat was Rs.78,63,888/- as such this Commission has no pecuniary jurisdiction. This complaint is liable to be dismissed.
5. The complainants filed their rejoinder reply on 05.03.2018, in which, facts stated in the complaint were reiterated. It has been stated that the flat was booked for own residence and not for any commercial purpose. Mahesh Agarwalla, son of complainant-1 took admission in Lloyd Law College, Greater Noida. Existing residence of the complainants was at about 45 Km. from the aforesaid College, as such for their own residence, the flat was booked. The complaint was filed for refund of principal amount of Rs.7631013/- and the interest of Rs.2700000/- and Rs.1500000/- as compensation and total valuation comes to Rs.11831013/- as such this Commission has pecuniary jurisdiction. Perusal of the letter dated 20.09.2017 shows that it was issued merely to realise the money. In this letter, it was nowhere stated that Occupancy Certificate had been obtained, therefore, the complainants vide letter dated 25.09.2017 called for information regarding Occupancy Certificate/Completion Certificate and whether the unit allotted to the complainants was complete in all respect and ready for taking possession. The complainants have also raised their protest regarding liability to pay demanded money as given at Serial No.7, 8 and 9 in the letter/statement of account dated 20.09.2017. In the statement of account, further Rs.205606/- was shown as interest while the complainants had made timely payment of the instalments and no interest was liable to be charged. In response to the letter dated 25.09.2017, the builder by their e-mail dated 26.09.2017 and 05.10.2017 admitted that finishing work in the flat was yet to be carried out and same would be done post clearance of the dues. The builder refused to provide a copy of the occupancy certificate. The builder also denied the physical inspection of the flat by the complainants, which gave a reasonable doubt in the minds of the complainants, in respect of the completion of the construction of the flat. The possession was promised to be handed over within a period of 36 months with a grace period of six months from the date of allotment i.e. 29.09.2012, which had lost in January, 2015. Even in September, 2017, the builder has not supplied the copy of the Occupancy Certificate to the complainants although the complainants have made payment of more than 95% of the sale price, therefore, the complainants have no way but to file the present complaint. The builder has not only committed deficiency in service, but had also adopted unfair trade practice. The builder has realised the amount of 11 instalments till 30.01.2016. The letter dated 28.06.2016 amounts to illegal demand. The alleged agreement dated 17.05.2013 was not executed by the complainants and no reliance can be placed upon it.
6. The complainants filed Affidavit of Evidence of Anil Agarwalla. The builder filed affidavit of evidence of Mr. Mahesh Kumar Tripathi and Affidavit of Admission/Denial of the documents of the complainants. Both the parties have filed their short synopsis.
7. I have considered the arguments of the counsel for the parties and examined the record. This complaint has been filed on 13.11.2017, for refund of sale consideration of Rs.76,31,013/- paid to the builder, if the builder is failed to failed to give possession within 15 days. According to the builder, they had already offered possession, vide letter dated 20.09.2017. Before taking possession, the buyers had to clear the dues according to the Terms and Conditions and complete other formalities, for execution of conveyance deed. So far as final
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finishing work is concerned, it is always completed after final payment, so that at the time of taking possession, nothing remained incomplete. Instead of making final payment and completing other formalities, the complainants wrote letter dated 25.09.2017, 27.09.2017, 06.10.2017 and 24.10.2017 and ultimately filed this complaint. As such the complaint is liable to be dismissed as the relief as claimed has already been offered to them before filing the complaint.
8. The complainants submitted that the flat was allotted to them on 29.07.2012. At the time of allotment, they were assured that possession would be given within 36 months with grace period of six months, which was completed in January, 2016. Till 30.01.2016, the complainants have paid Rs.7631013/- (i.e. more than 95% of sale price), but the builder was not in a position to give possession to them. The builder vide letter dated 28.06.2016, raised illegal demand of Rs.293053/-, which was protested at that time. Then the builder kept silence for about one year. In the alleged possession letter dated 20.09.2017, it was nowhere mentioned that "Occupation Certificate" had been obtained. In the statement of account as supplied along with letter dated 20.09.2017, again (i) one time electricity connection charges
(ii) Labour cess (iii) Core cutting/DG indicator and (iv) Interest of Rs.205606/- were demanded. In the absence of any indication of "Occupation Certificate" in this letter, the complainants demanded information regarding issue of "Occupation Certificate". In spite of various letters, the builder did not supply copy of "Occupation Certificate" nor permitted physical inspection of the flat, as such, the complainants were compelled to file this complaint.
9. A perusal of the letter dated 20.09.2017, shows that it does not indicate anywhere that
"Occupation Certificate" had been obtained. In view of previous demand letter dated 28.06.2016, this letter created a doubt in the mind of the complainants about the completion of the flat. In spite of various letters, the builder did not supply copy of "Occupation Certificate"
nor permitted physical inspection of the flat, as such, the complaint was filed and it is maintainable. The builder was bound to disclose "Occupation Certificate" and also permit physical inspection. The complainants had already deposited Rs.7631013/- till 30.01.2016. Denial of physical inspection and "Occupation Certificate" was unfair, which compelled the complainants for filing this complaint.
10. The builder filed a copy of an agreement dated 17.05.2013. The complainants have denied execution of this agreement. The agreement does not contain signature of the complainants. Therefore, no reliance can be placed on it. The builder took the case that at the time of allotment on 29.07.2012, they were assured that possession would be delivered within three years i.e. up to July 2015. The builder did not take plea of force majeure for delay in construction. Six months grace period was also expired in January, 2016.The builder has filed only one reminder dated 12.01.2015, which is prior to the promised date of possession, as such, the complainants cannot be said as a defaulter. By not supplying "Occupation Certificate" and not permitting inspection, the builder has committed unfair trade practice. In present case, offer of possession was delayed for about one year eight months.
11. Supreme Court in Fortune Infrastructure Vs. Trevor D' Limba, (2018) 5 SCC 442, Pioneer Urban Land & Infrastructure Ltd. Vs. Govind Raghavan, (2019) 5 SCC 725, Kolkata West International City Pvt. Ltd. Vs. Devasis Rudra, 2019 (6) SCALE 462 and
Wg.Cdr. Arifur Rahman Khan Vs. DLF Southern Homes Pvt. Ltd., (2020) 16 SCC 512,
held the buyer cannot be made to wait for unlimited period for possession. In case of inordinate
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delay in offer of possession, the buyer was entitled for refund of money. So far as judgment of Supreme Court in Ireo Grace Realtech Vs. Abhishek Khanna, (2021) 3 SCC 241, is concerned, in this case, delay in offer of possession was found as 7 months. As such Supreme Court held that the buyer was obligated to take possession.
O R D E R
In view of aforesaid discussions the complaint is allowed. The opposite parties are directed to refund entire amount of Rs.7631013/- along with interest @ 9% per annum, from the date of each deposit till actual payment, to the complainants, within two months from the date of this judgment.
......................J
RAM SURAT RAM MAURYA
PRESIDING MEMBER
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