STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

PUNJAB, CHANDIGARH.

Consumer Complaint No.705 of 2019 Date of institution : 24.09.2019 Date of decision : 17.07.2020 Harvinder Singh S/o Jeon Singh, Village Bibipur, Tehsil and District Patiala, Punjab.

….Complainant

Versus

1. C & C Towers Limited, through its Managing Director, ISBT-cum- Commercial Complex, opp. Verka Milk Plant, Phase-VI, Mohali, Punjab.

E-mail ID:gsp@candcinfrastructure.com

2. The Managing Directors, C & C Towers Limited, ISBT-cum- Commercial Complex, opp. Verka Milk Plant, Phase-VI, Mohali, Punjab.

E-mail ID:gsp@candcinfrastructure.com

3. CVS Sehgal, GM (Commercial), C & C Towers Limited, ISBT- cum-Commercial Complex, opp. Verka Milk Plant, Phase-VI, Mohali, Punjab.

E-mail ID:gsp@candcinfrastructure.com

.…Opposite Parties

Consumer Complaint under Section 17 of

the Consumer Protection Act, 1986.

Quorum:-

Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President

1) Whether Reporters of the Newspapers may be allowed to see the Judgment? Yes/No

2) To be referred to the Reporters or not? Yes/No

3) Whether judgment should be reported in the Digest? Yes/No Argued By:

For the complainant : None

For OPs No.1 & 2 : Ex parte

For OP No.3 : Sh. Anuj Kohli, Advocate.

JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT

The complainant has filed this complaint, under Section 17 of the Consumer Protection Act, 1986 (in short, "the Act"), against the opposite parties, seeking following directions to them:

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i) to deliver possession of the unit (shop/space) No.39, Floor 3^rd, Tower-C, having super area of 685 sq.ft. (approximately) in a time bound manner;

ii) to refund the amount of ₹22,77,625/-, along with interest at the rate of 14% per annum till the date of realization;

iii) to pay compensation of ₹5,00,000/-, on account of mental agony and harassment suffered by the complainant; and

iv) to pay ₹75,000/- towards litigation expenses. Facts of the Complaint

2. Brief facts, as set out in the complaint, are that being allured by the advertisements given by the opposite parties regarding their under construction Complex known as "Bus Terminal-cum- Commercial Complex" situated in Sector 57, Mohali, the complainant applied for allotment of a unit therein, exclusively for the purpose of creating the source of his livelihood by means of self-employment. He was allotted Unit No.39, Floor 3^rd, Tower-C, having super area of 685 sq.ft. in that project, vide allotment letter dated 07.07.2012 Ex.C-1. Total cost of the said unit was fixed as ₹65,07,500/-, out of which the complainant paid 20% as booking amount and 15% at the time of allotment; totaling ₹22,77,625/-, as per details given in Para-5 of the complaint. As per Clause 1.3.3 of letter of allotment, the opposite parties agreed to complete the construction of the unit within 48 months from compliance date i.e. 16.12.2009. However, the opposite parties failed to complete the project by that date, nor any development was carried out at the site. The opposite parties sent

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various letters Ex.C-3 (colly.) to the complainant, informing about delay and seeking more time for completion and execution of the project. Despite lapse of more than 7 years from the date of allotment, there is no sign of delivery of possession of the unit. Therefore, the complainant requested them to refund the amount deposited by him, along with interest at the rate of 18%, vide letter dated 01.07.2019 Ex.C-4, but without any effect. The aforesaid act and conduct of the opposite parties amount to deficiency in service. Earlier, the complainant filed Consumer Complaint No.658 of 2019; which was dismissed as withdrawn, vide order dated 05.09.2019 Ex.C-5, with liberty to file a fresh one on the same cause of action with better particulars. Hence, the present complaint.

Defence of the Opposite Parties

3. Upon notice, opposite parties No.1 & 2 did not appear despite their service and, as such, they were proceeded against ex parte, vide order dated 08.01.2020. Opposite party No.3 appeared through counsel and filed reply to the complaint.

4. Opposite party No.3, in his reply, raised preliminary objections that there is no deficiency in service or unfair trade practice on his part. The complaint is bad for mis-joinder and non-joinder of parties. The complainant is not consumer of opposite party No.3, as defined in the Act. Opposite party No.3 is an Ex-Indian Army Officer and he retired as Lt. Col. therefrom. He has disassociated from opposite party No.1-Company, vide Resignation dated 01.12.2018 Ex.OP-3/1, but he has not been paid his full and final amount by the

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Company and he is awaiting the remaining payment. Document showing full and final settlement calculation is Ex.OP-3/2. It was further pleaded that opposite party No.3 was only an employee of the Company and was never a Director. He acted under the express directions of the Chairman and Directors of the Company. All the customers applied for allotment of spaces/units with the Company and the entire project belongs to the Company itself. The payments, whatsoever received from the customers, were utilized by the Company and opposite party No.3 discharged his duties as a dutiful employee; in lieu of which he was paid salary and allowances. He was not a beneficiary of the amount paid by the customers to the Company. It was further pleaded that the Board of Directors passed a resolution dated 09.04.2009, authorizing opposite party No.3 to act on behalf of the Company, sign and execute documents at the local level at Mohali. Copies of Appointment Letter and resolution are Ex.OP-3/3 and Ex.OP-3/4. As per Clause-8 of the Appointment Letter, the services of opposite party No.3 were completely at the discretion of the Company and as per requirement he was liable to be transferred to any other site anywhere. This shows that he was just an employee of the Company. It is well settled that for the acts of the Company, the Company and its Directors are responsible/liable, but an employee, like opposite party No.3, cannot be held liable in any manner. It was further pleaded that on account of reasons beyond the control of the Company, the project got delayed as a result of which possession of units could not be offered, as per terms and conditions of the allotment

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letters. Some of the allottees started making complaints and demanding refund of their deposited amounts and being a dutiful employee, opposite party No.3 brought this fact to the notice of the Chairman and other Directors of the Company by writing e-mails Ex.OP-3/5. Sh. G.S. Johar, Chairman of the Company held meetings with the allottees and addressed various letters dated 07.05.2015, 24.12.2015, 21.11.2017 and 06.06.2018 Ex.OP-3/6 to Ex.OP-3/9 to them, assuring to refund their amounts, along with interest. The Company issued letter dated 21.11.2017, stating that it would refund the deposited amount of investors, along with interest and that the investors, who wanted to stay with the Company, would be paid interest at the rate of 8.8% on their deposited amount. Some of the allottees malafidely got lodged FIR against the Company, Directors and even included the name of opposite party No.3 therein. However, after considering the matter, opposite party No.3 has been absolved therefrom, on the basis of clarification given by the Chairman and Directors of the Company. Furthermore, vide investigation report dated 03.10.2018 Ex.OP-3/13 given by Deputy Supdt. of Police, District S.A.S. Nagar, opposite party No.3 has been declared to be not guilty. This Commission, vide order dated 19.11.2019 passed in Consumer Complaint No.663 of 2019, dismissed the complaint against the Chairman of the company. On merits, similar pleas, as raised in preliminary objections, were reiterated. All other allegations levelled in the complaint were denied and it was prayed that the complaint against opposite party No.3 be dismissed.

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Evidence of the Parties

5. To prove his claim, the complainant filed his own affidavit, along with copies of documents i.e. allotment letter dated 07.07.2012 Ex.C-1, demand drafts Ex.C-2 (colly.), provisional receipt dated 16.03.2012 Ex.C-3 (colly.), letter dated 01.07.2019 Ex.C-4 and order dated 05.09.2019 Ex.C-5.

6. Opposite party No.3 filed his own self attested affidavit, along with copies of documents i.e. resignation dated 01.12.2018 Ex.OP-3/1, Full and Final Settlement document Ex.OP-3/2, Appointment Letter dated 18.03.2009 Ex.OP-3/3, Resolution dated 09.04.2009 Ex.OP-3/4, e-mails Ex.OP-3/5 (colly.), letter dated 07.05.2015 Ex.OP-3/6, letter dated 24.12.2015 Ex.OP-3/7, letter dated 21.11.2017 Ex.OP-3/8, letter dated 06.06.2018 Ex.OP-3/9, letter dated 05.09.2018 Ex.OP-3/10, statement of Sh. G.S. Johar, Chairman, C& C Towers Limited Ex.OP-3/11, Representation made to Senior Supdt. of Police, S.A.S. Nagar, Mohali Ex.OP-3/12, Investigation Report dated 03.10.2018 Ex.OP-3/13, list of Directors of opposite party No.1- Company Ex.OP-3/14, list of investors in Mohali Junction Ex.OP-3/15, demand draft dated 06.01.2017 Ex.OP-3/16 and Statement of Account Ex.OP-3/17.

Contentions of the Parties

7. None has appeared on behalf of the complainant at the time of arguments. Even no written arguments have been submitted on behalf of the complainant, despite availing due opportunities in this regard. However, I have heard learned counsel for opposite party No.3

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and perused the written arguments submitted on behalf of opposite party No.3 and record carefully.

8. The written arguments submitted on behalf of opposite party No.3 are on the lines of the reply filed by him. It has been further contended by learned counsel for opposite party No.3 that the dispute involved in the complaint is the inter-se dispute between the complainant and opposite parties No.1 & 2 and opposite party No.3 has no role to play in the same. Vide Appointment Letter dated 18.03.2009 Ex.OP-3/3, opposite party No.3 was appointed as General Manager (Commercial) in opposite party No.1-Company on salary of ₹1 lac per month plus allowances. Thus, he was just an employee of the Company and not the Chairman, Director or shareholder. He was acting just on the instructions of the Directors and Chairman of the Company. It has been further contended that opposite party No.3 has already resigned from the services of opposite party No.1-Company, vide letter dated 01.12.2018 Ex.OP-3/1 and his account has been partially settled vide Full and Final Settlement document Ex.OP-3/2 and he has not been paid his full arrears of the salary/allowances. It has been further contended that vide letter dated 05.09.2018 Ex.OP- 3/10, Sh. G.S. Johar, Chairman of the Company requested Senior Supdt. of Police, S.A.S. Nagar, Mohali to delete the name of opposite party No.3 from FIR No.0150 dated 14.08.2018, on the ground that he was never a Director, shareholder or promoter of the Company and was just an employee. Furthermore, vide investigation report dated 03.10.2018 Ex.OP-3/13 given by Deputy Supdt. of Police City-1,

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District S.A.S. Nagar, opposite party No.3 has been declared to be not guilty. Therefore, no deficiency in service can be attributed towards opposite party No.3 and the complaint against him is liable to be dismissed.

Consideration of Contentions

9. I have given my thoughtful consideration to the averments/evidence of the complainant and contentions raised on behalf of opposite party No.3.

10. At the outset, it is relevant to mention that the merits of the present complaint are squarely covered by the earlier verdicts given by this Commission in following cases:

i) Consumer Complaint No.343 of 2016 (Sharanjeet Kaur v. C and C Towers Ltd. & Ors.) decided on 02.06.2017;

ii) Consumer Complaint No.314 of 2017 (Indu Laroia & Anr. v. C and C Towers Limited & Ors.) decided on 07.11.2017;

iii) Consumer Complaint No.99 of 2018 (Dharam Pal Nanda v. C & C Towers Ltd. & Ors.) decided on 19.07.2018;

iv) Consumer Complaint No.825 of 2018 (Harpreet Singh v. C & C Towers Ltd. & Ors.) decided on 20.02.2019;

v) Consumer Complaint No.183 of 2019 (Darshan Singh v. C & C Towers Ltd. & Ors.) decided on 15.05.2019;

vi) Consumer Complaint No.930 of 2018 (Ms. Kusum Sharma & Ors. v. C & C Towers Ltd. & Ors.) decided on 04.04.2019;

vii) Consumer Complaint No.752 of 2019 (Manoj Goyal & Anr. v. C. & C Towers Ltd. & Ors.) decided on 19.12.2019; and

viii) Consumer Complaint No.761 of 2019 (Mohammad Shahbaz & Ors. v. C & C Towers Ltd. & Ors.) decided, vide order dated

08.01.2020.

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So, I proceed to dispose of the present complaint, in view of the decisions given in the above noted cases.

11. Undisputedly, the unit No.39, Floor 3^rd, Tower-C, measuring 685 sq.ft. was allotted to the complainant in the above said project of opposite parties No.1 & 2, vide letter of allotment dated 07.07.2012 Ex.C-1. As per Annexure-A of the letter of allotment, the total cost of the unit was fixed as ₹9,500/- per sq.ft. i.e. ₹65,07,500/-. The complainant deposited a total sum of ₹22,77,625/- towards the price of the unit, as per demand drafts Ex.C-2 (colly.) and provisional receipt dated 16.03.2012 Ex.C-3. As per Clause 1.3.3 of the letter of allotment, Ex.C-1, the construction of the unit was likely to be completed within 48 months from the compliance date i.e. 16.12.2009 after obtaining all the necessary approvals and sanctions, subject to force majeure circumstances. Therefore, the construction of the unit, in question, was to be completed and possession was to be delivered up to 15.12.2013. However, opposite parties No.1 & 2 failed to complete the construction of project/unit within the stipulated period, without any sufficient cause, so as to deliver possession of the unit, in question, to the complainant. The development/construction work in the project had been abandoned at the site. From letter dated 07.05.2015, Ex.OP-3/6, it is clear that opposite parties No.1 & 2 were facing financial constraints and, as such, they informed the complainant that the construction of the project would be restarted by July, 2015. They further extended the date of restart of construction and handing over of possession till June, 2016, as per letter dated 24.12.2015 Ex.OP-3/7.

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Furthermore, opposite parties No.1 & 2, vide letter dated 21.11.2017, Ex.OP-3/8, offered refund of the amount deposited by the allottees. It was also mentioned therein that the investors, who wanted to stay invested with the Company, were to be paid interest at the rate of 8.8% per annum on the amount deposited by them, along with other applicable conditions. All these letters clearly prove that opposite parties No.1 & 2 failed to complete the project within the stipulated timeframe, that is why they offered aforesaid rate of interest on the deposited amount of the investors, including complainant. Still further, letter dated 06.06.2018, Ex.OP-3/9 also proves that opposite parties No.1 & 2 were not having sufficient funds for raising the project and, as such, they requested for further extension of time till 30.09.2018 for repayment, as per commitment made vide letter Ex.OP-3/8.

12. In Harpreet Singh's case (supra), it was held as under:

"It is also relevant to mention that one another allottee sought information under RTI Act from GMADA. GMADA, vide letter dated 29.09.2016, Ex.C-7, supplied the requisite information to her, informing that no licence of construction was granted to the opposite parties, nor any agreement was entered into by the opposite parties with the Government. Still further, as per letter dated 11.03.2016, Ex.C-9, issued by GMADA, the process for cancelling the agreement of the opposite parties had already been initiated, due to non-completion of the project within the stipulated period. It is also mentioned therein that the reason for delay in completing the project was disclosed by the opposite parties to be paucity of funds. In such circumstances, the complainant cannot be made to wait for an indefinite period of time for the completion of the project and delivery of the space/unit in question. This certainly amounts to deficiency in service and adoption of unfair trade practice on the part of the opposite parties."

From perusal of observations made by this Commission in the aforesaid case also, it is clear that opposite parties No.1 & 2 failed to

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complete the project within the stipulated period due to paucity of funds and GMADA had initiated process for cancellation of their licence.

13. For the sake of repetition, it needs to be mentioned that opposite parties No.1 & 2 failed to appear before this Commission, despite their service and, as such, they were proceeded against ex parte. The whole purpose of pleadings is to give fair notice to each party of what the opponent's case is and to ascertain with precision the point(s) on which the parties agree and those on which they differ. The purpose is to eradicate irrelevancy. The complaint is a concise statement of facts and if no reply is filed to the complaint, the averments made therein are deemed to have been admitted. Since no defence on the part of opposite parties No.1 & 2 has come on record, so all the averments made in the complaint are deemed to have been admitted by them and the evidence led by the complainant stands unrebutted; for which an adverse inference is to be drawn against them. As per Section 5 (Development of land into Colony) of the Punjab Apartment and Property Regulation Act, 1995 (in short,

"PAPRA"), opposite parties No.1 & 2 were liable to obtain permissions/sanctions from the competent authority for developing the project, but as there is no such evidence on record, so it is held that they violated Section 5 of PAPRA.

14. As per Section 3 (General Liabilities of Promoter) of the PAPRA, opposite parties No.1 & 2 were required to make full and true disclosure of the nature of their title to the land, on which such project

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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. They were 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 project, as approved by the prescribed authority in the case of a project. However, they failed to comply with Section 3 of the PAPRA.

15. 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/commercial space/unit, but no evidence has been led on the record by opposite parties No.1 & 2 to prove that any account has been maintained by them in this respect. As such, they also violated Section 9 of the PAPRA.

16. As per Rule 17 of the "Punjab Apartment and Property Regulation Rules, 1995, framed under Section 45 of the PAPRA, it has been provided as under:-

17. Rate of interest on refund of advance money upon cancellation of agreement.- The promoter shall refund full amount collected from the prospective buyers under sub-section (1) of section 6 together with interest thereon at the rate of twelve per cent per annum payable from the date of receipt of amount so collected till the date of re-payment."

The Act came into being in the year 1986. It is the benevolent piece of legislation to protect the consumers from exploitation. The spirit of the benevolent legislation cannot be overlooked and its object is not to be

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frustrated. The complainant has made payment of substantial amount to opposite parties No.1 & 2, with the hope to get the possession of the unit within a reasonable period. The circumstances clearly show that they made false statement of facts about the goods and services i.e. allotment of unit and delivery of possession in a stipulated period. The act and conduct of opposite parties No.1 & 2 is a clear case of misrepresentation and deception, which resulted in the injury and loss of opportunity to the complainant. There is escalation in the price of construction also. The builder is under obligation to deliver the possession of the plot/unit/flat/space within a reasonable period. From the facts and evidence brought on the record of the complaint, it is clearly made out that opposite parties No.1 & 2 i.e. builders knew from the very beginning that they had not complied with the provisions of the PAPRA and Rules and would not be able to deliver the possession within the stipulated period, thus by misrepresentation induced the complainant to book the unit, due to which the complainant has suffered mental agony and harassment. It is the settled principle of law that compensation should be commensurate with the loss suffered and it should be just, fair and reasonable and not arbitrary. The builder is bound to compensate for the loss and injury suffered by the complainant for failure to deliver the possession, so has been held in catena of judgments by the Hon'ble Supreme Court and the Hon'ble National Commission. To get the relief, the complainant has to wage a long drawn and tedious legal battle. As such, the complainant was at loss of opportunities.

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17. In these circumstances, opposite parties No.1 & 2 are liable to deliver physical possession of the unit, in question, complete in all respects, along with agreed facilities and amenities with Completion/Occupation Certificate issued by the competent authority, subject to payment of balance sale consideration, without any interest and penalty thereon and to execute the Sale/Conveyance Deed in favour of the complainant. They are also liable to pay compensation for delay in delivery of possession of the unit, in question, at the rate of 12% per annum on the amount deposited by the complainant with effect from 15.12.2013 till delivery of possession of the unit, in question, as observed above. In case they fail to deliver possession of the unit to the complainant, then they shall refund the entire amount deposited by the complainant, along with compensation for causing financial loss and depriving the complainant of the use of the said amount during the period it remained with the opposite parties at the rate of 12% per annum from the respective dates of deposit till realization, as per Rule 17 of PAPRA. Besides this, the complainant is also entitled to suitable litigation costs and other expenses.

18. So far as the complaint against Sh. CVS Sehgal-opposite party No.3 is concerned, it needs to be mentioned that he has since resigned from the services of opposite party No.1-Company, as is evident from Resignation Letter dated 01.12.2018 Ex.OP-3/1 and his account has been settled, vide Full and Final Settlement document Ex.OP-3/2; though he has alleged that his arrears have not been fully paid. The complaint has been filed on 24.09.2019 i.e. after the

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resignation of opposite party No.3. Even otherwise, opposite party No.3 was appointed as General Manager (Commercial), vide Appointment Letter dated 18.03.2009 Ex.OP-3/3 on fixed salary of ₹1 lac per month+ vehicle +mobile and other benefits. Various allottees lodged complaints against the Company and its

Chairman/Directors/officials for non-delivery of possession of units in time. Sh. G.S. Johar, Chairman of the Company, vide letter dated 05.09.2018, Ex.OP-3/10, requested the Senior Supdt. of Police, District S.A.S. Nagar, Mohali to delete name of opposite party No.3 from FIR No.0150 dated 14.08.2018, on the grounds that he was just an employee of the Company and not a Director, shareholder or promoter. The Deputy Supdt. of Police, City-1, District S.A.S. Nagar, Mohali conducted thorough investigation and prepared detailed report dated 03.10.2018 Ex.OP-3/13, to the effect that opposite party No.3 was just an employee of the Company and the amount deposited by the investors was deposited in the account of the Company only. He was appointed as authorized signatory by the Directors of the Company. Therefore, opposite party No.3 was declared to be not guilty and it was recommended that after holding him innocent, further proceedings may be initiated against the remaining offenders. In view of this cogent and convincing evidence, for the fault, deficiency in service and unfair trade practice adopted by the opposite parties No.1 & 2, opposite party No.3 cannot be held liable, as he was just an employee of the Company and has since resigned from its services.

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Therefore, the complaint against opposite party No.3 is liable to be dismissed.

19. Accordingly, the complaint is partly allowed against opposite parties No.1 & 2 only and the same is dismissed against opposite party No.3. Following directions are issued to opposite parties No.1 & 2:

i) to deliver actual and physical possession of the unit, in question, complete in all respects, along with agreed facilities and amenities with Completion/Occupation Certificate issued by the competent authority, subject to payment of balance sale consideration, without any interest and penalty, and to execute the Sale/Conveyance Deed in favour of the complainant;

ii) to pay compensation for delay in delivery of possession of the unit, in question, at the rate of 12% per annum on the amount deposited by the complainant with effect from 15.12.2013 till delivery of possession of the unit, in question, as ordered above; and

iii) to pay ₹23,000/- as litigation expenses and other expenses.

iv) The remaining sale consideration payable by the complainant shall be adjusted from the above said liability of opposite parties No.1 & 2.

20. In case they fail to comply the aforesaid directions, then in the alternative, they shall:

i) refund the entire amount deposited by the complainant i.e. ₹22,77,625/-, along with compensation for causing financial loss

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and depriving the complainant of the use of the said amount during the period it remained with opposite parties No.1 & 2 at the rate of 12% per annum from the respective dates of deposit till realization as per Rule 17 of PAPRA; and

ii) to pay ₹23,000/- towards litigation costs and other expenses.

21. The compliance of this order shall be made by opposite parties No.1 & 2 within a period of 60 days of the receipt of certified copy of the order.

22. The complaint could not be decided within the stipulated timeframe, due to heavy pendency of Court cases the lockdown enforced in the entire country, in view of the advisory issued by the Ministry of Health & Family Welfare, Government of India, to avoid the mass gathering due to threat of COVID-19.

(JUSTICE PARAMJEET SINGH DHALIWAL)

PRESIDENT

July 17, 2020. (Gurmeet S)

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