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2021 Supreme(SC) 12

SUPREME COURT OF INDIA
Dhananjaya Y.Chandrachud, Indu Malhotra, Indira Banerjee, JJ.
IREO GRACE REALTECH PVT. LTD — Appellant
Versus
ABHISHEK KHANNA AND OTHERS — Respondents
Civil Appeal No. 5785 of 2019 with Civil Appeal No. 7615 of 2019; Civil Appeal No. 7975 of 2019; Civil Appeal No. 8454 of 2019; Civil Appeal No. 8480 of 2019; Civil Appeal No. 8482 of 2019; Civil Appeal No. 8785-94 of 2019; Civil Appeal No. 9139 of 2019; Civil Appeal No. 9216 of 2019; Civil Appeal No. 9638 of 2019 and Civil Appeal No. 3064 of 2020
Decided on : 11-01-2021

Headnote:

The present batch of Appeals has been filed by the Appellant-Developer, to challenge the judgment passed by the National Consumer Disputes Redressal Commission ("National Commission") directing refund of the amounts deposited by the Apartment Buyers in the project "The Corridors" developed in Sector 67-A, Gurgaon, Haryana, on account of the inordinate delay in completing the construction and obtaining the Occupation Certificate.

Issues: 1. Determination of the date from which the 42 months period for handing over possession is to be calculated under Clause 13.3, whether it would be from the date of issuance of the Fire NOC as contended by the Developer; or, from the date of sanction of the Building Plans, as contended by the Apartment Buyers; 2. Whether the terms of the Apartment Buyer's Agreement were one-sided, and the Apartment Buyers would not be bound by the same; 3. Whether the provisions of the Real Estate (Regulation and Development) Act, 2016 ("RERA Act") must be given primacy over the Consumer Protection Act, 1986;(4) Whether on account of the inordinate delay in handing over possession, the Apartment Buyers were entitled to terminate the agreement, and claim refund of the amounts deposited with interest.

Judgement Key Points

How to determine the start date for the 42-month possession period under Clause 13.3 of the Apartment Buyer’s Agreement?

What is the primacy between RERA and the Consumer Protection Act in resolving delays in handover and refunds?

Whether the terms of the Apartment Buyer’s Agreement are unfair and one-sided, and whether buyers are entitled to terminate and refund due to delays.


JUDGMENT

Indu Malhotra, J.

The present batch of Appeals has been filed by the Appellant-Developer, to challenge the judgment passed by the National Consumer Disputes Redressal Commission ("National Commission") directing refund of the amounts deposited by the Apartment Buyers in the project "The Corridors" developed in Sector 67-A, Gurgaon, Haryana, on account of the inordinate delay in completing the construction and obtaining the Occupation Certificate. Aggrieved by the said Judgment, the Appellant-Developer has filed the present batch of Appeals under Section 23 of the Consumer Protection Act, 1986 ("Consumer Protection Act").

Since common issues have arisen for consideration, they are being decided by a common Judgment.

For the sake of brevity, the facts in Civil Appeal No. 5785 of 2019 are being referred to as the lead matter.

2. The Department of Town and Country Planning granted a license to Respondent No.3 - Precision Realtors Pvt. Ltd. and Respondent No.4 - Blue Planet Infra Developers and Madeira Conbuild Pvt. Ltd. for developing a group housing colony on a vast tract of land admeasuring about 37.5125 acres where multiple towers comprising of 1356 apartments were to be constructed. Subsequently, the license for construction was transferred to the Appellant - Developer.

3. On 23.07.2013, the Building Plans of the project were sanctioned by the Directorate of Town and Country Planning, Haryana. Clause 3 of the sanctioned Plan stipulated that NOC/ Clearance from the Fire Authority shall be submitted within 90 days from the date of issuance of the sanctioned Building Plans.

4. The Developer opened booking for the apartments in 2013. On 07.08.2013, the Respondent No.1- Apartment Buyer was allotted a 2 BHK apartment in Tower-C of the project. Similar allotment letters were issued to various other Apartment Buyers in the housing project.

5. On 23/24.10.2013, the Developer applied for issuance of an NOC for the Fire Fighting Scheme of the group housing colony to the Commissioner, Municipal Corporation, Gurgaon.

The Commissioner, Municipal Corporation vide letter dated 30.12.2013 raised 16 objections with respect to the proposed Fire Fighting Scheme submitted by the Developer.

The Developer replied to the said objections vide letter dated 22.01.2014, stating that the objections raised by the Commissioner had been rectified. The Developer sought approval of the Fire Fighting Scheme on priority.

The Municipal Corporation vide letter dated 28.03.2014 informed the Developer that the deficiencies in the application for Fire NOC had not been cured. The Developer was granted 15 days' time to cure the defects, failing which, the application would be deemed to be rejected.

Ultimately, on 27.11.2014, the Director, Haryana Fire Service granted approval to the Fire Fighting Scheme subject to the conditions mentioned therein.

6. On 12.12.2013, Respondent No.3 obtained environmental clearance for setting up the group housing project from the State Environment Impact Assessment Authority. Clause 39 of the said clearance stipulated that the project proponent shall submit a copy of the Fire Safety Plan duly approved by the Fire Department before the start of construction.

Under Part-B of the General Conditions in Clause (vi), it was stipulated that the project proponent would obtain all other statutory clearances, such as the approval for storage of diesel from the Chief Controller of Explosives, Fire Department, Civil Aviation Department, Forest Conservation Act, 1980 and Wildlife (Protection) Act, 1972, Forest Act, 1927, PLPA 1900 etc. from the concerned authorities, prior to the construction of the project.

7. The Apartment Buyers vide letter dated 25.03.2014 received a copy of the Apartment Buyer's Agreement with a construction linked payment plan, which is extracted hereunder:

INSTALLMENT PAYMENT PLAN

S. No.

LINKED STAGES

%

TOTAL


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