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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
D.K. Jain, President, Vinay Kumar, Member, Mrs. M. Shreesha, Member
M/s. Utopia Projects Pvt. Ltd., A Registered Company Through Its Director, Mr. Ravinder Chohan —Appellant
versus
Shahin Bi Mulla —Respondent
First Appeal No. 1227 of 2014
(Against the Order dated 26/09/2014 in Complaint No. 09/2014 of the State Commission Goa)
Decided on 1.4.2015
For the Appellant:Mr. S.N. Tripathi & Mr. Jayant Chaurasia, Advocates
IMPORTANT POINT
If possession has not been given as per committed date, purchaser of flat has the right to demand refund of amount paid with interest and compensation.
Headnote:Consumer Protection Act, 1986—Sections 17, 19 and 21—Real estate—Agreement for construction of flat—Non-completion of project on time—Reason given by Developer for delay is disputes with contractor—Such disputes cannot be construed to be within ambit of force majeure conditions—Appellant cannot take umbrage under this clause—If possession has not been given as per committed date, purchaser of flat has the right to demand refund of amount paid with interest and compensation—There is no jurisdictional error or infirmity in order of State Commission—Appeal dismissed.
Held: The reason given by the Developer for the delay is ‘Disputes with the Contractor’. Viewed from any angle, such disputes cannot be construed to be within the ambit of ‘force majure conditions’. Therefore, the Appellant cannot take umbrage under this clause.
The State Commission also discussed clause 42(d) of the Agreement which is reproduced as under:
“In the event of a termination of this Agreement all amounts which have been paid pursuant to this Agreement by the Purchaser till the Force Majeure Event shall be applied towards any costs incurred by the Developer in relation to the Project land and/or Building and/or the Property including but not limited to legal and administrative costs. Any remaining sums shall be applied towards refunding a maximum of 50% of any amounts paid by the Purchaser”.
The Appellant cannot rely on the afore-mentioned clause 42 (d) as he had not exercised his right to terminate the Agreement and it is clear that this clause would come into force only in the event of termination of the Agreement.
This Commission in F.A. No. 250 of 2014 between Emaar MGF Land Limited & Anr. Vs. Mr. Amit Puri decided on 30th March, 2015 observed that “in the event of a developer failing to deliver possession of the property within the stipulated period, for any reason, save and except a force majeure condition, agreed to between the contracting parties, an allottee cannot be compelled to accept an alternate site/plot and he would be within his rights to seek refund of the amount deposited with the developer against allotment. Therefore, in our view the plea of the Appellants that since the agreement provides for compensation @Rs.50/- per sq. yd. per month for the delayed period of delivery, neither any compensation for the delay nor interest on the amount deposited can be awarded, is absolutely untenable and deserves to be out rightly rejected”.
Keeping in view the afore-mentioned observation, we are of the opinion that if possession has not been given as per the committed date, the purchaser of the said flat has the right to demand refund of the amount paid with interest and compensation. (Paras 11 to 15)
Result: Appeal dismissed.
M. Shreesha, Member—Aggrieved by the order of the State Consumer Disputes Redressal Commission Goa in Complaint Case No. 09 of 2014, the Opposite Party preferred this Appeal.
2. The brief facts as set out in the Case are that the Complainant entered into an Agreement for Construction and Sale on 24.2.2012 with the Opposite Party for purchase of a Residential Unit No. W A-3 52 in ‘Amar Prem’ Project for a total consideration of Rs.30,00,000/-, which was paid by the Complainant by way of two cheques of Rs.15,00,000/- each dated 23.9.2011 and 24.2.2012 respectively. The Opposite Party/builder had executed an agreement dated 23.7.2010 with M/s. RPC Builders and Developers and obtained the construction licence and plan from the concerned authorities. As per clause 15 (a) of the Agreement, the Opposite Party had to hand over the possession on or before September, 2013, with a grace period of four months. The Complainant visited the site in August 2013 and observed that there was no development at all and even the foundation work was not done. Vexed with the situation, she got issued a legal notice on 29.12.2012 calling upon the Opposite Party to hand over possession of the said flat, complete in all respects and the builder replied vide letter dated 25.1.2013 but did not comply with respect to handing over the possession. Hence, the complaint seeking direction to the Opposite Party to pay compensation in the form of rent at Rs. 8,500/- per month for the delay in handing over the possession from the month of September, 2013; interest at the rate of 18% per annum on Rs.30,00,000/-; compensation of Rs.20,00,000/- towards mental agony and loss of business; Rs.50/- per sq. ft. per month for the entire period of delay as per clause 15 (c) of the agreement or in the alternative direction to the Opposite Party to refund Rs.30,00,000/- with interest @ 18% per annum from the date of signing of the said Agreement till the date of realisation.
3. The Opposite party filed its written version admitting that it had entered into an Agreement with the Petitioner for Construction and Sale of the subject flat on 24.2.2012, for a total consideration of Rs.30,00,000/-. The Opposite Party stated that the construction at the site could not be started due to disputes with the Contractor, who committed breach of the terms of Agreement entered into between them on 23.07.2010, whereby the OP had paid the Contractor in advance and the contractor was demanding extra payment for the properties. The completion date of the project was September, 2013 and hence it was not possible to hand over the possession of the residential flat by January, 2013, i.e. 7 months in advance and there was no question of the Opposite Party failing to comply with the legal notice dated 29.12.2012. The Opposite Party further stated that through their reply they had brought to the notice of the Complainant the factual position and that they were trying to employ a special firm to undertake standard block foundation for the construction and also assured the Complainant that the project had not been grounded. The Opposite Party also contended in its written version that delay due to force majeure conditions attracts clause 42(d) of the Agreement as the circumstances were beyond the control of the builder and also that there was no wilful delay in handing over the possession.
4. The State Commission relied on clause 15 (c) of the Agreement wherein it is provided that if any delay extended beyond the stipulated period, the developer shall be liable to pay the purchasers compensation of Rs. 50/- sq. ft. per month for the entire period of delay. It also discussed clause 42(d) of the Agreement wherein it is stipulated that the developer should exercise his right to terminate the Agreement and only on such termination, the builder can take umbrage under the clause of force majeure.
5. Based on the fact that the Opposite Party had not completed the project on time, the State Commission held tha
