Back
CHANDIGARH STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Mr. Justice Jasbir Singh, President, Mr. Dev Raj and Mrs. Padma Pandey, Members
SARBJIT SINGH - Appellant
Versus
PUMA REALTORS PVT. LTD. - Respondent
Complaint Case No. 266 of 2016
Decided on : 14-09-2016
Mr. Sandeep Bhardwaj, Advocate, for the Complainant; Mr. Ramnik Gupta, Advocate, for the Opposite Party
The existence of an arbitration clause in an agreement does not bar the Consumer Fora from entertaining a consumer complaint, as the remedy provided under the Consumer Protection Act, 1986 is in addition to and not in derogation of any other law for the time being in force.
Headnote:
CONSUMER PROTECTION ACT, 1986 - SECTION 3 - ARBITRATION AND CONCILIATION ACT, 1996 - SECTION 8 - HOUSING CONSTRUCTION - SERVICE - CONSUMER DISPUTE - JURISDICTION - TERRITORIAL JURISDICTION - UNFAIR TRADE PRACTICE - DEFICIENCY IN SERVICE - REFUND - INTEREST - COMPENSATION - COST OF LITIGATION - PENAL INTEREST.
Fact of the Case:
The complainant booked a residential plot in the project of the opposite party. He made payments as per the payment plan. However, the possession of the plot was not delivered to him within the stipulated time. The complainant visited the site and found that the development work was going on at a snail's pace. He continued to make payments under threat given by the opposite party that in case payment is not made, the plot allotted will be cancelled. The complainant received an offer letter for possession of the plot, but he found that there was no approach road to the project, plots were not marked, boundary wall was not constructed, internal roads were not ready, electricity, water and other facilities were not available, and sewerage treatment plant was not installed. The complainant filed a consumer complaint seeking refund of the amount paid, compensation for mental agony and physical harassment, and cost of litigation.
Finding of the Court:
1. The complainant is a consumer as defined under Section 2(1)(d) of the Consumer Protection Act, 1986 (the Act). 2. The opposite party is providing a service as defined under Section 2(1)(o) of the Act. 3. The complaint involves a consumer dispute and is maintainable. 4. This Commission has territorial jurisdiction to entertain and decide the complaint. 5. The opposite party failed to complete the development and construction within the stipulated period and was deficient in rendering service. 6. The offer of possession made by the opposite party is nothing but a paper possession, which is not sustainable in the eyes of law. 7. The act of the opposite party in offering paper possession of the unit, in the absence of development work, basic amenities at the site, non-obtaining of necessary permissions including completion certificate, amounted to deficiency in providing service and also adoption of unfair trade practice.
Issues: 1. Whether the complainant is a consumer as defined under Section 2(1)(d) of the Act? 2. Whether the opposite party is providing a service as defined under Section 2(1)(o) of the Act? 3. Whether the complaint involves a consumer dispute and is maintainable? 4. Whether this Commission has territorial jurisdiction to entertain and decide the complaint? 5. Whether the opposite party failed to complete the development and construction within the stipulated period and was deficient in rendering service? 6. Whether the offer of possession made by the opposite party is nothing but a paper possession, which is not sustainable in the eyes of law? 7. Whether the act of the opposite party in offering paper possession of the unit, in the absence of development work, basic amenities at the site, non-obtaining of necessary permissions including completion certificate, amounted to deficiency in providing service and also adoption of unfair trade practice?
Ratio Decidendi: 1. The definition of 'consumer' under Section 2(1)(d) of the Act is wide enough to include a person who hires the services of a builder/developer for purchasing a plot. 2. Housing construction or building activity carried on by a private or statutory body constitutes 'service' within the ambit of Section 2(1)(o) of the Act. 3. A complaint involving the deficiency in service in relation to housing construction is a consumer dispute and is maintainable under the Act. 4. The territorial jurisdiction of a Consumer Commission is determined by Section 17 of the Act, which provides that a consumer complaint can be filed before the State Consumer Disputes Redressal Commission within the territorial jurisdiction whereof a part of cause of action arose to the complainant. 5. A builder/developer is deficient in rendering service if it fails to complete the development and construction within the stipulated period. 6. An offer of possession of a plot, which is not accompanied by the completion of development work, basic amenities at the site, and the obtaining of necessary permissions including completion certificate, is nothing but a paper possession and is not sustainable in the eyes of law. 7. The act of a builder/developer in offering paper possession of a unit, in the absence of development work, basic amenities at the site, non-obtaining of necessary permissions including completion certificate, amounts to deficiency in providing service and also adoption of unfair trade practice.
Final Decision: The complaint is partly accepted. The opposite party is directed to refund the amount of Rs. 66,30,754 to the complainant, along with interest @ 12% compounded quarterly, from the respective dates of deposits, onwards. The opposite party is also directed to pay compensation in the sum of Rs. 3 lacs for causing mental agony and physical harassment to the complainant, and cost of litigation to the tune of Rs. 50,000. The payment of awarded amounts shall be made by the opposite party to the complainant within a period of 45 days from the date of receipt of a certified copy of this order, failing which, it shall be liable to pay the amount mentioned at Sr. No.(i), along with penal interest @ 15% compounded quarterly, instead of @ 12% and interest @ 12% compounded quarterly, on the amount mentioned at Sr. Nos. (ii) and (iii), from the date of filing of this complaint, till realization.
ORDER
Mr. Justice Jasbir Singh, President - The complainant vide application dated 19.2.2011, applied to the opposite party, for purchase of a residential plot, in its project, namely IREO Hamlet, Sector 98, Mohali, Punjab. Along with the application form, an amount of Rs. 6,50,000, was deposited by the complainant, as booking amount. Vide provisional allotment letter dated 29.4.2011, the complainant was allotted residential plot bearing No. 207, measuring 246.97 square yards, in the said project @ Rs.23,000 per square yard. To make payment, the complainant was offered time linked payment plan. 95% of the total sale consideration was to be paid within 18 months from the date of booking and remaining 5% of the sale consideration plus (+) other charges were to be paid on delivery of possession of the plot, in question. Plot Buyer's Agreement (in short the Agreement) Annexure C-2 was executed between the parties, on 26.7.2011. Total sale consideration of the plot was fixed at Rs. 60,81,660, which included External Development Charges, Preferential Location Charges (PLC), Interest Free Maintenance Security (IFMS), etc.
It was stated that as per Clause 11.1 of the Agreement, after development, physical possession of the plot was to be delivered to the complainant within 24 months, with grace period of 6 months i.e. not later than 30 months, from the date of execution of above Agreement i.e. on or before 25.1.2014. Without getting any consent of the complainant, payment plan was changed from time linked to development linked. The complainant continued to make payments, as and when demanded by the opposite party. However, possession of the plot was not delivered to the complainant, by the stipulated date. By the end of February 2015, the complainant had paid an amount of Rs. 57,97,845, towards price of the plot.
2. It is case of the complainant that during the intervening period, he visited the project site and was astonished to see that development work was going on at a snail's speed. He continued to make payment, even after 25.1.2014, under threat given by the opposite party, that in case payment is not made, the plot allotted will be cancelled. Many a time, he visited the office of the opposite party to know the exact date of offer and delivery of possession of the plot, but he was put off, by giving one excuse or tire other.
3. It is further case of the complainant that without making necessary development at the site and obtaining necessary approvals from the Competent Authorities, possession letter was issued by the opposite party on 4.5.2015. After receipt of above offer letter, the complainant again visited the site and was surprised to see that there was no approach road to the project in question. Plots were not marked. Boundary wall was not constructed. Internal roads were not ready. Electricity, water and other facilities were not available. Sewerage Treatment Plant was not installed at the spot. Other basic amenities were also missing. It was specifically stated by him that qua Sector 98, layout plan was approved by the Chief Town Planner, PUDA, only on 15.5.2013, subject to compliance of many conditions, most of which were incomplete. Completion certificate was not available. To say so, reliance was placed upon information received by a similar situated allottee, by invoking the provisions of Right to Information Act, 2005, vide letters dated 26.2.2015 Annexure C-6 and 3.3.2015 Annexure C-7.
4. Details of deficiencies found qua the project, in question, is given in para No. 14 to 19 of this complaint. It was further stated that as per information dated 2.9.2014, before issuance of offer of possession letter, completion certificate was not obtained by the opposite party from the Competent Authority. It was specifically alleged that offer of possession made vide letter dated 4.5.2015 was only a paper possession and in fact development at the spot was not complete.
5. It was further stated that the aforesaid acts of the op
