NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
C. Viswanath, Presiding Member and
Ram Surat Ram Maurya, Member
Rukhsana Shaheen Khan and Anr. – Complainants
Versus
M/s. Amrapali Grand (A Partnership Firm)
and Anr. – Opp. Parties
Consumer Case No.1016 of 2017
Decided on 15.7.2021

IMPORTANT POINTS
(1) Misleading advertisements/non-fulfillment of claims given while advertising property causes serious harassment to homeowners and this practice needs to sufficiently deterred via penalization
(2) Rent cannot be awarded for the period in which possession was not given as there is no precedent
(3) IBC moratorium of a partner does not affect an appeal before NCDRC

Headnote:

Consumer Protection Act 1986, Section 2(1)(r) – Unfair Trade Practice (Consumer Protection Act 2019, Section 2(28) – Consumer Protection Act 1986, Section 13(3B) – Misleading Advertisements (Consumer Protection Act 2019 Section 38(8) – Interim Order - Complainant purchased flat in Opp. Party No. 1’s apartments after being induced by Opp. Party No. 2/bank advertisement on NDTV show “Hot Property” (2007) offering 10% discount on cost on immediate booking – Possession guaranteed by Dec. 2009 – Opp. Parties not able to provide possession and paid EMI as compensation till August 2010, then stopped making payments – Complainant kept trying to get possession – Apartments finally completed in 2013 but no notice of possession given – When asked for possession, Opp. Parties demanded 10% amt. (earlier perceived as discount) with 24% interest p.a. – Complaint filed before National Commission for return of amount paid, along with pendente lite interest and rental cost incurred till date – Opp. Party No. 2/bank argued that bank was not directly involved, its name should be deleted from complaint – Complainant showed screengrab of NDTV and screenshot of Opp. Party No. 2/bank’s website advertising the project - NCDRC put a penalty of Rs. 10 Lakhs on Opp. Party No. 2/bank for its involvement in misleading advertisement on its website as well as NDTV – Commission awarded complainant the amt. paid along with 9% interest instead of 24% acc. to norms – Commission also stated that rent cannot be added to cost due to dearth of precedents – Commission also awarded the complainant Rs. 50,000 as cost of litigation from each Opp. Party.

Held: The complainants filed Interim Application No. 5922 of 2019, for initiating criminal prosecution against Sandeep Bakshi, Chief Executive Officer & Managing Director of ICICI Bank, exercising power under Section 340 Cr.P.C. and awarding exemplary cost of Rs.10,00,000/- against the Bank, for adopting unfair trade practice, in featuring a project, which was not in existence and thereby cheating the customers.

The complainants filed Affidavit of Additional Evidence on 11.09.2018, attaching documentary evidence (i) Printout of the website of ICICI Bank, showing advertisement of Amrapali Grand, mentioning delivery of possession in December, 2009 (ii) Data Analytics Service Provider used by ICICI Bank (iii) Copy of FIR registered against Anil Sharma, CEO of Aprapali Grand (iv) Copy of FIR lodged by Surendra Singh (v) Copies of guidelines issued by RBI.

We have considered the arguments of the parties and examined the record. The counsel for Amrapali Grand raised preliminary objection in hearing/deciding the complaint on merit on the grounds:- (i) The project Amrapali Grand was under the aegis and flagship of Ultra Home Construction Pvt. Ltd. On a petition of Bank of Baroda under Insolvency & Bankruptcy Code, 2016, Case No. (IB) 122 (PB)/2017 was registered against Ultra Home Construction Pvt. Ltd., before National Company Law Tribunal, New Delhi, in which by order dated 04.10.2017, moratorium was declared under Section 14 of the said Code, 2016 as such hearing of this complaint was liable to be adjourned sine die and (ii) Supreme Court in Writ Petition (Civil) No. 940 of 2017, Bikaram Chaterji Vs. Union of India and other connected writ petitions, by its order dated 01.08.2018, freezed Bank Accounts of Amrapali Grand and other company of the groups. By a subsequent order dated 23.07.2019 (reported in Manu/SC/0947/2019) appointed Mr. R. Venkataramani, Senior Advocate of Supreme Court as the Receiver. Home buyers were directed to get their claim, if any, registered before the Receiver, who can refund money with prior approval of the Supreme Court.

From the documents on record, it is proved that ICICI Bank had featured a show on NDTV in 2007 as “Hot Property” Amrapali Grand, discount of 10% on cash down payment and possession in December, 2009, which is still available of its website. Such advertisements were also published in newspapers. But while granting the loan to the complainants, it took U-turn and surreptitiously obtained the signatures of the complainants on a letter, mentioning therein that necessary permission and approval from the concerned authority were still to be obtained by the builder and it would not hold ICICI Bank responsible for any delay or deferment of the said project at any subsequent date. From this letter, it is proved that it was in knowledge of the ICICI Bank that the project of Amrapali Grand was not started at the time of advertisements. ICICI Bank further gave Rs.1,98,717/- to ICICI Lombard General Insurance ltd., from the loan account of the complaints and obtained Insurance Policy of the flat No. T-VI/403, Fourth Floor Amrapali Grand for the period of 31.05.2007 to 30.05.2012, covering risk from fire of the building and its contents and burglary of the contents. Knowing well that at that time, neither the project nor the flat were in existence. Featuring about the date of possession of a project, which was not in existence at the time of advertisement and obtaining its insurance policy incurring huge amount of the complainants is not only unfair trade practice but also amounts to criminal breach of trust. Interim Application No. 20235 of 2017 filed by ICICI Bank is rejected. By way of exemplary cost and punitive damages we impose Rs.10,00,000/- (ten lakh only) upon ICICI Bank (opposite party-2) under general clause of the relief.

Although ICICI Bank sanctioned loan of Rs.71,71,257/- to the complainants out of which, Rs.69,72,540/- was paid to Amrapali Grand on 04.06.2007 through cheque No. 115127 dated 31.05.2007. Hon’ble Supreme Court in GDA Vs. Balbir Singh, (2004) 5 SCC 65 held that the compensation includes actual monetary loss, expected future monetary loss and punitive damages for mental and physical suffering. At present, for monetary loss, in the cases for refund of money is being given by awarding 9% interest on the money which is liable to be refunded along with refund of that money. The complainants could not show any case law in which amount of rent paid was also included in actual loss. From, Email letter dated 22.11.2008 (Exhibit-14) written by the complainants to Managing Director of Amrapali Grand, it is proved that 10% discount of total sale consideration has been denied, in the year 2008. From this it is proved that the dispute regarding payment of discount was raised much before December, 2009. If the complainants have decided to take back their money, for not giving discount of 10%, then it ought to have been done in the year 2008. The complainants are not entitled for damages towards the rent paid by them. Amrapali Grand (opposite party-1) is liable to return Rs.69,72,540/- along with interest a @ 9% per annum from 04.06.2007 till its actual payment. (Paras 8, 12, 17, 20 & 27)

(B) Partnership Act, 1932 – Insolvency and Bankruptcy Code, 2016 – Opp. Parties plead that since the project was made by partnership firm and partner (M/S Ultra Homes Construction Pvt. Ltd.) was under IBC moratorium, the case was liable to be adjourned – NCDRC ruled that case was against the partner and not against the project, it will have no effect on the case – Objections rejected.

Held: Amrapali Grand (opposite party-1) contested the complaint and filed its written statement on 14.12.2017, in which, it has been admitted that Amrapali Grand was a partnership firm, registered under Partnership Act, 1932 and engaged in developing, constructing of multi-story buildings and selling its unit, under self-financing group housing scheme; They advertised about construction of a multi-story building of 3 BHK (configuration 1850 Sq. feet) and 4 BHK (configuration 2950 Sq. feet) residential flats over plot No. GH-09, Sector Zeta-01, Grater Noida, under Cash Down Payment Plan; When the complainant booked 4 BHK flat, then the agreement dated 26.05.2007 was executed in their favour and Rs.69,72,540/- was received on 04.06.2007 through Cheque No.115127 dated 31.05.2007. Opposite party-1 also admitted that cheque No. 018189 of Rs.7,56,675/- was handed over to them on 26.05.2007, at the time of booking of the flat but has stated that it was subsequently returned to the complainants as they agreed to give this amount at the time of possession, they never encashed it. The construction of Amrapali Grand was completed in 2010 and all the buyers (except the complainants) had taken possession over the flats allotted to them in the year 2011. When the complainants approached them for taking possession, the were informed that out of Rs.81,07,550/- i.e. total cost of the flat, they had to pay Rs.69,72,5400/- and remaining sale consideration of Rs.11,35,010/- at time of sale deed and possession. But they did not agree for it under the pretext that at the time of booking of the flat, the were given 10% discount of the total cost. They denied that any such discount was given to the complainants at any time booking. A written agreement for sale was executed between the parties, which does not contain any clause regarding 10% discount or commitment of the construction in December, 2009. The complaint was malafidely filed to extract money from opposite party-1. The complainants did not abide with the terms of the agreement as such it stands cancelled and the complainants were not entitled to any relief. Opposite party-1 has also raised preliminary objection on the ground that entire work of Amrapali Grand was being done under the flagship of M/S Ultra Home Construction Pvt. Ltd., partner (b), which controlled the stake either by itself or through shareholders, directors and partners. The project Amrapali Grand was under the aegis of Ultra Home Construction Pvt. Ltd. On a petition of Bank of Baroda under Insolvency & Bankruptcy Code, 2016 against Ultra Home Construction Pvt. Ltd., Case No. (IB) 122 (PB)/2017 was registered before National Company Law Tribunal, New Delhi, in which, moratorium was declared under Section 14 of the said Code, by order dated 04.10.2017 as such hearing of this complaint was liable to be adjourned sine die. The complaint has been malafidely filed for making exorbitant demand which is an attempt of unjust enrichment and is liable to be dismissed. (Para 3)

Result: Complaint partly allowed, awarded refund with 9% interest. Objections of Opp. Parties dismissed.