Both Developer and Land Owner liable for delay and misrepresentation under consumer protection law, despite contractual ambiguities.

ORDER

1. Challenge in these two First Appeals, under Section 19 of the Consumer Protection Act, 1986 (for short “the Act”), one by M/s. AIPL Ambuja Housing and Urban Infrastructure Ltd, Opposite Party No.3 in the Complaint/Appellant in First Appeal No. 1545/2017 (for short, “the Land Owner”) and the other by the Phoenix Infra Pvt. Ld., Opposite Party No.1 in the Complaint/Appellant in First Appeal No. 1855/2017 (for short, the “Developer”), is to the order dated 23.05.2017, passed by the Punjab State Consumer Disputes Redressal Commission at Chandigarh (for short “the State Commission”) in Consumer Complaint No. 259 of 2015. By way of impugned order, while allowing the Complaint filed by the Complainant/Respondent No. 1 herein, the State Commission has directed both the Appellants/Opposite Parties to refund a sum of ₹30,78,000/- to the Complainant along with interest @ 12% p.a. in terms of Rule 17 of PAPRA; to pay ₹3,00,000/- as compensation for the mental agony and harassment suffered by Complainant and ₹30,000/- as limitation expenses, within a period of 30 days from the receipt of a copy of the order failing which the compensation amount shall carry interest @ 12% p.a. from the date of order till realization.

2. Since both the Appeals emanate from the same impugned Order, these are being disposed of by this common order.

3. Succinctly put, the material facts, giving rise to filing of the Complaint, are that the Opposite Party No.3, the Land Owner was the absolute owner and in possession of 6.13 acres of land located at Khanna, Punjab on which they wanted to develop a Township namely “Dream City” consisting of Plots, Villas, Independent Floors etc. Opposite Party No.1, the Developer through its Authorized Signatory (Opposite Party No.2), entered into a ‘Memorandum of Understanding’ with the Land Owner as its franchisee on 29.09.2012 for purchase of 14640 sq. yards of land for development and construction of multistoried G-2 (ground+ 2 floors) and marketing thereof.

4. The Developer through an advertisement invited the public to invest the amount in the Project, Dream City, with a promise to construct higher quality flats and to hand over possession within a period of 18 months from the date of booking. Being attracted by the advertisement issued by the Developer, the Complainant, a retired Principal from Guru Gobind Singh College, Ludhiana, purchased a flat, i.e. Unit No.1, Block G at Ground Floor having super area of 1350 sq. ft. and 300 sq. ft. lawn in the said township and paid the booking amount of ₹1,50,000/- on 18.11.2012. An agreement to that effect was executed between the Complainant and the Developer on 19.05.2014. As per Clause C of the said Agreement, construction of the Unit was likely to be completed within a period of 18 months of commencement of construction, with a grace period of six months subject to the receipt of requisite approvals and permissions from the concerned authorities. In terms of the Clause D of the Agreement, upon completion of construction of the Unit, written offer of possession/final demand notice was to be issued to the Complainant. According to the Complainant, she paid a total sum of ₹30,78,000/- to the Developer upto January 18, 2013 by raising a loan of ₹20,00,000/- from HDFC Bank.

5. Since the Developer failed to deliver the possession as promised and there was no response to the letters/emails sent to them, the Complainant on 17.03.2015, alleging that a verbal promise was made to hand over possession by September 2013; no compensation had been paid for delay and not even a single floor had been completely constructed, wrote a letter to the Developer and requested them to return the hard ea