ATUL MOHAN JOSHI vs SHUBH ENTERPRISE & 3 ORS.

The facts giving rise to the filing of this complaint, as noted in the order of this Commission dated 24.07.2017, can be summarized as under: "The case of the complainant is that OP No.1 allotted a residential flat no. 1004 admeasuring 1060 sq. ft. to him vide a letter dated 11.06.2010 for a total agreed consideration of Rs.73,00,000/-. No specific time period for delivery of possession of the flat to the complainant was stipulated in the allotment letter though the case of the complainant is that OP No.1 had promised to deliver possession by March 2012. It appears that the land on which the building was to be constructed by OP No.1 belongs to OP No.2 D.N. Nagar Manas Cooperative Housing Society Limited which had entered into a construction agreement with OP No.1. Later on, the agreement between OP No.1 & 2 came to be cancelled and OP No.2 entered into an independent agreement with OP No.3 for construction of residential flats on its property. Though an agreement was executed between the complainant and OP No.1 sometime in early 2014 for refund of a total sum of Rs.38,44,740/- to the complainant, the payment in terms of the said agreement was not made to the complainant. Therefore, in view of clause 2.8 of the said agreement, the aforesaid understanding/settlement stood cancelled and the complainant became entitled to the flat which was allotted to him. Since the flat has not even been constructed, the complainant is before this Commission seeking the following reliefs: I. That this Hon. Commission be pleased to hold the opposite party no. 1,guilty of being deficient in providing proper and defect-free services and further guilty of following unfair trade practice.

II. That this Hon. Commission be pleased to direct the opposite party no. 1, firstly to rectify the defects in their services and make the said flat ready viz. Flat No. 1004, approximately 1060 sq. ft. (Super Built Up) area, on the 10 th floor, in the building "Shubh Manas Co-operative Housing Society Ltd., at D.N. Nagar, Link Road, Andheri (West), Mumbai ? 400 058, lying being and situate at immoveable property bearing Survey No. 106-A, City Survey No. 195 (Part), being a saleable component, complete in all respects of construction by obtaining the Building Completion Certificate and the Occupation Certificate, by accepting the balance consideration.

III. That this Hon''ble Commission be pleased to direct the opposite party to execute the proper Agreement for sale in favour of the Complainants pertaining to the said flat viz. Flat No. 1004, approximately 1060 sq. ft. (Super Built Up) area, on the 10 th Floor, in the Building, "SHUBH MANAS Co-operative Housing Society Limited, at D.N. Nagar, Link Road, Andheri (West), Mumbai ? 400058, lying being and situate at immovable property bearing Survey No. 106-A, City Survey No. 195 (Part), being a saleable component, and co-operate with the Complainants in getting the same registered with the Sub-Registrar of Assurances, by accepting the balance payments and hand over quiet, vacant and peaceful possession of the same to the complainants by accepting the balance consideration.

IV. That in the event of opposite party herein is not in a position to hand over the quiet, vacant and peaceful possession of the said flat no. 1004, as per prayer clause (c) above at the earliest, then in the alternative to the above, the opposite party be directed to allot/procure a similar residential flat admeasuring 1060 sq. ft. S Built Up area having similar amenities and standing, to the Complainants in the vicinity of the Flat No. 1004 and/or of the project of the Opposite Party at the costs and expenses of the opposite party.

V. That in the event, the opposite party no. 1 is not in a position to even comply with the directions as per prayer clause (d),t hen in that event, this Hon. Commission be pleased to direct the opposite party no. 1 to reimburse and/or pay to the complainant the prevailing market value of the suit flat to be constructed on the immovable property viz. flat no. 1004, approximately 1060 sq. ft. (Super Built Up) area, on the 10 th floor, in the Building, "SHUBH MANAS Co-operative Housing Society Limited, D.N. Nagar, Link Road, Andheri (West), Mumbai ? 400 058, lying being and situate at immovable property bearing Survey No. 106-A, City Survey No. 195 (Part), being a saleable component, so as to enable the complainant to procure similar such residential flat.

VI. That pending the hearing and final disposal of the present complaint, the opposite parties it''s servants, agents, partners, assigns, nominees and/or any other person/s claiming by under or through them be restrained under the provisions of Sec 13(3)(b), from alienating, encumbering, disposing off and/or creating any their party right title and interest in the said flat viz. Flat No. 1004, approximately 1060 sq.ft. (Super Built Up) area, on the 10 th Floor, in the Building "Shubh Manas Co-operative Housing Society Ltd., at D.N. Nagar, Link Road, Andheri (West), Mumbai ? 400058, lying being and situate at immoveable property bearing Survey No. 106-A, City Survey No. 195 (Part), Being a saleable component, in any manner whatsoever.

VII. That this Hon. Commission be pleased to direct the Opposite party no. 1, to pay to the complainants an amount of Rs.5,00,000/- as and by way of mental torture and agony suffered by the complainants.

That this Hon. Commission be further pleased to direct the Opposite party no. 1, to pay to the complainant an amount of Rs.50,000/- as and by way of cost of the complaint.

VII. Interim and Ad-interim reliefs in terms of prayer clause (e) above, j) Costs of the complaint be provided for ."

The complaint against original OP No.2 D.N. Nagar Manas Co-operative Housing Society Limited and original OP No.3 Manas Gruhpravesh LLP was dismissed by this Commission vide the above referred order dated 24.07.2017.

Coming to the complaint qua OP (originally OP No.1) namely Shubh Enterprise, the complaint has been resisted by the said OP which has admitted the payment of Rs.8,02,000/- from the complainant as well as the allotment letter dated 11.06.2010. He has however, denied the agreement dated January 2014 set up by the complainant. He has also denied having received cash payment of Rs.17,00,000/- from the complainant. It is alleged that when the OP could not refund the principal amount of Rs.8,02,000/- on the project coming to a grinding halt, the complainant pressurized the OP to sign the agreement for receiving the refund of the said amount alongwith interest aggregating to Rs.25,02,000/-. It is further alleged that the agreement was got prepared by the complainant through his advocate and since the OP was in financial doldrums, he had no option but to sign the same without reading its contents, on the last page of the document. The OP has also submitted that on execution of the alleged agreement dated 10.01.2014, the best remedy available to the complainant is to claim the balance amount payable under the said agreement through the process of a Civil Court.

As noted earlier, the OP allotted a flat having super built-up area of about 1060 sq. ft. to the complainant for a total consideration of Rs.73,00,000/-. To this extent, there is no dispute between the parties. It is also not in dispute that the construction of the building in which the flat was to be situated never commenced. The OP also admits his signatures on the agreement of January 2014 relied upon by the complainant. Though the date of execution of the document does not appear on its first page, the stamp paper purports to have been purchased on 10.01.2014 meaning thereby that the said document came to be executed on or after 10.01.2014. In preamble ''C'' of the document, the OP has admitted having received a sum of Rs.17,00,000/- in cash from the complainant in addition to the sale consideration mentioned in the allotment letter. The aforesaid amount is referred as ''other consideration'' in the said agreement and the aggregate of the consideration mentioned in the allotment letter and the other consideration is referred as ''total consideration''. Though the OP has denied having signed the pages other than the last page of the document and the purported signature of the OP on pages 1 to 8 of the document are different from his admitted signature on the last page of the document, the submission of the learned counsel for the complainant is that page 1 to 8 bear initials of the OP whereas the last page bears his full signature. Since the OP admits his signature on the last page of the document and he also admits that the aforesaid document was not a blank document, the same according to him having been got prepared by the complainant, the onus was upon him to explain to this Commission as to why he signed only the last page of the document without going through the contents of the pages comprising the document. There is no satisfactory explanation from the OP as to why he signed the document on its last page without going through and understanding its contents. Moreover, at no stage the OP sent any notice/letter to the complainant alleging therein that he had signed the last page of the document without going through and understanding the contents of the document as a whole. In these circumstances, I am unable to accept the contention that the OP had put his signature on the last page of the document without going through and understanding its contents. Consequently, I have no hesitation in holding that he had also received a sum of Rs.17,00,000/- from the complainant which was referred as ''other consideration'' in preamble ''C'' of the document. The aggregate payment made by the complainant to the OP therefore, stands at Rs.25,02,000/- out of Rs.4,00,000/- have already been received by him.

The next question which arises for consideration is as to whether the complainant is entitled to one or more reliefs sought in the complaint or he is entitled only to the balance amount out of the agreed amount of Rs.38,44,740/- in terms of the agreement dated 10.01.2014. The contention of the learned counsel for the OP, as noted earlier, is that at best, the complainant is entitled to the amount of Rs.34,44,740/- after taking credit for Rs.4,00,000/- which admittedly stands paid to the complainant. Clause 3, 4 & 5 of the agreement dated 10.01.2014 read as under: " 3. It is hereby agreed, declared and confirmed by and between the parties hereto that only upon the receipt of the said refund amount in full, the said allotment letter dated 11th June, 2010 issued by Shubh Enterprise viz. the Developers herein to 1. Mr Atul Mohan Joshi for the allotment of the said flat being Flat No.1004 on the 10th Floor, admeasuring 1060 square feet built up area in the said proposed building, to be constructed in place and stead of the said Building 31 of D N Nagar Manas Co-operative Housing Society Ltd. standing on a piece of land bearing Survey No.106 A corresponding to CTS No.195 (part) lying being and situate at Village and Taluka Andheri and more particularly described in the SCHEDULE OF PROPERTY hereunder written, shall thereafter be deemed to have been mutually revoked, terminated and cancelled and further the same shall only thereafter forthwith be treated as null and void and absolutely ineffective and inconsequential. On the cancellation, termination and revocation of the said allotment letter the same shall cease to be of any effect and the right, title, interest, benefit, claim, demand and/or lien of the purchasers in respect of the said flat and under the said allotment letter shall stand satisfied, released, relinquished and waived. On receipt of the entire refund amount by the purchasers from the developers, the developers shall be entitled to absolutely sell, transfer, assign, dispose of and/or create such third party rights in respect of the flat without any claim, demand, lien of any nature whatsoever from the purchasers or anyone else claiming for and/or on their behalf either jointly and/or severally in respect of the said flat or any part thereof or any other sums of money whether under these presents or otherwise.

In Case of failure on the part of the developers to make the payment of the said refund amount in full to the purchasers on or before the due date, the purchasers shall be at liberty to seek specific performance of the said allotment letter and this agreement and further also be at liberty to exercise all the remedies that may be available under law to the purchasers.

This agreement shall not/never be interpreted as or shall tantamount to the purchasers having reduced or foregone or surrendered any of his/her/their rights or entitlement under the terms of the said allotment letter."

On a conjoint reading of the aforesaid clause, I have no hesitation in holding that in the event of failure of the OP to pay the balance amount of Rs.34,44,740/- to the complainant on or before 31.03.2014, the complainant was entitled to enforce all his rights under the allotment letter dated 11.06.2010. The agreement dated 10.01.2014 in such an event was to become null and void and treated as non-est . Even otherwise, Section 55 of the Contract Act comes into play in such a situation. The aforesaid section reads as under: "55. Effect of failure to perform at a fixed time, in contract in which time is essential.- When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it has not been performed, becomes voidable at the option of the promisee, if the intention of the parties was that time should be of the contract. Effect of failure when time is not essential. ? If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure. Effect of acceptance of performance at time other than that agreed upon.- If, in case of a contract voidable on account of the promisor''s failure to perform his promise at the time agreed, the promisee accepts performance of such compensation for any loss occasioned by the non-performance of the promise at the time agreed, unless, at the time of such acceptance he gives notice to the promisor of his intention to do so." In view of the above referred provision in the Contract Act, since the OP failed to make payment of Rs.34,44,740/- to the complainant on or before 31.03.2014, the complainant stood relied on its obligation to accept the aforesaid amount in full and final settlement of his claim and he became entitled to enforce the legal rights available to him under the allotment letter dated 11.06.2010.

As far as the issue of pecuniary jurisdiction of this Commission which the learned counsel for the OP raised during the course of arguments is concerned, as held by a three-Members Bench of this Commission in CC No.97 of 2016 Ambrish Kumar Shukla & Ors. Vs. Ferrous Infrastructure Pvt. Ltd. , the value of the services in such cases would mean the sale consideration agreed to be paid by the flat buyer to the developer. The said consideration admittedly, was Rs.73,00,000/- even if the disputed amount of Rs.17,00,000/- is excluded from consideration. In terms of Section 21 of the Consumer Protection Act, this Commission would have the pecuniary jurisdiction to entertain the complaint where the value of the goods or services as the case may be and the compensation if any claimed, exceeds Rs.1 Crore. One of the reliefs claimed by the complainant is a direction to the OP to re-imburse and/or pay to him the prevailing market value of the suit flat measuring about 1060 sq. ft. in the building Shubh Manas Co-opeative Housing Society Limited at D.N. Nagar, Link Road, Andheri (West), Mumbai. As per the ready reckoner issued by the Government of Maharashtra, the market value of such a flat on the date of filing of this complaint itself was more than Rs.1 Crore. Therefore, it would be difficult to dispute that this Commission does possess the requisite jurisdiction to entertain the complaint.

Mr. Prabhavalkar states that prayer (e) is only an alternative to prayer ''b'' which in any case is not available to the complainant since the project has already been abandoned. When more than one reliefs are claimed in a consumer complaint, all the prayers including the alternative prayer must fall within the pecuniary jurisdiction of the Commission before which this complaint is instituted. Prayer (e) which is an alternative prayer within the pecuniary jurisdiction of this Commission, the complaint could not have been instituted before any other Court/Forum or this Commission.

The next question which arises for consideration is as to what amount the complainant is entitled as compensation on account of failure of the OP to construct and deliver possession of residential flat having super built-up area of about 1060 sq. ft. to him in terms of the allotment dated 11.06.2010. As noted earlier, the minimum market value of such a flat in the locality in which it was to be situated, was Rs.2,00,000/- per sq. mtr. which comes to Rs.20,156/- per sq. ft. of built-up area. On the last date of hearing, the complainant was requested to approach the Government School of Planning & Architecture to report as to what would be the built-up area of a flat having super built-up area of1060 sq. ft., based upon the norms/practices prevalent in June 2010 in Andheri (West). However, in the absence of approved building plans, the above referred School could not give the required information. The complainant therefore, agrees to accept the built-up area given by the OP for the aforesaid flat. The built-up area according to the OP comes to 776 sq. ft. The market value of a flat of 776 sq. ft. of the built-up area on the date of institution of this complaint, when calculated as per the value given in the ready reckoner given by the Government of Maharashtra comes to Rs.1,56,41,056/-. The aforesaid rate carries escalation to the extent of 5% if the flat is situated on the tenth floor of the building. Applying the aforesaid escalation, the value of a flat having built-up area of 776 sq. ft., on the tenth floor, comes to Rs.1,64,23,108.80p on the date of institution of the complaint. After deducting the agreed sale price of Rs.90,00,000/- from the aforesaid amount, the balance amount comes to Rs.74,23,108.80p (say Rs.74,23,108/-). This amount represents the excess amount which the complainant will have to pay if he is to buy a flat admeasuring 776 sq. ft. of built-up area on the tenth floor of the building on the date of institution of the complaint. Had the OP honoured its obligation under the letter of allotment, the value of the flat today would have been Rs.1,64,23,108.80p. However, this would have been possible only on the complainant making payment of Rs.90,00,000/- to the OP calculating the payment already made by him. He having paid only Rs.25,02,000/- including the amount of Rs.4,00,000/- having already been received back by him. If simple interest @ 12% per annum till the date on which this complaint was instituted, is calculated on the amount which the complainant did not pay, the figure is stated to be Rs.28,58,720/-. The complainant is therefore, entitled to only a sum of Rs.45,64,388/- (Rs.74,23,108/- - Rs.28,58,720/- ) as compensation from the OP, in addition to refund of the balance principal amount of Rs.21,02,000/-.

For the reasons stated hereinabove, the complaint is disposed of with the following directions: (i) The OP shall refund the balance principal amount of Rs.21,02,000/- to the complainant alongwith compensation quantified at Rs.45,64,388/-.

(ii) The payment in terms of this order shall be made within three months from today, failing which it shall carry interest at the rate of 9% per annum w.e.f. three months from today.

(iii) The OP shall also pay a sum of Rs.25,000/- as the cost of litigation to the complainant.