M2k Developers (P) Ltd. vs Deepti And Ors.

AGGRIEVED by the order, dated 09.09.2013, in CC No. 61 of 2013 passed by the State Consumer Disputes Redressal Commission, Haryana at Panchkula (for short "the State Commission"), Opposite Party No. 1 has preferred this Appeal under Section 19 of the Consumer Protection Act, 1986 (for short "the Act"). By the impugned order, the State Commission allowed the Complaint and directed the Appellant herein to deliver the possession of Flat No. H -16, FF, Super Area 1720 SFT i.e. 281 sq. yards situated at M2K White House at Sector 57, Mayfield Garden, Gurgaon and in case, the said flat was not available with the Appellant, in that eventuality, to hand over possession of some other alternative flat in the nearby adjoining project, together with compensation and Costs of 5 Lac.

SUCCINCTLY put, the facts which are material to the case are that: The Appellant is a Private Limited Company engaged in development and construction of houses in the name and style of "the White House" in which the Complainant, respondent No. 1 and her husband, respondent No. 2 herein had booked one unit bearing Flat No. H -16, FF, Super Area 1720 SFT i.e. 281 sq. yards in M2K "The White House" at Sector 57, Mayfield Garden, Gurgaon with the Appellant in the proposed site. The Complainant stated that she had paid 5,11,000/ - vide cheque No. 815576 dated 22.01.2008. According to the Complainant, at the time of booking, it was assured by the Appellant that the flat booked was a corner flat. But subsequently, in the month of September 2010, she came to know that this house was not a corner house, but a single sided one.

THE Appellant addressed a letter dated 09.02.2008 asking the Complainant to pay the balance amount of 5,70,000/ - which was made by her vide cheque No. 623664 dated 08.05.2008. Thus, the Complainant had paid in all an amount of 10,81,530/ -. The grievance of the Complainant was that as per the agreement executed between the parties, the construction of the flat in question was to be completed within 18 months but the Appellant did not adhere to the terms and conditions of the allotment letter. While so, Appellant issued a letter dated 18.07.2009 stating that the unit was booked in joint names and for that reason, the Appellant was unable to initiate any action. On 04.08.2009, the matrimonial case filed by the Respondent No. 2 against the Complainant was resolved having been withdrawn and thereafter, a joint letter dated 06.08.2009 was sent to the developer which was acknowledged by them. Thereafter, no communication was received by the Complainant qua installments. While so, on 04.11.2010, the Appellant issued a letter intimating the Complainant that allotment of the subject flat has been cancelled. Hence the Complainant filed the Complaint bearing No. 8 of 2011 before the State Commission seeking direction to the Appellant Developer to accept the balance payment and register the said flat in her name with compensation and costs. Vide order dated 28.03.2012, the State Commission dismissed the said Complaint in default for want of prosecution as none was present on behalf of the Complainant on the said date. On an Appeal filed by the Complainant, this Commission vide order dated 19.07.2013 remitted the case back to the State Commission to decide the same in accordance with law. Appellant/Opposite Party No. 1 contested the matter before the State Commission stating that the Complaint was not maintainable for the reason that the Complainant had agreed to the terms and conditions of the contract executed between her and the Appellant. It was pleaded that the Complainant and the Respondent No. 2, who is her husband, had jointly approached the Appellant on 21.01.2008 for allotment of residential unit Flat No. H -16, FF, Super Area 1720 SFT i.e. 281 sq. yards in M2K "The White House" at Sector 57, Mayfield Garden, Gurgaon in their project for a total consideration of 52,25,304/ -, against which an amount of 5,11,000/ -, i.e., 10% of the basic sale price was deposited jointly by the Complainant and Respondent No. 2 and Flat No. H -16, FF, Super Area 1720 SFT i.e. 281 sq. yards in M2K "The White House" at Sector 57, Mayfield Garden, Gurgaon was allotted to them in joint name and they were informed that the said unit would be made available subject to compliance of certain formalities and timely payment of all dues. Several letters were issued by the Appellant on 29.03.2008, 07.05.2008, 16.06.2008 and 08.08.2008 requesting the Complainant to submit certain documents such as PAN Card, Residence Proof, Specimen Signatures etc. but the Complainant failed to submit the same. Numerous reminders/letters were also sent between 27.03.2008 and 18.08.2008 but there was no response from either of the Respondents.

AS per Clause 13 of the applicant/contract, "non -execution of Flat Buyer Agreement" within a period of 30 days of dispatch by the Company shall be treated as an event of default on the part of the Complainant and the Respondent No. 2, and the same was informed to the Complainant vide letter dated 01.02.2008 and reminder letters dated 27.03.2008, 19.04.2008, 12.05.2008, 05.06.2008, 14.07.2008 and 18.08.2008. A demand note dated 09.02.2008 for payment of 5,70,061/ - was issued and reminders again sent on 10.03.2008, 25.03.2008, 02.04.2008, 15.04.2008 and a final notice on 26.04.2008 to make the outstanding payment within 10 days, failing which the allotment would be cancelled. On receipt of the final letter dated 26.04.2008, the Complainant and the Respondent Party No. 2 paid 5,70,000/ - vide a joint account cheque dated 08.05.2008.

ANOTHER demand note for 5,70,530/ - was made on 09.05.2008 as per the construction linked payment plan with the due date fixed on 24.05.2008. The Complainant and the second Respondent again failed to honour the agreed terms of Clause 16 of the Application/contract. Reminders were sent on 02.06.2008, 16.06.2008, 01.07.2008 and 28.07.2008.

A demand note for 5,10,530/ - was sent on 03.09.2008, as per the construction linked payment plan and a final notice dated 20.01.2009 was issued as a last and final opportunity to the complainant to pay the outstanding installment for the amount of 15,91,652/ - within 15 days with the clear stipulation that in case of nonpayment of outstanding payment, the registration would stand cancelled forthwith.

THE second Respondent vide his letters dated 03.03.2009 and 17.03.2009 informed the Appellant that there was matrimonial dispute between the Complainant and him and requested that no transfer be made in respect of the subject flat in favour of the Complainant.

ON completion of brick work, a demand notice was sent on 07.07.2009 for payment of 23,57,446/ - but the same was not paid. A series of reminders was sent but there was no response. However, on 06.08.2009 the Complainant and the second Respondent submitted a handwritten letter stating that the matrimonial disputes were all settled and that both of them were interested in continuing with the project and asked for a time period of 1 1/2 months to make the balance payment. But the Complainant and the second Respondent did not make any payments and the Appellant by virtue of their legal rights under the terms of the application/contract, addressed a letter dated 18.07.2009 cancelling the allotment and requesting the Complainant and the second Respondent to collect the balance amount after forfeiting the earnest money as per the terms of the contract. Thereafter, a Flat Buyer Agreement dated 18.01.2011 was executed between the Appellant and M/s. Vidhan Builder Private Limited, who subsequently, sold the said flat to one Mr. Gursharan Singh and the possession of the flat was also handed over. As per Clause 16 of the application/contract, it was agreed by the Complainant and the second Respondent that in case of allotment being terminated/cancelled, the Appellant shall be free to allot/sell the flat to a new applicant/buyer on the terms and conditions as deemed fit by the developer. Hence, the Appellant submitted that there was no deficiency in service on their part.

THE State Commission based on the evidence adduced, allowed the Complaint and observed as follows: "Though the opposite parties had raised the plea that they had further sold the unit to M/s. Vidhan Builders Pvt. Ltd. and the said purchaser further sold the unit to one Gursharan Singh, to whom the possession has already been delivered. However, these documents placed on the file in the shape of Ex.R -1 to Ex.R -15 show the fabrication of the documents. On being specifically put to the learned counsel for the opposite parties to show the authorization/permission to occupy the premises granted by Town and Country Planning Department, which is the controlling authority, learned counsel had no answer to this. Undisputedly, the builder cannot occupy the project and hand over possession unless a developer gets sanction to occupy the premises from Town and Country Planning Department. The opposite parties failing to produce any document indicate that the documents have been manipulated to frustrate the right of complainant of her legitimate due. Thus, the fact and circumstances of the case clearly establish it a case of deficiency in service on the part of the opposite party No. 1. The opposite party No. 1 in order to hide its own default, by taking false plea cancelled the allotment of complainant''s flat, which act of the opposite party No. 1 cannot be allowed to sustain.

For the reasons recorded above, this complaint is accepted and direction is given to the opposite party No. 1 to deliver the possession of flat bearing No. H -16, FF, Super Area 1720 SFT i.e. 281 sq. yards in M2K White House at Sector -57, Mayfield Garden, Gurgaon without any further delay. In case the above said flat is not available with the opposite party No. 1, in that eventuality, the opposite party No. 1 is directed to hand over possession of some other alternative flat in the nearby adjoining project in fully developed area. Complainant is awarded compensation of 5,00,000/ - (Rupees Five Lakhs) for mental agony, harassment as well as cost of litigation."

AGGRIEVED by this order, the developer preferred this Appeal.

HEARD learned Counsel Mr. Sumesh Dhawan and Ms. Deepti Gupta, the Complainant in person.

THE facts not in dispute are that the Complainant and the second Respondent jointly approached the Appellant on 21.01.2008 for allotment of a residential Flat No. H -16, FF, Super Area 1720 SFT i.e. 281 sq. yards in M2K "The White House" at Sector 57, Mayfield Garden, Gurgaon against total consideration of 52,25,304/ -. It is also admitted that an amount of 5,11,000/ - equivalent to 10% of basic sale price was paid by the Complainant and the second Respondent jointly as booking amount after duly filling in the application form dated 21.01.2008. This allotment was confirmed by the Appellant vide letter dated 01.02.2008 in the joint names of both the Respondents. Thus, Appellant''s case is that despite several reminders on 29.03.2008, 07.05.2008, 16.06.2008 and 08.08.2008, the Respondents did not submit relevant documents with respect to ID proof etc. Thereafter, the Respondents failed to execute the Flat Buyer Agreement within 30 days of dispatch by the Appellant Company, i.e. 03.03.2008. As per the agreed terms of Clause 13 and 29, non execution of Flat Buyer Agreement within a period of 30 days would be treated as event of default. The same was again informed by the Respondents vide letter dated 01.02.2008 and remainders dated 27.03.2008, 19.04.2008, 12.05.2008, 05.06.2008, 14.07.2008 and 18.08.2008.

A demand note was issued on 09.02.2008 for 5,71,061/ - and once again reminders were sent on 10.03.2008 25.03.2008, 02.04.2008 and 15.04.2008. When a final notice was sent on 26.04.2008, when the Respondents paid an amount of 5,70,000/ - through a joint account cheque.

LEARNED Counsel appearing for the Appellant submitted that despite repeated requests, for the balance payments, by demand note dated 09.05.2008 and reminders dated 02.06.2008, 16.06.2008, 01.07.2008 and 28.08.2008, no payments were made. Learned Counsel for the Appellant vehemently argued that another demand notes dated 03.09.2008 and 26.09.2008 for the balance payment of 10,81,121/ - and another demand note dated 12.11.2008 for payment of the 4 installment i.e. total of 15,91,651/ - was totally ignored by the Respondents herein. Learned Counsel further contended that for the matrimonial disputes which admittedly existed between both the Respondents, the payment schedule cannot be altered.

COMPLAINANT /Opposite Party No. 1, who appeared in person, submitted that a letter was addressed jointly by her and her husband on 06.08.2009 seeking 1 1/2 months'' time for making the necessary payments. She submitted that a letter dated 18.07.2009 was addressed to her asking her to pay the installments due along with interest within 15 days from the date of receipt of this letter, failing which her registration would stand cancelled. She submitted that this letter was received by her on 26.07.2009 and within 15 days, i.e. on 06.08.2009 she had referred to this cancellation letter in her reply and sought for continuation of the unit and time for payment. She submitted that on 20.08.2009 the family settlement letter was deposited before the Appellant who also acknowledged the same.

CANCELLATION letter dated 18.07.2009 reads as follows: "THROUGH REGISTERED AD.

July 18, 2009

Ref: WH/2009/914/0408

Ms. Deepti Gupta and Mr. Vipul Gupta 12/13, B Apna Enclave, Near Railway Station, Gurgaon

Sub: Reply to your Letter dated 04.04.2009

Ref: Provisional Unit No. H -16/FF in our Residential Project "The Whitehouse" situated at H Block, Sector -57, Mayfield Gardens, Gurgaon, Haryana

Dear Sir,

We are in receipt of your letter and are thankful to you for sharing your concerns with us. We are glad to reply to your apprehensions as under: -

We would like to inform you that the unit No. H -16/FF was booked in joint name of Ms. Deepti Gupta and Mr. Vipul Gupta and any communication regarding the same shall be entertained by us provided the same is signed by both the Applicant''s or a specific authority is submitted to represent the other Applicant. Please note that as per our record you have not submitted any explicit authority in your favour to act on behalf of Ms. Deepti Gupta. Nevertheless pending receipt of such authority, the concerns are replied as under:

That it is denied that the Floor Buyer Agreement sent to you for execution is one sided and against the Principle of Natural Justice. The Floor Buyer Agreement is based on the equity and all the clauses including raised by you have been incorporated in accordance with the applicable laws, rules, regulation and in synchronization with the terms and conditions of the Application form for allotment of the said Unit duly signed by you.

That for the removal of your doubts, we clarify that the said allotment is NOT SUBJECT TO SIGNING OF APPLICATION FORM and APARMTNET BUYER AGREEMENT; rather the said allotment is SUBJECT TO THE TERMS and CONDITIONS OF THE APPLICATION FORM and APARTMENT BUYER AGREEMENT. Accordingly, in tune with the terms and conditions of the said Application Form and Apartment Buyer Agreement, timely payment of the consideration as per the payment plan signed by you is the essence of the allotment; and you have failed and neglected to adhere to the said payment plan despite of the completion of corresponding construction activity at site and service of our regular demand notes follows by repeated reminders/notices.

Please note that vide our letter dated 20.01.2009, we had extended you a final opportunity to make payment the outstanding dues, even thereafter you chose not to make payment of the dues till date. Nevertheless, we hereby extend you the ultimate opportunity to pay your due installments along with interest within 15 days from the date of this letter, failing which your captioned registration shall stand cancelled.

We shall be glad to serve you for any further assistance.

Thanking you.

M2K Developers Pvt. Ltd.

(Authorised Signatory)

Copy to Ms. Deepti Gupta and Mr. Vipul Gupta 7 -C/843, Faridabad"

THE Appellant does not deny receipt of the handwritten letter by both the Respondents herein, but states that the Respondents did not make any payment on the installments due even after extending their time.

TO the question addressed to the Complainant, who appeared in person, with respect to any payments made between 16.08.2009 and 04.11.2010, she submitted that sincere efforts were made by her but the Appellant refused to accept the same. She also contended that the construction was delayed beyond the stipulated time and the builder did not choose to file the Occupancy Certificate in the Fora below.

WE observe from the record that admittedly, the Occupancy Certificate dated 29.10.2010 was not filed before the State Commission. The learned Counsel appearing for the Appellant submitted that an opportunity was not given to them for filing the said certificate. We do not find any force in this contention of the Appellant herein. Order of the State Commission is dated 09.09.2013 and the Complaint was filed on 15.02.2011. There was a period of two years during which the Appellant could have filed the Occupancy Certificate before the State Commission but did not choose to do so.

NOW we address ourselves to the issue whether the Appellant was right in selling the unit to M/s. Vidhan Builders Private Limited which, in turn, sold the same to one Mr. Gursharan Singh. Learned Counsel appearing for the Appellant submitted that the State Commission had taken 20.06.2011 as a date for agreement between the Appellant and M/s. Vidhan Builders Private Limited but in fact it is a date of endorsement.

LEARNED Counsel for the Appellant contended that there is no deficiency in service on their part as repeated notices and reminders were given to the Respondents/Complainant to make the payments as per Construct Linked Payment Plan, but this was not adhered to, by them. We observe from the record that the Respondents did not show their bonafide by making any payments after 06.08.2009 when they had requested for 1 1/2 months'' time, which is again subsequent to the cancellation letter dated 18.07.2009, and hence now cannot insist for conveyance of the subject flat, which allotment had finally been cancelled vide letter dated 04.11.2010. Further, the Conveyance Deed filed by the Appellant Company shows that the Appellant has executed the Sale Deed in favour of Mr. Gursharan Singh on 03.10.2013. The learned Counsel for the Appellant also submitted that Mr. Gursharan Singh has already taken possession of the said flat. Apart from not filing the Occupancy Certificate before the State Commission, the Appellant Company was deficient in its services by: "a) retaining the amounts paid by the Complainants herein even after issuing the cancellation letter;

b) entering into the agreement with the third party during the pendency of the Complaint before the State Commission;

c) executing the Conveyance Deed with Mr. Gursharan Singh on 03.10.2013, which is subsequent to the order of the State Commission dated 09.09.2013 thereby making the order of the State Commission unexecutable."

TO the question if any alternate flat can be given in any of the similar projects, learned Counsel for the Appellant submitted that their Company does not have any similar projects coming up in that area.

TAKING into consideration their submissions and also the escalation of the prices, we are of the considered view that the Appellant should refund the amount retained by them i.e. 10,81,530/ -, admittedly paid by the Respondents by two cheques with interest @ 18% p.a. from the respective dates of payments till the date of realization, together with penal costs of 25,000/ -. We are of the considered view that it is a fit case to award interest @ 18% p.a., keeping in view the conduct of the Appellant Company and also the terms and conditions of its Floor Buyer Agreement, which stipulates interest @ 24% p.a. for any default in payments. In the result, this Appeal is partly allowed modifying the order of the State Commission with a direction to the Appellant to refund the amount received i.e. 10,81,530/ - with interest @ 18% p.a. from the respective dates of deposit till the date of realization, and costs of 25,000/ -. Time for compliance is four weeks from the date of receipt of copy of this order.