M/S. S.S. SINGLETON THROUGH ITS AUTHORIZED PARTNER, SHRI RUNWAL SUYOG SURESH vs SANTOSH PRADIP PATIL & ORS.

These four appeals as detailed in the heading above, have been filed under section 19 read with section 21(a)(ii) of the Consumer Protection Act, 1986 and arise out of a common order dated 09.12.2016, passed by the Maharashtra State Consumer Disputes Redressal Commission (hereinafter referred to as ''the State Commission'') in consumer complaints Nos. 37/2015, 38/2015, 39/2015 & 40/2015, made by the respondents in these appeals. The State Commission partly allowed the complaints vide impugned order.

The brief facts of the case are that the appellant is a builder/developer, carrying business in the name and style as "Shamit Singleton". On information about a residential project of the said opposite party/OP Builder at village Nakshtrawadi, District Aurangabad, the complainants approached him for purchase of flats in the said project. The complainants in consumer complaints No. 37/2015, 38/2015 and 39/2015 booked their flats on 23.11.2012, whereas the 4 th complainant booked his flat on 22.06.2013. The builder-buyer agreements for the sale of flats were also executed between the parties. In two cases, the said agreements were executed on 28.03.2013, in the 3 rd case on 31.08.2013 and in another case on 22.10.2013. The details of the flats booked, the total consideration and the amounts paid to the OP Builder are as follows:-

Sl. No. CC No. Name Flat booked Total Consideration Amount Paid Balance

1 37/15 Santosh Patil & Deepali Patil A-408 20,00,000 19,76,800 23,200

2 38/15 Roza Pathade & eknath Pathade A-701 20,00,000 17,75,000 2,25,000

39/15 Vaibhav Bhagat B-609 20,00,000 19,00,000 1,00,000

40/15 Sachin Kahandal_& Shalaka Kahandal A-315 17,50,000 16,61,500 88,500

The case of the complainants is that as per the agreements, the possession of the flats was to be handed over to them by the OP builder by September, 2014 but the OP Builder failed to meet his commitment, resulting in physical and financial hardship to the complainants, as they had to stay in rented premises and had to pay interest on the loans advanced by the Banks. The complainants contended that despite receiving payment of more than 90% of the total consideration, the OP Builder did not deliver the possession to them as per schedule. They filed the consumer complaints in question, seeking directions to the OP Builder to complete the construction and hand over the possession of the flats to them and also execute and register the sale deeds in their favour. It was also prayed that if the OP Builder was not in a position to deliver the possession, he should be directed to refund the amount deposited with them alongwith interest @24% p.a. and also make payment of the money received for registration charges, stamp duty etc. The complainants also demanded compensation on various amounts on account of mental harassment and cost of litigation etc.

In the written version filed by the OP builder before the State Commission, it was contended that the complainants did not come under the category of ''consumer'' and the complaints were bad for non-joinder of partners of the OP builder firm. It was also stated that the complainants did not pay instalments of the sale consideration in time, because of which, the construction could not be completed as per schedule. It was also stated in the reply that the construction had been completed upto 80% and that the possession of the flats shall be handed over in March 2017.

After considering the averments made by the parties, the State Commission concluded that the complaints were maintainable under the Consumer Protection Act; these were not bad for non-joinder of parties; and that the OP Builder had not been able to offer possession of the flats, despite receiving 90% of the amount from the complainants and hence, had indulged in deficiency in service. The operative portion of the order passed by the State Commission is as follows:-

"1. All the four complaints being CC No. 37/2015, 38/2015, 39/2015 & 40/2015 are partly allowed.

The opponent builder is directed to complete the construction work of the flats in question in all respects and hand over the possession of the same to respective complainants on or before 31st March, 2017, after receiving the balance amount of consideration as shown in the statement in para-3 of judgment.

In the event of failure to hand over the possession of flats to the respective complainants on or before 31st March, 2017, the opponent builder shall refund the amount of consideration paid by the respective complainants as shown in the statement given in para-3 above along with interest @10.75 % p.a. from 01.10.2014 fill the date of refund of the amount.

The opponent builder is further directed to pay to each of the complainants the amount of Rs.1,42,980/- spent by them towards stamp duty, registration charges etc. along with interest @ 9% p.a. from 01.10.2014 till the realization of the entire amount.

The opponent builder is also directed to pay to each of the complainants a compensation of Rs.50,000/- towards mental and physical harassment and Rs.10,000/- as cost of the complaint, within 30 days from the date of receipt of this order."

Being aggrieved against the orders passed by the State Commission, the OP Builder is before this Commission by way of the present first appeals.

During arguments before us, the learned counsel for the appellant submitted that the construction of the flats in question, was almost complete. Work was in progress to complete the amenities in the project. The learned counsel stated that although they had committed that the flats shall be completed and handed over by 31.03.2017, they required further time of five months and shall be able to deliver the possession of the flats by 31.08.2017. The learned counsel stated that the construction got delayed due to various problems like water scarcity etc. but the appellants were ready to pay the amounts spent by the complainants by way of rent etc.

Per contra, the learned counsel for the respondents contended that despite giving commitment about handing over the possession, the OP Builder failed to complete the construction in time. The flats in question were still incomplete and the common facilities/amenities had not been provided so far. The learned counsel argued that they had already suffered a lot at the hands of the builder, as they had to pay interest on the amount borrowed from the banks and also had to pay rent for the accommodation hired. The complainants were interested to get refund of their money only, alongwith interest.

We have examined the entire material on record and given a thoughtful consideration to the arguments advanced before us.

The first issue that requires our consideration is whether the complaints are maintainable under the Consumer Protection Act, 1986; or the complainants should have availed remedy under the Specific Performance Act for the performance of the contract entered between the parties. The facts of the case make it clear that there is a valid builder- buyers'' agreement between the parties, according to which, the OP Builder was required to hand over the constructed flats within the time schedule laid down in the same. The factum of acceptance of substantial part of consideration amount by the OP Builder from the complainants has not been denied by them. It is evident, therefore, that the complainants have availed of "service" regarding "housing construction" from the OP builder as defined under section 2(o) of the Consumer Protection Act, 1986. The complainants, therefore, do fall under the definition of ''consumer'' under the Consumer Protection Act, 1986 and hence, they were competent to file the present consumer complaints.

The State Commission have already clarified in the impugned order that under section 3 of the Consumer Protection Act, 1986, the complainants are competent to avail of the additional remedy as provided under the Consumer Protection Act, 1986. The contention of the OP Builder, therefore, that the complainants should have approached the Civil Court under the Specific Performance Act only is, therefore, without any force. The other contention made by the OP Builder that the complainants booked the flats for investment/commercial purpose etc. has also not been proved by any documentary evidence on record. It is held, therefore, that the State Commission rightly observed that the complainants do come under the definition of ''consumer'' and the complaints were maintainable under the provisions of the Consumer Protection Act, 1986.

On the issue of non-joinder of parties, the State Commission have given a finding in the impugned order that the agreement of sale was executed by the said firm through its authorised partner, namely, Runwal Suyog Suresh. The Complainants have rightly made only the authorised partner as the opposite party in the case and hence, the complaints do not suffer from any defect like the non-joinder of necessary parties.

The main issue that requires our consideration is whether deficiency in service on the part of OP Builder is established on account of the fact that they failed to deliver the possession of the flats in time.

From the facts on record, it is abundantly clear that more than 90% of the payment has been made by the complainants to the OP Builder after raising loans from commercial banks or from their own sources. The allegation raised by the OP Builder that the payment was not made in time, does not hold any ground in the present cases, as the possession of the property in question could not be handed over by September 2014. Even if some part of the payment was not made in time, that does not provide any justification for the OP Builder to delay the construction of flats, considering the fact that a time of more than two years have already passed and the flats have not been delivered to the complainants till date. Further, no evidence has been produced on record to show that there was any shortage of material like cement, steel, sand etc., or there was any scarcity of water in the area. Unless convincing evidence is provided to explain the factors on account of which the delay is stated to have taken place, the contention of the OP Builder cannot be believed or taken into consideration to the detriment of the complainants / consumers. The plea taken by the OP Builder that they had provided some discount to the complainants in the price of the flats, or they had paid the rental amount to them for certain period, does not absolve them from the responsibility of delivering the possession of the flats in time.

As mentioned in the impugned order of State Commission, the OP Builder had undertaken to complete the construction work and hand over the possession of the flat to the respective complainants by the end of January 2017. In the written version filed by the OP Builder on record, a commitment has been given that the possession will be handed over by the end of March 2017. Vide impugned order, the State Commission allowed time to the OP Builder to complete the construction work of the flats in all respects and hand over the possession of the same on or before 31.03.2017. The facts on record, however, indicate that the OP Builder has not been able to fulfil the undertaking given by them in their own written version before the State Commission, and are asking for a further time of 5 months to complete the construction of the flats. In the absence of any concrete commitment or statement on oath in this regard, it is not possible to accept the version of the OP Builder that they shall be able to deliver the flats by the end of August 2017 even. The deficiency in service on the part of the OP Builder is, therefore, writ large, based on the facts on record.

Similar issues have been discussed in the orders passed by this Commission from time to time in the recent past. In " Swarn Talwar & Ors. vs. United Ltd. " [ CC No. 347/2014 decided on 14.08.2015 ] and allied matters, this Commission ordered refund of amount deposited alongwith simple interest @18% p.a. as a comprehensive, all-inclusive compensation since the builder failed to offer possession of the flats to the complainants within the time agreed between the parties as per the builder and buyers'' agreement.

Further, in an order passed by this Commission in " Puneet Malhtora vs. Parsvnath Developers" [CC No. 232/2014 decided on 29.1.2015] , it was held as follows:-

"Since the opposite party could not compete the projects in which the residential flats were booked by the complainants, either within the agreed time of thirty-six months or even within a reasonable time thereafter, and even today the projects are nowhere near completion, the complainants are entirely justified in seeking refund of the amount, which they had paid to the opposite party."

In the present cases, therefore, the demand of the complainants seeking refund of the amount deposited by them alongwith interest is fully justified.

In their well-reasoned detailed orders, the State Commission directed the OP Builder to hand over the possession of the properties by 31.03.2017, but on their failure to do so, they were directed to refund the amount paid by the complainants alongwith interest @10.75% from 01.10.2014 till the date of refund of the amount. It is quite evident that while passing the said order, the State Commission have allowed interest to the complainants on the same rates as they were required to pay to their respective banks. The said interest has been allowed from 01.10.2014, i.e., for the period after the promised date of possession in September 2014. It is clear that the OP Builder have used and enjoyed the amounts deposited by the complainants much earlier and there could be justification for the grant of interest for the previous period as well. However, considering the fact that the complainants have not challenged the order of the State Commission, we deem it appropriate to retain the rate of interest as well as the period from which it has been allowed at the same level.

From the foregoing discussion, it is clear that there is no merit in the present appeals, which could justify any modification in the impugned order passed by the State Commission. All the four appeals are, therefore, ordered to be dismissed and the impugned order passed by the State Commission is upheld. There shall be no order as to costs.