9911796707
TMI Blog2015 (6) TMI 330X X X X Extracts X X X X X X X X Extracts X X X X ..... apartments were initially allotted to some other persons, from whom they were later purchased by the concerned complainants. However, there was no change in the date stipulated in the Buyers Agreement for delivery of possession of the flat. The grievance of the complainants is that neither the possession of the apartments has been given to them nor is the construction complete though the last date stipulated in the Buyer's Agreement for delivery of the possession to them has already expired more than 2 years ago. The complainants are, therefore, before this Commission seeking delivery of the possession of the flats agreed to be sold to them or in the alternative payment of current market value of such houses which is stated to be Rs. 10,000/- per sq. ft. They are also seeking payment of compensation on account of loss of rental income to them with effect from the stipulated date of possession, compensation @Rs. 5/- per sq. ft. as per the agreement entered between the parties and compound interest @18% p.a. with effect from the stipulated date of possession. The complainants are also seeking compensation on account of their mental torture, agony etc. 2. The complaints have been re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pay compensation at the revised rate, i.e., Rs. 13/- per sq. ft., after expiry of the revised date of possession. Yet another condition imposed in the said letter is that post-15.06.2015, the transfree or nominees of the existing allottees shall not be eligible for the revised penalty of Rs. 13/- per sq. ft. per month. It is also stated in the aforesaid letter that if possession is delayed beyond the above-mentioned time limits, revised penalty shall be Rs. 13/- per sq. ft. per month. 5. During the course of hearing, the learned counsel for the complainants stated, on instructions, that the complainants are not interested in taking refund of the money paid by them to the opposite party and they want to have possession of their respective flats even if the said possession is to be delivered in terms of the revised date of possession indicated in the above-referred letter of opposite party. In view of the aforesaid statement, the only question which survives for consideration in these complaints is as to what interest/compensation should be paid to the complainants by the opposite party, till the date the possession is delivered to them. 6. Clause 4.a of the Buyers Agreement reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and over the possession of the apartment to the flat buyers within 36 months from the date of signing the agreement with them. The exceptional circumstances which could justify delay in hand over the possession of the apartments were:- (a) Lock-out (b) Strike (c) Slow-down (d) Civil Commotion (e) War, enemy action, terrorist action, earthquake or act of God and (f) any reason or circumstance beyond the control of the developer. The delay in handing over the possession of the apartments could also be justified if there was to be a new legislation, regulation or order suspending, stopping or delaying the construction of the complex and the apartments. 8. Neither any new legislation was enacted nor an existing rule, regulation or order was amended stopping suspending or delaying the construction of the complex in which apartments were agreed to be sold to the complainants. There is no allegation of any lock-out or strike by the labour at the site of the project. There is no allegation of any slow-down having been resorted to by the labourers of the opposite party or the contractors engaged by it at the site of the project. There was no civil commotion, war, enemy action, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hrough contractors/sub-contractors, the material such as bricks, sand and even water will be arranged by the contractor/sub-contractor and not by the opposite party. As noted earlier, there is no evidence of the opposite party having invited tenders after awarding the work of project in question to the contractors/sub-contractors and there being no response to such tenders. Therefore, I find no merit in the plea that the completion of the project was delayed due to non-availability of water, sand and bricks in adequate quantity. As regards common-wealth games projects work, on those projects was complete before the games were held in October 2010. The project in question on the other hand was required to be completed in phases, beginning end of 2012, i.e., more than 2 years after the aforesaid games were concluded. In any case, it has been more than 4 ½ years since common-wealth games were held and even today the project in question is far from complete. Therefore, there is no merit in the contention that the completion of the project was delayed on account of commonwealth games. Consequently, there is no escape from the conclusion that the delay in construction of the apart ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is true, as contended by Mr. M.N. Krishnamani, that in an appropriate case the Tribunal without trenching upon acute disputed question of facts may decide the validity of the terms of the contract based upon the fact situation and may grant remedy. But each case depends upon its own facts". In PUDA Vs. Mrs. Shabnam Virk II (2006) CPJ 1(SC), it was stated in an advertisement issued by PUDA that the price quoted therein was purely tentative based on the then cost of construction and was likely to be revised on the higher side by the time houses were completed. The respondent before the Hon'ble Supreme Court challenged the demand of the additional cost raised by PUDA. The demand however, was upheld noticing the aforesaid clause in the advertisement. However, a term of a contract, in my view will not be final and binding if it is shown that the consent to the said term was not really voluntary but was given under a sort of compulsion on account of the person giving consent being left with no other choice or if the said term amounts to an unfair trade practice. It was submitted by the learned counsel for the complainants that the term providing for payment of a nominal compensation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pital investment, in case he does not honour his part of the contract by defaulting in giving timely possession of the flat to the buyer. Such a term in the Buyer's Agreement also encourages the builder to divert the funds collected by him for one project, to another project being undertaken by him. He thus, is able to finance a new project at the cost of the buyers of the existing project and that too at a very low cost of finance. If the builder is to take loan from Banks or Financial Institutions, it will have to pay the interest which the Banks and Financial Institutions charge on term loan or cash credit facilities etc. The interest being charged by the Banks and Financial Institutions for financing projects of the builders is many times more than the nominal compensation which the builder would pay to the flat buyers in the form of flat compensation. In fact, the opposite party has not even claimed that the entire amount recovered by it from the flat buyers was spent on this very project. This gives credence to the allegation of the complainants that their money has been used elsewhere. Such a practice, in my view, constitutes unfair trade practice within the meaning of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pleadings which would make out a case of adoption of unfair trade practice on the part of the opposite party. I therefore, have no hesitation in holding that instead of paying nominal compensation of Rs. 5/- per square foot of the super area, the opposite party should pay adequate compensation to the complainants which would not only take care of the additional financial burden on them on account of the delay in construction of the flat but will also give some compensation to them for the harassment and mental agony which they have suffered all along and are likely to suffer atleast for some more time on account of the opposite party having not delivered the possession of the flat to them by the date stipulated in the Buyer's Agreement. 14. As noted earlier, the cost of the borrowing for individual home buyers is about 10% per annum though it had gone upto 11.5% in last few years. In my view, if the opposite party, pays simple interest @ 12% per annum to the complainants, that would not only take care of the additional financial burden on them but also give some monetary compensation to them for their sufferings on account of the delay in handing over possession of the flat purch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing houses and / or plots on a regular basis, solely with a view to make profit by sale of such houses. If however, a house to be constructed by the service provider is purchased by him purely as an investment and he is not undertaking the trading of houses on a regular basis and in the normal course of the business profession or services in which he is engaged, it would be difficult to say that he had purchased houses for a commercial purpose. A person having surplus funds available with him would not like to keep such funds idle and would seek to invest them in such a manner that he gets maximum returns on his investment. He may invest such funds in a Bank Deposits, Shares, Mutual Funds and Bonds or Debentures etc. Likewise, he may also invest his surplus funds in purchase of one or more houses, which is/are proposed to be constructed by the service provider, in the hope that he would get better return on his investment by selling the said house(s) on a future date when the market value of such house (s) is higher than the price paid or agreed to be paid by him. That by itself would not mean that he was engaged in the commerce or business of purchasing and selling the house (s). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of action and, therefore, so long as the possession is not delivered to him the buyers can always approach a Consumer Forum. It is only when the seller flatly refuses to give possession that the period of limitation prescribed in Section 24A of the Consumer Protection Act would began to run. In that case the complaint has to be filed within two years from the date on which the seller refuses to deliver possession to the buyer. However, in the present cases the opposite party did not refuse possession of the flats to the complainants at any point of time and, therefore, the cause of action continues to subsist in favour of the complainants. Reliance in this regard may be place upon the decision of the Hon'ble Supreme Court in Meerut Development Authority Vs. M.K. Gupta, IV(2012) CPJ 12 where the Hon'ble Supreme Court held that in such a case the buyer has a recurrent cause for filing a complaint for non-delivery of possession of the plot. 18. It was also contended by the learned counsel for the opposite party that since the agreements between the parties contains arbitration clause, arbitration and not a complaint before this Commission is the appropriate remedy. I, however, find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not have anticipated that the builder will not be able to honour its commitment, as regards the stipulated date of delivery of possession. No separate compensation for the mental agony, harassment and suffering needs to be paid by the opposite party to the complainants. However, in the case of those complainants who acquire the flats by way of resale more than one year after the initial allotment, the opposite party should pay compensation in the form of simple interest at the rate of 12% per annum with effect from three years from the date of the repurchase till the date on which the possession is delivered to them. As in other cases no compensation would be payable for the first three years from the date of initial allotment of the flat. For the interregnum i.e. between three years from the date of initial allotment and three years from the date of repurchase by them, compensation shall be paid by the opposite party at the rate of Rs. 5/- per sq. ft. of the super area in terms of clause 4.c of the buyers agreement. I am awarding lesser compensation to those purchased the flat from the initial allottee more than one year after the date of initial allotment, considering the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey should be awarded compound interest at the rate of 18% per annum, which was the rate at which they were to pay interest to the builder, in the event of default on their part in making timely payment. I however, find no merit in the contention. The opposite parties admittedly did not agree to pay compounded interest to the complainants @ 18% per annum in case they were not able to hand over possession of the apartments within the time stipulated in the agreement. In such a case, the complainants would be entitled only to compensation commensurate with the financial loss actually suffered by them on account of the delay on the part of the opposite parties in handing over possession of the apartments to them and some compensation for the mental agony claimed by them on account of the delay in getting possession of the flats, but, they cannot seek to make a windfall over and above the actual financial loss suffered by them. A consumer coming to the Consumer Forum alleging deficiency on the part of the opposite party in rendering services to him can seek and recover a just and fair compensation but cannot seek to earn profit like in a commercial venture. 21. It transpired during th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
