MANU/SF/0018/2020

BEFORE THE CHANDIGARH STATE CONSUMER DISPUTES REDRESSAL

COMMISSION
CHANDIGARH
Complaint Case No. 206 of 2019
Decided On: 26.05.2020
Appellants: Harbinder Kaur and Ors.
Vs.
Respondent: Ansal Properties & Infrastructure Ltd. and Ors.
Hon'ble Judges/Coram:
Raj Shekhar Attri, J. (President), Padma Pandey and Rajesh K. Arya, Members
Counsels:
For Appellant/Petitioner/Plaintiff: A.P. Bhandari, Advocate
For Respondents/Defendant: Sandeep Kumar and Rupali Shekhar Verma, Advocates
DECISION
Raj Shekhar Attri, J. (President)
1. It is the case of the complainants that on 19.09.2011 they had booked flat bearing
No. 239, First Floor, measuring 1435 square feet, in a project launched by opposite
party No. 1, under the name and style 'Victoria Floor-Golf Links-II", Sector 116, SAS
Nagar, Mohali, Punjab (in short the unit), total sale price whereof was fixed at Rs. 39
lacs. It has been stated that despite the fact that substantial amount of Rs.
37,30,213/- stood paid by them to opposite party No. 1, yet, it failed to deliver
possession of the said unit by 01.11.2014 i.e. within a period of 36 months (30
months plus (+) 6 months extended period) as per Clause 5.1 of the Agreement
dated 01.11.2011 (Annexure C-4) for dearth of construction and development works
at the project site. During the period intervening, opposite party No. 1 offered
relocation to unit No. B-83 in the same project, which was not accepted by the
complainants. Ultimately, the complainants were relocated to unit No. 254, First
Floor, in the said project, but possession thereof was also not delivered to the
complainants. Number of requests made by the complainants, written as well as oral,
to opposite party No. 1 to deliver possession of the relocated unit, did not yield any
result.
1 . It has been averred that for making payment towards price of the said
unit, the complainants have availed housing loan from opposite party No. 2,
under subvention scheme, under which, opposite party No. 1 committed to
pay Pre-EMIs till possession of the unit is delivered, yet, it has also come to
their knowledge that opposite party No. 1 has defaulted in making payment
of the said Pre-EMIs also.
2. When, neither possession of the unit booked nor of the relocated unit was
offered to the complainants, a request was made to opposite party No. 1 to
refund the amount paid. As such, the complainants and opposite party No. 1
entered into a settlement agreement dated 25.10.2017 (Annexure C-16), vide
which it was committed by opposite party No. 1 that it will refund the entire

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amount of Rs. 37,30,213/- i.e. Rs. 29,25,000/- to opposite party No. 2
towards repayment of loan and Rs. 8,05,213/- to the complainants alongwith
interest @7% p.a. till realization. It has been stated that out of the aforesaid
amount of Rs. 37,30,213/-, opposite party No. 1 has so far paid an amount
of Rs. 12 lacs only i.e. Rs. 4 lacs towards repayment of loan amount out of
Rs. 29,25,000/- and Rs. 8 lacs to the complainants out of Rs. 8,05,213/-.
Thereafter, despite making number of requests, opposite party No. 1 failed to
make the remaining payment either to them or to opposite party No. 2.
3 . By stating that the aforesaid act and conduct of opposite party No. 1,
amount to deficiency in providing service and adoption of unfair trade
practice, this complaint has been filed by the complainants seeking directions
to opposite party No. 1 to make payment of remaining amount of loan to
opposite party No. 2 alongwith up-to-date interest; to pay remaining amount
of Rs. 5213/- to the complainants alongwith interest, compensation;
litigation expenses etc.
4. The claim of the complainants has been contested by opposite party No. 1,
on numerous grounds, inter alia, that they have concealed material facts
from this Commission; that they did not fall within the definition of
'consumer', as defined under Section 2 (1)(d) of the Act; that because the
period of 36 months, for delivering possession of the unit was tentative, as
such, time was not to be considered as essence of the contract; and that the
complaint filed is beyond limitation.
5 . On merits, payments made by the complainants towards the unit in
question as mentioned in the complaint; execution of buyer agreement; non
delivery of possession of the originally allotted unit by the promised date or
even of the relocated unit by the date when this complaint has been filed;
execution of settlement agreement dated 25.10.2017; payment of only Rs. 12
lacs referred to above, out of Rs. 37,30,213/-; and nonpayment of the
remaining amount, has not been disputed. However, it has been stated that
opposite party No. 1 is committed to pay Pre-EMI to opposite party No. 2,
under subvention scheme till offer of possession of relocated unit is delivered
to the complainants; that construction of the unit is almost complete; that
opposite party No. 1 has applied for completion certificate/clearance with the
competent authorities; and that possession will be delivered thereafter.
Prayer has been made to dismiss the complaint.
6. Opposite party No. 2 in its written version pleaded that since no specific
allegations have been levelled against it, as such, it has no concern, with the
dispute, qua the complainants and opposite party No. 1. Receipt of Rs. 4
lacs, referred to above, towards part repayment of loan amount is not
disputed. However, its Counsel pleaded that, in case, this Commission comes
to the conclusion that the complainants are entitled to refund of amount paid,
then first charge be ordered in favour of opposite party No. 2, so that it is
able to seek apportionment of its dues.
7 . This Commission has afforded adequate opportunities to the parties to
adduce evidence in support of their respective contentions, by way of filing
affidavit. In pursuance thereof, they have adduced evidence and also
produced numerous documents.

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 8. We have heard the contesting parties and have gone through the evidence
and record of the case, very carefully.
9 . First we will deal with the objection raised to the effect that the
complainants did not fall within the definition of 'consumer'. It may be stated
here that the objection raised is not supported by any documentary evidence
and as such the onus shifts to opposite party No. 1 to establish that the
complainants have purchased the unit in question to indulge in 'purchase and
sale of units/flats' as was held by the Hon'ble National Commission in Kavit
Ahuja vs. Shipra Estates MANU/CF/0937/2015 : I (2016) CPJ 31 but since
they failed to discharge their onus, hence we hold that the complainants are
consumers as defined under Section 2(1)(d) of the Act.
10. There is no dispute with regard to the fact that, in the first instance, on
19.09.2011 the complainants had booked unit bearing No. 239, in the project
of opposite party No. 1, against which it had received substantial amount of
Rs. 37,30,213/- against total sale consideration of Rs. 39 lacs. Out of the
said amount Rs. 29,25,000/- was released by opposite party No. 2 against
the loan obtained by the complainants under subvention scheme and the
remaining amount of Rs. 8,05,213/- had been paid by them, from their own
sources.
2 . It is also not in dispute that possession of the unit booked by the complainants
was not offered to them, by the promised date i.e. 01.11.2014 (within a period of 36
months as per Clause 5.1 of the Agreement dated 01.11.2011 (Annexure C-4) for
dearth of construction and development works at the project site, as a result whereof,
ultimately, they were relocated by opposite party No. 1, to unit No. 254, First Floor,
in the same project. It is also coming out from the record that possession of even
relocated unit No. 254 was not delivered to the complainants for want of construction
and development activities, as a result whereof, settlement agreement dated
25.10.2017 (Annexure C-16), was executed between the parties. It is evident from
Clause B. of the said settlement agreement that opposite party No. 1, in a very candid
manner, admitted that due to some unavoidable circumstances, the Company is not in
a position to handover/deliver possession of relocated unit No. 254 FF, Victoria
Floors, to the complainants. Relevant part of the said clause is reproduced
hereunder:-
"That due to some unavoidable circumstances, the Second Party is not in
position to handover/deliver the above mentioned Floor No. 254 FF, Victoria
Floors, to the First Party in accordance to allotment letter dated 5/8/2011."
It is further evident from the contents of said settlement agreement that in view of
above fact, it was committed by opposite party No. 1 that it will refund the entire
amount of Rs. 37,30,213/- i.e. Rs. 29,25,000/- to opposite party No. 2 towards
repayment of loan amount under subvention scheme and Rs. 8,05,213/- to the
complainants alongwith interest @7% p.a. till realization, latest by 24.04.2018 (180
days, from 25.10.2017). Relevant part of the said agreement is reproduced
hereunder:-
1 . That Second Party will refund Rs. 8,05,213/- to First Party and will also
pay an interest @7% p.a. w.e.f. 2014 till the date of refund of complete
amount
2 . That Second Party will pay Rs. 3 lacs within 45 days, from execution of

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 the agreement and balance amount including interest, as mentioned in Para
above, within 180 days, from the date of execution of this agreement.
3 . That amount Rs. 2925000/- received from HDFC Ltd. as Loan
Disbursement shall be refunded to HDFC Ltd. by Second Party within 180
days.
1 . Since, it is a clear-cut case of non delivery of possession of the unit in
question to the complainants, for dearth of construction and development
activities, which fact has not been disputed by opposite party No. 1 in its
written statement and also by its Counsel during pendency of this complaint,
as such, this Commission will like to deal with the moot question with regard
to the refund of amount to be made by opposite party No. 1 to the
complainants and also repayment of loan amount to opposite party No. 2.
3. It is coming out from the record that, though, vide the said settlement agreement,
opposite party No. 1 had committed to refund the entire amount received in the
manner, referred to above, latest by 24.04.2018 (180 days, from 25.10.2017), yet,
out of the aforesaid amount of Rs. 37,30,213/-, opposite party No. 1 has so far paid
an amount of Rs. 12 lacs only i.e. Rs. 4 lacs towards repayment of loan amount of
Rs. 29,25,000/- and Rs. 8 lacs to the complainants against Rs. 8,05,213/-. At the
time of arguments also, Counsel for opposite party No. 1 failed to give any answer,
as to why the Company failed to make the balance payment, referred to above,
despite making commitment vide settlement agreement (Annexure C-16). Even this
much was not made clear, as to whether construction work took place at the project
site or not. The facts of the case transpire that the opposite party No. 1 made false
representations, which were materially incorrect and were made in such a way that
the complainants, to whom it was made, was entitled to rely upon it and they may act
in reliance on it. The complainants are thereby involved in a disadvantageous
contract with opposite party No. 1 and suffered financial loss, mental agony and
physical harassment. Representations/statements made at that time were believed to
be true. All the facts established that from the very inception there was intent of
opposite party No. 1 to induce the complainants to enter into a contract and also
intent to deceive them. Infact, the acts committed by the Company are not only fraud
but also amounts to misrepresentation of facts.
4. Furthermore, there is nothing on record to show that opposite party No. 1 suffered
any force majeure circumstances, on account of which, construction and development
work at the project site could not be completed and possession of originally allotted
unit was not delivered to the complainants by the committed date, referred to above
or even thereafter. Even this much has not been proved that the originally allotted
unit or the relocated one, was in existence or not. However, deficiency in providing
service and adoption of unfair on the part of opposite party No. 1 is writ large
because even after making commitment vide the settlement agreement, referred to
above, to the effect that entire amount will be refunded within a period of 180 days
from 25.10.2017, yet, only part amount of Rs. 12 lacs out of Rs. 37,30,213/- i.e. Rs.
4 lacs towards repayment of loan amount out of Rs. 29,25,000/- and Rs. 8 lacs to the
complainants against Rs. 8,05,213/-, has been paid by it. Under these circumstances,
it could very well be said that once the terms and conditions of the said settlement
deed have been violated by opposite party No. 1, it cannot take any advantage out of
it, by saying that the complainants are debarred from filing this consumer complaint
and that the Company will offer possession of the unit shortly, after receiving
completion certificate/clearances. It is not the case of opposite party No. 1 that it had

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fully complied with the terms and conditions of the settlement agreement, within the
committed period but even then the complainants have filed this complaint. Opposite
party No. 1 in the present case wants to have the cake and eat it too. It clearly shows
the high-handedness of opposite party No. 1 towards the poor consumers like the
complainants. It is therefore held that the act and conduct of opposite party No. 1
amount to grave deficiency in providing service, negligence and adoption of unfair
trade practice on its part.
1 . In the face of settlement agreement, referred to above, wherein, it has
been candidly admitted by opposite party No. 1 that due to some unavoidable
circumstances, the Company is not in position to handover/deliver
possession of even relocated unit, the plea taken by it, in its written
statement to the effect that time was not the essence of contract; that
construction of the unit is almost complete; and that the Company is
committed to bear Pre-EMI till possession of the unit is offered; and that
since the possession was to be offered latest by 2014, as such, this
complaint filed is time barred; has no significant value in the eyes of law and
is accordingly rejected being rendered infructuous. Since, opposite party No.
1 has failed to comply with the terms and conditions of the settlement
agreement, as such, violation thereof, has attracted penal consequences
against it.
2. The complainants cannot be made to wait for an indefinite period on the
bald pleas taken by opposite party No. 1 that it is ready to pay compensation
for the period of delay in delivering possession or that it is committed to pay
Pre-EMI to opposite party No. 2 from where loan has been obtained by the
complainants, under subvention scheme; especially, in the face of contents
of the settlement agreement, referred to above. It is well settled law that
non-delivery of possession of plots/units in a developed project by the
promised date is a material violation on the part of a builder and in those
circumstances, the allottee is well within his/her right to seek refund of the
amount paid. Our view is supported by the principle of law laid down by the
Hon'ble Supreme Court of India in the case titled as Pioneer Urban Land &
Infrastructure Ltd. Vs. Govindan Raghavan. Civil Appeal No. 12238 of 2018.
decided on 02.04.2019 and also in Fortune Infrastructure v. Trevor D' Lima &
Ors. MANU/SC/0253/2018 : (2018) 5 SCC 442. As such, we are of the
considered opinion that if we order refund of the entire amount paid
alongwith interest, that will meet the ends of justice.
3. Now, we will deal with the question, as to what rate of interest should be
awarded to the complainants, while ordering refund of amount paid. It is a
simple case of non-delivery of possession of the unit by the builder/opposite
party No. 1 to the complainants, by the promised date of even thereafter. A
similar question, as to what rate of interest should be granted while ordering
refund of the deposited amount, in case, the builder fails to deliver
possession of residential units/plots, by the stipulated date, fell for
determination before the Honble Supreme Court of India in H.U.D.A. Vs.
Neelam Sharma. Civil Appeal No. 3417 of 2003 decided on 18.08.2004 . In
the said case, the Hon'ble Supreme Court held that in case of refund of
amount, the Interest Act would apply and 12% interest is to be granted from
the date of amounts deposited till repayment. Recently also, under similar
circumstances, the Hon'ble National Commission in Alok Kumar Vs. M/s.
Golden Peacock Residency Private Limited & Anr.. Consumer Case No. 1315

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 of 2018. decided on 06 Sep 2019 while ordering refund of the amount paid,
awarded interest @12% p.a.
5 . Not only as above, even under Section 12 of the Punjab Apartment and Property
Regulation Act, 1995, read with Rule 17 of the Rules thereunder, it has been
specifically mentioned that if the amount is to be refunded, it is to be refunded
alongwith interest @12% p.a. It is therefore held that if interest @12% p.a. is
awarded on the amount to be refunded to the complainants, that will meet the ends
of justice.
1 . For the reasons recorded above, this complaint is partly accepted, with
costs and opposite party No. 1 is directed as under:-
i. To refund the entire amount, actually paid by the complainants
from their own sources/pocket, at the time of booking and thereafter
also, towards part price of the unit in question, alongwith interest
@12% p.a., from the respective dates of deposits onwards, after
deducting the amount of Rs. 8 lacs therefrom, already paid by it to
the complainants.
ii. To refund the amount to the complainants, if any, paid by them to
opposite party No. 2, towards equated monthly installments, on the
loan amount, as it was the liability of opposite party No. 1, under
subvention scheme, as admitted by it in its written statement also.
iii. To repay the entire loan amount to opposite party No. 2, released
by it in favour of the Company, in respect of the unit/relocated in
question alongwith pre-EMI installments, if any due, till date, after
deducting the amount of Rs. 4 lacs already paid by it to opposite
party No. 2 through the complainants. It is also made clear that till
the time, the entire loan amount is not repaid to opposite party No.
2, opposite party No. 1 shall be bound to pay the equated monthly
installments/Pre-EMI interest to opposite party No. 2, alongwith up-
to-date interest on the loan account, till realization.
iv. To pay compensation for causing mental agony and physical
harassment and also litigation expenses, in lumpsum, to the tune of
Rs. 50,000/- to the complainants.
v. The payment of amounts mentioned at sr. Nos. (i), (ii) (if any)
and (iv) shall be made by opposite party No. 1 to the complainants
within a period of 30 days from the date of receipt of a certified copy
of this order, failing which the amount mentioned at Sr. Nos. (i) and
(ii) (if any), thereafter shall carry interest @15% p.a., from the date
of default and interest @9% p.a., on the amount mentioned at Sr.
No. (iv) from the date of filing of this complaint, till realization,
besides compliance of other directions given.
vi. Complaint against opposite party No. 2 is dismissed with no order
as to costs, subject to directions aforesaid.
2. Certified Copies of this order be sent to the parties, free of charge.
3. The file be consigned to Record Room, after completion.

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Pronounced. 26.05.2020
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