NATIONAL CONSUMER DISPUTES REDRESSAL …...Mr. Akshay Sharma, Advocate (in FA/1309/2016) € € For the Respondent : Mr. Navneet Kumar, Advocate Mr. Vikas Bhadana, Advocate (in FA/1312/2016)

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSIONNEW DELHI

FIRST APPEAL NO. 853 OF 2016

(Against the Order dated 02/06/2016 in Complaint No. 94/2016 of the State Commission

Chandigarh)

1. DLF HOMES PANCHKULA PVT. LTD.SCO NO. 190-191-192, SECTOR-8-C,CHANDIGARH ...........Appellant(s)

Versus 1. D.S. DHANDAS/O. SH. KISHAN LAL DHANDA, R/O. HOUSE NO.302, SHAKTI APARTMENT, SECTOR-14,PANCHKULAHARYANA ...........Respondent(s)


(Against the Order dated 02/08/2016 in Complaint No. 137/2016 of the State CommissionChandigarh)

WITH IA/10931/2016(Directions),IA/11714/2017(Placing addl. documents)

1. DLF HOMES PANCHKULA PRIVATE LIMITEDDLF GATEWAY TOWER, SECOND FLOOR DLFCITY PHASE-III,GURGAON 122002HARYANA ...........Appellant(s)

Versus 1. ATUL GUPTATHROUGH HIS POWER OF ATTORNEY HOLDER,SH. SURAJ GUPTA S/O. SH. SOHAN LAL GUPTA,R/O. 997 B-2 WARD NO 9 VASHVKARMA COLONYPINJOREPANCHKULA ...........Respondent(s)



WITH IA/9561/2016(Stay),IA/11715/2017(Preponment of date of hearing)

1. DLF HOMES PANCHKULA PRIVATE LIMITED ...........Appellant(s)Versus

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1. NEERAJ SAHNI & ANR.H.NO.654, SECTOR -8, PUNCHKULA,HARYANA2. RUHEE SAHNIW/O SH. NEERAJ SAHNI,H.NO.654,SECTOR-8,PUNCHKULA,HARYANA ...........Respondent(s)



WITH IA/9563/2016(Stay),IA/11717/2017(Placing addl. documents)

1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANAGER/AUTHORISEDSIGNATORY/OFFICER-INCHARGE/DIRECTORSALES & MARKETING, SCO 190-192, SECTOR-8-C,CHANDIGARH, U.T. PIN-1600092. DLF HOMES PANCHKULA PVT. LTD.THROUGH ITS MANAGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALES & MARKETING, REGD. OFFICE DLF CITY,PHASE-III, GURGAON-122002HARYANA3. M/S. BEE GEE BUILTECHTHROUGH ITS DIRECTOR/PARTNER, ADMN.OFFICE, SCF 44-45, 1ST FLOOR, SECTOR-9,PANCHKULAHARYANA4. M/S. BEE GEE BUILTECHTHROUGH ITS DIRECTOR/PARTNER, ADMN.OFFICE, SCF 44-45, 1ST FLOOR, SECTOR-9,PANCHKULAHARYANA ...........Appellant(s)

Versus 1. YACHANA GUPTADAUGHTER OF SH. RAMESH GUPTA, RESIDENTOF HOUSE NO. 488/B, NEAR BUS STAND, PINJORE,DISTT. PANCHKULAHARYANA2. SMT. JASNEET KAURWIFE OF JATINDER PAL SINGH, BOTH RESIDENTOF HOUSE NO. 1973, PHASE-10, SAS NAGAR,

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MOHALI,PUNJAB ...........Respondent(s)



WITH IA/9564/2016(Stay),IA/11718/2017(Placing addl. documents)

1. DLF HOMES PANCHKULA PRIVATE LIMITED &ANR.THROUGH ITS MANAGER/AUTHORIZEDSIGNATORY/OFFICEER-IN-CHARGE/DIRECTORSALES & MARKETING, SCO NO. 190-191-192,SECTOR-8-C,CHANDIGARH-U.T. PIN-1600092. DLF HOMES PANCHKULA PVT. LTD.THROUGH ITS MANAGER/AUTHORIZEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALES & MARKETING, REGD. OFFICE DLFGATEWAY TOWER, SECOND FLOOR, DLF CITY,PHASE-III,GURGAON-122002HARYANA ...........Appellant(s)

Versus 1. USHA RANOUTWIFE OF SH. HARINDER RANOUT, RESIDENT OFFLAT NO. 201, GH-102, SECTOR-20,PANCHKULAHARYANA ...........Respondent(s)



WITH IA/11720/2017(Placing addl. documents)


1. COL. M.S. REKHI & ANR. ...........Respondent(s)FIRST APPEAL NO. 1307 OF 2016


Chandigarh)WITH

IA/11721/2017(Placing addl. documents)

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1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANAGER/AUTHORIZEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALES & MARKETING SCO 190-191-192,SECTOR-8-C,CHANDIGARH-1600092. DLF HOMES PANCHKULA PVT. LTD.,HAVING REGISTERED OFFICE AT: THROUGH ITSMANAGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRETORSALES & MARKETING, DLF GATEWAY TOWER,SECOND FLOOR, DLF CITY, PHASE-III,GURGAON-122002HARYANA ...........Appellant(s)

Versus 1. BRIG. (RETD.) RAKESH KANT SHARMAS/O. LATE SH. J.R. SHARMA, VILLAGE & POSTOFFICE DHALIARA, DISTRICT-KANGRA (H.P.) ...........Respondent(s)





1. ANIL SHARMA & ANR. ...........Respondent(s)FIRST APPEAL NO. 1309 OF 2016


Chandigarh)WITH

IA/11723/2017(Placing addl. documents)1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALE & MARKETING, SCO 190-191-192, SECTOR-C,CHANDIGARH-160009 ...........Appellant(s)

Versus 1. RITA AGGARWALW/O. SUDHIR KUMAR, R/O. HOUSE NO. 516,SECTOR-7,PANCHKULA,

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HARYANA ...........Respondent(s)FIRST APPEAL NO. 1310 OF 2016


Chandigarh)WITH

IA/11724/2017(Preponment of date of hearing)1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALE & MARKETING, SCO 190-191-192, SECTOR-C,CHANDIGARH-1600092. DLF HOMES PANCHKULA PVT. LTD.,HAVING REGD. OFFICE AT: THROUGH ITSMANAGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALES & MARKETING, DLF GATEWAY TOWER,SECOND FLOOR, DLF CITY, PHASE-III,GURGAON-122002HARYANA ...........Appellant(s)

Versus 1. LT. CO. SANJEEV DADHWALS/O. SH. RAJINDER SINGH, R/O. H NO. 2,GULMOHAR AVENUE (NEAR ADARSH ENCLAVE),DHAKOLI, MC-ZIRAKPUR,TEHSIL DERRABASSI,MOHALI-160104 ...........Respondent(s)




1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALE & MARKETING, SCO 190-191-192, SECTOR-C,CHANDIGARH-1600092. DLF HOMES PANCHKULA PVT. LTD.,HAVING REGD. OFFICE AT: THROUGH ITSMANAGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTOR

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SALES & MARKETING, DLF GATEWAY TOWER,SECOND FLOOR, DLF CITY, PHASE-III,GURGAON-122002 HARYANA ...........Appellant(s)

Versus 1. BRIJESH KUMAR SOOD & ANR.S/O. SH. S.S. SOOD, R/O. B-4, SAINIK SCHOOLNAGROTA, JAMMU TAWI-181221JAMMU AND KASHMIR2. BEELAM SOODW/O. SH. B.K. SOOD, R/O. B-4, SAINIK SCHOOLNAGROTA,JAMMU TAWI-181221JAMMU AND KASHMIR3. NEELAM SOODW/O. SH. B.K. SOOD, R/O. B-4, SAINIK SCHOOLNAGROTA,JAMMU TAWI-181221JAMMU AND KASHMIR ...........Respondent(s)




1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITSMANAGER/AUTHORIZED/OFFICERIN-CHARGE/DIRECTORSALES & MARKETING, SCO-190-191192, SECTOR-8-C,CHANDIGARH-160009U.T.2. DLF HOMES PANCHKULA PVT LYD.THROUGH ITS MANAGER/AUTHORIZEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTOR SALES &MARKETING, DLF GATEWAY TOWER, SECOND FLOOR,DLF CITY, PHASE-III,GURGAON-122002HARYANA ...........Appellant(s)

Versus 1. SANDEEP MALIKS/O. SH. BARU RAM MALIK, R/O. H NO. 515/5, ADARSHNAGAR, NARWANA ROAD, JIND,HARYANA ...........Respondent(s)


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Chandigarh)WITH

IA/11727/2017(Placing addl. documents)1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANAGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALES & MARKETING, SCO 190-191-192,SECTOR-8-C,CHANDIGARH-160009UTTAR PRADESH ...........Appellant(s)

Versus 1. BIJENDER SINGH SANGWANS/O. PURAN SINGH SANGWAN, R/O. FLAT NO. 302,CARNATION BLOCK, AMRAVATI ENCLAVE,PANCHKULAHARYANA ...........Respondent(s)




1. DLF HOMES PANCHKULA PRIVATE LIMITEDTHROUGH ITS MANAGER/AUTHORISEDSIGNATORY/OFFICER-IN-CHARGE/DIRECTORSALES & MARKETING, DLF GATEWAY TOWER,SECOND FLOOR, DLF CITY, PHASE-III,GURGAON-122002HARYANA, INDIA ...........Appellant(s)

Versus 1. KANWAL MOHAN & ANR.S/O. SH. ROSHAN LAL, R/O. HOUSE NO. 1582,GROUND FLOOR, SECTOR-4,PANCHKULAHARYANA2. MANI GOELW/O. KANWAL MOHAN, R/O. HOUSE NO. 1582,GROUND FLOOR, SECTOR-4,PANCHKULA ...........Respondent(s)


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WITH IA/6421/2016(Stay),IA/9254/2016(Directions),IA/11712/2017(Placing addl. documents)


Versus 1. PAWAN SINGHS/O. SH. SAROOP SINGH, R/O. FLAT NO. 402,BLOCK-A, PLOT NO. GH-105, SECTOR-20,PANCHKULAHARYANA ...........Respondent(s)



WITH IA/6422/2016(Stay),IA/9255/2016(Directions),IA/11713/2017(Placing addl. documents)


Versus 1. LT. COL. AMIT SINGHS/O. SH. DALVIR SINGH, R/O. HOUSE NO. 37/1,PATTERSON SQUARE, AMBALA CANTT.,HARYANA ...........Respondent(s)

BEFORE: HON'BLE MR. DR. S.M. KANTIKAR,PRESIDING MEMBER HON'BLE MR. DINESH SINGH,MEMBER

For the Appellant :For the Respondent :

Dated : 12 Dec 2018ORDER

For the Appellant

:

Mr. Pravin Bahadur, Advocate

Ms. Seema Sundd, Advocate

Mr. R. Soundar Rajan, Advocate

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Mr. Aditya P. N. Singh, Advocate

(in FA/853/2016)

For the Respondent :

Ms. Priyanka Dutta, Advocate

Mr. Sudhir Bisla, Advocate

Ms. Nainee Jha, Advocate

(in FA/854/2016 ; 855/2016; 1308/2016;1310/2016; 1311/2016)

For the Respondent : NEMO

(in FA/1144/2016)

For the Respondent :

Mr. Anant Agarwal, Advocate

Ms. Shweta Sirohi, Advocate

Ms. Ritika Khanna, Advocate

(in FA/1237/2016; 1239/2016 & 1240/2016)

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For the Respondent : Ms. Pooja Vohra, Advocate

(in FA/1306/2016)

For both Respondents :

Mr. Amarjeet Singh, Advocate

Mr. Anant Aggarwal, Advocate

Ms. Ritika Khanna, Advocate

(in FA/1307/2016)

For the Respondent :Mr. Rajesh Sharda, Advocate

Mr. Akshay Sharma, Advocate

(in FA/1309/2016)

For the Respondent :Mr. Navneet Kumar, Advocate

Mr. Vikas Bhadana, Advocate

(in FA/1312/2016)

For the Respondent : in person

(in FA/1314/2016

For the Respondent :Mr. Surender Deswal, Advocate

Mr. Prashant V., Advocate

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(in FA/1356/2016)

For the Respondents :

Mr. Amarjeet Singh, Advocate

Mr. Sudhir Kathpalia, Advocate

A fair number of first appeals (f.a.s) filed by the appellant – builder co. are pending before1.

various benches of this Commission, including this bench.

The instant case relates to 16 f. a. s filed by the appellant – builder co. under section 19 of theConsumer Protection Act, 1986 against the State Commission’s Orders (6 nos.) dated 02.06.2016,02.08.2016, 17.08.2016, 29.08.2016, 01.09.2016 and 12.09.2016 whereby the State Commissiondirected the builder – co. to hand over physical possession of the units as per the terms andconditions of the agreements; execute and get registered the sale-deeds; pay compensation; andpay cost of litigation to the respondents – complainants.

We heard the learned counsels for the builder co. and the complainants, and perused the2.material on record.

During arguments on 24.10.2018 the learned counsels for the builder co. raised an objection3. that this bench was constituted of non-judicial members and as such was not competent in law toadjudicate the issues.

We feel it appropriate to briefly put the question of competence in perspective.4.

Notwithstanding that one of us has a doctorate in law and one of us has a graduate degree in5. law in the first division, and notwithstanding that one of us has had over five years’ experience inthis Commission itself and one of us has had fair experience of court-work including revenuecourt–work (in which the CPC and the Evidence Act were applicable, civil court jurisdiction was barred, parties wererepresented through advocates, reasoned judgements were delivered and were subject to scrutiny),the fact is that we are not from the judicial service.

But, briefly, we would like to refer to the following:6.

Statement of Objects and Reasons

The Consumer Protection Bill, 1986 seeks to provide for better protection of the interests ofconsumers and for the purpose, to make provision for the establishment of Consumer councils andother authorities for the settlement of consumer disputes and for matter connected therewith.

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To provide speedy and simple redressal to consumer disputes, a quasi-judicial machinery issought to be set up at the district, State and Central levels. These quasi-judicial bodies willobserve the principles of natural justice and have been empowered to give relief of a specificnature and to award, wherever appropriate, compensation to consumers. Penalties fornon-compliance of the orders given by the quasi-judicial bodies have also been provided.

Aims and Object

An Act to provide for better protection of the interests of consumers and for that purpose to makeprovision for the establishment of consumer councils and other authorities for the settlement ofconsumers’ disputes and for matters connected therewith.

Section 20 (1) (b)

The National Commission shall consist of—

(b) not less than four, and not more than such number of members, as may be prescribed, and oneof whom shall be a woman, who shall have the following qualifications, namely:—

(i) be not less than thirty-five years of age;

(ii) possess a bachelor's degree from a recognised university; and

(iii) be persons of ability, integrity and standing and have adequate knowledgeand experience of at least ten years in dealing with problems relating to economics,law, commerce, accountancy, industry, public affairs or administration:

Proviso to Section 20 (1)(b)

Provided that not more than fifty per cent. of the members shall be from amongst the personshaving a judicial background.

Explanation. -- For the purposes of this clause, the expression “persons having judicialbackground” shall mean persons having knowledge and experience for at least a period of tenyears as a presiding officer at the district level court or any tribunal at equivalent level:

Section 20 (1A) (ii)

A Bench may be constituted by the President with one or more members as the President maydeem fit.

A reading of the above in conjunction makes clear to a sufficient extent the intention of the7. legislature and the intent of the legislation.

. We would also like to refer to the judgment delivered by Hon’ble Supreme Court in the8case of in L. Chandra Kumar vs. Union of India and Ors. 18 March 1997 th Appeal (Civil)

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in which the following question was framed and answered by the Hon’ble481 of 1980 inter aliaCourt:

(2) Whether the Tribunals, constituted either under Article 323A or under Article 323B of theConstitution, possess the competence to test the constitutional validity of a statutoryprovision/rule?

The Hon’ble Court had answered the question as below:inter alia

“However, it is important to emphasise that though the subordinate judiciary or Tribunals createdunder ordinary legislations cannot exercise the power of judicial review of legislative action to theexclusion of the High Courts and the Supreme Court, there is no constitutional prohibition againsttheir performing a supplemental--as opposed to a substitution - role in this respect. That such asituation is contemplated within the constitutional scheme becomes evident when one analysesClause (3) of Article 32 of the Constitution……”

(para 80 of the Judgment)

“…..So long as the jurisdiction of the High Courts under Articles 226/227 and that of this Courtunder Article 32 is retained, there is no reason why the power to test the validity of legislationsagainst the provisions of the Constitution cannot be conferred upon Administrative Tribunalscreated under the Act or upon Tribunals created under Article 323B of the Constitution. …….”


“There are pressing reasons why we are anxious to preserve the conferment of such a power onthese Tribunals……”


“………It has been contended before us that the Tribunals should not be allowed to adjudicateupon matters where the vires of legislations is questioned, and that they should restrict themselvesto handling matters where constitutional issues are not raised. We cannot bring ourselves to agreeto this proposition as that may result in splitting up proceedings and may cause avoidable delay. Ifsuch a view were to be adopted, it would be open for litigants to raise constitutional issues, manyof which may be quite frivolous, to directly approach the High Courts and thus subvert thejurisdiction of the Tribunals. Moreover, even in these special branches of law, some areas doinvolve the consideration of constitutional questions on a regular basis; for instance, in servicelaw matters, a large majority of cases involve an interpretation of Articles 14, 15 and 16 of theConstitution. To hold that the Tribunals have no power to handle matters involving constitutionalissues would not serve the purpose for which they were constituted……. While saving the powerof judicial review of legislative action vested in the High Courts under Article 226/227 of theConstitution, it will ensure that frivolous claims are filtered out through the process ofadjudication in the Tribunal. The High Court will also have the benefit of a reasoned decision onmerits which will be of use to it in finally deciding the matter.”


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“Before moving on to other aspects, we may summarise our conclusions on the jurisdictionalpowers of these Tribunals. The Tribunals are competent to hear matters where the vires ofstatutory provisions are questioned. However, in discharging this duty, they cannot act assubstitutes for the High Courts and the Supreme Court which have, under our constitutional setup,been specifically entrusted with such an obligation. Their function in this respect is onlysupplementary and all such decisions of the Tribunals will be subject to scrutiny before a DivisionBench of the respective High Courts. The Tribunals will consequently also have the power to testthe vires of subordinate legislations and rules. However, this power of the Tribunals will besubject to one important exception. The Tribunals shall not entertain any question regarding thevires of their parent statutes following the settled principle that a Tribunal which is a creature ofan Act cannot declare that very Act to be unconstitutional. In such cases alone, the concernedHigh Court may be approached directly. All other decisions of these Tribunals, rendered in casesthat they are specifically empowered to adjudicate upon by virtue of their parent statutes, will alsobe subject to scrutiny before a Division Bench of their respective High Courts. We may add thatthe Tribunals will, however, continue to act as the only courts of first instance in respect of theareas of law for which they have been constituted. By this, we mean that it will not be open forlitigants to directly approach the High Courts even in cases where they question the vires ofstatutory legislations (except, as mentioned, where the legislation which creates the particularTribunal is challenged) by overlooking the jurisdiction of the concerned Tribunal.”


“..…..For these reasons, it has been urged that the appointment of Administrative Members toAdministrative Tribunals be stopped. We find it difficult to accept such a contention. It must beremembered that the setting-up of these Tribunals is founded on the premise that specialist bodiescomprising both trained administrators and those with judicial experience would, by virtue of theirspecialised knowledge, be better equipped to dispense speedy and efficient justice. It wasexpected that a judicious mix of judicial members and those with grass- roots experience wouldbest serve this purpose. To hold that the Tribunal should consist only of judicial members wouldattack the primary basis of the theory pursuant to which they have been constituted. Since theSelection Committee is now headed by a Judge of the Supreme Court, nominated by the ChiefJustice of India, we have reason to believe that the Committee would take care to ensure thatadministrative members are chosen from amongst those who have some background to deal withsuch cases.”


Statutory appeal under the Act 1986 lies in Hon’ble Supreme Court. Hon’ble High Court9.exercises superintendence (Article 227) over this bench. This bench’s Orders, functioning aresubject to scrutiny, superintendence.

This bench has been constituted by Hon’ble President of the Commission, who is a retired10.judge of Hon’ble Supreme Court. Other single and division benches comprising of non-judicialmembers are functioning in the Commission. This bench has been taking up builder co. –complainant cases of this builder co. and of other builder cos. in the routine.

The above (paras 5 to 10) put the question of competence in perspective.11.

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We do not feel any need to examine our competence, when the case before us is the first12. appeals of the appellant – builder co.

In any case, this bench cannot determine its own competence.13.

On the bench expressing its intention to proceed with adjudication of the 16 f.a.s that were14.taken up on 24.10.2018 for final hearing, the learned counsels for the appellant – builder co.(then) handed over a copy of an I.A. filed in some other f.a. (that was not taken up on24.10.2018), but in which f. a. no. 853 of 2016 (that was taken up on 24.10.2018) is alsointer aliamentioned. The said I.A. is an application filed under “Regulation 12 of the Consumer ProtectionRegulations, 2005 and ‘other enabling provisions of the Consumer Protection Act, 1986’ ”.

In para 8 of the said I.A. the following is stated:

8. That the following are some of the which arise in the captionedsubstantial questions of lawmatters, as also in the pending SLP before the Hon’ble Supreme Court:

(underlining supplied by us)

I. Whether the Hon’ble National Consumer Disputes Redressal Commission has thejurisdiction under the Consumer Protection Act, 1986 to pass order and directions which areclearly beyond the scope of the terms of a validly executed agreement between the parties?

II. Whether the Commission has the jurisdiction to partially rely upon the clauses of theAgreement entered into by the Parties, while ignoring the others of an agreement dulyexecuted between the parties, and then voluntarily increase the said compensation to a levelwhich would afford an undue advantage to the Consumer?

III. Whether the Ld. State Commission could have ignored that the Appellant was notcharging any escalation on the construction cost of the flat for the delay in terms of Clause1.2 of the Agreement and in any case the said delay in completion of the flats was beyond thecontrol of the Appellant herein?

IV. Whether the Ld. State Commission had a jurisdiction to grant compensatory reliefwhen the party claiming so, had not suffered any loss or damage and the present case doesnot match that yardstick?

V. Whether the Ld. State Consumer Disputes Redressal Commission has overlooked thespecific clauses pertaining to Force Majeure Conditions set out in Clause 11(a), (b) and (c)and Clause 43 of the Independent floor Buyers Agreement?

VI. Whether the Ld. State Consumer Disputes Redressal Forum has properly appreciated thenon-availment of exit option by the allotees in terms of the Independent Floor BuyersAgreement as well as the separate exit option given to all allottees?

VII. Whether the allottees who have chosen to continue with the agreement, and not avail thetwo exit options, have a right to claim compensation beyond what is agreed to under theIndependent Floor Buyers Agreement?

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VIII. Whether the Ld. State Consumer Disputes Redressal Commission has overlooked thespecific clause pertaining to compensation for delay set out in Clause 15 of the IndependentFloor Buyers Agreement?

IX. Whether the Ld. State Consumer Disputes Redressal Commission could have ignored thewell settled principle as held in catena of judicial decisions that appreciation in a the value ofreal estate is adequate compensation for any alleged delay?

X. Whether the Ld. State Consumer Disputes Redressal Commission while passing theimpugned order ought to have adjudicated the fact that the individuals before it are not‘consumer’ as per section 2(1)(d) of the Consumer Protection Act, 1986 or not?

XI. Whether the Ld. State Consumer Disputes Redressal Commission had the jurisdiction totreat the payment made by an Independent floor buyer as an investment and then allow for areturn on such investment in favour of the flat purchaser ranging between 12 – 18% on suchpayment already made?

In paras 11, 12, 13 and 14 of the said I.A. the following is stated:

11. That the present application is being moved for listing of caption first appeals listed on08.08.2018 before Bench comprising of a Judicial Member under Regulation 12 of the ConsumerProtection Regulations, 2005. The said Regulation is set out hereunder:

‘ :- Where a Bench, constituted by the President of the12. Hearing by BenchesState Commission or the National Commission as provided under section 16 or section 20,as the case may be, does not have a member with judicial background and any complexquestion of law arises and there is no precedent to decide the law point, the Bench soconstituted may refer the matter to the President of the State Commission or the NationalCommission as the case may be to constitute another Bench of which the President shallbe a member’.

(underlining supplied by us)

12. That it is humbly submitted that various complex questions of law are involved in the presentmatter, as would be evident from some of the questions of law which have been set outhereinabove. Further, the orders passed by the Ld. State Commission have been passed by aBench comprising of the Presiding Judicial Member, who is retired Judge of the Hon’ble HighCourt of Punjab & Haryana at Chandigarh.

13. That in the aforesaid circumstances, it is humbly submitted that it would be appropriate tohave all the captioned first appeals listed before a Bench of this Hon’ble Commission whichcomprises of a Judicial Member. As stated the Hon’ble Bench 6 wherein these appeals arepresently listed is a Bench of Hon’ble Technical Members only.

14. That it is accordingly prayed that appropriate orders for listing of the captioned appealsbefore a Bench comprising of Hon’ble Judicial Member may be passed.

The issues mentioned in para 8 of the said I.A. are issues that arise in the normal wont in15.builder co. – consumer agreements / disputes. They are decided in the routine while adjudicating

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such cases. A bare perusal shows that they are not “substantial questions of law”. We feel itunnecessary to dwell on what constitutes a substantial question of law; it would be misplaced inthe present context.

We find no “complex” question of law in this case as may require us to refer this case to16. Hon’ble President of the National Commission under Regulation 12 of the Consumer ProtectionRegulations, 2005.

On the bench declining to refer these 16 f.a.s to Hon’ble President under Regulation 12,17. learned counsels for the builder co. (then) handed over a copy of Hon’ble High Court’s Orderdated 25.09.2018 in CM (M) 1141 / 2018 & CM APPL. 38729 / 2018, in which it is inter aliadirected as below:

…….Without any observations on the merits or demerits of the submissions, taking into accountthe proceedings in CM(M)953/17 and the verdict of the Hon’ble Supreme Court in “Madras Bar

(supra), further proceedings before the learnedAssociation Vs. Union of India and Another”Bench No. 6 of the National Consumer Disputes Redressal Commission in relation to appeal no.First Appeal No. 446/2017 connected with First Appeals no. 447/2017 to 452/2017; First AppealNo. 634/2017 to 637/2017 and First Appeal no. 1236/2017 connected with First Appeals no.1237/2017, 1241/2017; 1243/2017; 1248/2017; 1252/2017; 1310/2017 to 1316/2017 are stayed tillfurther orders and furthermore the operation of the order dated 08.08.2018 and 18.09.2018 in thesaid cases of the Bench no. 6 of the National Consumer Disputes Redressal Commission is alsostayed till further orders…..

Learned counsels for the builder co. informed that Orders dated 08.08.2018 and 18.09.2018referred to in Hon’ble High Court’s above-quoted Order dated 25.09.2018 were the following:

First Appeal No. 446 of 2017

connected with

First Appeals No. 447/2017 to 452/2017; 634 /2017 to 637/2017

First Appeal No. 1236 of 2017

connected with

First Appeals No. 1237/2017 1241/2017; 1243/2017; 1248/2017; 1252/2017; 1310/2017 to1316/2017

Dated: 08.08.2018

Heard learned senior counsel for the appellants and learned counsels for the respondents.

Application dated 08.08.2018 filed with reference to Regulation 12 of Consumer ProtectionRegulations, 2005 was heard.

The issues in the whole matter were also heard.

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On the suggestion of the learned senior counsel for the appellants, it is directed that the mainmatter will be finally heard on 25.09.2018 at 2.00 pm. The issues raised in the application dated08.08.2018 as well as all other issues and contentions the appellant and/or the respondents maylike to raise will be heard together with the main matter on 25.09.2018.

It is also clarified to all parties that no adjournment will be granted on the date of final hearing i.e.25.09.2018.


connected with:

First Appeals No. 447/2017 to 452/2017; 634/2017 to 637/2017


connected with:

First Appeals No. 1237/2017 ; 1241/2017; 1243/2017; 1248/2017; 1252/2017; 1310/2017 to1316/2017

Dated: 18.09.2018

List these matters on 25.09.2018, the date already fixed.

Learned counsel for the builder co. further informed that the above-referred Order dated25.09.2018 of Hon’ble High Court has been complied with by this bench:


Connected with:

First Appeals No. 447/2017 to 452/2017; 634/2017 to 637/2017


connected with:

First Appeals No. 1237/2017 ; 1241/2017; 1243/2017; 1248/2017; 1252/2017; 1310/2017 to1316/2017

Dated: 25.09.2018

Learned counsels for the appellant – builder co. have handed over Order dated 25-09-2018 ofHon’ble High Court, Delhi in which the operative portion is as below:

“…….Without any observations on the merits or demerits of the submissions, taking into accountthe proceedings in CM (M) 953/17 and the verdict of the Hon’ble Supreme Court in “ Madras

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” (supra), further proceedings before theBar Association Vs. Union of India and Anotherlearned Bench No. 6 of the National Consumer Disputes Redressal Commission in relation toappeal no. First Appeal No.446/2017 connected with First Appeals no. 447/2017 to 452/2017;First Appeal No. 634/2017 to 637/2017 and First Appeal no. 1236/2017 connected with FirstAppeals no. 1237/2017, 1241/2017; 1243/2017; 1248/2017; 1252/2017; 1310/2017 to 1316/2017are stayed till further orders and furthermore the operation of the order dated 08.08.2018 and18.09.2018 in the said cases of the Bench no. 6 of the National Consumer Disputes RedressalCommission is also stayed till further orders…….”

In compliance:

(i) Proceedings before this bench no. 6 in relation to the said appeals shall remain stayedtill further orders of Hon’ble High Court.

(ii) Operation of the Order dated 08.08.2018 shall remain stayed till further orders ofHon’ble High Court.

(iii) Operation of the Order dated 18.09.2018 shall remain stayed till further orders ofHon’ble High Court.

Learned counsels for the builder co. submitted that, having regard to Hon’ble High Court’s18. above-referred Order dated 25.09.2018 in CM (M) 1141 / 2018 & CM APPL. 38729 / 2018, thisbench may consider not to take up these 16 f.a.s.

It was noted that the appellant – builder co. in the case before Hon’ble High Court (CM19.(M) 1141 / 2018 & CM APPL. 38729 / 2018) is the same. The respondents – complainants beforeHon’ble High Court are different i.e. different from the respondents – complainants in theseinstant 16 f.a.s before this bench. They are not parties before Hon’ble High Court. Therespondents – complainants in these 16 f.a.s are not being afforded opportunity before Hon’bleHigh Court. Hon’ble High Court has not stayed further proceedings in these instant 16 f.a.s.

Learned counsels for the appellant – builder co. could not show and did not affirm that anymention of these 16 f.a.s was made explicitly (or implicitly) in the applications filed beforeHon’ble High Court. Nor could they show or affirm that any prayer was made to seek Hon’bleHigh Court’s order that further proceedings in these instant 16 f.a.s be stayed. It was but admittedand accepted that no specific order of Hon’ble High Court (or Hon’ble Supreme Court) to stayfurther proceedings in these instant 16 f.a.s exists.

Learned counsels for the respondents – complainants submitted, explicitly and categorically, thatthere is no Order of Hon’ble High Court (or Hon’ble Supreme Court), whatsoever, in relation tothese instant 16 f.a.s. Specifically, there is no Order of Hon’ble High Court (or Hon’ble SupremeCourt) to stay further proceedings in these instant 16 f.a.s. They also drew attention to section19A of the Act 1986 wherein the ideal normative period for deciding first appeal is 90 days. Andthey requested that final arguments be heard, and the instant 16 f.a.s be decided.

This bench requested learned counsels for the builder co. to argue on merit on the 16 f.a.s20. taken up for arguments on 24.10.2018, to which they (finally) agreed.

The short delay of 1 day in filing f.a. no. 1144 of 2016 was overlooked.21.

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We note that these 16 f.a.s have similar facts and same questions of law involved.22.

We are taking f.a. no. 853 of 2016, arising from the Order dated 02.06.2016 of the StateCommission in c.c. no. 94 of 2016, DLF Homes Panchkula Pvt. Ltd. vs. D.S. Dhanda, as thelead-case.

The facts, as taken from the lead-case, first appeal no. 853 of 2016, and as recorded in23.paras 4, 5 and 6 of the said Order dated 02.06.2016 of the State Commission, are as below:

4. Under above circumstances, to dictate order, facts are being taken from consumer complaintbearing No. 94 of 2016, titled as D.S. Dhanda Vs. DLF Homes Panchkula Private Limited and

The complainant, who is a retired employee, has filed this consumer complaint seekinganr.possession of the unit, allotted to him, by the opposite parties. It is case of the complainant thatcopy of the brochure Annexure C-1, showing rosy pictures of the upcoming project, has beengiven to the prospective buyers, by the opposite parties. Allured by the facts given in the saidbrochure and appearing through media, the complainant booked a built-up flat, in the said project,on 30.03.2010 and paid an amount of Rs.4 lacs, towards booking amount. Vide letter dated03.04.2010, he was allotted flat, bearing no.DVF-E-7/25-FF#217, measuring 1450 square feetsaleable area, in a project known as “DLF Valley”, in Sector 3, Kalka-Pinjore Urban Complex,Panchkula, Haryana. Total price of the said unit, including External Development Changes,Infrastructure Development Charges etc. was fixed at Rs.35,08,999.69Ps. plus taxes payable asper law. Buyer’s Agreement was executed between the parties, on 11.02.2011. By that time, theopposite parties had already received an amount of about Rs.10 lacs. As per Clause 11 (a) of theAgreement, possession of the unit was contemplated to be delivered within 24 months, from thedate of execution of the same i.e. upto 10.02.2013, failing which, as per Clause 15, the oppositeparties were liable to pay Rs.10/- per square feet, per month, for the period of delay. When thiscomplaint was filed in the year 2016, the complainant had already paid an amount ofRs.32,18,158/-. It is grievance of the complainant that within the given time i.e. 10.02.2013,delivery of possession of the unit was not in sight. The opposite parties issued an advertisement ina newspaper namely “Hindustan Times” on 13.01.2014, much after the cutoff date, promising thatpossession of the units, will be handed over in the year 2014. Even thereafter, possession of theunit was not offered to the complainant. Many queries raised by the complainant, through variousletters/emails were not even replied by the opposite parties. It is also grievance of the complainantthat whatever construction has been raised at the site, is of poor quality and many facilities as perpromise made, has not yet been provided. It was averred that on account of non-delivery ofpossession of the unit, by the stipulated date, the complainant is being forced to live in a rentedaccommodation, for which he is paying hefty amount of rent to the tune of Rs.15,000/- per month,meaning thereby that additional financial loss has been caused to him. By stating as above, prayerhas been made, seeking directions to the opposite parties to deliver possession of the unit, inquestion, alongwith compensation and litigation expenses.

5. Upon notice, reply was filed by the opposite parties, wherein assertions made by thecomplainant were controverted. It was stated that on account of delay in handing over possessionof the unit, no loss is going to be caused to the complainant because allotment made to him is costescalation free. Possession of the constructed unit will be handed over to the complainant at aprice, which was fixed in the year 2011. Execution of the Agreement and promise to hand overpossession within 24 months, from the date of execution of that Agreement were not controverted.However, it is stated that construction at the site could not be completed, on account of staygranted on construction activities, by the Hon'ble Supreme Court of India, between 19.04.2012

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upto 12.12.2012, which caused delay in handing over possession of the constructed unit to thecomplainant. It was further stated that to get extension of time of one year, to handover possessionof the unit, consent was sought from the complainant vide letter dated 05.06.2013 Annexure R-9and in the alternative, it was open to him to get back the money deposited by him, alongwithsimple interest @9% p.a.. However, the said option was not exercised by the complainant. It isstated that as on date, when reply was filed, construction of 258 independent floors is completeand another 1517 built-up units are near completion. Even occupation certificates have beenreceived for aforesaid 259 units and as on date 86 units have been offered for possession to theowners. Not only this, even completion certificate in respect of the project, has been obtainedfrom the Competent Authorities. It is stated that when construction is not complete, on account offorce majeure circumstances, the complainant is only entitled to get delayed compensation. It isasserted that the unit, in question, was purchased for future gain, as such, the complainant wouldnot fall within definition of a consumer, as defined under Section 2 (1) (d) of 1986 Act. It wasalso pleaded that time is not the essence of contract. It is pleaded that construction of the units, isin full swing and offer of possession, will be given to the complainant shortly. Even,facilities/amenities to be provided, are on the verge of completion and the same will be providedto the buyers, in coming days.

6. On merits, it was admitted that the unit was sold to the complainant. Amount so received andfurther that possession could not be delivered in time, for want of complete construction, was alsoadmitted. It was averred that the complainant defaulted in making payment of installments,towards the said unit. It is further stated that not only as above, other reasons for delay in startingconstruction work, at the site are, delay in sanction/ revision of layout plans by the CompetentAuthorities; delay in approval of service plans and various other approvals/sanctions etc. by theCompetent Authorities. It is further said that the complainant will be compensated, by makingpayment of compensation for the period of delay in handing over the possession, by the oppositeparties, as per Clause 15 of the Agreement. It is a contractual obligation between the parties to bedischarged, as such, this Commission has no jurisdiction to entertain the complaint and only theCivil Court has jurisdiction. It is stated that terms and conditions of the Agreement are bindingupon the parties. Prayer was made, to dismiss the complaint, filed by the complainant.

The salient material dates and the specific awards made in the 16 f.a.s are depicted in24. tabular form below:

C.C.Nos.

(F.A.Nos.)

Date ofBuyer’sAgreement

Date ofInstitution ofCompliant

Physicalpossession

Registrationof

Sale Deed

Compensation

by way of intereston

the depositedamount

Compensation

in lumpsumform

Cost oflitigation

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Date ofImpugnedOrder

C.C. 94of 2016

(f. a.

853 of2016)

[lead-case]

11.02.2011

14.03.2016

02.06.2016

To handoverphysicalpossessionwithin fourmonths.

To execute andregister thesale deedwithin onemonth fromdate of handingover ofpossession.

Interest @12% p.a.on the depositedamount from10.02.2014 to31.05.2016 within 2months, failingwhich the saidamount shall carrypenal interest @15%p.a. till realization;and

Interest @12% p.a.on the depositedamount from01.06.2016 onwards(by 10 ofth

following month),failing which thesame shall carrypenal interest @15%p.a. from the date ofdefault till thedelivery ofpossession.

Rs. 3 lakh,within 2months

Rs.50,000/-within 2months

25.04.2011



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C.C. 158of 2016;

(f. a.

854 of2016)

22.04.2016

02.06.2016






C.C. 159of 2016

(f. a.

855 of2016)

20.12.2010

22.04.2016

02.06.2016







Rs.50,000/-

within 2months

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C.C. No.137 of2016

(f. a.

1144 of2016)

02.01.2012

11.04.2016

02.08.2016

To handoverphysicalpossessionwithin threemonths.


Interest @12% p.a.on the depositedamount from02.01.2015 to31.07.2016 within 45days, failing whichthe said amount shallcarry penal interest@15% p.a. tillrealization; and


following month),failing which thesame shall carrypenal interest @15%p.a. from the date ofdefault till thepayment is made.

Rs. 1.50 lakhwithin 45 days

Rs.50,000/-within 45days

C.C. No.133 of2016

(f. a.

1237 of2016)

07.01.2011

06.04.2016

17.08.2016

To handoverphysicalpossessionwithin 30 days.




following month),failing which thesame shall carrypenal interest @15%



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p.a. from the date ofdefault till thepayment is made.

C.C.Nos. 192of 2016&

193 of2016

(f. a.s no.

1239 of2016 &1240 of2016)

01.02.2011

09.05.2016

17.08.2016

&

05.05.2011

09.05.2016

17.08.2016

To handoverphysicalpossessionwithin 3months.


Interest @12% p.a.on the depositedamount from02.02.2014 and06.05.2014,respectively to31.08.2016 within 45days, failing whichthe said amount shallcarry penal interest@15% p.a. tillrealization; and



Rs. 1.50 lakh(each) within 45days

Rs.50,000/-(each)within 45days

C.C. No.232 of2016

11.11.2010



Interest @12% p.a.on the deposited

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(f. a.

1306 of2016)

24.05.2016

29.08.2016


amount from01.09.2016 onwards(by 10 ofth

following month),failing which thesame shall carrypenal interest @15%p.a. from the date ofdefault till thepayment is made;

to refund thededucted amount ofRs.52,842/-alongwith interest12%p.a. within 45days.



C.C. No.243 of2016

(f. a.

1307 of2016)

30.12.2010

30.05.2016

29.08.2016








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C.C. No.313 of2016

(f. a.

1308 of2016)

22.02.2011

04.07.2016

29.08.2016








C.C.Nos. 273of 2016;

311 of2016;

312 of2016

&

08.12.2010

17.06.2016

01.09.2016

&

31.01.2011

04.07.2016

01.09.2016


Interest @12% p.a.on the depositedamount from08.12.2013,31.01.2014,03.12.2013 and27.01.2014,respectively to31.08.2016 within 45days, failing whichthe said amount shallcarry penal interest@15% p.a. tillrealization; and

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316 of2016

(f. a.s no.

1309 of2016,1310 of2016,1311 of2016 & 1312 of2016)

&

03.12.2010

04.07.2016

01.09.2016

&

27.01.2011

04.07.2016

01.09.2016




Rs. 1.50 lakh(each) within 45days.

Rs.50,000/-(each)within 45days

C.C. No.220 of2016

(f. a.

1314 of2016)

09.12.2010

19.05.2016

01.09.2016

To handoverphysicalpossessionwithin 30 dayson payment ofthe amount bythecomplainantraised videletter dated03.02.2016,exceptcontingentdeposit [email protected] persq. ft. in thesum ofRs.25,477/-and Advocatefees/charges ofRs.18,000/-.



following month),failing which the

Rs. 1.00 lakhwithin 2months.


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same shall carrypenal interest @15%p.a. from the date ofdefault till thepayment is actuallymade.

C.C. No.278 of2016

(f. a.

1356 of2016)

03.02.2011

21.06.2016

12.09.2016

To handoverphysicalpossessionwithin 3months onpayment of dueamount by thecomplainant.





Rs. 1.50 lakhwithin 45 days.

Rs.50,000/-within 45days.

The State Commission vide its Order dated 02.06.2016 had allowed the complaint with25.directions as recorded in para 28 of its Order (lead-case):

28. For the reasons recorded above, all the complaints are partly accepted, with costs, in thefollowing manner:-

Consumer Complaint bearing No. 94 of 2016, titled as D.S. Dhanda Vs DLF HomesThe opposite parties are jointly and severally directed as Panchkula Private Limited and anr.

under:-

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1.

2.

3.

4.

5.

6.

To hand over physical possession of the unit, allotted in favour of the complainant,complete in all respects, as per the terms and conditions of the Agreement, to thecomplainant, within a period of four months, from the date of receipt of a certified copy ofthis order, on payment of the amount, legally due against him.

To execute and get registered the sale deed, in respect of the unit, in question, within onemonth from the date of handing over possession, as indicated in Clause (i) above, onpayment of registration charges and stamp duty, by the complainant, directly to theRegistering Authorities concerned.

To pay compensation, by way of interest @12% p.a., on the deposited amount, to thecomplainant, from 10.02.2014 to 31.05.2016, within 2 months, from the date of receipt of acertified copy of this order, failing which, the said amount shall carry penal interest @15%p.a. instead of 12% p.a., till realization.

To pay compensation by way of interest @12% p.a. on the deposited amount, due to thecomplainant w.e.f. 01.06.2016, onwards (per month), by the 10 of the following month,th

failing which, the same shall also carry penal interest @15 % p.a., instead of 12% p.a., from the date of default, till the delivery of possession.

To pay compensation, in the sum of Rs.3 lacs, on account of mental agony and physicalharassment, caused to the complainant, within two months from the date of receipt of acertified copy of this order, failing which, the same shall carry interest @12% p.a., from thedate of filing the complaint till realization.

To pay cost of litigation, to the tune of Rs. 50,000/-, to the complainant, within two monthsfrom the date of receipt of a certified copy of this order, failing which, the same shall alsocarry interest @12% p.a., from the date of filing the complaint till realization.

. After hearing arguments on 24.10.2018, and after perusing the material on record, and after26thoughtful consideration, we recorded the gist of our considered view in the daily Order of24.10.2018:

1. Heard the learned counsels for the appellant – builder co. and the learned counsels for therespondents - complainants.

2. Perused the material on record.

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3. We hold deficiency in service and unfair trade practice on the part of the appellant – builderco.

4. The operative paragraph of the impugned Order dated 02.06.2016 of the State Commission inF.A. No. 853 of 2016 is partially modified as below:

sub-paras (i) & (ii): as such, unequivocally re-articulated

sub-paras (iii), (iv) & (v): compensation:

(a) by way of interest on the deposited amount from the assured date of handing over possessionto the actual date of handing over possession. The rate of interest shall be the rate for housebuilding loan in the corresponding period in a scheduled nationalized bank (take, State Bank ofIndia). If ‘floating’/varying/different rates of interest were prescribed, the higher rate shall betaken for this instant computation; and

(b) a sum of Rs. 1 lakh per year from the assured date of possession to the actual date ofpossession (pro – rata to the nearest whole month, with part month to be taken as one month).

sub-para (vi): cost of litigation: a sum of Rs. 1,00,000/-.

apropos impugned Orders of the 15 connected cases.Mutatis mutandis

5. In addition, specifically for indulging in unfair trade practice, stern advice of caution to theappellant - builder co. with cost of Rs. 25,000/- in each case (i.e. in total 1 + 15 = 16 cases) to bedeposited in the Consumer Legal Aid Account of the State Commission.

6. Full compliance of sub-paras (i) & (ii) shall be made within four weeks of the date of thereasoned judgment.

All payments (as modified) in respect of sub-paras (iii) to (vi) shall be made within four weeks ofthe date of the reasoned judgment.

Failure in timely compliance shall attract higher/penal interest and other compensation/costs(which shall be determined by this Commission in the facts and specificities of that contingency ifit so arises).

7. Reasoned judgment to follow.

We are giving our reasons hereinafter.

To succinctly bring the rival contentions into focus, it may be stated, in brief, that, in the27.lead-case, the contention of the complainant was that despite depositing more than 90% of thetotal cost of the subject unit (deposited: Rs.32,18,158/; total cost: Rs.35,08,999.69p), the builderco. failed to deliver physical possession of the unit till the date of filing of the compliant [as wellas till the date of decision of the State Commission (02.06.2016), as also till the date of arguments(24.10.2018) in the first appeal before this Commission]. As per the terms and conditions of thebuyer’s agreement dated 11.02.2011, the possession was to be delivered within two years from the

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date of execution of the agreement i.e. upto 10.02.2013. The construction raised at the site was ofpoor quality and many basic facilities / amenities, as promised, had not yet been provided. Due tonon-delivery of possession of his dwelling unit, the complainant was being forced to live in arented house despite paying almost the full cost.

And the contention of the builder co. was that due to the possession of the unit inforce majeurequestion could not be delivered to the complainant in time as Hon’ble Supreme Court vide itsOrder dated 19.04.2012 stayed construction activities at the site. Time was not the essence of thecontract. The builder co. vide its letter dated 05.06.2013 explained the reasons for delay inhanding over possession and gave an option to cancel the allotment and avail refund along withsimple interest (@ 9% p.a.) but the complainant did not avail the said offer. The builder co. iswilling to pay compensation @ rs.10/- per sq. ft. per month as per clause 15 of the agreement tothe complainant if he is not found guilty of breach of any terms and conditions of the agreement.The State Commission has no jurisdiction to entertain this complaint because the allegationslevelled against the builder co. require detailed interpretation of the clauses of the agreementwhich cannot be done in summary proceedings.

The State Commission in its Order dated 02.06.2016 has given findings that28. reasoned(lead-case):

(a) the complainant is a consumer within the definition of ‘consumer’ under section 2 (1) (d) ofthe Act 1986 (para 16 of the State Commission’s Order);

(b) the complaint is maintainable in consumer fora (State Commission) as per section 3 of the Act1986 (para 18);

(c) existence of an arbitration clause in the agreement does not bar the jurisdiction of the StateCommission (para 19);

(d) time was unequivocally made the essence of the contract (para 17);

(e) the shelter of conditions can not be taken by the builder co. as it did not takeforce majeurerequisite approvals / sanctions from the competent authorities before launching the project inquestion (para 15 ); and

(f) (in addition to deficiency in service,) the builder co. is also guilty of adoption ofinter aliaunfair trade practice (para 20, para 21).

During arguments on 24.10.2018 learned counsels for the builder co. handed over a fair29.number of judgements and citations to support its contentions:

1. Madhya Pradesh Housing Board Vs. Progressive Writers and Publishers, (2009) 5Supreme Court Cases 678;

2. Bangalore Development Authority Vs. Syndicate Bank, (2007) 6 Supreme Court Cases711;

3. Haryana Urban Development Authority Vs. Raje Ram, (2008) 17 Supreme Court Cases407;

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4. Budhi Ram Vs. Haryana Urban Development Authority & Ors., II (2011) CPJ 165(NC);

5. Shri Satish Kumar Pandey & Anr. Vs. M/s. Unitech Ltd., Consumer Case No. 427 of2014 (along with 23 connected Consumer Cases) decided on 08.06.2015 by the NationalCommission;

6. Prashant Kumar Shahi Vs. Ghaziabad Development Authority, (2000) 4 Supreme CourtCases 120;

7. Kailash Nath Associates Vs. Delhi Development Authority & Anr., (2015) 4 SupremeCourt Cases 136;

8. Delhi Development Authority Vs. P.R. Samanta, (2015) 14 Supreme Court Cases 501;

9. Secretary, Bhubaneshwar Development Authority Vs. Susanta Kumar Mishra, (2009) 4Supreme Court Cases 684;

10. Ghaziabad Development Authority Vs. Balbir Singh, (2004) 5 Supreme Court Cases 65;

11. HUDA Vs. Raj Singh Rana, (2009) 17 Supreme Court Cases 199;

12. State of Rajasthan & Anr. Vs. Ferro Concrete Construction Pvt. Ltd., (2009) 12Supreme Court Cases 1;

13. Krishna Bhagya Jala Nigam Ltd. Vs. G. Harischandra Reddy & Anr., (2007) 2 SupremeCourt Cases 720;

14. M/s. Ackruti Jay Developers & Ors. Vs. Sashi Govind Gadakh, R.P. No. 2942 of 2015decided on 06.01.2017 by the National Commission;

15. Capt. Gurtaj Singh Sahni & Anr. Vs. Manager, Unitech Ltd. & Anr., Consumer CaseNo. 603 of 2014 (along with 17 connected Consumer Cases) decided on 02.05.2016 by theNational Commission;

16. Satish Kumar Malhotra & Ors. Vs. DLF Ltd. & Anr., Consumer Case No. 1375 of 2015decided on 07.06.2016 by the National Commission;

17. DLF Ltd. & Anr. Vs. Satish Kumar Malhotra & Ors., Civil Appeal No. 7371 of 2016,decided on 26.08.2016 by Hon’ble Supreme Court;

18. DLF Homes Panchkula Pvt. Ltd. & Anr. Vs. Himanshu Arora & Anr., First Appeal No.123 of 2017(along with connected 41 First Appeals) decided on 11.12.2017 by the NationalCommission;

19. DLF Homes Panchkula Pvt. Ltd. & Anr. Vs. Himanshu Gupta & Anr., R.A. No. 114 of2018 in First Appeal No. 123 of 2017, decided on 09.04.2018 by the National Commission;

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20. DLF Homes Panchkula Pvt. Ltd. & Anr. Vs. Himanshu Arora & Anr., Petition(s) forSpecial Leave to Appeal (C) No.(s) 12603 of 2018 dated 18.05.2018 of Hon’ble SupremeCourt ; and

21. M/s Emaar MGF Land Ltd. & Anr. Vs. Aftab Singh, Civil Appeal Diary No.(s) 37997of 2017 with Civil Appeal No. D. No. 38994 of 2017 dated 15.12.2017 of Hon’ble SupremeCourt.

The judgements and citations handed over by learned counsels for the builder co. have30.been perused by us. We find that they are not relevant or applicable on the facts and specificitiesof this case, they are not relevant or applicable here in the manner and for the purpose theirrelevance and applicability was sought to be argued by learned counsels for the builder co.

. The State Commission had heard both sides, appraised the evidence, and passed a reasoned31Order.

We are broadly in agreement with the findings of the State Commission.

We are, but, also making our reasoned examination of the matter, as well as stating the reasons forfinding it appropriate to slightly modify the award of the State Commission.

We may first note that the Act 1986 is for better protection of the interests of consumers, to32.provide speedy and simple redressal to consumer disputes, in recognizedly a fight amongstunequals.

We may also note that the consumer – complainant is not seeking specific performance of a33.contract in a civil court; he is seeking consumer justice from a quasi-judicial machinery forredressal of consumer disputes under the provisions of the Consumer Protection Act, 1986.

Section 3 of the Act 1986 specifically provides that the provisions of this Act shall be in34. addition to and not in derogation of the provisions of any other law for the time being in force. That is, the remedy provided under the Act is in addition to the provisions of any other law for thetime being in force; the provisions of this Act give the consumers an additional remedy besidesthose that may be available under other existing laws.

. It flows straightaway from section 3 of the Act that existence of an arbitration clause in the35agreement does not bar the jurisdiction of the State Commission.

The subject unit is a residential dwelling units, the subject project is a residential housing36. project.

The complainant who entered into the buyer’s agreement with the builder co. was ‘consumer’within the meaning of section 2(1)(d) of the Act 1986. On the face of it, he was not barred oncount of “commercial purpose” (exception and ‘explanation’ to section 2(1) (d) refer) etc.

It may be added here that the buyer’s agreement and the amount deposited by the complainantwith the builder co. are admitted by both sides.

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The State Commission had the jurisdiction to entertain these complaints, and to adjudicate37. apropos deficiency in service [section 2(1) (g) & (o)] and unfair trade practice [section 2(1) (r)]under the additional (alternative) remedy provided for consumers (section 3). We find no issueinvolved, as may require such (voluminous) oral and documentary evidence and such (complex)examination as to make it apt or necessary to be adjudicated only and only by a civil court. Wefind the case within the professional competence and lawful jurisdiction of the State Commission.The builder co.’s contentions to the contrary are misconceived and erroneous.

Here, first, we may refer to clause 11 (a) to (c), clause 14 and cause 15 of the buyer’s38.agreement:

Clause 11 (a) to (c):

(a) Schedule for possession of the Said Independent Floor

The Company based on its present plans and estimates and subject to all just exceptions,endeavors to complete construction of the Said Independent Floor within a period of twenty four(24) months from the date of execution of the Agreement unless there shall be delay or failure dueto Force Majeure conditions and due to reasons mentioned in Clause 11(b) and 11(c) or due tofailure of Allottees to pay in time the Total Price and other charges, taxes, deposits, securities etc.and dues/ payments or any failure on the part of the Allottee abide by all or any of the terms andconditions of this Agreement.

(b) Delay due to reasons beyond the control of the Company

If the possession of the Said Independent Floor is delayed due to Force Majeure conditions, thenthe Company shall be entitled to extension of time for delivery of possession of the SaidIndependent Floor. The Company during the continuance of the Force Majeure reserves the rightto alter or vary the terms and conditions of this Agreement or if the circumstances so warrant, theCompany may also suspend the development for such period as is considered expedient and theAllottee shall have no right to raise any claim compensation of any nature whatsoever for or withregard to such suspension.

The Allottee agrees and understands that if the Force Majeure condition continues for a longperiod, then the Company alone in its own judgment and discretion may terminate this Agreementand in such case only the liability of the Company shall be to refund the amount without anyinterest or compensation whatsoever. The Allottee agrees that the Allottee shall have no right orclaim of any nature whatsoever and the Company shall be released and discharged of all itsobligations and liabilities under this Agreement.

(c) Failure to deliver possession due to Government rules, orders, notifications etc.

If the Company is unable to complete the construction/development of the Said IndependentFloor/ Said Building/ Said Project due to any government/ regulatory authority’s action, inactionor omission then the Company may in its sole discretion challenge the same by moving theappropriate Courts, Tribunal(s) and / or Authority. In such a situation, the amount(s) paid by theAllottee shall continue to remain with the Company and the Allottee shall not have a right toterminate this Agreement and ask for refund of his money and this Agreement shall remain inabeyance till final determination by the Court(s) / Tribunal(s) / Authority (ies). However the

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Allottee may, if so desires become a party along with the Company in such litigation to protectAllottee’s rights arising under this Agreement. In the event the Company succeeding in itschallenge to the impugned legislation or rule, regulation, order or notification as the case may be,it is hereby agreed that this Agreement shall stand revived and the Allottee shall be liable to fulfilall obligations as provided in this Agreement. It is further agreed that in event of the aforesaidchallenge becomes final, absolute and binding, the Company will subject to provisions oflaw/court order, refund within reasonable period in such manner as may be decided by theCompany to the Allottee all the amounts received from the Allottee after deducting NonRefundable Amounts without any interest or compensation and the decision of the Company inthis regard shall be final and binding on the Allottee save as otherwise provided herein, theAllottee shall be left with no other right, claim of whatsoever nature against the Company underor in relation to this Agreement.

Clause 14:

Failure to deliver Possession by the Company

If for any reasons other than those stated above, the Company is unable to or fails to deliverpossession of the Said Independent Floor to the Allottee within twenty four months (24) from thedate of execution of the Agreement or within any extended period or periods as envisaged underthis Agreement, then in such case, the Allottee shall be entitled to give notice to the Company,within ninety (90) days from the expiry of said period or such extended periods, as the case maybe, for terminating this Agreement. In that event the Company shall be at liberty to sell and / ordispose of the said Independent Floor and Parking Space(s) to any other party at such price andupon such terms and conditions as the Company may deem fit without accounting for the saleproceeds thereof to the Allottee. Thereafter the Company shall within ninety (90) days from thedate of full realization of the sale price after sale of said Independent Floor and the ParkingSpace(s) refund to the Allottee, without any interest, the balance from the amounts paid by theAllottee in respect of the said Independent Floor and the Parking Space(s) without deduction ofEarnest Money but after deduction of other Non Refundable Amounts. The Allottee agrees thatthe Allottee shall have no other claim against the Company in respect of the said IndependentFloor and Parking Space(s) under this Agreement. If the Allottee fails to exercise the right oftermination within the time limit as aforestated, by delivery to the Company of a written noticeacknowledged by the Company in this regard then the Allottee shall not be entitled to terminatethis Agreement thereafter and shall continue to be bound by the provisions of this Agreement.

Clause 15:

Abandonment

The Allottee agrees and understands that the Company may abandon the said Project due to anyreasons whatsoever, without giving any reasons and if the Company abandons the said Projectthen this Agreement shall stand terminated and the Allottee shall be entitled to refund of theamount alongwith 9% interest per annum for the period the amount has been laying with theCompany and the Company shall not be liable to pay any other compensation whatsoever.

However, the Company may, at its sole option and discretion, decide not to terminate thisAgreement in which event the Company agrees to pay only to the Allottee(s) and not to any oneelse subject to the Allottee not being in default under any term of this Agreement, compensation

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@ Rs.10/- per sq. ft. of the Saleable Area of the said Independent Floor per month for the periodof such delay beyond twenty four months or such extended periods as permitted under thisAgreement. The adjustment of such compensation shall be done only at the time of conveyancingthe said Independent Floor to the Allottee first named in this Agreement, and not earlier.

. Without in any manner negating the fact that the consumer – complainant entered into the39buyer’s agreement voluntarily, with eyes open, we may, but, also place in perspective that theappellant is a builder co., its activities spread across different districts and states of the country. Ithas its own pre-determined and pre-set articulation of (its) buyer’s agreement. The buyer –consumer has to necessarily agree to the letter of the agreement, inclusive of all its terms andconditions, as determined and set by the builder co., else, he cannot enter into the agreement at all.The language (pre-determined, pre-set) of the agreement is vetted, administratively, financially,technically and legally, by functionaries (/ experts) of the builder co., and the buyer – consumer has to but agree to it (there is anin totoelement of ‘take it, or leave it’, notwithstanding that the buyer-consumer enters into the buyer’sagreement voluntarily and with eyes open and is aware of its articulation and language). We,however, made it explicit that we are, but, only putting the perspective in place, and are not(repeat not) treating this to be unfair or deceptive within the meaning of section 2 (1) (r) of theAct.

We also want to place in perspective that the nature of the agreement between the builder co. andthe consumer – complainant was in essence of a self-financing scheme, in which the consumer –complainant was paying the builder co. the agreed total cost prior to / simultaneous to theconstruction, and it went without saying that the total cost included the builder co.’s effort andprofit.

. For an ordinary common buyer – consumer, the two fundamentals which are significant40and material are, , ‘Cost’ and, , ‘Time’, that is, the total cost, read with the schedule ofone twomaking payment, and the total time period in which possession would be delivered.

The clear sum and substance and import of “- - - endeavors to complete construction of the41. Said Independent Floor within a period of twenty four (24) months from the date of execution ofthe Agreement - - -” in clause 11(a) read in conjunction with “- - - compensation @ Rs.10/- persq. ft. of the Saleable Area of the said Independent Floor per month for the period of such delaybeyond twenty four months - - -” in clause 15 as evident to a reasonable man of normalintelligence is that the builder co. would complete construction and hand over possession of theunit within a period of 24 months from the date of execution of the agreement, and, in case thereis some short reasonable delay in offering possession, the builder co. would pay compensation forsuch short reasonable delay @ rs.10/- per sq. ft. of the saleable area of the independent floor permonth.

That in clause 11(a) the words “subject to all just exceptions” or “endeavours to complete” etc.etc. have been used or that other terms and conditions (albeit ‘ifs and buts’) have been built intoclause 11(a) to (c), and / or clause 14, and / or clause 15, and / or other clauses, does not in anymanner take away the import of the proposition intended to be conveyed and understood.

And the compensation for delay provided for in clause 15 (rs.10 per sq. ft. p.m.) cannot be for anunreasonably protracted period or indefinite; at best it can be for a short period that would appearto be reasonable and would be acceptable to a reasonable man.per se as such

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The contention forwarded by the builder co. that the various terms and conditions of clause 11(a)to (c), clause 14 and clause 15, read together, imply that delay could for any period beyond 24months, short or protracted, reasonable or otherwise, and the (self-evidently meagre)compensation for delay provided for in clause 15 could be paid indefinitely for any period above24 months is misconceived and erroneous. As already stated, the clear import and intent of “- - -endeavors to complete construction of the Said Independent Floor within a period of twenty four(24) months from the date of execution of the Agreement - - -” in clause 11(a) read with thecompensation of “- - - @ Rs.10/- per sq. ft. of the Saleable Area of the said Independent Floor permonth for the period of such delay beyond twenty four months - - -” provided for in clause 15 isthat the construction would be completed and the possession handed over not later than 24 monthsof the execution of the agreement and that for a short reasonable delay beyond 24 months a(somewhat token) compensation would be paid.

To say that the possession can be delayed indefinitely or unreasonably and a token compensationfor delay can be paid indefinitely or for an unreasonably protracted period is misconceived anderroneous. Indefinite or unreasonable delay with token compensation for delay cannot continue ad

, (such situation would be absurd).nauseam ad infinitum

The builder co.’s contention that ‘time is not the essence of the contract’ is misconceived anderroneous.

From the afore discussion, an axiom flows that the builder co. had to hand over possession42. of the unit within a period of 24 months from the date of agreement as provided for in clause11(a) and a short reasonable delay would have attracted token compensation as provided for inclause 15 (this token compensation for a short period, would, by its very nature, has to be onlyand only for a short period which a reasonable man would not agitate).

And two natural corollaries flow therefrom; , the consumer-complainant has the fundamentaloneoption to obtain the possession of the unit as and when it is offered by the builder co. and inaddition seek just and equitable compensation under the Act 1986 for delay in offering possessionbeyond the conveyed and understood period of 24 months if the delay was unreasonable; , thetwoconsumer-complainant has the other option to claim refund of the principal amount; interestthereon; and compensation, if the offer of possession of the unit is unreasonably delayed beyond24 months.

. Summing up, the consumer- complainant has both options available, , to obtain43 onepossession of the unit as and when offered by the builder co. and to in addition seek just andequitable compensation under the Act 1986 for unreasonable delay in possession, and, , to opttwofor a fair amount from the builder co. if the possession of the unit is unreasonably delayed.

Here, in the lead-case, c.c. no. 94 of 2016, f.a. no. 853 of 2016, the agreement was44.executed on 11.02.2011, the conveyed and understood period of 24 months expired on10.02.2013, the consumer-complainant went to the State Commission on 14.03.2016 i.e. almost37 months after expiry of the 24 months from the date of execution of the agreement.Significantly, the possession of the unit in question was not offered even in the subsequent periodof litigation in the State Commission (upto 02.06.2016; about 2 ½ more months) and also in thestill subsequent period of litigation in the National Commission (upto 24.10.2018, the date of

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arguments; about 28 yet more months). Such delay in offering possession cannot be said to bereasonable or normal. The complainant’s right to seek either of the two remedies summed-up inpara 43 above is well and truly evident.

The position in respect of the other 15 c.c.s / f.a.s is similar (the table in para 24 refers).

. It is seen that of the two options available to the consumer – complainant (as determined in45para 43 above), he opted for obtaining possession and in addition seeking compensation under theAct 1986 for unreasonable delay in possession.

. For the consumer, when he entered into the buyer’s agreement and made his first deposit46towards the total cost, and subsequently continued to ( / will continue to) make his deposits (withthe stipulated penal interest if there was / is any delay in depositing any instalment/s) as per thestipulated schedule of deposit, the proposition conveyed and understood was that the constructionwould be completed, possession would be delivered, registration would be executed, completioncertificate and other documentary requisites from concerned authorities would be provided,requisite structural drawings & plans from the builder co. would be provided, by the builder co.,within the conveyed and understood time period of 24 months.

Prior to (or, at the least, simultaneous to) getting a consumer to enter into its buyer’s47. agreement and accepting the first payment towards the total cost of the unit, the builder co. isrequired and expected to have the due pragmatic and realistic assessment and preparation of theproject planning, execution and completion. Planning, execution and completion are itsresponsibility, and not of the consumer.

(Normal) impediments or problems that arise in planning, execution and completion are itsresponsibility, and not of the consumer.

Specifically, availability of land ( / acquisition of land), as well as approvals from competentauthorities, as and when due, being fundamental basic requirements of a housing project, aredecidedly the builder co.’s primary responsibilities, and not of the consumer.

Cost and Time overruns are its responsibility, not of the consumer.

. Non-fulfilment of its overall responsibilities of project planning, execution and completion48can not be and are not grounds for condoning or overlooking delay in completion and handingover possession.

, unforeseeable circumstances, irrespective of its various ‘liberal’ or ‘strict’Force majeureinterpretations, and irrespective of its various interpretations in different sets of facts, can, but, notbe nebulously and irrationally argued for anything and everything related to the builder co.’sresponsibilities for completion of the project without cost or time overruns.

. It is significant that the material facts and consequences relating to availability of land (/49acquisition of land) and approvals from concerned authorities at the due time were not brought tothe notice of the consumer at the time of entering into the buyer’s agreement. In the absence of the facts and the consequences thereof being specifically and explicitly brought to his notice, thebuyer – consumer would reasonably (and correctly) understand that all aspects of projectplanning, execution and completion, inclusive of availability of land (/ acquisition of land) and

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approvals from concerned authorities at the due time, are the responsibility of the builder co. andhave been / are being / would be duly taken care of by the builder co., without cost or timeoverruns. Not bringing the material facts and consequences relating to availability of land (/acquisition of land) and approvals from the concerned authorities at the due time to the notice ofthe buyer – consumer while entering into its buyer’s agreement was unfair and deceptive of thebuilder co. [within the meaning of section 2(1) (r) of the Act 1986].

. We note that due to litigation relating to acquisition of land, construction activity in the50project was stopped from 19.04.2012 to 12.12.2012 in compliance of Order dated 19.04.2012 ofHon’ble Supreme Court:

:Order dated 19.04.2012 of Hon’ble Supreme Court in SLP No. 21786-88 / 2010

We are of the view that the entire acquisition proceeding deserve to be quashed.prima facieHowever, before passing any order in that regard, we deem it proper to order impleadment of allthe persons, in whose favour land was released at different stages as parties to the special leavepetitions. Learned counsel for the petitioner is directed to furnish the list of all such persons bytomorrow and also file amended cause title.

The Registry is directed to issue notice to the impleaded parties returnable in the first week ofJuly, 2012.

With a view to avoid further complications in the matter, we direct the State of Haryana and itsfunctionaries and also the impleaded respondents not to undertake further constructions on theland which was acquired vide Notification dated 26.9.2007 read with the declaration dated25.9.2008. This would mean that all the ongoing construction activities shall be stopped forthwith.

:Order dated 12.12.2012 of Hon’ble Supreme Court in SLP No. 21786-88 / 2010

Before concluding, we consider it proper to observe that even though while issuing notice in thespecial leave petitions, the Court had felt that the legality of the acquisition merits consideration in the light of the alleged violation of Section 5A of the Act and the official respondents weredirected to file affidavits and produce records in the context of the alleged discriminationpracticed in the matter of release of land after the issue of notification under Sections 4 (1)and 6 (1) and passing of award, we do not consider it necessary and proper to decide thesame because the only argument made before the High Court related to the competence of ShriK.K. Amrohi to perform the functions of the Collector and no other issue was considered anddecided by the High Court.

In the result, the special leave petitions are dismissed. The interim orders stand automaticallyvacated.

As a sequel to the dismissal of the special leave petitions, all pending interlocutoryapplications are disposed of as infructuous.

We also note that vide its letter dated 05.06.2013 the builder co. had communicated the51. following to the buyer – consumer:

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Date of Notification :

26.09.2007

Date of Declaration :

25.09.2008

Date of buyer’s agreement (lead-case) :

11.02.2011

This is further to our letter of 28 December 2012. To recap the facts, we refer to our earlierth

letter dated 11.05.2012 by which we had informed that as per directions of the Hon’ble SupremeCourt vide its order dated 19.04.2012 in SLP No. 21786-88 / 2010 and a communication dated30.04.2012 from DTCP, Haryana, we had put the construction activities at the project site inabeyance and no further construction activities were carried out pursuant to the said directions.

The Hon’ble Supreme Court dismissed the SLP No. 21786-88 / 2010 vide its order dated12.12.2012 and the earlier order dated 19.04.2012 passed by Supreme Court to not to undertakefurther construction activities at the project land stands vacated.

The company will endeavour to complete the Project subject to the delay of 12 months which hasoccurred due to stoppage of the work mentioned above. We may also like to mention that forsuch delay the company is not liable for performance of its obligations as per the terms of theallotment of apartment as set out in clause 17 of the Application for allotment of apartment.

We request you to confirm that you will agree to the above conditions for additional time to betaken for completion of the construction. In case you do not agree to the above, the Company willcancel the allotment and refund the amount paid by you along with simple interest calculated @9% p.a.

We will request you to please provide your consent by sending a confirmation in the duplicatecopy of this letter within 10 days from the date of receipt of this letter. In case the company failsto receive the confirmation from you within the stipulated time period of 10 days, it will bedeemed to be considered that you are agreeable to continue with the allotment on the above termsand conditions, including the extended time line for completion of the project.

. We may note the chronology of dates:52

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Date of Hon’ble Supreme Court’s interim Order prohibiting constructionactivities :

19.04.2012

Date of Hon’ble Supreme Court’s Order vacating all interim Orders:

12.12.2012

Date of expiry of 24 months’ period for completing of construction anddelivery of possession :

10.02.2013

Date of letter from builder co. to complainant informing that it will“endeavour to complete the project subject to the delay of 12 months whichhas occurred due to stoppage of the work” and asking to confirm that thecomplainant agrees to the conditions for additional time to be taken forcompletion of the construction and informing that if he does not agree thebuilder co. will cancel the allotment and refund the amount paid with simpleinterest @ 9% per annum and further informing that if confirmation is notsent within 10 days it will be deemed that the complainant is agreeable tocontinue with the allotment with the changed terms and conditions :

05.06.2013

Date of filing of complaint in the State Commission :

14.03.2016

. The litigation apropos land acquisition had initiated to the entering into of the buyer’s53 prioragreement. The facts and consequences thereof were brought to the notice of the complainantnotat the time of entering into the buyer’s agreement. The letter dated 05.06.2013 was issued afterabout four months of expiry of the 24 month period to complete construction and deliverpossession. An offer of refund with 9% simple interest per annum on the deposited amount wasmade about four months the construction should have been completed and the possessionafterdelivered. An of was granted to either agree to delay of 12unreasonably short time 10 days

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months in completing construction and delivering possession or to take the deposited amount backwith 9% simple interest per annum, with a stipulation that if confirmation is not received withinthe 10 days it will be that the complainant to with the allotment with the deemed agrees continue

terms and conditions. Construction activities were stopped for about 8 monthschanged(19.04.2012 to 12.12.2012), (but) the builder co. assigned to itself an extended time period of 12months. The construction was completed of the said 12 months’ extendednot even after expirytime period (assigned, by the builder co., by itself, to itself). The 12 months’ extended time periodexpired on 09.02.2014. The complainant went to the State Commission on 14.03.2016 i.e. 25months thereafter. The arbitrariness and highhandedness of the builder co. is well evident. Thebuilder co.’s unfair and deceptive acts [within the meaning of section 2(1) (r)] are also wellevident.

. We may make it explicit that mere issuance of the letter dated 05.06.2013 did not in any54manner dilute the builder co.’s responsibilities towards project planning, execution andcompletion, including availability of land (/ acquisition of land) and approvals at the due time,without cost or time overruns, and which responsibilities arose (qua the complainant) on the dateof entering into the buyer’s agreement with the complainant and receiving the first paymenttowards the total cost of the subject unit from the complainant.

. The State Commission has granted compensation by way of interest from “10.02.201455(promised date in view of the extension sought vide letter dated 05.06.2013 i.e. 12 months afterthe stipulated date as per Agreement i.e. from 10.02.2013)” (lead-case):

To pay compensation, by way of interest @ 12% p.a., on the deposited amount, to thecomplainant, from 10.02.2014 (promised date in view of the extension sought vide letter dated

to05.06.2013 i.e. 12 months after the stipulated date as per Agreement i.e. from 10.02.2013)31.05.2016, within 2 months, from the date of receipt of a certified copy of this order, failingwhich, the said amount shall carry penal interest @15% p.a. instead of 12% p.a., till realization.

To pay compensation by way of interest @ 12% p.a. on the deposited amount, due to thecomplainant w. e. f. 01.06.2016, onwards (per month), by the 10 of the following month,th

failing which, the same shall also carry penal interest @ 15% p.a., instead of 12% p.a., from thedate of default, till the delivery of possession.

(para 28 (iii) & (iv) of the State Commission’s Order dated 02.06.2016)

We are not interfering with this date adopted by the State Commission to compute compensationfrom.

This however does not in any manner condone the unfair and deceptive facts and specificities ofthe said letter dated 05.06.2013, as brought out in para 53 above.

And, the (mere) issuance of such letter dated 05.06.2013, or adopting the milestone date forcomputing compensation from this letter, in no manner affects or dilutes the builder co.’sresponsibilities as enunciated in paras 47, 48, 49 and 54 above.

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We may specifically add that when the milestone date for computing interest has been kept as perthe date indicated in the unfair and deceptive letter dated 05.06.2013, there remains no case for,

, not giving just and equitable compensation, and, , not putting a just and appropriateone twotime-frame for the due compliance of the award made.

. In the lead-case there was delay in possession for a period of more than 37 months from the56expiry of 24 months of the date of execution of the agreement, and also more than 25 months ofthe date of expiry of the 12 months’ extended time period assigned by the builder co. (by itself toitself), before the consumer – complainant sought relief under the Act 1986. The possession of theunit was not offered even in the subsequent period of litigation in the State Commission (about 2½ more months) and also in the still subsequent period of litigation in the National Commission(upto 24.10.2018, the date of arguments; about 28 yet more months).

Deficiency in service within the meaning of section 2(1) (g) & (o) of the Act is well evident.

The position in respect of the other 15 c. c. s / f. a. s is similar (the table in para 24 refers).

The consumer – complainant was put to loss and injury, put to a continuous position of mentalagony and physical harassment, hardship and difficulty, uncertainty and helplessness, even aftermaking payment of 32,18,158 / 35,08,999 x 100 = about 92% of the total cost well beforeapproaching the State Commission.

We may note that the builder co. has raised two principal contentions:57.

that ‘time was not the essence of the contract’.one:

that due to the possession of the subject unit could not be given to thetwo: force majeurecomplainant in time as Hon’ble Supreme Court had stayed construction activities at the site videits Order dated 19.04.2012.

We have already determined in para 41 above that the builder co.’s contention that ‘time is not theessence of the contract’ is misconceived and erroneous. [Such finding has also been given by theState Commission (refer para 28 (d) above)].

We may also note that assigning (by itself to itself) an extended time period of 12 months by itsletter dated 05.06.2013 is also on the face of it inconsistent with the builder co.’s contentionper sethat ‘time was not the essence of the contract’. Had that been so, there was no need to assign toitself an additional time period in the way it was assigned by it vide its letter dated 05.06.2013(refer paras 53, 54 above). However, that being as it may be, we are, as already determined in para41 above, of the clear opinion that the builder co.’s contention that ‘time is not the essence of thecontract’ is misconceived and erroneous.

We may further note that, as already stated in paras 47 and 48 above, availability of land (/acquisition of land), as well as approvals from competent authorities, as and when due, beingfundamental basic requirements of a housing project, are decidedly the builder co.’s primaryresponsibilities, and not of the consumer, and, , unforeseeable circumstances,force majeureirrespective of its various ‘liberal’ or ‘strict’ interpretations, and irrespective of its variousinterpretations in different sets of facts, can, but, not be nebulously and irrationally argued for

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anything and everything related to the builder co.’s responsibilities for completion of the projectwithout cost or time overruns. In the given facts and position of this case, we do not find merit inthe builder co.’s contention that stoppage of construction activities for about 8 months (from19.04.2012 to 12.12.2012) due to an interim Order of Hon’ble Supreme Court in litigationapropos acquisition of land can be construed to mean .‘force majeure’

However, we may furthermore note that due to this interim Order of Hon’ble Supreme Court, thebuilder co. assigned to itself an extended time period of 12 months vide its letter dated05.06.2013. The State Commission has computed compensation from the date the extended timeperiod expired. We have also not interfered with this milestone date (refer para 55 above).

So, either way, this contention of the builder co. also fails.

In the light of the above discussion, we find, both, deficiency in service within the meaning58. of section 2(1) (g) & (o), and unfair trade practice within the meaning of section 2 (1) (r), to bewell and truly evident on the part of the builder co.

In remedy, it is just, equitable, appropriate and necessary to direct the builder co. to hand overphysical possession and to register the units as well as to pay compensation and cost of litigationto the complainants, and, in addition, specifically for indulging in unfair trade practice, to put thebuilder co. to stern advice of caution with just and appropriate cost.

. The complainants are entitled to the following relief:59

Possession:(A)

Physical possession of the subject unit, complete in all respects as per the terms and conditions ofthe subject agreement, and, specifically, as per the agreed & assured specifications & amenities,on payment of the total cost in full by the complainant as per the agreed schedule of payment(inclusive of penal interest for delay in payment of any instalment/s).

Registration:(B)

Execution and registration of the sale-deed, on payment of registration charges and stamp duty bythe complainant to the registering authorities, along with completion certificate and otherdocumentary requisites from the concerned authorities and requisite structural drawings & plansrelating to civil work, electrical work, water / plumbing, sanitation, etc. as are necessary andrequired for the buyer – consumer for future maintenance and upkeep of his unit.

Compensation:(C)

The compensation for loss and injury, for mental agony and physical harassment, hardship anddifficulty, uncertainty and helplessness, can be neither meagre nor exorbitant, but has to be justand equitable, commensurate with the loss and injury (note: it could be less than or more thanwhat the complainant asked for or what the State Commission determined, at the consideredwisdom of the adjudicating authority / court in the facts and specificities of the case).

And it is always desirable and preferable, to the extent feasible and appropriate in the facts andspecificities of a case, that some objective logical criteria be identified and adopted to determine

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the compensation. The compensation cannot be arbitrary or whimsical, some reasonable andacceptable rationale has to be evident, subjectivity has to be minimised.

We note that the State Commission has given compensation in two parts, , by way of interestoneon the deposited amount from the ‘promised’ / assured date after taking in view the extensionsought vide letter dated 05.06.2013 i.e. 12 months after the 24 months’ conveyed and understoodtime period for completing construction and handing over possession, and, , a lumpsumtwoamount.

If compensation comprises of two parts, (i) by way of interest on the deposited amount from theassured date (milestone date) of completing construction and handing over possession to theactual date of handing over possession, and, (ii) lumpsum amount, we find nothing wrong in it.

We do not agree with the builder co.’s contentions that interest on the deposited amount shouldnot be provided since it is not a case of refund but a case of delay in possession. The interest onthe deposited amount has to be viewed in the light of the purpose for which it is intended. It is buta way of computing compensation for delay in possession that is commensurate with the amountdeposited by the complainant, and here it has been computed after adopting a milestone date asper the builder co.’s own (unfair and deceptive) letter of 05.06.2013. There can be and is noquestion of not agreeing to and endorsing the award of interest from the said milestone date.

Here we may however add that the rate of interest also cannot be arbitrary or whimsical, somereasonable and acceptable rationale has to be evident, subjectivity has to be minimised, a logicalcorrelation has to be established. Albeit detailed arithmetic or algebra is not required. Logical, (tothe extent feasible) objective parameters should be adopted. Rounding off simplification etc. tomake the computation doable could be adopted.

We feel it appropriate that, considering that the subject units in question are dwelling units, in aresidential housing project, the rate of interest for house building loan for the correspondingperiod in a scheduled nationalized bank (take, State Bank of India) would be appropriate andlogical, and, if ‘floating’ / varying / different rates of interest were / are prescribed, the higher rateof interest should be taken for this instant computation.

We also feel it appropriate and logical that the lumpsum amount awarded should becommensurate with the period for which there has been delay in possession beyond the milestonedate, and be objectively and logically computed so.

In our considered view, a sum of Rs. 1 lakh per year from the assured date of handing overpossession to the actual date of possession (pro-rata to the nearest whole month, with part monthto be taken as one month) would be objective, logical, just and equitable in the facts andspecificities of the case.

Cost of litigation: (D)

In respect of cost of litigation, too, just and equitable cost is necessary (this, by its very nature,needs no elaboration).

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In our considered view, cost of litigation of Rs.1 lakh is just and appropriate in the facts andspecificities of the case.

. It is also to add that it would be inappropriate not to protect the lawful interests of the bank60/ financial institution that provided loan (if any) to the complainant, for the subject unit, when theactual dispute is between the complainant and the builder co. only and the bank / financialinstitution but provided loan to the complainant in the normal wont of its functioning.

We are thus of the considered view that the compensation and the cost of litigation should, first,go to the bank or financial institution from which the consumer – complainant has availed loanfacility (if any) for making payments to the builder co. towards the total cost of the unit. The firstcharge on the amount payable, to the extent, should be of the bank or financial institution fromwhich the consumer – complainant has taken loan for making the payment for the said dwellingunit.

. And consumer justice in the true sense has to be met. Once the award is adjudicated and61determined, the onus is on the builder co. to be prompt and dutiful in complying with the awardwithin the stipulated time. Creating yet further agony, harassment, hardship, difficulty,uncertainty, helplessness, for the consumer by delaying or diluting the compliance of the awardwithin the stipulated period (if the adjudication is not stayed or quashed or modified by a higherauthority / court) will be an unacceptable situation, to be viewed seriously – the agony,harassment, hardship, difficulty, uncertainty, helplessness, of the consumer should end, promptlyand fully, the chapter should close. Therefore, if the builder co. delays or dilutes the adjudicatedaward, it would and should attract higher / penal interest and other compensation / costs.

. We, finally, firm-up the award as below:62

The builder co. shall hand over physical possession of the subject unit, complete in all(A)respects as per the terms and conditions of the subject agreement and specifically as per theagreed & assured specifications & amenities, on payment of the total cost in full by thecomplainant as per the agreed schedule of payment (inclusive of penal interest for delay inpayment of any instalment/s), within four weeks from the date of pronouncement of this Order.

The builder co. shall execute and get registered the sale-deed of the subject unit, on(B)payment of registration charges and stamp duty by the complainant to the registering authorities,along with completion certificate and other documentary requisites from the concerned authoritiesand requisite structural drawings & plans relating to civil work, electrical work, water / plumbing,sanitation, etc. as are necessary and required for the buyer – complainant for future maintenanceand upkeep of his unit, within four weeks of pronouncement of this Order.

The builder co. shall pay compensation to the complainant:(C)

by way of interest on the deposited amount from the assured date of handing over(i) possession (i.e. the “promised date” 10-02-2014 indicated in the para 28( iii) of the StateCommission’s Order dated 02.06.2016) to the actual date of handing over possession (lead-case):

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The rate of interest shall be the rate for house building loan in the corresponding period in ascheduled nationalized bank (take, State Bank of India). If ‘floating’ / varying / different rates ofinterest were / are prescribed, the higher rate shall be taken for this instant computation;

The interest upto 31 October 2018 shall be paid within four weeks of the pronouncement of thisst

Order. The onus of calculating the correct and full interest and paying the same to the complainantwith clear and cogent calculation sheet shall be on the builder co.

For default in delivery of possession of the subject unit beyond 31 October 2018, the interest forst

each month, November 2018 onwards, shall be paid by the builder co. to the complainant withinthe immediate next month.

a sum of Rs. 1 lakh per year from the assured date of handing over possession to the actual(ii)date of handing over possession (pro – rata to the nearest whole month, with part month to betaken as one month).

The amount due upto 31 October 2018 shall be paid within four weeks of the pronouncement ofst

this Order. The onus of calculating the correct and full amount and paying the same to thecomplainant with clear and cogent calculation sheet shall be on the builder co.

For default in delivery of possession of the subject unit beyond 31 October 2018, the amountst

due for each month, starting November 2018 onwards, shall be paid by the builder co. to thecomplainant within the immediate next month.

The builder co. shall pay cost of litigation of Rs.1 lakh to the complainant, within four(D) weeks of the pronouncement of this Order.

The first charge on the amount payable for compensation and cost of litigation by the(E) builder co. to the complainant shall be, to the extent, of the bank or financial institution fromwhich the complainant has taken loan (if any) for making payment to the builder co. for thesubject dwelling unit.

The award for the complainants in the 15 connected c.c.s / f. a. s, which have similar facts(F) and are similarly placed, shall be the same, mutatis mutandis.

In addition, specifically for indulging in unfair trade practice, the appellant – the builder(G)co. is put to stern advice of caution with cost of Rs. 25,000/- in each case (i.e. in total 1 + 15 = 16cases) to be deposited in the Consumer Legal Aid Account of the State Commission, within fourweeks of the pronouncement of this Order.

Failure in timely compliance shall attract higher / penal interest and other compensation /(H) costs (which shall be determined by this Commission in the facts and specificities of thatcontingency if it so arises).

So disposed.

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......................DR. S.M. KANTIKAR

PRESIDING MEMBER......................

DINESH SINGHMEMBER

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Documents

NATIONAL CONSUMER DISPUTES REDRESSAL …...Mr. Akshay Sharma, Advocate (in FA/1309/2016) € € For the Respondent : Mr. Navneet Kumar, Advocate Mr. Vikas Bhadana, Advocate (in FA/1312/2016)