1. THIS original complaint is filed by one Shri Shaukat Rai aged 77 and his wife Smt. Shanta Rai who entered into agreement with opposite party No. 1-M/s. Falcon Developers for purchase of a residential flat in a housing complex known as Mount Helicon in Pune promoted by the said opposite party No. 1. Opposite party No. 2 M/s. Falcon Construction is the builder. Opposite party Nos. 2 to 9 are members of O.P. No. 1,. Falcon Developers which is a joint venture firm.
2. THE facts of the case are quite simple and mostly admitted. THE complainant No. 1 having retired from service in Delhi wanted to settle down in Pune and approached the respondent No. 2, Falcon Construction for purchase of a flat No. B-1, measuring 167.50 sq. mtrs. in the housing complex "Mount Helicon" being developed by them. It is admitted that the consideration is Rs. 16,85,000/-. THE complainant is also required to pay an amount of Rs. 50,000/- towards service charges. It was admitted between the parties that the possession of the duly constructed flat is to be given to the complainant on or before 31st December, 1998. As per verbal demand raised from time to time by the opposite party No. 2, the complainant paid the entire consideration of Rs. 17,35,101/- which includes service charges of Rs. 50,000/- by 16th April, 1997. THEreafter, as required under the provisions of the Maharasthra Ownership of Flats Act, 1963, M/s. Falcon Developers, opposite party No. 1 executed an agreement with the complainant on 11.7.1998. This agreement reiterates that the flat costs Rs. 16,85,000/- i.e. 16.85 lakhs. That service charges of 50,000/- have to be paid and that possession of the flat handed over by 31st December, 1998.
It is alleged by the complainant that work on the proposed housing complex stopped from 7th July, 1998 and did not resume thereafter. It is alleged that a legal notice was sent to the proprietor of opposite party No. 2, M/s. Falcon Construction and to O.P. No. 3 by the complainant about non-delivery of the said flat. It is further alleged that the opposite party No. 2 refused to take delivery of the said notice whereas opposite party No. 3 in their reply disowned any responsibility and squarely laid the blame on the shoulders of opposite party No. 2. In these circumstances, the complainant moved this Commission to seek redressal of their grievances. In their prayer they wanted a direction to be given to the opposite parties to hand over possession of the said flat duly completed in all respects together with interest @ 24% p.a. from 1st January, 1999 till the date of handing over the possession of the flat, on the amount of Rs. 17,35,101/- paid by the complainant to the opposite parties. In the alternative, it is prayed that the opposite parties should return the amount of Rs. 17,35,101/- with interest @ 24% per annum from the date of payment till the date of refund. In addition, the complainants claimed damages to the extent of Rs. 6,69,000/- details of which are at para 12 of the complaint.
Written replies have been filed by opposite party No. 2 and separately by opposite party Nos. 3 to 9 together. The opposite party Nos. 3 to 9 by and large, washed off their hands saying they are not directly involved in the construction of the housing complex and that they entered into a joint venture agreement with opposite party No. 2 because they owned the land on which the construction was proposed. Opposite party No. 1 admitted clearly that no work could be carried on after 7th July, 1998 due to very severe shortage of funds. The shortage of funds, in turn came about because of sharp increase in the price of building materials and labour and depressed market conditions which commenced from the middle of 1995 which prevented him from raising finance from any other source such as loan or sale of certain assets, etc. He avers that there were certain unforeseen costs to be incurred in the development work due to the topography of the site and due to development of approach roads; very difficult soil conditions; need to erect a retaining wall; extra excavation work; and cutting of hillside etc. He avers that some of the prospective buyers also did not adhere to the new schedule of payment agreed upon on 22nd January, 1998.
3. ESSENTIALLY, his argument is that the delay in completion of the project was due to reasons and factors substantially beyond his control and also as a result of unforeseen contingencies. He had put up some alternative proposals like acquiring extra FAR, to the prospective buyer which they intitially agreed to in March, 2000 but ultimately refused to accept it in May, 2000 at the instigation of the present complainants. He also stated that the agreement with the prospective purchasers did not provide for any escalation clause and that he was trying to find some mutually acceptable way out but that the purchasers were non-cooperative.
Whatever be the difficulties of the opposite parties, it is clear that as far as the complainants are concerned, they made the entire payment within time. We understand that though housing complex was complete to the extent of 65%, the opposite party Nos. 1 and 2 are not in a position to complete the project. Therefore, there is no point in asking them to give possession of the said flat to the complainants. At the same time, the builder has used the money paid by the complainant. Ends of justice would be met if the builder returns the entire amount paid by the complainants with interest @ 18% per annum to the complainants. The original complaint is allowed and we order that the opposite party Nos. 1 and 2 to pay an amount of Rs. 17,35,101/- to the complainant with interest @ 18% p.a. from 1.1.1999 till the payment is made. Opposite party Nos. 1 and 2 are also ordered to pay Rs. 10,000/- as costs to the complainanta. Complaint allowed.
