P. Palanisamy Vs M/S. Anjli Infra Housing LLP

Dr. Inder Jit Singh, Presiding Member

1. The present batch of Consumer Complaints (CCs) have been filed by the Complainant(s) against Opposite Party as detailed above, inter alia praying for directions to the OP to:-

i. Possession of the Apartment along with Occupation Certificate (OC)

ii. Compensation for delay in possession.

iii. Immunity from charging escalation.

iv. Compensation towards mental agony and litigation.

2. Since the facts and question of law involved and the reliefs prayed for in these complaints are similar/identical and against the same Opposite Party except for minor variations in the dates, events and flat numbers etc., which are summarized in the Table at Annexure-A, these complaints are being disposed off by this common order. However, for the sake of convenience, Consumer Complaint (CC) No. 2408 of 2017 is treated as the lead case and facts enumerated herein under are taken from CC/2408/2017.

3. Notice was issued to the OP.  Parties filed Written Statement/Reply, Rejoinder, Evidence by way of an Affidavit and Written Arguments/Synopsis etc. as per details given in the Table at Annexure-A.  The details of the flats allotted to the Complainants/other relevant details, based on pleadings of the parties and other records of the case are also given in the Table-A.

4. Brief facts of the case, as emerged from the pleadings of the parties and other case records are that: -

(i)  On 07.11.2013, complainant booked a flat with OP, in their project ‘Ankur Palm Springs’ in Chennai and a Unit No. B-14, Floor-1, Block-B, measuring 1332 sq.ft. was allotted at a total cost of Rs.96,84,264/-. Complainant paid an amount of Rs.91,67,773/-.

(ii) Two agreements, one for sale and another for construction, were signed.As per construction agreement dated 07.11.2013, the committed date of possession was 30.06.2015, and OP was entitled to a further grace period of six months.Hence, the committed date comesto 31.12.2015.

(iii) During the pendency of the complaint, possession of the flat was taken over by the complainant on 18.04.2018.

5. It is averred/stated in the Complaint that before the booking of the flat by the complainant, the OP was aware of the fact that the project was not going to be completed as it had no permission to construct. The OP despite knowing the pendency of OA of 213 of 2014 and OA 37 of  2015 before the NGT and a stay over construction activities, continued to accept instalments from the complainant. The OP, despite directions dated 10.10.2013 of SEIAA clearly directing that as per Government of India guidelines and National Environmental Policy, prior EC was necessary for any construction activity and non-adherence would be violation. Through letter dated 10.10.2013, SEIAA categorically commanded and directed the OP that it shall not commence any activity other than cleaning the site, fencing the site and putting up temporary structure etc. Despite the fact that OP had no permission to construct the said project in terms of the categorical directions of SEIAA, the OP booked the flat and also continued to take instalments which constitute deficiency in service.

6. As per clause 2.5 of the agreement for construction, the OP promised to handover the possession of the apartment to the complainant by 30th June 2015.The payment schedule with a time linked payment plan was also provided by the OP.The complainant has paid the entire sum demanded by the OP towards the flat but the OP has not fulfilled the promise to handover the possession of the flat within the promised time. Some of the clauses in the Buyer’s Agreement that the complainant was made to sign by the OP, were/are one sided, which is a clear-cut case of “deficiency in service’ and unfair trade practice’ on the part of the OP.

7. The OP in their written statement/reply stated that delay occurred was beyond the control of the OP and the time limit prescribed in the Agreement was subject to force majeure.  The delay of 28 months in handing over possession was due to non-processing of OP’s Environmental Clearance (EC) application by SEIAA, Tamil Nadu in time, once the EC was issued on 18.01.2018, the work on the project was expedited and completed by the OP and Completion Certificate (CC) was obtained on 26.02.2018.  OP then on 18.04.2018 handed over the possession by executing a sale deed. The OP has already paid the compensation for the delay in possession after discussion with the complainant.  It is also alleged that complainant defaulted in making payments in time and the timely payment was the essence of the agreement.  In view of the clauses 3 (iv) and (v) of the agreement, the OP was entitled to charge interest in case of delayed payment/cancel the agreement.

8. Complainant in his rejoinder stated that OP failed to handover the apartment to the complainant within promised time.  The OP has been wilfully delaying the construction of the residential complexes and aggressively developed their commercial complexes to enjoy recurring handsome income, which clearly shows unethical business practices, deficiency in service and abusing the process of law on the part of the OP.

Heard counsels of both sides.  Contentions/pleas of the parties, based on their Complaint/Reply, Rejoinder, Evidence, Written Arguments, and Oral Arguments advanced during the hearing, are summed up below.

9. It was argued by the OP that delay in possession was due to reasons beyond the control of OP.  This time limit of 36 months in the agreement is subject to force majeure.  The delay of 28 months in handing over possession was occasioned due to non-processing of OP’s Environmental Clearance (EC) application by SEIAA, Tamil Nadu in time, once the EC was issued on 18.01.2018, the work on the project was expedited and completed by the OP and Completion Certificate (CC) was obtained on 26.02.2018.  OP then on 18.04.2018 handed over the possession by executing a sale deed.  Further, OP has already paid compensation @Rs.20/- per sq.ft. per month for the period of delay of 28 months.  The said amount was paid after having discussions with all homebuyers, including the complainant, and after having a settlement with them.  It is also alleged that complainant failed to adhere to the payment schedule and defaulted in making payments in time; timely payments was the essence of the agreement.  OP, in view of clause 3 (iv) and (v) of the agreement, although entitled to charge interest in case of delayed payment and cancel the agreement, has not done so.

10. Complainant argued that OP in his written statement has stated that “OP in a mistaken bonafide belief that EC certificate has to be furnished only at the time of completion of project commenced construction as per planning permit.  OP on 10.10.2013 made an application for EC”.  It is also an admitted fact that on the same day i.e. 10.10.2013, SEIAA wrote back to OP clearly directing that as per Government of India guidelines and National Environmental Policy, prior EC was necessary for any construction activity and non-adherence would be violation.  SEIAA also directed that OP shall not commence any activity other than cleaning the site, fencing the site and putting up temporary structure etc.  Complainant further argued that flat was booked by them on 07.11.2013, meaning thereby that even before complainant booked the said unit, OP knew it well that project was not going to be completed as it had no permission to construct.  However, such information was not disclosed to the complainant, which is a case of grave breach, deficiency and unfairness on the part of OP.  Not only the OP booked the flat despite directions dated 10.10.2013 of SEIAA, but also continued to take instalments which itself constitutes deficiency in service.  Hence, it is not a case of force majeure.

11. The fact of delay is admitted by the OP.  Their contention that delay compensation was paid as part of settlement is not valid as there is no specific written settlement between OP and complainant in this regard.  Letter dated 07.12.2016 vide which an amount of Rs.1.06 lakh has been paid to complainant by way of compensation @Rs.20/- per sq.ft. per month for the period October 2015 to January 2016 is not a copy of settlement/minutes of settlement as claimed by OP.  There is a reference in this letter to discussions/deliberations held on 16.11.2016, but no signed minutes of such meetings showing complainant as signatory to any such minutes/deliberations have been produced.

12. NGT in its order dated 07.07.2015 in OA No. 37 of 2015 and 213 of 2014 in S.P. Muthuraman Vs. Union of India & Ors. and related cases observed that the project proponents having violated that law cannot be permitted to take  advantage of their own wrong doing under the shelter of ‘deeming fiction’.  The NGT did not agree with the arguments of project proponents that grant of principal approval ipso facto had the effect of granting other permissions to start construction without complying with other laws and permissions from the other authorities and stated that all the project proponents are deemed to be in knowledge of the laws relating to construction of such projects.  The project proponents are not persons who can be presumed to be ignorant of law, they are into this business for years and notification of 2006 came into existence in the year 2006.  All the projects in question commented in the year 2010 and subsequent thereto.

13. It was argued by the complainant that despite knowing the pendency of OA of 213 of 2014 and OA 37 of  2015 before the NGT and a stay over construction activities, OP continued to accept instalments from the complainant.

14. I tend to agree with the contentions of complainant and on going through various documents produced by the parties find that the plea of OP that delay was due to force majeure circumstances is not valid.  OP is responsible for the delay and hence liable to pay delay compensation to the complainant as determined by the Commission.

15. The contention of the OP that the parties are bound by the agreement is also not acceptable. Complainant argued that some of the clauses of the agreement were/are one sided, the complainant had to sign the already prepared documents and that some of the clauses contained therein were totally unreasonable and were in favour of OP only.  A perusal of the agreement shows timely payment of instalments is essence of agreement, but timely delivery of the apartment is not. Hon’ble Supreme Court in Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan (2019) 5 SCC 725 held that “a term of a contract will not be final and binding if it is shown that the flat purchasers had no option but to sign on the dotted line, on a contract framed by the builder ......... the incorporation of one sided clause in an agreement constitute an unfair trade practice as per Section 2 (r) of the Consumer Protection Act, 1986 since it adopts unfair methods or practices for the purpose of selling flats by the builder ........., the appellant-builder cannot seek to bind the respondent with such one sided contractual terms.”

16. Plea of the OP for Arbitration as per conditions in the Agreement is also not accepted as the remedies under the Consumer Protection Act are in addition to the remedies available under special statue.

17. In the instant case, there is a delay of about 27 months in handing over the possession of flat by the OP. It has been held by Hon’ble Supreme Court in various cases that delay in possession from the committed date amounts to deficiency in service on the part of developer. Hence, the complainants in the present circumstances have a legitimate right to claim a fair delay compensation/interest from the OP.  The plea of OP for entitlement of compensation to the complainant in accordance with provisions of the Agreement is not valid.

18. For the reasons stated hereinabove, and after giving a thoughtful consideration to the entire facts and circumstances of the case, various pleas raised by the learned Counsel for the Parties, all the Consumer Complaints Viz Nos. CC 2408, 2409, 2410, 2411, 2413, 2415 and 2416 of 2017 are allowed/disposed off with the following directions/reliefs: -

(i)  The OP shall pay delay compensation in the form of simple interest @ 6% per annum on the amount paid by the complainants from the committed date of possession (31.12.2015) till the date of physical possession.

(ii) The OP shall pay a sum of Rs.25,000/- as cost of litigation to    the Complainants in all the Consumer Complaints covered under this order. 

(iii) The payment in terms of this order shall be paid within three months from today.

The pending IAs, in any of the Consumer Complaints, if any, also stand disposed off.