Surinder Mohan Sharma vs The Punjab State Federation Of Co ...

on 23 January, 2017

State Consumer Disputes Redressal Commission

Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017
Cause Title/Judgement-Entry STATE CONSUMER DISPUTES REDRESSAL COMMIS

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Appeal No.

294 of 2016

Date of Institution

24.10.2016

Date of Decision

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

23.01.2017

Surinder Mohan Sharma son of Basant Ram, House No.60, Sector 38-A, Chandigarh

......Appellant

Versus

The Punjab State Federation of Co-operative House Building Societies Ltd. through its Managing

.......Respondent

Appeal under Section 15 of the Consumer Protection

Act, 1986.

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

MR. DEV RAJ, MEMBER

MRS. PADMA PANDEY, MEMBER

Argued by: Mr.Amit Sharma, Advocate for the appellant.

Mr.Ashwani Prashar, Advocate for the respondent.

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

Appellant/complainant has filed this appeal against order dated 12.09.2016, p

2. As per facts on record, the Punjab State Federation of Cooperative House Buil

Category of flat

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

Total No. of flats

Tentative Price

Area

1.

Class III Employees 20.18 lacs

2. Class IV Employees 14.92 lacs

3. EWS 5.98 403.97 The appellant/complainant applied to OP for allotment of flat in

Category-III in general category, as referred to above, and made payment of Rs.1,01,000/-. In draw
of lots, he was allotted a flat vide allotment letter dated 28.1.2009. He further deposited
registration money of Rs.2,02,000/- as per terms and conditions stipulated in the above said letter.
Thereafter, he continued to make payment in installments as per schedule and by 25.2.2011 paid a
total sum of Rs.12,11,000/- to the respondent. It is his case that completion of the project was
delayed on account of malpractices adopted by the contractor and office bearers of the respondent.
It was further said that for causing loss in crores, an FIR was got registered. On 3.11.2014,
complainant received a letter intimating him about completion of the project and offering
possession of allotted flat to him subject to payment of final cost of the flat amounting to
Rs.33,10,000/-, Enhancement in the price was seriously challenged by the complainant. It was
further said that the respondent/OP was not justified in delaying delivery of possession for about
three years. By giving above facts, it was prayed that increase in price of the flat be set aside with a
further direction to OP/respondent to return him the deposited amount of Rs.12,11,000/- with
interest. Further prayer was made to make payment of Rs.5.00 lacs towards deficiency in providing
service and adopting unfair trade practice by the Opposite Party.

3. Upon notice, reply was filed by the OP/respondent stating that the objection regarding
price of the flat allotted cannot be gone into by the Fora. It was further stated that in the allotment
letter dated 28.1.2009 it was specifically stated that the price mentioned therein was tentative, the
final price of the flat will be calculated at the time of handing over of possession of the flat. It was

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

further stated that the flats were constructed under partially self-financing scheme. Increase in the
price was justified by giving many reasons like amount spent on power sub-station, increase in cost
of building material etc. It was further stated that it was not a time bound scheme. It was further
observed that some delay was caused on account of non-availability of building material and
pending dispute with the Punjab State Power Corporation Ltd. to set up a power sub-station of
lesser capacity. It was also stated that the balance amount was to be paid by the
allottee/complainant in 120 equated monthly installments alongwith interest @ 12%. By making
reference to Clause-4 of the brochure, vide which the scheme was advertised, it was stated that when
possession stood offered, it was not open for the complainant to claim refund.

4. To the reply, rejoinder was filed by the complainant/respondent controverting the pleas raised
by the Opposite Party/ respondent.

The Forum, on analysis of pleadings of the parties, evidence on record and arguments
addressed, dismissed the complaint of the complainant vide order under challenge dated 12.9.2016.
Hence, this appeal.

5. Counsel for the appellant has vehemently contended that the Forum was wrong in
dismissing the complaint filed by the complainant/appellant. It was specifically stated that the
complaint filed was not barred by limitation, as has been held in the order under challenge.

6. It was rightly noted by the Forum that as per terms and conditions of the brochure, under
which the Scheme was published, no period was fixed to complete the project and to handover
possession of the flat to the allottees. Noting as above, it was said that the delay was caused on
account of factors beyond the control of the respondent. In that regard it was said by the Forum as
under ;

"The possession could not be offered to the complainant until and unless all the facilities like
electricity, water etc. were made available to the allottees. Annexure OP-6 proves that the office of
Municipal Council, Banur permitted the construction of housing complex to the OP on 15.7.2009.
Annexure OP-2 is a copy of the order dated 29.4.2014 passed by the Punjab State Electricity
Regulatory Commission, Chandigarh in Petition No.6 of 2014 wherein the supply of voltage of the
HOUSEFED complex at Banur was determined as 11 KV and further action to release individual
connections was to be initiated by PSPCL as per Rules and Regulations after completion of requisite
formalities. Vide Annexure C-8 the complainant was intimated about allotment of flat No.2404,
Floor No.1st Block No.24 Category I at Cooperative Housing Complex, Banur, District SAS Nagar,
Mohali and the detail of the final cost was disclosed and the complainant was asked to make the
payment of the balance amount of Rs.20,99,000/- and the complainant was offered to come to take
the possession by 15.2.2015. It is also admitted that the complainant did not deposit the balance
amount and approached this Forum for refund of the amount.

So far as the delay in completion of the project is concerned, the same was beyond the control of
the OP as the PSPCL refused to release the connection until and unless the 66 KVA sub-station is
constructed. Had that been constructed, it would have enhanced the cost of the project and it is

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

alleged by the OP that the cost must have been enhanced to the extent of Rs.11 to 12 crores. As a
prudent man, the OP filed a petition No.46 of 2013 before the Punjab State Electricity Regulatory
Commission, Chandigarh which was allowed vide order dated 24.10.2013 and later on as the order
of said Commission was not followed by the PSPCL, therefore, a petition No.6 of 2014 had to be filed
for the implementation of the said order dated 24.10.2013 which was disposed of on 29.4.2014
(Annexure OP-2). Thereafter NOC of 912 flats at Banur was granted vide letter No.1543 dated
12.6.2014 (Annexure OP-3). There was also scarcity of building material due to mining problems in
the state. Due to environmental clearances, there was ban on mining in the state of Punjab and
sand, gravel and bricks were not available which resulted in delay in the execution of the project.
The Hon'ble Supreme Court on 27.2.2012 had stayed the extraction of the minor minerals out of the
quarries upto 5 hectares as per the directions contained in Deepak Kumar & Ors. Vs. State of
Haryana & Ors. (2012) 4 SCC 629 and on the basis of the same, the Hon'ble High Court had stayed
the extraction of minor minerals on 1.8.2012 in the state of Punjab also as is evident from the order
in CWP No.9388 of 2012 decided on 17.8.2012. There was a tremendous increase in the cost of
material and labour. The escalation in the cost was beyond the control of the OP as prices of steel,
cement, marble etc. were increased every year on account of inflation. Thus, taking into
consideration all the facts and circumstances of the case, we have no hesitation to hold that there
was no delay on the part of the OP to deliver the possession to the complainant. The complainant
was offered the possession, detail of the cost was also disclosed to the complainant and the
complainant was asked to make the payment of the balance amount, but, the complainant did not
turn up to take the possession which was to be taken upto 15.2.2015 nor the balance amount was
deposited. As such, no fault can be found with the OP."

7. We are of the opinion that the view expressed by the Forum is perfectly justified.
Construction was delayed on account of paucity of building material in view of some order passed by
the High Court and further lot of time was spent in getting permission from the Punjab State Power
Corporation Ltd. to set up a power sub-station to supply electricity to the complex in question. So
far as enhancement in price is concerned, it was rightly noted that as per the brochure, under which
Scheme was launched, the price offered was tentative. Final price was to be calculated at the time
when construction was complete and possession was to be delivered to the allottee. It was further
noted that it was self-financing scheme and higher price was fixed on account of escalation of price
of building material between 2009 to 2014. Similar dispute regarding increase in price came up
before this Commission in Satish Kumar Vs Managing Director, Housefed, Appeal No.250 of 2015
decided on 5.10.2015. Taking note of averments made by the Opposite Party, and facts on record, it
was observed as under ;

"So far as increase in price of the unit(s) is concerned, it was made clear in the
advertisement that the price of a unit was tentative and actual price of the same will be intimated
when offer of possession thereof will be made. There is sufficient evidence, on record, to show that
construction was delayed on account of various reasons like non-grant of No Objection Certificate by
the Electricity Department; setting up of STP as per norms; non-availability of the material etc. etc.,
which was beyond the control of the respondent. It has also come on record that construction of the
unit(s) was raised by the respondent to provide housing accommodation to those, who were not
having shelter over their head. It was done on the basis of no-profit-no-loss basis. There is nothing

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

on record to show that the above commitment was not fulfilled by the respondent and it has claimed
the amount which will profit it. It was firmly stated by the respondent in the reply that in terms of
the Policy of the State Government to construct affordable accommodation, the said project/scheme
was initiated.

8. It is not in dispute that in the brochure launching the Scheme, time schedule was given as
to when an allottee can claim refund. Clause-4 of the brochure reads thus ;

"4. Surrender of flat

a) If the refund of the (initial deposit) earnest money of 5% is sought before the closing of scheme,
no deduction shall be made.

b) If the refund of the (initial deposit) earnest money of 5% is sought after the closing of scheme,
but before the next payment of 10% towards Registration money, 25% of the receipt of earnest
money towards initial deposit shall be deducted.

c) If the refund is sought after the date of payment of 10% Registration money, but before the
offer of the possession of flat that shall be allowed after deduction of 50% of the receipt of earnest
money (i.e. of 15% earnest money).

d) No refund shall be made after the offer of possession of the flat."

Different steps to claim refund have been mentioned. Under clause (d) it has been
specifically stated that when possession is offered, no refund can be claimed. It is proved on record
that possession of the flat was offered to the complainant on 3.11.2014. He was to take possession by
15.2.2015 by making payment of balance amount. To get refund, application was filed on 2.1.2015.
Taking note of above said facts, it was rightly observed by the Forum that the complainant was not
entitled to claim any refund of the amount paid. To the same effect, is the ratio of judgment of this
Commission in Nirmal Singh Vs the Punjab State Federation of Cooperative Housing Building
Societies Ltd. Complaint No.83 of 2015 decided on 2015. When declining similar prayer of claiming
refund qua this very project, it was said by this Commission that after issuance of possession letter,
refund cannot be claimed.

9. Contention of the Counsel for appellant that let appellant be allowed to rescind the
contract subject to surrender of 10% of the amount, is liable to be rejected in view of the reasons
given above. Reliance of Counsel for appellant on the ratio of judgment of National Consumer
Disputes Redressal Commission in R.P.No.3860 of 2014 titled as DLF Ltd. Vs Bhagwanti Narula
decided on 6.1.2015 is not proper. That was a case of non-deposit of amount and the entire amount
was forfeited in terms of the Agreement between the parties. Interpreting the said term, it was said
by the National Consumer Disputes Redressal Commission that in such like situation only 10% of
the amount can be forfeited, and rest of the amount was ordered to be refunded. Facts of that case

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 Surinder Mohan Sharma vs The Punjab State Federation Of Co ... on 23 January, 2017

are altogether different to the present case where it is specifically stated that refund cannot be
claimed when flat is ready for possession. The scheme was self-financing scheme- on no profit no
loss basis. The construction was raised by getting money from the allottees. A part of the amount
was to be paid in easy 120 monthly installments. If at the fag end, when flat is ready for possession,
an allottee is allowed to get refund, the entire purpose of the scheme will be frustrated. Today real
estate market has slid down. Many allottees will opt to get refund of amount with interest and the
entire project will fail. Even the genuine buyers will suffer.

10. Under the above circumstances, we find no case made out to interfere in the order under
challenge.

11. For the reasons recorded above, the appeal, being devoid of merit, must fail, and the same is
dismissed, with no order as to costs. The order of the District Forum is upheld.

12. Certified copies of this order, be sent to the parties, free of charge.

13. The file be consigned to Record Room, after completion.

Pronounced.

23.01. 2017 [HON'BLE MR. JUSTICE Jasbir Singh] PRESIDENT [

DEV RAJ] MEMBER [ PADMA PANDEY] MEMBER

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