RITA BHATIA Vs. TRANQUILLE LIVING SPACES PRIVATE LIMITED

JUDGEMENT

(1.) The brief facts of the case are that the Complainants had booked a villa in the project "Belle Vue Chalets" (later renamed as "Bhowali Valley Chalets") of the Opposite Party located at Village Nagari Gaon, Bhowali Tehsil, District Nainital, Uttarakhand in June 2015. The promised date of handing over of possession, as per the Opposite Party, at the time of booking was 36 months from the date of booking i.e. the possession was to be handed over by June 2018. It is further stated that the total consideration cost of the villa was Rs.86,17,750.00 and the Complainants had paid almost 85% of the consideration amount by 22/9/2017. Yet the villa was nowhere near completion. At the time of booking, in the advertisement in their brochure, the Opposite Party had promised various facilities like modular kitchen along with kitchen garden, swimming pool, barbeque pit, fireplace, adventure zone, club house, mini golf course besides other facilities. The Complainants were allotted residential villa C-47, Block-C having built up area of 1960 sq. ft. At the time of booking, the Complainants had paid Rs.1.00 Lakh on 1/6/2015 and Rs.6,99,500.00 on 23/6/2015 and thus paid total registration amount of Rs.7,99,500.00 by 23/6/2015 to the Opposite Party. They were allotted the unit vide Provisional Allotment Letter dtd. 23/6/2015. The Opposite Party did not execute any agreement for two years and it was only after payment of Rs.71,19,500.00 by 22/9/2017 that an agreement was executed between the parties on 3/10/2017. It is apparent that till that time also, the building plans of the project were not approved and the Opposite Party had arbitrarily changed the date of possession by mentioning in the agreement that the possession would be handed over after three years from the date of execution of the agreement i.e. by 3/10/2020. It is submitted that even without approvals from the authorities of the project, the Opposite Party had started the booking and raised money from the proposed buyers which was an illegal act in the eye of law and it amounts to unfair trade practice as well. The Complainants had opted for construction linked payment plan and whenever there was a demand from the Opposite Party, duly made the payments. It is submitted that the Opposite Party did not raise any demand for payment after 22/9/2017 which clearly shows that the construction of the project had been stalled. The Opposite Party had demanded the payment of the instalments without reaching to the milestone which fact is clear from the status of construction at the project site. As per the terms of clause 11.1 of the agreement, the construction of the villa was to be completed in 36 months from the date of signing of the agreement and the Opposite Party also added 6 months as grace period for completion of villa to 36 months. It is submitted that this clause of the agreement was in clear violation of the clauses of Allotment Letter dtd. 23/6/2015 wherein the Opposite Party had promised to hand over the possession within 36 months from the date of allotment. It is submitted that the Opposite Party had failed to hand over the possession in terms of the Allotment Letter and thus has caused mental agony to the Complainants. The prime object of the Complainants was to provide timely and quality standard holiday home for their family members and this object got frustrated due to the delay on the part of the Opposite Party. The Opposite Party had also charged Preferential Location Charges @ 5% of the total consideration amount even when the allotted unit was not located at the preferential location. The Opposite Party had also imposed mandatory membership fee of the club house of Rs.50,000.00 which the Complainants had paid. The Complainants also noticed variation in the material being used in the project. The Complainants sent an e-mail dtd. 13/6/2016 to the Opposite Party. The Opposite Party duly replied the said e-mail on 14/6/2016 stating various reasons for shifting from the AAC blocks in the construction which were not convincing and not acceptable. When the Complainants visited the project site on 10/12/2017, they found that there was no construction work going on at the site, also they were assured that the handover would be done by the end of year 2018. The Complainants sent various e-mails dtd. 13/6/2016, 14/6/2016, 23/9/2016, 26/10/2016 and 30/1/2018 to the Opposite Party in enquiring about status of the project. They were given false assurances. Several of their e-mails were not replied. It is submitted that as per the clause 2 (b) of the agreement, the Opposite Party had promised to pay the compensation @ Rs.5.00 per sq. ft. per month of the super area till the date of offer of possession, however in case of delay on the part of buyer to timely make payment, it authorised itself to charge 18% compounded quarterly interest as a penalty. This further shows unfair trade practices on the part of the Opposite Party. It is submitted that vide e-mail dtd. 11/6/2019 the Opposite Party had admitted that the project had been delayed and also informed that the name of the project had been changed from "Belle Vue Chalets" to "Bhowali Valley Chalets". It is submitted that no permission of the Complainants was sought before changing the name of the project. It is submitted that that no offer of possession has so far been made to the Complainants. A legal notice dtd. 25/6/2019 was sent to the Opposite Party. It is submitted that the conduct of the Opposite Party amounts to deficiency in service. On these contentions, it is prayed that the Opposite Party be directed to refund their deposited amount of Rs.71,90,746.00 along with interest @ 18% p.a. from the date of receipt of payments till the date of refund and also pay compensation of Rs.1.00 Lakh to the Complainants for mental agony, harassment and Rs.1,50,000.00 towards litigation costs.

(2.) The claim is contested by the Opposite Party No.1. No Written Statement has been filed by the Opposite Party No.2. In the Written Statement, the Opposite Party has taken preliminary objection that the Complainants did not fall within the definition of consumers under the Consumer Protection Act. The Complainants have invested in the said villa only as an investor and for commercial gain and not for personal use. The Complainants are speculative investors and invested with the intention to sell the said villa in the real estate market when it is booming and since the real estate market is hit by downfall, the Complainants are seeking refund and therefore, the present Complaint deserves dismissal. It is not disputed that the villa had been booked by the Complainants in their project and that the villa had been allotted by them to the Complainants vide an Allotment Letter dtd. 23/6/2015 and subsequently, an agreement dtd. 3/10/2017 had been executed. It is submitted that that delay in completion of the project cannot be attributed to the Opposite Party. It is submitted that a sum of Rs.7,99,500.00 was paid by the Complainants and thereafter they did not adhere to the payment plan and thus were defaulters. The Opposite Party had waived off the interest levied upon the Complainants on account of delay in making the payments. It is further contended that the alleged delay in completing the villa was beyond their control on account of force majeure circumstances as it got delayed on account of regulatory factors. When the project was conceived, there was no RERA and the project was to be approved and constructed under the provision of Sec. 143 (b) of the Zamindari Abolition and Land Reforms Act. It is submitted that the said approval had been granted to the Opposite Party and in pursuant to that almost 1/3rd of the plots were registered to individual buyers. However, the RERA had also become applicable. In order to comply with the directions of the RERA, the Lake District Authority required the project to be reviewed and under new set of rules, required new approvals to be procured which could be done only after cancellation of the old and existing approval under provisions of Sec. 143 (b) and new applications to be filed with LDA. As a result, while the application for cancellation of approval under provision for Sec. 143 (b) was moved, a fresh application was moved for approval under RERA and therefore, valuable time was lost in these activities. However, even during this period, the Opposite Party had been spending money from their pockets in order to ensure that the work and development continue at the site. The project was further delayed on account of supply and transportation issues which were beyond their control. It is submitted that there is no deficiency in service on the part of the Opposite Party. It is submitted that that at the end of 2017, the Complainants had approached the Opposite Party seeking cancellation of the allotted villa and refund of the sale consideration amount on account of financial crunch. The Opposite Party was agreeable to pay the same only after deduction of the necessary cancellation charges as per agreement. The Complainants thereafter revoked their request for cancellation and thereafter, did not make any payment towards construction of the said villa and then approached this Commission with unclean hands. As per the BBA dtd. 3/10/2017, the project was to be completed within 36 months from the date of agreement with further grace period of 6 months therefore latest by 3/4/2021 and therefore, the Complaint is pre mature and deserves to be dismissed. It is submitted that the BBA supersedes any previous agreement. It is further submitted that they are liable to pay only Rs.5.00 per sq. ft. on account of delay if any. On these contentions, it is submitted that the Complaint is liable to be dismissed.

(3.) Rejoinder had been filed in which all the contentions of Written Statement have been denied and the averments made in the Complaint have been reiterated.