The National Consumer Disputes Redressal Commission, presided by Mr. Subhash Chandra and Dr. Sadhna Shanker held that a buyer cannot be made to wait indefinitely to obtain possession and failure to deliver to possession within a reasonable time ia unjust and amounts to deficiency in service.Brief Facts of the Case The complainant booked a 400 sq. yard plot with Punjab Urban Planning...
The National Consumer Disputes Redressal Commission, presided by Mr. Subhash Chandra and Dr. Sadhna Shanker held that a buyer cannot be made to wait indefinitely to obtain possession and failure to deliver to possession within a reasonable time ia unjust and amounts to deficiency in service.
Brief Facts of the Case
The complainant booked a 400 sq. yard plot with Punjab Urban Planning & Development Authority/developer, paid Rs. 2,40,000 as earnest money, and was declared successful in a draw. After receiving a Letter of Intent, she paid Rs. 3,60,000, with the promise that possession would be given after development work or within 18 months. However, no development work was done by the developer by the time the complaint was filed. The complainant received an allotment letter for a specific plot, paid the required amounts, and requested a refund of excess payments and a rebate, as per the allotment terms. Despite multiple requests, the developer delayed responding, eventually refunding only part of the excess amount without paying interest. The complainant also faced a re-allotment of a different plot, which she contested as unlawful. The developer admitted delays and incomplete work but still failed to deliver possession of the plot, leading to allegations of deficiency in service and unfair trade practices. Being aggrieved, the complainant filed a complaint before the State Commission of Punjab which allowed the complaint. It directed the developer to refund the amount deposited by the complainant of Rs.26,56,500 with interest of 12%per annum, award compensation of Rs.3,00,000 on account of causing and pay Rs.50,000 as litigation expenses. Diassatisfied, the developer filed an appeal before the National Commission.
Contentions of the Developer
The developer argued that the complainant does not qualify as a consumer under the Act and that the State Commission lacks jurisdiction. They also claimed the complainant is not entitled to interest on the excess amount, the case involves complex facts unsuitable for summary proceedings, and there was no deficiency in their service. Therefore, they requested the complaint be dismissed.
Observations by the National Commission
The National Commission observed that the issue was whether the developer's failure to deliver possession within the agreed timeframe amounted to a deficiency in service. Based on evidence, the complainant applied for a residential plot, making her a consumer under the Consumer Protection Act, and the consumer forum had jurisdiction to entertain the case. The developer's claim that the plot was purchased at auction for commercial purposes was rejected, as no auction had taken place, and the developer failed to provide any proof. The Commission noted the developer's re-allotment of a different plot without notifying or obtaining consent from the complainant, which was unlawful. The possession was supposed to be handed over within 18 months, but the developer failed to complete the development works or provide the necessary completion certificate, constituting a deficiency in service and unfair trade practice. Reliance was placed on previous cases like Vision India Realtors Pvt. Ltd. vs. Sanjeev Malhotra and Kolkata West International City Pvt. Ltd. vs. Devasis Rudra, which established that failure to deliver possession within a reasonable time is unjust. Regarding the excess payment, the developer refunded Rs. 2,48,175, and as per the allotment terms, no interest was due on the advanced amount. However, the complainant was entitled to a refund of the deposited amount along with compensation at 9% interest, citing Experion Developers Pvt. Ltd. vs. Sushma Ashok Shiroor.
The National Commission modified the State Commission's order and directed the developer to refund the deposited amount with 9% interest, failing which the interest rate would increase to 12%.
Case Title: Punjab Urban Planning & Development Authority (P.U.D.A) Vs. Surekha Singla
Case Number: F.A. No. 131/2021