Flat Purchasers Cannot Be Made To Wait For An Indefinite Period Hoping To Obtain Possession; Reiterates NCDRC

Commission stated that, mere contention that complainants paid 50% payment upfront for a discount itself cannot be a reason to exclude the complainants from the scope of section 2 (1) (d) of the Consumer Protection Act, 1986.

In this case, the complainant had booked a flat by depositing a booking amount of Rs.22,23,690/-in the project 'Chintels Serenity', Sector 109, Gurugram, being developed by the opposite party. As per the allotment letter a flat was allotted to the complainants at a total sale consideration of Rs.1,64,09,050/-. An Apartment Buyer's Agreement was executed between the two parties wherein, as per clause 11 of the agreement, the possession of the flat was promised by the opposite party to the complainants after a period of 36 months with six months grace period. The payments were to be made stage wise and the complainants had paid Rs.1,69,96,578/- to the opposite party including the payment due "on possession". The possession had not been offered till date while the opposite party continued to receive payments. Aggrieved by the act of opposite party the complainant filed an appeal before the National Commission under section 12 (1) (a) of the Consumer Protection Act, 1986.

Before the National Commission, the complainants, submitted that they cannot be made to wait for inordinately long periods of time to receive the possession of the flat booked after making payments and that they are entitled for refund of the money paid along with interest as compensation for mental agony and litigation cost incurred by them. It was argued that Apartment Buyer Agreement was arbitrary and one-sided and constituted an unfair trade practice.

The opposite party submitted that, the occupancy certificate has been obtained from the Town & Country Planning Department, Haryana, a copy of which has been submitted along with their affidavit in evidence. A letter for final offer of possession for apartment issued to the complainants has also been filed.

Analysis:

The issue for consideration before the National Commission was whether the opposite party is liable to pay 100% refund of the total amount paid by the complainant or not.

Commission found that, the opposite party has not provided any documentary evidence in support of his contention that the complainants are not 'consumers' under the scope of section 2 (1) (d) of the Consumer Protection Act, 1986, except relying on the fact that they paid 50% of the amount in a single instalment against a discount.

Commission relied upon the case of Kavita Ahuja vs Shipra Estates where it was held that, the onus of establishing that the complainant was dealing in real estate, i.e., in the purchase and sale of plots/ flats for commercial purposes to earn profits lies upon the opposite party.

Commission also relied upon the case of Rajnish Bhardwaj and Ors vs M/s CHD Developers Ltd., and Ors where it was observed that, "In a catena of judgments, this Commission has laid down that the onus of proof shifts to the Opposite Party to prove that the Complainant is "investor" and it is observed that the Opposite Party did not discharge their onus of proof regarding this aspect. Hence, the Complainants are "Consumers" as defined under Section 2 (1) (d) of the Consumer Protection Act, 1986".

The bench stated that, mere contention that complainants paid 50% payment upfront for a discount itself cannot be a reason to exclude the complainants from the scope of section 2 (1) (d) of the Consumer Protection Act, 1986. As the opposite party have failed to provide any evidence to prove that complainants are engaged in the business of buying and selling the real estate, their averments cannot be accepted.

After examining the documents on record, commission observed that, the complainants had been regularly paying the amounts demanded by them towards the flat booked in the project being developed by the opposite party. The opposite party has not produced any evidence of any notice to the complainant for default. Neither on the date of filing of the complaint nor subsequently has the opposite party has made any valid offer of possession in respect of the said flat and therefore, his contention that he is ready to offer possession is liable to be rejected.

Commission relied upon the case of Kolkata West International City Pvt. Ltd., vs Devasis Rudra and Pioneer Urban land and Infrastructure Ltd., vs Govindan Raghavan and connected matter, where SC held that flat purchasers cannot be made to wait for an indefinite period of time hoping to obtain possession and that seeking refund of amounts deposited is a valid redressal.

Commission stated that, there is neither a valid occupation certificate nor can the opposite party claim to have made a proper offer of possession. Therefore, there is, merit in the complainants' averments.

National Commission allowed the appeal and directed the opposite party to refund the entire amount of Rs.1,69,96,578/- to the Complainant with 9% simple interest from the date of respective deposits till the date of payment.

Case Name: Sangeeta Agarwal & Anr. v. M/S. Chintels India Ltd.

Case No.: CONSUMER CASE NO. 2562 OF 2018

Corum: Justice Deepa Sharma, Presiding Member and Subhash Chandra, Member

Decided on: 27^th May, 2022

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