NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
NEW DELHI.

ORIGINAL PETITION NO. 190 OF 2000

Kunj Behari Mehta & Anr. … Complainants

Versus

Ansal Properties & Industries Ltd. … Opposite Party

BEFORE:

HON’BLE MR. JUSTICE M.B. SHAH, PRESIDENT.

HON’BLE MR. ANUPAM DASGUPTA, MEMBER.

For the Complainant … Mr. S.K. Dholakia, Sr. Advocate

With Mr. Rajesh Lathigara, Advocate

For the Opposite Party … Mr. Avtar Singh, Advocate.

Dated: 12^th MAY, 2008

O R D E R

JUSTICE M.B. SHAH, J., PRESIDENT

Can a builder after agreeing to deliver the possession within a stipulated time, raise a contention that as the price of the flat/property has gone up, it should not be directed to pay any compensation or to pay compensation at reduced rate for delay in delivering the possession of the property?

In our view such contention of any builder is unjustified and unreasonable because after sale of the property all the benefits accrue to the purchaser and not to the vendor. In any case, if such contention is accepted, the builders/contractors would earn crores of rupees by delaying the delivery of the possession of the flat/property for months together for one reason or the other.

Facts:

The Complainants have approached this Commission on 3^rd May, 2000 with a prayer that the Opposite Party – Ansal Properties & Industries Ltd., be directed to deliver possession of apartment No.502, on 5^th floor, E Block, Celebrity Homes and also to pay interest @ 24% per annum on Rs.26,26,790/-, i.e., the amount deposited by them with the Opposite Party, w.e.f. 10.10.1998 till the date of delivery of possession. In the alternative, they have prayed that if the Opposite Party, is unable to deliver the possession of the apartment, then the Opposite Party be directed to refund the amount of Rs.26,26,790/- to the Complainants with interest @ 24% from the date of payment of the instalment till the date of actual realization from the Opposite Party.

On the said complaint, on 19^th December, 2000, this Commission had issued notice to the Opposite Party. However, the matter remained pending on one ground or the other. When it came up for hearing on 7^th December, 2007, the matter was adjourned so as to enable the parties to explore the possibility of a compromise. On that date it was agreed by the Complainants that they would deposit Rs.5,58,000/- with the Registrar of this Commission on or before 12^th December, 2007 and the Opposite Party would deliver the possession of the flat to the Complainants on or before 19^th December, 2007. This agreement was without prejudice to the contentions raised by both the parties before this Commission. It was also pointed out by the learned counsel for the Opposite Party that while calculating the amount of Rs.5,58,000/-, the Opposite Party had not considered the maintenance charges which were required to be paid by the Complainants from the date of offer of possession, i.e., from September, 2003 and, hence, that issue be kept open for arguments at the time of final hearing. Order was passed accordingly.

Again, when the matter came up for hearing on 30^th April, 2008, the learned counsel appearing on behalf of the Complainants submitted that for unjustified delay in delivering the possession of the apartment from 10^th October, 1998 till 20^th December, 2007, the Opposite Party should be directed to pay interest @ 24% per annum on the amount deposited by the Complainants. Further, reliance was placed on the receipt dated 3^rd September, 1996 and covering letter dated 28^th August, 1996 to the effect that interest @ 17% per annum would be payable by the Opposite Party on all advance deposits provided the entire payment is made in one go. On that basis , the Complainants deposited the 6^th, 7^th, 8^th and 9^th instalments for which receipt was issued by the Opposite Party on 3^rd September, 1996. On that receipt, it was specifically mentioned, “This payment is to confirm that the 6^th, 7^th, 8^th and 9^th instalments are made in advance and 17% interest would be allowed”.

For verification of the said letter and the receipt, time was given to the learned counsel for the Opposite Party. At the time of hearing, learned counsel for the Opposite Party did not dispute the said letter or the receipt.

With this background, we would refer to the agreement executed between the parties with regard to sale of the apartment which was to be constructed by the Opposite Party. The agreement is dated 2^nd March, 1995. As per the said agreement, the Opposite Party was to construct the Celebrity Homes, Palam Vihar with certain specifications as provided therein and the Complainants were required to the pay basic sale price of Rs.28,38,000/-, external development charges of Rs.89,870, charges of Rs.1,00,000/- for car parking space in the basement, and club membership fee of Rs.20,000. The basic sale price was to be paid in instalments from 9^th April, 1995 to 9^th December, 1997. It was also agreed that at the time of delivery of possession 5% of the basic price, i.e., Rs.1,41,900/- was to be paid by the Complainants.

As per Clause 13, the Opposite Party had agreed that the possession of the said premises, Phase-1, was likely to be delivered by the Company to the Apartment/Penthouse/Garden Allottee within three and half years from the date of booking, subject to force majeure circumstances and on receipt of all payments punctually as per agreed terms, and also on receipt of complete payments of the basic sale price and other charges due and payable upto the date of possession.

As some extra construction was made, the Complainants were required to pay a higher basic sale price at Rs.29,88,800. Out of that, the Opposite Party received Rs.25,29,770/-. That amount was paid by the Complainants before October, 1997.

It is also agreed that the Complainants were required to pay extra development charges amounting to Rs.4,140/-, electric connection charges of Rs.2,35,000/- as well as fire fighting charges amounting to Rs.29,688/-, stamp duty and registration charges at Rs.6,000/-.

For the aforesaid facts, there is no dispute between the parties.

The question which requires consideration is how much compensation is to be awarded to the Complainants for the delay in construction and delivery of possession?

As stated above, possession of the premises was to be delivered within 3-1/2 years from the date of agreement, on payment of the due instalments regularly. It is not disputed that the Complainants had paid the entire amount before October, 1997. The agreement between the parties was executed on 2^nd March, 1995. If the period of 3-1/2 years is taken into consideration, then the Opposite Party was required to deliver the possession on or before 10^th October, 1998.

However, the Opposite Party was actually required to be directed by this Commission to deliver the possession in December, 2007 and consequently, the possession of the apartment was delivered only on 20^th December, 2007(as against 10^th October, 1998).

The learned counsel appearing on behalf of the Opposite Party submitted that the Opposite Party had written a letter to the Complainants on 2^nd August, 2003 and informed the Complainants that the Opposite Party had immense pleasure in forwarding the formal letter as “Offer of Possession” and welcoming the Complainants to Celebrity Homes – an important Land Mark of Palam Vihar. The Opposite Party produced on record a copy of the said letter.

As against this, it is contended by the learned counsel for the Complainants that the said letter was sent to a wrong address, because before the date of the said letter the Complainants had shifted and the letter was received back by the Opposite Party. The learned counsel further contended that knowing full well that the complaint was filed on 19^th December, 2000, no such offer of possession was made before this Commission, in the present proceedings. He submits that this was a fraud committed by the Opposite Party. He, therefore, contended that the Opposite Party should be directed to pay compensation and the measurement of the compensation should be grant of interest, if not @ 24% p.a. as prayed, at least, @ 17 % per annum as agreed by the Opposite Party in its own letter dated 28^th August, 1996 and the receipt dated 3^rd September, 1996.

As against this, the learned counsel appearing on behalf of the Opposite Party submitted that in such cases, there was no question of awarding interest @ 24% or 17% because the Opposite Party had already delivered the possession of the flat and the value of the said flat had increased due to the increase in the price of the property.

The learned counsel for the Complainants contended that the Opposite Party was charging interest @ 24% per annum, on delayed payments, and, therefore, it should be directed to pay compensation at the said rate, and, in any case @ 17% per annum.

In our view, the contention that there is increase in the price of the property and, therefore, compensation for such inordinate delay in delivery of possession should not be granted, is totally misconceived. If the price of an immovable property increases, it cannot be said that the parties are not required to abide by their contractual obligations. In any case, it is the luck of the Complainants that the price of the property has increased and it cannot be said that it is for the benefit of the vendor. The builder/vendor of the property cannot claim advantage on account of increase in price after sale. Hence, this contention is totally unreasonable and unjustified.

Further, an Application dated 7.11.2006 was filed before this Commission, stating therein that the Complainant, namely, Kunj Behari Mehta, came to India on 29.9.2006 and visited the flat on 1.10.2006 and came to know that the Opposite Party had given possession of adjoining flats, namely, E-501 and E-503. He, therefore, met the Manager at site who informed that his flat No.E-502 was ready for possession for quite some time. However, the Manager expressed his inability to show the flat in question as the same was occupied by the contractor of the Opposite Party, and, at that time, the flat was locked. Thereafter, the complainant No.1 went to the Head Office of the Opposite Party and contacted the Manager-Sales and requested him to hand over the possession of the flat in question. The Manager, roughly and curtly, replied, “Go to the Court and get its possession through the Court”. These facts are not denied by the Opposite Party.

Considering the aforesaid facts, in our view, the Opposite Party is required to pay compensation for unjustifiably not delivering the possession of the flat as per the agreement in October 1998 till December, 2007.

In our view, the ends of justice would be met if, for this unjustified delay, we direct the Opposite Party to pay interest @ 12% per annum from 1^st November, 1998 till 1^st December, 2007 on the amount deposited by the Complainant upto 1^st November, 1997 i.e. in all on a sum of Rs.25,29,770/-.

Further, for the high-handed and rough behaviour of the Manager of the Opposite Party, the Opposite Party shall pay compensation of Rs.50,000/-. This amount shall be deposited with this Commission by way of bank draft drawn in the name of the Registrar of this Commission which shall be transferred to the “Consumer Legal Aid Account” maintained by this Commission.

In the result, the complaint is partly allowed. The Opposite Party is directed to pay interest @ 12% per annum from 1^st November, 1998 till 1^st December, 2007 on the amount deposited by the Complainant upto 1^st November, 1997, i.e., in all on the sum of Rs.25,29,770/-. It would be open to the Complainants to withdraw the amount of Rs.5,58,000/- deposited with this Commission and the Opposite Party after adjustment of the said amount of deposit, shall pay the remaining amount on account of interest to the complainants within four weeks from today. There shall be no order as to costs.

Sd/-

……………………………….J.

(M.B. SHAH)

PRESIDENT

Sd/-

………………………………….

(ANUPAM DASGUPTA)