Order passed by Consumer Forum for case 1800 of 2011, Prakash vs SJR Enterprises

7/23/2019 Order passed by Consumer Forum for case 1800 of 2011, Prakash vs SJR Enterprises

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CC No.1800/2011Filed on 26.09.2011Disposed on 13.04.2012

BEFORE THE III ADDITIONAL BAITGALORE URBAIT DISTRICTCONSUMER DISPUTES REDRESSAL FORIIM,BANGAIORT - 56() O52.DATED THIS THE 13th DAY OF APRIL 2OI2coNsuMER coMpLArNT NO.l8OO IaOLL iPRESENT: Sri T. Rajashekharaiah, B.A. L.L.B., IPRESIDENTSri. H.M.Shivalingappa, B.Sc., LL.B.,MEMBERSmt. Dr. Subhashini, M.B.B.S.," MEMBER

COMPLIIINANT I lprat


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to pay Rs.73,35,71O/- as the total cost of the land, building, 2 carparks and amenities. In addition to it, the Complainant has to bearthe cost of BWSSB and BESCOM charges. As on 26.4.2011, tJreComplainant has paid Rs.69,02,000/- and he has paidRs.4,22,O691- towards BWSSB and BESCOM charges. It iscontended that the Opposite Party was required to deliverpossession of the flat by September 2010 with a grace period of 3months. But the Opposite Party has not completed tlle constructionin time and he has not delivered possession. When theComplainant wanted to inquire about when it will be delivered, theOpposite Part5r was not responded properly to such inquiries.

2. It is stated that the Opposite Party was demanding topay full sum in short notice of 7 days and causing harassment tothe Complainant. The Opposite Party alleged that the delay inhanding over of the flat was because the Complainant has delayedpayment by nearly one month. It is stated that due to delay incompletion of the project, there was increase in the registrationcharges and the VAT and that has increased the price. TheComplainant has paid 95Yo of the cost of the flat and inspite of it,tlre possession has not been given. It is stated that windows andbalcony doors are fully of glass material with aluminum frame andthe Opposite Party has not fixed any safety metal grills which arenormally provided for windows. The windows are not strong and byaccidental push, any person may fall fi'om the higher floors. But theOpposite Party is not willing to install the grills for the windows.Hence, this Complaint is filed praying for a direction to theOpposite Party to pay penal charges of Rs.16,OOO/- per month fromJanua4r 2011 due to the delay in construction. It is prayed todirect the Opposite Party to meet tJle additional cost ofRs.2,OO,OOO/- which happened due to increase in the VAT, servicetax, registration charges etc., It is also prayed for a direction to theOpposite Party to provide the grills for the glass windows anddoors. It is prayed to award Rs.9,000/- as the amount spent by theComplainant for the legal consultation and he has prayed for

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compensation of Rs.10,000/- for the physical strain and mentalagony suffered by the Complainant.

3. The Opposite Party has filed version and has admittedabout entering into agreement to sell the flat to the Complainant. Itis contended that the Complainant has not adhered to the palrmentschedule and there was delay in making payments. It is stated tltatunder the agreement, there is arbitration clause to settle thedisputes between the parties and because of it, this Court has nojurisdiction. It is stated that the agreed cost of the flat wasRs.77,86,000/- and not Rs.73,35,71O1- as contended by theComplainant. Now the Complainant is liable to pay service tax ofRs.1,31,977/-.As such, the total sum payable by the Complainantis Ri.79,97,94O1-. It is admitted that the Opposite Party wasrequired to hand over possession of the flat on or before September2010 with 3 months grace period. It is stated that the time fixedwas tentative and the time is not essence of the contract. On4.9.2011, the Complainant has listed some pending works and hedid not dispute the completion of the project. It is stated thatpolishing of the floor and doors was not done due to tJre fact thatthe majority of the purchasers will prefer to do the same as pertheir choice and taste. Hence, the polishing and sanitary workswere kept pending which will be linished only after it was handedover to the purchaser. Hence only few works regarding floorpolishing, door polishing, kitchen and sanitary works were keptpending which will be finished after consultation of the purchaserswhile handing over possession. Due to movement of labourers,plumber works etc., damages and scratching will be caused if theyare polished at this stage. Hence, those works were not completed.

4. It is stated that the Opposite Party called upon theComplainant to get the sale deed registered by payrngRs.7,17,888/- being the balance payable by the Complainantexcluding stamp duty and registration cost. The Complainant wasnot able to pay that amount and to cover up his latches, he hasfiled this Complaint. The Opposite Party is ready to complete all

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other fittings, painting and polishing work and any work left asshown by the Complainant. Even though the Complainant delayedthe payment of the amount, the Opposite Party did not impose any

-r')-"-- ' - penalty and it has only collected the balance amount without any,61: -: iirterest as a matter of courtesy and a-Iso to maintain good

ts. It is stated that there was dispute raised by thetadjat'nt landowners in OS No.5854/2008 on the file of City CivilCorlit, Bangalore and they have obstructed tJle road. leading to the

" g-*' apartment. As a result, the Opposite Party was unable to transportthe construction materials and there was certain delay due to thosefacts. Hence, the Opposite Part5r was entitled for extension of timefor delivery of possession of the completed apartment. On severaltimes, the Complainant was demanded to pay all the statutorydeposit amounts and registration cost and the Complainant has notdone so. In view of this fact, the Complainant is not entitled toclaim any penalty or damage for the alleged delay in delivering theflat. The Complainant is still due to pay Rs.10,53,3221- whichincludes stamp duty and registration cost. The Complainanthimself has postponed the registration of the sale deed for want offunds. The claim of penalty charges at Rs.l6,OOOl- per month isimaginary and it is contrary to the terms of construction agreementand there is no basis to claim such amount. It is stated that thereis no merit in the contention regarding the quality and safety issuesas the Opposite Party has constructed the building according to thespecifications and designs as approved by the customers from timeto time. The glass window is a specified standard and able towithstand all normal force and keeping in view of the safety of thepurchasers, such windows are hxed. Hence, the question of fixingthe grills for additional safety does not arise. The demand to paythe amount, made by the Opposite Party, is as per the paymentschedule agreed between ttre parties and he cannot have anygrievance about it. There is no delay in the matter of constructionand as per the admission of the Complainant, the flat was ready fordelivery and for registration in the month of March 2011and that


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opportunity was not utilized by the Complainant. Hence, theComplainant is not entitled for any relief and the Complaint isliable to be dismissed.

The points that arise for our consideration are:(1) Whether this Forum has jurisdiction?(2) Whether tJre Complainant has established

deficiency in service by the OppositeParty?(2) To what relief the Complainant is entitled?Our Iindings to these points are as hereunder:(1) Affirmative(2) Affirmative(3) As per the final order.

REASONS8. POINT NO.l: It is contended by the Opposite Party

that under the agreement, there is an arbitration clause to referthe dispute to arbitrator and because of it, this Forum has nojurisdiction. In our opinion, this contention is not acceptable forthe reason that this is an alternative remedy u/s 3 of theConsumer Protection Act, 1986. Section-3 provides that provisionof this act shall be in addition to and not in derogation of theprovisions of any other law for the time being in force. Hence, theprovisions of tllis act will be applicable even though there wasarbitration clause. Hence this contention of the Opposite Party isnot acceptable. Hence, this point is held in favour of theComplainant.

g. FOINT NO.2: The main grievance of theComplainant is about the delay in delivery of possession. Theconstruction agreement between the parties is produced and it isnot in dispute that there is a delay. The clause-S of theconstruction agreement specifrcally states that the Opposite Party

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"l*;,, ttmplete the construction on or before September 2O1Owith

i:;$ montl:s grace period additionally. It also states that if there isany delay in securing permanent connections' tempora4lconnections will be provided till permanent connections areprovided. It states that the opposite Party shall not be liable if heis unable to complete the construction for the reasons beyond hiscontrol such as non availability of the building materials, notgetting necessary orders from the competent authorities etc., Italso provides that incase of delay in giving possession' theoppositePartyshallbeliabletopay4persq.ftofthesuperbuiltup area per month as damages. It also provides that time is theessence of the contract. The relevant Clause-S reads as fo110ws:

5I COMPLETION & DELIWRY OF POSSESSION:5.1) The possession of the Schedule 'C' Apartment in Schedule 'A'Propery iitt O" delivered by the Seconil party after complction ofcoistriction on or before September 2010 wilh three months graceperiod additianally. rnougn every effort will made to obtain electrical,iater and sewetage connections within the stipubted time, norcsponsibility will -be accepted by the Second Pafiy for delay's inabiaining such connections, Clearances, Occupanq and' otherCetifrcite yrom the statutory authorities and Firct Parfi shall not be"oti*a tu-claim any damages/losses/interest against the second Parfion the grounil of such delay. If there is delay in securing pemanent"orne"iions, temporary connecti.ons will be provided till permanmtconnections arte- proviiled. The ftrst Pafo shall however pay theconsumption charges as pet bilk raised5.2) The Second Pafi shall not be litble if they unable to complete thecoistruction of the building and/ or the Schedule 'C' Apartment anddeliver possesiion by the aforesaid date by reuson of non-availabilily orCemeni, Steel, Said, Bricks and other consttuction nolerials, civilcommotion or by any Act of God or { the delay is as a resuk ol any Rule,NotiJication of ihe Govemment, Municipal; Authority, plan sanctioningautiorifies, aiy Court and/ or any other Public ot Competent Anlhori$tprohibiting development and/ or construction activitics or for reasons'beyond tie contrit of the Second Party and in any of the aforesaidien*, the Second iarq snail be entitled to utension of time fordelivery and possession of the completed apartment and the monics tillthen paful byit " Fiot forty under this Agreemenl shall not be refunded"5.3) In case of delay in delivery if the aparfrttentfor teosons other thanwiat is statei above, the Second Party is entitled to a gruce periotl ofthree months and if the delay percists, the Second PaW shall pal theFirst Pafi damages at Rs.4/'(Four only) per Sq'Ft super builbup areapr, ^onti of deky of the Scheduk 'C' Apartment till delivery, provi'ded


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Second Party in-toto.5.5) The First Party shall take possession of the Apattment is Schedule'C' herein after paying in full all the dues including various deposi*mentioned in this Agreement and overdue interest, d any, within Fifteendays from the date of receipts of the notice in wtiting to the Firct Pafiintimating that the said Apartment is rcadyfor use and occupation, timcbeing the essence of the contract in thal behalf,

1(). The contention of the Opposite Party is tllat theconstruction of the building is completed and only some mirrorworks such as flooring, polishing, door polishing, kitchen andsanitary works were kept pending and they can be done later etc.,In this way, the Opposite Party admits that the interior works arenot completed. Hence in our opinion, without completing theinterior works, construction of the building cannot be said to havebeen completed. In addition to it, the Opposite Party should alsoobtain the necessar5i occupancy certificate from the competentauthority before delivery of possession. Hence, ttrese things clearlygo to show that the Opposite Party has not completed theconstruction of the building within agreed time i.e' on or beforeSeptember 2010. The explanation given by the Opposite Party forthe delay is that they are only small works and they can be donelater, but that contention cannot be accepted. It is furthercontended that tJre Complainant has failed to adhere the paymentschedule and because of it, the works are not completed. But theOpposite Party further states that he has not invoked any vigorousclause of claiming interest or terminating the contract andforfeiting 2Oo/o of cost of construction with a good intention ofmaintaining relationship even ttrough there was delay in payrngthe amount. It is stated that still the Complainant is due to pay


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I'.1lCl'6*, !f8 ,r!'"When these contentions are considered' it goes to show that the

Opposite Party does not plead any acts beyond his control such asnon-availability of building materials' not obtaining statutorypermissions etc., Any how, it is admitted that the Complainant haspaid the cost of the building substantially and he is requiied to paysmall amount towards stamp duty and registration cost etc., whenthat is so, it was the duty of the Opposite Party to complete theconstruction and offer to deliver possession of the building byrequiring the Complainant to pay the balance amount' But

insteadof completing the works, the Opposite Parties is only demanding topay the extra amounts from the Complainant' Hence' we are of theopinion that the delay in completing the construction is due to theacts of the Opposite Party and it is not due to any latches on thepart of the Complainant' It is contended by the opposite party thatthe time was not the essence of the contract and also relied ondecisions to that effect. In our opinion whether time was theessence of the contract or not is a question of fact and it dependson the facts of that case. Hence, the ratio of those decisionscannot be applied to the facts of this case' unless we are satisfiedthat the time was not the essence of the contract' In our opinionthe contention of the opposite party that time was not tlre essenceof the contract is not acceptable because' provision is made in thecontract to pay damages if there is delay' That clearly indicatesthat time was the essence of the contract' Hence' this contentionof ttre opposition is not acceptable'

11. It is further contended that the Opposite Party was notresponding properly to the enquiries made by the Complainant andhe was demanding to pay the amount in short notice etc'' In ouropinion, these things are not serious matters which may lead todeficiency of service' Hence, only the delay in delivering possessionis the main factor which requires to be considered' Hence' we areof the opinion that due to delay in delivery of possession of the flat'


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the Opposite Party has committed deficiency of service'Hence' this

point is held in favour of the Complainant'L2. POINT NO.3: Due to delay in delivery of

possession, the Complainant has prayed for penalty charges ofRs.16,0OO/- per month from 1'1'2011' In our opinion' tJre partiesare bound by the terms of the agreement' Under Clause 5'3 of theagreement which is referred above, it is stated that incase of delayin delivery of possession, the Opposite Party shall be liable to paydamages at 4 per sq.ft. of super built up area per month' Henceonly at this rate, compensation has to be awarded' C'-schedule ofthe.agreementtosell"statesthattheflatthatwasagreedtobesold.was measuring 212O sq'ft of super built up area inclusive ofproportionate share in common area' Hence' the super built uparea is 2120 sq.ft- Hence, the compensation to be awarded is2l2O X 4 = Rs.848O/-. Hence, Rs'84801' per month is thecompensation that can be awarded for the delay' The constructionwas required to be completed by September 2010 and with graceperiod of 3 months' Hence from January 2}tl, the Complainantwill be entitled to claim compensation. Hence from 1.1.2011 untilthedateofdeliveryofpossession,theoppositePartyshallbeliableto pay compensation at Rs.8480/- per month'

13. As some works are still required to be completed' theOpposite Party needs some time and in our opinion' within 30 daysfromthedateofthisorder,theoppositePartyshouldbqabletocomplete the remaining works' In the mean time' the Complainantmay be directed to pay the balance amount including the cost ofregistration and stamp duty. Within 15 days after making suchpa5rment by the Complainant, the Opposite Party may be directedto deliver possession of the flat and simultaneously execute thesale deed.

L4. The next prayer of the Complainant is to direct tlteoppositePartytomeettheadditionalcostsresultingfromincreasein VAT, service tax, registration cost etc', It is alleged that there is


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-, ..)\ ':;j -",&r"^r. of about Rs.2,00,000 I - for such causes. In our opinion,thiscontentioniqnotacceptableasthereisnomaterialto

substantiate tl:eir contention. Even otherwise t]rey are incidentalcostandtheComplainantshouldbearthesame.Moreover,t}recomplainant has to bear all these costs at tl-e time of registration'Hence, he is not entitled for this relief'

ls.Thenextprayeristodirectt}reoppositePartytofixsafety grills for the glass, windows etc', In our opinion' thiscontention is not acceptable because there is no material to showthatt]rerewasanyagreementtofixirongrillsfortheglass,windowsordoors.Moreover,fixingglasswindowsisnaturalandthe contention that the glass windows affect the safety of theinhabitants is not prima-facie acceptable. Hence, we hold that heis not entitled for any such relief'

16. The Complainant has prayed for compensation ofRs.9,ooo/-aScostofthelitigationandcompensationofRs.10,O0O/- towards the mental agony suffered by him' In ouropinion,Rs.S,ooo/-maybeawardedtowardscostsandRs.S,o0o/-maybeawardedtowardscompensationduetot}rehardshipcaused to him.:

17. The complainant has made amendment to the complaint andfurther pleaded that the opposite party is trying to reduce thepndivided share of land and it will cause loss to him. He pleads thatthere has been no official communication to flat owners as to why theundivided share of lands needs to be reduced. Hence, he seeks for aformal explanation from the opposite parly as to why undivided shareof land has been reduced. In our opinion there is no reason to takecognizance of these allegations because the opposite parf has notinformed the complainant about it. when the opposite party has notasked the complainant to reduce the undivided share of land thecomplainant need not worry about it. Hence, it is premature to raise


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such contention by the complainant. If the opposite party is insistingto get the documents executed and to take possession etc, when thecase is pending, he is not expected to threaten the complainant aboutit. In our opinion these things are of less significance and thecomplainant is not bound by any such acts of the opposite party.Hence, it is sufficient if proper directions are given in the operativeportion of the order about executing documents and delivery thepossession by the opposite parly and that will meet the grievance ofthe complainant and no separate order is required for such additionalprayer. Hence, we pass the following order.

ORDERThe Complaint is allowed in part. It is held that the Opposite

Party has committed de{iciency of service. The Opposite Party shallcomplete tl:e remaining works, relating to construction of thebuilding, within 30 days from the date of this Order. TheComplainant shall pay the balance amount including the cost ofregistration and stamp duty to the Opposite Party within 30 daysfrom the date of this Order. The Opposite Party shall arrange todeliver possession and execute the necessary deed of conveyancewithin 15 days from the date of making payment of the balanceamount by the Complainant. The Opposite Party shall be liable topay compensation of Rs.848Ol- pet month from 1.1.2011 untilcompletion of 3O days from the date of this Order. If further delayis committed by the Opposite Party in delivering possession, evenafter payment of the balance amount by the Complainant, then,the Opposite Par{y shall be liable to pay further compensation ofRs.8480/- per month until delivery of possession. If delivery ofpossession is delayed due to non-payment of the balance amountby the Complainant within 30 days from the date of this order, theComplainant shall not be entitled for compensation of Rs.848O/-per month for the period subsequent to 30 days from the date of

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this Order. The Complainant is entitled for cost of Rs.5,0O0/-(Rupees five thousand) and compensation of Rs.S,OOO/- (Rupeesfive thousand) due to the hardship caused to him. TheComplainant is not entifled for any other reliefs prayed by him.

This Order is pronounced on this the 13tt day of April 2012.

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Order passed by Consumer Forum for case 1800 of 2011, Prakash vs SJR Enterprises

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Transcript of Order passed by Consumer Forum for case 1800 of 2011, Prakash vs SJR Enterprises