TaxTMI 
TaxTMI 
2019 (4) TMI 231
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....Sector 62, Golf Course Extension Road, Gurugram. The Respondent - Flat Purchaser entered into an Apartment Buyer's Agreement dated 08.05.2012 with the Appellant - Builder to purchase an apartment in the said project for a total sale consideration of Rs. 4,83,25,280/-. As per Clause 11.2 of the Agreement, the Appellant - Builder was to make all efforts to apply for the Occupancy Certificate within 39 months from the date of excavation, with a grace period of 180 days. 3.2. The excavation of the project commenced on 04.06.2012. As per Clause 11.2 of the Agreement, the Builder was required to apply for the Occupancy Certificate by 04.09.2015, or within a further grace period of 6 months i.e. by 04.03.2016, and offer possession of the flat to the Respondent - Flat Purchaser. The Appellant - Builder however failed to apply for the Occupancy Certificate as per the stipulations in the Agreement. 3.3. The Respondent - Flat Purchaser filed a Consumer Complaint before the National Commission on 27.01.2017 alleging deficiency of service on the part of the Appellant - Builder for failure to obtain the Occupancy Certificate, and hand over possession of the flat. The Respondent....
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....spondent - Flat Purchaser, along with Interest @10.7% S.I. p.a. towards compensation. The rate of Interest @10.7% S.I. p.a. was fixed in accordance with Rule 15 of the Haryana Real Estate (Regulation and Development) Rules, 2017 which reads as follows : "15. An allottee shall be compensated by the promoter for loss or damage sustained due to incorrect or false statement in the notice, advertisement, prospectus or brochure in the terms of Section 12. In case, allottee wishes to withdraw from the project due to discontinuance of promoter's business as developers on account of suspension or revocation of the registration or any other reason(s) in terms of clause (b) sub-section (I) of Section 18 or the promoter fails to give possession of the apartment/ plot in accordance with terms and conditions of agreement for sale in terms of sub-section (4) of section 19. The promoter shall return the entire amount with interest as well as the compensation payable. The rate of interest payable by the promoter to the allottee or by the allottee to the promoter, as the case may be, shall be the State Bank of India highest marginal cost of lending rate plus two percent. ..." (emph....
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....reafter and he shall continue to be bound by the provisions of this Agreement, provided that in such case, the Developer shall continue to pay the compensation provided herein. 20. RIGHT OF CANCELLATION BY THE ALLOTTEE Except to the extent specifically and expressly stated elsewhere in this Agreement, the Intending Allottee shall have the right to cancel this Agreement solely in the event of the clear and unambiguous failure of the warranties of the Developer that leads to frustration of the contract on that account. In such case, the Allottee shall be entitled to a refund of the installments actually paid by it along with interest thereon @ 6% per annum, within a period of 90 days from the date of communication to the Developer in this regard less any payments made towards taxes paid by the Developer or interest paid due or payable, any other amount of a non-refundable nature. No other claim, whatsoever, monetary or otherwise shall lie against the Developer nor shall be raised otherwise or in any manner whatsoever by the Allottee. Save and except to this limited extent, the Allottee shall not have any right to cancel this Agreement on any ground whatsoever." ....
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....t - Flat Purchaser. 5.1. It was submitted that the filing of the Consumer Complaint may be treated as his Termination Notice under Clause 11.5 (ii) of the Agreement. Under the Agreement, the Builder was obligated to apply for the Occupancy Certificate within 39 months from the date of excavation, with a grace period of further 6 months. The period got over by 04.03.3016 after taking into account the grace period. Admittedly, the Appellant - Builder offered possession after an inordinate delay of almost 3 years on 28.08.2018. On account of the inordinate delay, the Respondent - Flat Purchaser had no option but to arrange for alternate accommodation in Gurugram. Hence, he could not be compelled to take possession of the apartment after such a long delay. It was in these circumstances that the Respondent - Flat Purchaser sought stay of the cancellation of the allotment as a collateral, till his claim for refund was adjudicated by the National Commission. 5.2. It was further submitted that the Clauses of the Agreement were one-sided. As per Clause 6.4 (ii) of the Apartment Buyer's Agreement, the Appellant Builder could charge Interest @18% p.a. for delayed payments. Howe....
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....it is a "service" as defined by Section 2 (o) of the Consumer Protection Act, 1986. The inordinate delay in handing over possession of the flat clearly amounts to deficiency of service. In Fortune Infrastructure & Anr. v. Trevor D'Lima & Ors., (2018) 5 SCC 442 this Court held that a person cannot be made to wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation. 6.2. The Respondent - Flat Purchaser has made out a clear case of deficiency of service on the part of the Appellant - Builder. The Respondent - Flat Purchaser was justified in terminating the Apartment Buyer's Agreement by filing the Consumer Complaint, and cannot be compelled to accept the possession whenever it is offered by the Builder. The Respondent - Purchaser was legally entitled to seek refund of the money deposited by him along with appropriate compensation. 6.3. The National Commission in the Impugned Order dated 23.10.2018 held that the Clauses relied upon by the Builder were wholly one-sided, unfair and unreasonable, and could not be relied upon. The Law Commission of India in its 199th Report, addressed the iss....
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....ction 2 (r) of the Consumer Protection Act, 1986 defines 'unfair trade practices' in the following words : "'unfair trade practice' means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice ...", and includes any of the practices enumerated therein. The provision is illustrative, and not exhaustive. In Central Inland Water Transport Corporation Limited and Ors. v. Brojo Nath Ganguly and Ors., (1986) 3 SCC 156 this Court held that : "89. ... Our judges are bound by their oath to 'uphold the Constitution and the laws'. The Constitution was enacted to secure to all the citizens of this country social and economic justice. Article 14 of the Constitution guarantees to all persons equality before the law and equal protection of the laws. This principle is that the courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between parties who are not equal in bargaining power. It is difficult to give an exhaustive list of al....
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....riod commencing from the date of payment of each installment, till the date on which the amount was paid, excluding only the period during which the stay of cancellation of the allotment was in operation. In Bangalore Development Authority v. Syndicate Bank, (2007) 6 SCC 711 a Coordinate Bench of this Court held that when possession of the allotted plot/flat/house is not delivered within the specified time, the allottee is entitled to a refund of the amount paid, with reasonable Interest thereon from the date of payment till the date of refund. 8.1. In the present case, the National Commission has passed an equitable Order. The Commission has not awarded any Interest for the period during which the Order of stay of cancellation of the allotment was in operation on the request of the Respondent - Flat Purchaser. The National Commission has rightly awarded Interest @10.7% S.I. p.a. by applying Rule 15 of the Haryana Real Estate (Regulation And Development) Rules, 2017 from the date of each installment till 05.02.2017 i.e. till the date after which the Order of stay of cancellation of the allotment was passed; and thereafter, from the date of the Commission's final Order till....