DLF HOMES PANCHKULA (P) LTD. THROUGH ITS AUTHORISED SIGNATORY MR. SHIV KUMAR versus SUSHILA DEVI AND ANR. ETC. on 26 February 2019

[2019] 2 S.C.R. 739

DLF HOMES PANCHKULA (P) LTD. THROUGHITS AUTHORISED SIGNATORY MR. SHIV KUMAR

v.

SUSHILA DEVI AND ANR. ETC.

(Civil Appeal Nos. 2285-2330 of 2019)

FEBRUARY 26, 2019

[UDAY UMESH LALIT AND HEMANT GUPTA, JJ.]

Consumer Protection Act, 1986:

Complaint of deficiency in service – Against the developer ofproperty – Alleging delayed delivery of possession of apartments –Some of the complainants sought refund of all the money they hadpaid while others sought compensation for delayed delivery withpossession of the apartment – State Consumer Disputes RedressalCommission allowing the complaints directed refund of depositedamounts with interest @ 15% p.a. and with lesser rate in others andcompensation – Similar directions were passed in cases of delayeddelivery of possession – Appeal filed before National ConsumerDisputes Redressal Commission by the Developer – The Developerhowever objected that the appeals could not be proceeded with asthere was not even one Judicial Member on the Bench – NationalCommission reserved the matters for orders by its order dated1.8.2018 – Review petition filed by the Developer was rejected byorder dated 8.8.2018 – In petition u/Art.227 of the Constitutionagainst the orders dated 1.8.2018 and 8.8.2018, High Court stayedthe operation of the order of the National Commission – Thereafter,National Commission passed reasoned judgment on 7.9.2018affirming the order of State Commission – However, in view of thestay order of the High Court, it observed that judgment dated7.9.2018 would remain stayed till further orders by High Court –Present appeals by the Developers as well as some of thecomplainants – Held: All the parties agreed for disposal of the casesin terms of understanding as per the governing principles set out –Matter disposed of on the agreed understanding as settled by theparties.

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ACIVIL APPELLATE JURISDICTION : Civil AppealNos. 2285-2330 of 2019.

From the Judgment and Order dated 07.09.2017 of the NationalConsumer Disputes Redressal Commission, New Delhi in First AppealNos. 382, 447, 879, 881, 648, 649, 650, 651, 982, 1145, 1146, 1147, 1315,767, 1158, 1347, 1348, 1349, 1351, 1352, 1576, 1577, 1579, 1580, 1581,B1582, 1583, 1584, 1586, 1587, 1589, 1590, 1591, 1592, 1593, 1594, 1595,1598, 1601, 1623, 1578, 1599, 1600, 1622, 1625 of 2016, 1643, 453 and638 of 2017.

WITH

Special Leave Petition (Civil) Nos.931, 939 and 968 of 2019,CCivil Appeal No.2354 of 2019.

Pinaki Misra, Sr. Adv., Amarjeet Singh, Narender Yadav, R. N.Karanjawala, Ms. Ruby Singh Ahuja, Ms. Deepti Sarin, Nakul Gandhi,Sahil Monga, Ms. Manik Karanjawala, Ms. Kanika Agnihotri, Ms. SeemaSundd, Pravin Bahadur, Saurabh Kumar, Prabhat Ranjan, Aditya Singh,DMs. Swikriti Singhania, Alabhay D., Ms. Shreyansi Goel, Kartik Nayar,M/s. Karanjawala & Co., Ranbir Singh Yadav, Puran Mal Saini,Ms. Anzu K. Verkey, Pati Raj Yadav, B. Rajesh, Ankur Bansal, AnujArora, Dr. M. K. Ravi, Ms. Aruna Tilekar, Ms. Priya Puri, Ms. VineetaMeghrajani, Anand S. Jha, Md. Ali, Ankit Gupta, Akash Vashisth, RanvijaySingh, Siddharth Mittal, Hari Om Yaduvanshi, Dr. Monika Gusain, SandeepEChhabra, Jinendra Jain, Dinesh Chander Trehan, Ms. Astha Tyagi, RajeshKumar Chaurasia, Sudhir Kathapalia, Anant Agarwal, Ms. Sweta Rani,Siddharth Batra, Nikhlesh, Naveen Sheokand, Ashok Kashyap, VishwaPal Singh, Nikilesh Ramachandran, Advs. for the appearing parties.

The Judgment of the Court was delivered by FUDAY UMESH LALIT, J. 1. Leave granted in all matters,except Special Leave Petition (Civil) Nos.931 of 2019, 939 of 2019 and968 of 2019.

Re: Appeals arising out of Special Leave Petition (Civil) Nos.928-976of 20191(DLF Homes Panchkula (P) Ltd. Through its AuthorisedSignatory Mr. Shiv Kumar v. Sushila Devi and another2G

2. These appeals are directed against the final judgment and orderdated 07.09.2018 passed by the National Consumer Disputes RedressalCommission, New Delhi (hereinafter referred to as ‘the NationalCommission’) in First Appeal Nos.382/2016, 447/2016, 453/2017, 1[Except Special Leave Petition (Civil) Nos.931 of 2019, 939 of 2019 and 968 of 2019]

H2(Appeals by the Developer)

648/2016, 649/2016, 650/2016, 651/2016, 767/2016, 879/2016, 881/2016,1145/2016, 1146/2016, 1147/2016, 1158/2016, 1315/2016, 1347/2016, 1348/2016, 1349/2016, 1351/2016, 1352/2016, 1576/2016, 1577/2016, 1578/2016, 1579/2016, 1580/2016, 1581/2016, 1582/2016, 1583/2016, 1584/2016, 1586/2016, 1587/2016, 1589/2016, 1590/2016, 1591/2016, 1592/2016, 1593/2016, 1594/2016, 1595/2016, 1598/2016, 1599/2016, 1600/2016, 1601/2016, 1622/2016, 1623/2016, 1625/2016 and 1643/2017.

3. The original complainants had booked apartments in a projecttitled “DLF Valley, Panchkula” situated in Panchkula, Haryana, whichwas to be developed by the Developer. The Developer had promised tohandover possession within 24 months from the date of signing of theagreement. Various complaints came to be filed by the Complainantssubmitting that despite period of two years being over there was nosubstantial progress and as such, the Developer was deficient in renderingservice. Some of the Complainants prayed for refund of all the moneysthey had deposited from time to time along with interest and compensationwhile others sought relief in the nature of compensation for delayeddelivery of possession but insisted that the possession of the apartmentsbe handed over to them.

4. The State Consumer Disputes Redressal Commission, UT,Chandigarh (hereinafter referred to as ‘the State Commission’) by itsvarious orders allowed the complaints and directed refund of the amountsdeposited by the concerned Complainants with interest @ 15% per annumin some cases and with lesser rate in others and compensation. Similardirections were passed in cases of delayed delivery of possession. Theseorders passed by the State Commission were challenged by the Developerby filing aforementioned First Appeals in the National Commission whichwere disposed of by the National Commission vide its common orderdated 07.09.2018. The National Commission affirmed the view takenby the State Commission and dismissed all the appeals. Aggrievedthereby the present appeals by special leave were filed by the Developer.Re: Appeal arising out of Special Leave Petition (Civil) No.26519of 2018 (Ravi Datt Aggarwal and others v. DLF Homes PanchkulaPvt. Ltd. and others3

3Appeals by original Complainants

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A5. While the appeals as aforesaid were pending before the NationalCommission, it was submitted by the Developer that there had to be atleast one Judicial Member on the Bench and in cases where there wasnot even one Judicial Member on the Bench, the appeals could not andought not to be proceeded with. After hearing all submissions, theNational Commission by its order dated 01.08.2018 reserved the mattersBfor orders. Thereafter, Review Petitions were filed by the Developerwhich were rejected on 08.08.2018. The Developer then filed a petitionunder Article 227 of the Constitution being CM(M)No.951 of 2018 inthe High Court of Delhi questioning said orders dated 01.08.2018 and08.08.2018. While issuing notice, the High Court by its order datedC20.08.2018 stayed the operation of the order dated 08.08.2018 passedby the National Commission. The National Commission, thereafter,passed a reasoned judgment on 07.09.2018 rejecting all the submissions.However, in view of the fact that the order dated 08.08.2018 was stayedby the High Court, it observed that the operation of the Judgment dated07.09.2018 would remain stayed till further orders by the High Court.D

6. Some of the Complainants, being aggrieved, approached thisCourt by filing Special Leave Petition (c)No.26519 of 2018 in which,while issuing notice on 22.10.2018, this Court stayed the operation of theorder dated 20.08.2018 passed by the High Court.

7. Thereafter, the appeals filed by the Developer and theEComplainants were taken-up together.

8. It may be mentioned that matters where the Developer hadchallenged similar directions issued in other cases namely Civil AppealNos. 11097-11138 of 2018, were disposed of by this Court on 19.11.2018.In those cases, (Himanshu Arora case, for short) the State CommissionFhad awarded interest @ 12% which was reduced by the NationalCommission to 9%. After hearing learned counsel for both sides, thisCourt had passed following directions: - “8. Having regard to the above submission, we indicated to thelearned counsel appearing on behalf of the flat purchasers that itwould be appropriate if the interest as ordered by NCDRC at 9%per annum is made payable over the period which was determinedby the Order of the SCDRC. There is no objection by the flatpurchasers to the aforesaid modification being made. Evenotherwise, we are of the view that such a modification would be G

required in the interests of justice since it was the appellants whohad questioned the Order of the SCDRC before the NCDRC.

9. In the above facts and circumstances, we confirm the directionof the NCDRC that the appellants shall pay interest @ 9 per centper annum. However, the period over which interest shall bepayable will be in conformity with the order passed by the SCDRC.

10. We also direct that in computing the interest payable in termsof the Order of the NCDRC to the extent modified above, theappellants would be entitled to credit for the compensation, if any,which has been paid to any flat buyer in terms of Clause 15 of theflat purchase agreements. In other words, the amount of interestpayable shall be computed after deducting any amount that hasbeen paid to the concerned flat buyer under Clause 15 of theagreement.

11. The amount which has been deposited in this Court inpursuance of the order dated 18.5.2018, shall be transferred bythe Registry to the Registrar of the SCDRC, Chandigarh. Theappellants shall, within a period of two weeks from today, file adetailed computation with reference to each of the flat buyersand the amount which is due and payable in pursuance of theabove directions. The amount shall be duly verified beforedisbursal, on proper identification, to each of the flat buyers. Aftercompleting the above exercise, in the event, that any amount(inclusive of the accrued interest) remains surplus, it shall berefunded to the appellants.

12. Upon the transfer of the amount, the SCDRC shall keep theamount in a short term fixed deposit until the stage of disbursementis reached.

The civil appeals are disposed of.”

9. When the present appeals were taken up, all the parties agreedthat these appeals be disposed of in terms with the directions issued bythis Court in Himanshu Arora’s case. We, therefore, directed theDeveloper to file a Chart in consultation with all the complainants andindicate what modalities be adopted. After such Chart was filed, it wasagreed that wherever compensation was to be awarded, it should be inthe form of interest @ 9% and the governing principles be as under:- AB

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A(a) In all Refund cases, the award of interest @ 9% would bepayable in respect of deposits from the day they were made tillthe date of refund.

(b) In cases where, upon transfer, a subsequent purchaser hadstepped into the shoes of the original allottee and had prayed forBRefund, the reckoning date for computing the interest be from thedate of his transfer in respect of all the amounts that were depositedby the original allottee and if any subsequent deposits were madeby the transferee, from the dates of such deposits;

(c) In cases where Possession was sought, the period availableto the Developer under the agreement being three years (that isCto say original period of two years which was extendable, at theoption of the Developer, by further period of one year) ought notto be computed while calculating compensation in the form ofinterest. Therefore, the period to be reckoned shall be after expiryof three years from the date of agreement and in respect of suchDperiod the compensation shall be at the same rate of 9%.

(d) In Possession cases, if there was any transfer and thetransferee had stepped into the shoes of the original allottee, thecompensation shall be paid from the date of expiry of three yearsfrom the agreement as aforesaid or from the date of transfer,whichever is later.E

10. The matter was, thereafter, adjourned so that the parties couldcheck and reconcile all the concerned amounts and present a mutuallyacceptable statement of figures. Accordingly, the Chart has beenpresented which is appended to this Judgment as Annexure-A.

11. Column No.13 of the tabulated chart denotes element of interestF@ 9% while Column No.16 denotes the amount that had been receivedby the Developer. Column No.14 shows the amounts of FDRs depositedby the Developer in respect of every Complainant, while Column No.17shows amount payable to every Complainant or recoverable from suchComplainant wherever excess amount was deposited. According to theGChart, Serial Nos.1 to 17 are Refund cases where Possession was notprayed for. Out of these 17 cases, those at serial nos. 9 and 16 werealready settled and as such their cases[4] shall not form part of this groupof appeals. Case at serial no.17 was a transfer case in the category of Refund cases and as such would be governed by principle (b) as statedhereabove. Rest of the cases in the Refund category will be governedby principle (a) stated hereinabove except the case of Colonel NareshKumar Kohli, whose name is at Serial No.14 which will be subject tomodification as stated hereafter.

12. According to Colonel Kohli, the fact that he had depositedRs.62,04,014/- was not disputed at any juncture either before the StateCommission or the National Commission and in fact FDR in that sumalready stood deposited by the Developer. However, in his caseColumn No.16 wrongly mentioned figure of Rs.60,54,812/- andconsequently the amount payable in Column No.17 was wrongly shownas Rs.24,60,356/-. We heard learned counsel for the Developer andColonel Kohli on this issue and find that the submission made by ColonelKohli deserves acceptance. We, therefore, correct the figures in ColumnNos.16 and 17 to be Rs.62,04,014/- and Rs.26,09,558/- respectively. Heshall be entitled, over and above the amount deposited in FD namelyRs.62,04,014/-, an amount of Rs.26,09,558/- as well.

13. We now turn to Possession cases which are tabulated fromserial nos. 18 to 48 (except case at serial no. 32). Let the case ofMr. Gautam Kashyup at Serial No.32, namely Special Leave Petition(Civil)No. 968 of 2019 be listed before a regular Court. All other mattersin Possession category stand disposed of in terms of the directions (c)and (d) as issued above.

14. Except to the extent any exception or modification stated inthis Judgment every person in Refund and Possession categories isaggregable to the disposal of their matters in terms of the understandingas above and the governing principles set out earlier.

15. It is directed that, on the strength of this order and upon properidentification to the satisfaction of the State Commission, the amountsstanding in Fixed Deposit Receipts against each of the Complainant alongwith interest, if any, accrued thereon be made over to said complainantwithin six weeks from today. We also direct the Developer to makeover to each complainant the amount in Column No.17 marked as“Amount Recoverable/Payable” within six weeks. In two cases i.e. inappeals arising out of Special Leave Petition (Civil)Nos.928 of 2019 and936 of 2019 where the excess amount has been deposited, the Developer A

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Awill be entitled to have such excess amount recovered from the amountspresently lying in deposit.

16. In respect of the matter at serial No.8 relating to originalallottee named Arun Yadav, certain additional directions are called for.Said original allottee is no more. While making the booking he hadBmentioned the name of his wife as a nominee. He has left behind hiswidow, two children and mother. The widow and the mother areindividually claiming refund of the amount deposited by him. At thisstage, the entitlement of either side cannot be gone into and the partiesmust be left to agitate this issue in a properly instituted matter before aCcompetent court. However, considering the fact that the mother, thewidow and two children, going by normal law relating to intestatesuccession for Hindus, would share the property of the deceased personequally, we direct ¾ of the sum to be made over to the widow who shalltake said sum for herself and on behalf of two children while theremaining ¼ of the sum shall be made over to the mother. They mustDhowever execute indemnity bonds agreeing to return the sum that theyhad received in whole or in part, in case a declaration as to theirentitlement by a competent court were to go against them.

17. Since, the matters are being disposed of on an agreedunderstanding and since no order of compensation was passed inEHimanshu Arora, no compensation other than what has been dealt withearlier, need be paid to the Complainants.

18. Finally, we direct:-

(a) SLP(C) Nos.931 and 939 of 2019 stand disposed of as havingFbeen settled by the parties.(b) SLP(C) No.968 of 2019 be listed for consideration beforeappropriate Bench in due course.

(c) All the appeals stand disposed of in terms indicated above.

(d) No costs.

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HKalpana K. Tripathy