Utpal Trehan v. Dlf Home Developers Ltd.
ANIRUDDHA BOSE, J.
Leave is granted on the limited question which was formulated by
this Court at the time of issue of notices, by the order passed on 3 rd
January 2022 in SLP (C) No.19226 of 2021. So far as SLP (C)
Nos.5871-5872 of 2022 are concerned, leave is granted on the point on
which the appellants thereof had confined their grievances, recorded in
our order passed on 19th April, 2022. We shall refer to these points later
in this judgment. The controversy which we shall address in this judgment
revolves around the quantum of compensation that the appellant in SLP
(C) No.19226 of 2021 (now appeal) would be entitled to receive because
of delay in delivery of possession of a flat as also the appellant’s obligation
to pay maintenance charges in respect thereof.
2. The specific disputes giving rise to these appeals rel ate to an
Apartment Buyers’ Agreement, executed on 3 rd December, 2008
between Utpal Trehan (whom we shall henceforth refer to as “allottee”)
and DLF Home Developers Limited (we shall refer to th em as the
“builder”) for purchase of a flat, within a complex named New Town
Heights in Sector-91, Gurgaon (now Gurugram), Haryana. This w as
booked by the allottee on depositing a sum of Rs.5 lakhs in March 2008.
The allotment letter was issued on 16 th April 2008, and allocation was
made of Apartment No. GBD-153 along with its parking. As pe r the
Apartment Buyers’ Agreement, the area of the flat was t o be 1760
square feet (super area). The consideration amount was Rs.45,12,000/-,
to be paid as per instalment payment plan forming part of the Agreement.
The stipulation relating to possession of the flat is contained in Clauses
11 and 17 of the said Agreement. A copy of the draft Agreement has
been annexed to the allottee’s paper book. In substance, the t ime for
463
possession has been stipulated to be within 36 months from the date of
execution of the Agreement subject to certain quali fications and
exceptions incorporated in the Agreement itself. This date of delivery of
possession, along with the effects thereof, underwent certain cha nges,
as there was delay on the part of the builders in getting certain regulatory
clearance. Mr. Pinaki Mishra, learned Senior Advocate has app eared
for the builder and the allottee has appeared in person before us.
3. The facts forming genesis of the grievances of the allot tee
have been summarised in the decision of the National Consumer Dispute
Redressal Commission (“National Commission”) delivered on 23rd July
2021, which is under appeal before us. We quote below the rele vant
passages from this decision:-
“12. ….. The allotment letter dated 16.04.2008 and
Annexure-3 to the Apartment Buyer’s Agreement dated
03.12.2008 provided a “Time Linked Payment Plan” un der
which 95% of the sale consideration (including Rs. 5,00,000/
- of booking amount) had to be paid in 11 instalments starting
from 29.05.2008 and ending on 29.06.2010. Vide Clause-1 2
of the Allotment Letter dated 16.04.2008 and Clause -11 of
Apartment Buyer’s Agreement dated 03.12.2008, the
possession had to be handed over within 36 months from the
date of agreement. Environment Clearance Certificat e was
delayed as such the builder could not start construct ion till
May, 2009, i.e. more than one year from booking. In such
circumstances, the builder through letter dated 26.03 .2009,
amended the terms of the agreement and the payment of th e
instalments were changed as “construction Linked Pay ment
Plan”. The builder has simultaneously provided vari ous
benefits to the buyers, i.e. Advance Payment Rebate in the
shape of interest at the rate of 13% p.a. on the am ount in
excess of 35% of sale price as on 26.03.2009, 5% dis count
of basic sale price, increase of approximately 5% ar ea and
compensation for delayed possession @ Rs.10/- per S q. ft.
per month from the date of expected possession till actual
possession and Timely Payment Rebate, equivalent to 10%
basic sale price. Letter dated 23.06.2009 and state ment of
account dated 10.06.2013 prove that the benefits of (i)
Rs.9059/- as Advance Payment Rebate, (ii) Rs. 1,98,000/ - as
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
5% discount of basic sale price and (iii) increase of 5% area
have been given to the complainant.
13. The complainant argued that “Timely Payment Rebate”
and “compensation for delay in possession” had not been
given in statement of the account dated 10.06.2013, for which
he was entitled. The builder has denied the Timely Paym ent
Rebate on the ground that in spite of service of demand letter
dated 29.12.2011, the amount due was not deposited till last
date i.e. 18.01.2012, rather it was deposited on 27. 01.2012
(without including the amount of interest accrued on it in the
meantime). As the time was essence of contract and this
instalment was not deposited in time as such the complainant
was not entitled for Timely Payment Rebate.”
(quoted verbatim from paperbook)
We shall discuss separately the position of the respective parties
as regards obligation of the allottee to pay maintenance charges.
4. The allottee had approached the Delhi State Consumer Disputes
Redressal Commission (“State Commission”), in the month of May 2015,
after the builder had raised additional demands under different heads.
As per the allottee, the total sum, as demanded, added upto Rs.9 lakhs
approximately. Otherwise, the allottee claims to have had cle ared the
requisite instalments. At that point of time, the main compl aint of the
allottee was of being deprived of certain payment related benefits on
being offered possession of the flat. He was being denied these benefits,
since as per the builder, the allottee had made default in payment within
the due date on demand of the developer of the ensuing instalment. As
would be apparent from the said passages of the decision under appeal,
the builder’s contention is that by a notice of 29 th December 2011, the
allottee was to pay the next instalment by 18 th January 2012, but this
was paid on 27th January 2012. The builder thus alleged nine days’ delay.
The allottee’s stand on this count, on the other hand, was that he had not
received the notice of 29th December 2011, but on receiving a reminder
on 22nd January 2012, he cleared the dues on 27 th January of that year.
5. The delivery and payment stipulations were modified on account
of delay in getting environmental clearance and these modifications, as
made by the builder, has been summarised in the passage quoted above
from the National Commission decision. So, we are avoiding a repeat of
these modification terms in this judgment.
465
6. Before the State Commission, the allottee prayed for the
following reliefs:-
“4. ……. i. Give the possession of the said flat at the earliest.
ii. Pay an amount of Rs. 10,00,000/- as compensation fo r
causing mental trauma and agony to complainant due to delay
in giving the possession.
iii. Also pay additional delayed possession rent @ Rs. 1 5/-
sq. ft. till the possession is offered to complainant.
iv. Further waive of the undue/unjustifiable demand already
raised towards the final dues settlement.
v. To pay Rs. 50,000/- towards the expenses incurred by the
complainants towards telephonic communications and
personal visits made to OP since 2006.
vi. To pay a sum of Rs. 75,000/- towards the payment of
litigation expenses.”
(quoted verbatim from paperbook)
7. During pendency of the proceeding before the State Commission,
an application was filed by the builder to bring on re cord certain
subsequent events. What was sought to be brought on record included
crediting to the allottee compensation for delayed possession of
Rs.4,22,816/-, Timely Payment Rebate of Rs.4,02,076/- and interest of
Rs.14,082/-. This application also highlighted that certain sum of money
was already credited to the allottee’s account under the head of Early
Payment Rebate. This application also showed the liab ility of the
complainant (i.e. the allottee) of Rs.3,16,899/- as maintenance charges,
Rs.96,000/- as IBM charges and Rs.14,18,203/- as holding charges. The
said application appears to have been filed subsequent to an attempt at
mediation while the dispute was pending before the State Commission.
8. The State Commission found that there was deficiency in service
and the complaint was allowed in following terms:-
“20. …… i. OP shall issue fresh offer of possession of the
apartment in question i.e. GBD-153, New Town Height s in
Sector-91, Gurgaon to the complainant and shall handov er
the possession of the apartment to the complainant w ithin a
period of 06 weeks.
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
ii. OP shall also execute the sale deed/conveyance deed and
get it registered in the name of the complainant on pay ment
of stamp duty, registration charges and other incid ental
charges, if any, by the complainant, within a period of one
month thereafter.
OP shall pay to the complainant the delayed compensa tion
@ Rs. 10/- per sq. ft. per month for the delayed period from
the agreed date of possession i.e. March, 2011 till the date o f
fresh offer of possession after adjusting the delay ed
compensation already paid to the complainant.”
(quoted verbatim from paperbook)
9. On the question of maintenance charges, however, the State
Commission went against the allottee, holding : -
“19. As regards payment of Rs 3,16,899/- towards maintenance
charges, and Rs.14,18,204/- toward holding charges @ Rs.
10 per square feet till 11.10.2018, as is stated in the afore said
handing over the cheque issued earlier a new cheque can be
issued against the same.
As on date, the complainant is liable to make the f ollowing
payment as per the agreement:
i. Maintenance charges (till 30.09.2018) – Rs.3,16,8 99.
ii. IBMS (Interest Bearing Maintenance Security) – Rs.
96,000/-
iii. Holding Charges (@ Rs. 10/- per sq. ft. till 11.10.2018)
– Rs.14,18,203/-.
However, upon suggestions from this Hon’ble Commiss ion,
the opposite party shall consider waiving the holding charges
accruing day by day and hence, nothing remains payable to
the opposite party. The maintenance security and th e
maintenance charges incurred towards upkeep of the
multi-storey building as mentioned above shall be payable to
the Condominium Association who are maintaining the
property inquestion since the date the property was ready for
possession and was conveyed/offered to the complainant. ”
(quoted verbatim from paperbook)
467
10. One of the critical issues which was examined by the State
Commission was as to whether there was any delay in paym ent of
instalment by the allottee upon demand being made. This question arose
as the builder had denied certain benefits to the appellant which would
have accrued to him if timely payment of instalments w as made on
demand. The builder alleged that the demand in this case was made on
29th December 2011 requiring the allottee to make payment by 18 th
January 2012. As we have already discussed, the allottee took the plea
that the letter of 29 th December 2011 was never received by him and
when he received a reminder letter of 19th January 2012 on 22nd January
2012, he made the payment on 27 th January 2012, factoring in certain
holidays which intervened. The State Commission examined this issue
and gave a finding on fact that the material on record did not establish
that the demand notice of 29th December 2011 was served on any adult
family member/known person of the allottee and that the developer had
failed to prove service of demand notice upon the allottee. The State
Commission thus held that the allottee could not be deprived of the benefits
outlined in the builder’s letter of 26 th March 2009 on the allegation of
failure to pay instalment within due date.
11. The appeal of the allottee to the National Commission was
mainly against the finding given by the State Commission on maintenance
charges. The builder questioned legality of that part of the decision of
the State Commission under which they were directed to issue fresh
offer of possession and payment of delayed compensation.
12. The National Commission partly allowed both the appeal s,
inter-alia holding:-
“In view of aforementioned discussions First Appeal No. 15 30
of 2019 is partly allowed and First Appeal No. 1638 of 2019
is partly allowed. DLF Home Developers Ltd., (the builder) is
directed to (i) offer possession of the apartment in disput e to
the complainant afresh and hand over possession to the
complainant within 6 weeks and execute the sale/conveyance
deed in his name, within one month thereafter, on payment of
stamp duty, registration charges and other incident al legal
charges, (ii) pay compensation for delay in possess ion, i.e
interest @ Rs. 6%- per annum on the sale price deposited by
him for the delayed period from July, 2013 till the date of
fresh offer of possession, adjusting “Early Payment Rebate”
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
of Rs.95,136/- as mentioned in statement of account dated
10.06.2013 and (iii) pay “Timely Payment Rebate” i.e 10%
of basic sale price. The builder is entitled to rea lise/adjust
the Maintenance charges, from the date of issue of Occupation
Certificate and cost of increased area (i.e. the area increasin g
to 5% of the increased area). The builder shall pay a cost of
Rs.50,000/- to the complainant to meet out his litigation and
other expenses.”
(quoted verbatim from paperbook)
13. So far as the allotee’s appeal is concerned, (arising out of SLP
(C) No.19226 of 2021) at the time of issue of notice, this Court had
passed the following order:-
“Heard petitioner in person.
Issue notice limited to the question of maintenance charges as
provided for by NCDRC in the concluding part of the ord er
impugned. Notice may be made returnable in four weeks.
Dasti service in addition to order in process permitted.”
14. In the appeal filed by the builder, at the stage of issue of notice
on the petition for special leave to appeal, it was recorded in our order of
19th April 2022 that the learned counsel appearing for the petitioner, (i.e.,
the builder) essentially confined his submissions to the grievance of the
petitioner- developer in regard to the directions b y the National
Commission and the State Commission for making ‘a fresh offe r of
possession’. We have indicated earlier in this judgment tha t we are
granting leave restricted to these two questions only.
15. We shall first deal with the question of directions to pay to the
builder maintenance charges. In the definition Clause and Clause s 19,
20 and 39 of the Apartment Buyer’s Agreement dated 3 rd December
2008, it has been specified:-
“Definitions
……
Maintenance Agency” means DHDL or association of allottees
or such other agency/body to whom the maintenance of t he
Said Building/Said Complex (including common areas and
facilities) is handed over by DHDL and who shall be
responsible for providing the maintenance services within the
469
Said Building /Said Complex and who shall be entitl ed to
collect the Maintenance Charges.”
“19. Maintenance of the Said Building/Said Complex/Said
Apartment
In order to provide necessary maintenance services, upon the
completion of the Said Building/ Said Complex the
maintenance of the Said Building/Said Complex may b e
handed over to the association of Apartment allottees or such
other agency/ body/ company/ association of condomi nium.
The Allottee agrees to execute Maintenance Agreement (draf t
given in Annexure VII to this Agreement) with the Mainte nance
Agency or any other nominee/ agency or other body/
association of Apartment owners as may be appointed by
DHDL from time to time for the maintenance and upkeep o f
the Said Land/the Said Building/the Said Complex. T his
Agreement shall not be deemed to be executed till the same i s
signed by all the parties. The Allottee further underta kes to
abide by the terms and conditions of the Maintenanc e
Agreement and to pay promptly all the demands, bills} charg es
as may be raised by the Maintenance Agency from tim e to
time. DHDL reserves the right to change, modify, am end,
impose additional conditions in the Maintenance Agreemen t
at the time of its final execution. The Maintenance C harges
shall become applicable/ payable from the date DHDL has
received the occupation certificate/the date of all otment
whichever is later. It is further clarified that DHDL ma y at its
sole discretion hand over the maintenance of the Said Building/
Said Complex to anybody/association of Apartment ow ners
of the Said Building/Said Complex including but not l imited
to any body/ association of condominium of the Said Building/
Said Complex, as the case may be, at any time before/ after
the construction of the Said Building/ Said Complex is complete
either for each building or for the entire Said Comp lex and
the Allottee specifically gives his consent to this pro posal. It
is further specifically clarified that the draft Ma intenance
Agreement, set out in Annexure VII to this Agreement is mer ely
an indicative Agreement that is proposed to be entered into
with the Allottee for maintenance and upkeep of the Said
Building/ Said Complex, however, if at any time, after having
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
taken over the Said Building/ Said Complex, the sai d
association of Apartment owners/ condominium of association
decides to modify, alter, add, delete any one or more of the
terms and conditions of the Maintenance Agreement, the
Allottee shall not have any objection to the same and shall
execute the Maintenance Agreement as may be require d by
the Maintenance Agency or association of Apartment owners
or association of condominium or its nominees or assigns.
20. Fixation of total Maintenance Charges
The total Maintenance Charges shall be more elaborately
described in the Maintenance Agreement (draft given in
Annexure VII). The Maintenance Charges shall be levied from
the date of occupation certificate or the date of a llotment,
whichever is later and the Allottee undertakes to pay the same
promptly. It is agreed by the Allottee that the pay ment of
Maintenance Charges will be applicable whether or not the
possession of Said Apartment is taken by the Allott ee. The
Maintenance Charges shall be recovered on such estim ated
basis which may also include the overhead cost on monthly/
quarterly intervals as may be decided by the Mainte nance
Agency and adjusted against the actual audited expense s as
determined at every end of the financial year and any surplus/
deficit thereof shall be carried forward and adjust ed in the
maintenance bills of the subsequent financial year. The
estimates of the Maintenance Agency shall be final and
binding on the Allottee. The Allottee agrees and unde rtakes
to pay the maintenance bills on or before due date as intimated
by the Maintenance Agency.
……
39. Association of apartment owners
The Allottee agrees and undertakes to join association/ socie ty
of apartment owners as may be formed by DHDL/Compan y
on behalf of Apartment owners and to pay any fees,
subscription charges thereof and to complete such
documentation and formalities as may be deemed neces sary
by DHDL/ Company for this purpose.”
(quoted verbatim from paperbook)
471
16. Annexure VII to that Agreement appears at Page 185 of the
paperbook in SLP (C) No. 19226 of 2021, which is in the form of a draft.
The actual copies of the Agreements, if executed, have not been annexed
to the paperbooks filed in either of these two appeals. No material has
otherwise been produced before us to show if the Maintenance Agreement
(Annexure VII to the main Agreement) was executed or not. Be that as
it may, even if we proceed on the basis that the maintenance Agreement
is applicable, the same constitutes a tripartite Agreement involving the
builder, New Town Heights Condominium Association, a registe red
society and the purchaser. This is in the format of a stan dard form
Agreement with several portions thereof left blank. In the counter affidavit
of the builder, it has been stated that the maintenance cha rges are not
paid to them but to the statutory condominium association of allotees
who actually renders maintenance services recovered from each allotee.
That association to us appears to be an independent body and there is
nothing on record to demonstrate that such association is an agent of
either the builder or the purchasers. In Clause 39 of the Apartment
Buyers’ Agreement, there is hint that such an Association might be
formed by the builder but no particular of its formation, or for that matter,
its existence have been shown before us at the time of hearing.
17. The definition of Maintenance Agency means “DHDL (the
builder) or association of allottees or such other agency…….” b ut the
conjunction “or” as has been applied in the definition claus e ought to
mean in the alternative and this definition cannot be construed to infer
that even after handing over the maintenance work to an associ ation,
the builder shall continue to remain as a maintenance agency entitled to
collect maintenance charges. The clause relating to fixati on of total
maintenance charges only specifies the obligation of an allottee to pay
such charges and the substantive Agreement specifies again t hat the
maintenance charges would be payable to the maintenance agency.
18. In so far as the subject dispute is concerned, the build er’s
case, as stated above, is that the maintenance agency is t o receive the
maintenance charges but no specific case has been made out tha t the
builder themselves are carrying on the maintenance work, which could
have brought them within the definition of maintenance agency under
the main Agreement. In such circumstances, we are unable to appreciate
as to how, in dealing with the allotees’ complaint against the builder, the
two statutory fora passed orders which effectively required the allotee
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
to make over payment as maintenance charges to a third pa rty, the
association in this case. We have already observed that from the materials
on record, no principal-agent relationship has been established between
the builder and the association as regards the Maintenance Agreement
entitling the builder to claim and receive maintenance charges. The builder,
at best, is facilitator in organising a maintenance agenc y. The overall
obligation of a flat buyer to pay maintenance charges may be derived
from interpretation of clause 20 of the main Agreement. But wit hout
any claim from the entity, who are to render maintenance services and
charge for the same, in our opinion, the two statutory fora ought not to
have directed the allottee to make payment of maintenance charges.
The National and the State Commissions, in our opinion, have committed
error in directing the allotee to make payment of maintenance charges,
which ought to have been paid to the association when there wa s no
claim from the association in the first place. Secondly, nothing has been
brought to our notice from which it could be inferred that the builder had
the authority to represent the association for collectin g maintenance
charges. On the other hand, as we have already indicated, the builder’s
own case is that the maintenance charges ought to be paid to the
association. The latter (i.e., the association) has not been impleaded as a
party at any stage of these proceedings. Nor they have prosecut ed any
claim.
19. We must point out here that from the two orders of the State
and the National Commissions, we do not find that the point on right of
the builder to claim maintenance charges was specifically discussed. In
the complaint before the State Commission, point was taken that in
absence of delivery of possession, charging for maintenance b y the
association was unjustified but the principle which we have discussed in
the preceding three paragraphs are purely legal issues an d goes to the
root of the dispute relating to payment of maintenance charges. Moreover,
question of law formulated in paragraph 2D of the allottee’ s special
leave petition (now appeal), in our opinion, is broad enough to cover this
issue. While determining rights of parties on a question of la w which
emerges from the pleadings and crystallises for adjudication, we cannot
ignore answering that question. For otherwise, an incorrect principle of
law may have to be laid down on account of failure of the li tigants in
raising it in clear terms. Moreover, the nature of the dis pute having
originated from a consumers’ grievance, the role of the Court has to be
beyond just being an adjudicatory forum in an adversarial caus e, and
473
must have an element of proactivity in public interest. Having returned a
specific finding on this point, we do not consider it necessary to deal
with the allottee’s contention that claim of maintenance charg e was
unjustified in absence of possession of the subject-flat being delivered to
them.
20. Now we shall turn to the legality of the decision under appeal
issuing direction upon the builder to make payment of delayed
compensation. The provision relating to delayed com pensation is
contained in Clause 17 of the main Agreement:-
“17. Failure to deliver possession : Remedy to DHDL : The
Allottee agrees that if the construction and develop ment of
the Said Complex is abandoned or DHDL is unable to giv e
possession within thirty six (36) months from the d ate of
execution of this Agreement or such extended period s as
permitted under this Agreement, DHDL shall be entit led to
terminate this Agreement whereupon DHDL’s liability shall
be limited to the refund of the amounts paid by the Al lottee
with simple interest @ 6% per annum for the period such
amounts were lying with DHDL and DHDL shall not be liable
to pay other compensation whatsoever.
However, DHDL may, at its sole option and discretion, de cide
not to terminate this Agreement in which event DHDL agre es
to pay only to the Allottee(s) and not to anyone else and only
in cases other than those provided in Clauses 14, 15, 16 and
50 and subject to the Allottee not being in default under any
term of this Agreement, compensation @ Rs. 5/- per sq. ft. of
the Super Area of the Said Apartment per month for the perio d
of such delay beyond thirty six (36) months or such extended
periods as permitted under this Agreement. The adju stment
of such compensation shall be done only at the time of
conveyancing the Said Apartment to the Allottee first na med
in this Agreement and not earlier.”
(quoted verbatim from paperbook)
21. As there was delay in obtaining regulatory clearance for the
project, the builder themselves had made certain modificati ons in the
terms of the Agreement, providing certain benefits to the f lat buyers.
This was done by the communication dated 26 th March 2009 (at page
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
223 of the paper book in the allottee’s appeal). The relevant portion of
this communication reads:-
“As far as “New Town Heights” is concerned, we would lik e,
to mention here that the necessary Building Plan Ap provals
for all the sectors of “New Town Heights” have been received.
As you know, we are a highly compliant organisation, and we
would like to start construction only after we have r eceived
the final Environment Clearance, which is awaited. As soon
as we receive the same, we shall commence the construct ion.
However, to allay any fear that you might have as far as the
handing over period is concerned, we hereby revise the
Compensation Clause No. 17 of the Agreement to Sell, to the
extent of doubling the Compensation payable to Rs. 10/- psft
per month , as against Rs. 5 /- psft per month, that was
applicable earlier. Similarly, if the customer delays in taking
over the possession once the possession is offered by the
Company, he/she shall also be liable to pay Holding Charges
at the same rate, ie., Rs. 10/- psft per month, for the delay
involved in taking over the possession.
We stand behind our promised date of delivery as 3 years, as
we have already communicated earlier. We have amended this
clause to “3 Years from the date of booking” instead of ‘3
years from the date of Agreement’, which was the ea rlier
commitment.”
(quoted verbatim from paperbook)
The direction of the State Commission on delayed compensation
has already been quoted in this judgment. The National Commissi on,
however, modified this directive, which has also been quoted in the earlier
paragraph. This modification has been questioned by the allotee.
22. Paragraphs 15 and 16 of the National Commission’s decision
disclose the reasoning for modifying the directive of the State Commission
upon the builder to pay delayed compensation. Such modification is as
regards the quantum of compensation and the relevant pa rt of the
National Commission’s order is reproduced below:-
“15. So far as the compensation for delayed possess ion is
concerned, the complainant has accepted part of the benef its
given under the letter dated 26.03.2009 and is clai ming
475
remaining benefits. By this letter, mode of payment of the
instalments were changed as “construction Linked Pay ment
Plan”. The construction was started in May, 2009. A fter
adjusting the amount till March, 2009 and the benefits give n
by the letter dated 26.03.2009, on it, the complain ant was
asked to deposit instalment some time in 2010. Demand notice
dated 16.03.2012, shows that Terrace Floor Slab was
completed at that time and demand notice dated 18.06.2 012
shows that the builder had applied for issue of Occupa tion
Certificate, which has been issued on 28.02.2013. Thereafter,
final accounts of the buyers were prepared and poss ession
was offered through letter dated 10.06.2013. Due to delay in
starting construction payment schedule of the instalments w as
changed and to mete out suffering of the buyers, va rious
benefits were provided. Delay in offering possessio n had
occurred as construction could not be started for more t han
one year of booking. lf the buyers were required to pay ment
instalments on later dates than the dates fixed in the
agreement, then how it can be expected that the poss ession
could be given within three years of the agreement. In the
circumstances, the builder was justified in not giv ing
compensation for delayed possession in the statemen t of
account dated 10.06.2013.
16. However, as we found that the complainant was ent itled
for “Timely Payment Rebate” as such statement of the accou nt
dated 10.06.2013 and demand on its basis was illega l. In
such circumstances we direct the builder to pay 6% p.a. interest
on the amount deposited by the complainant toward b asic
sale price, as compensation for delay in possession from July
2013 till date of offer of possession as directed by Supreme
Court in Wg. Cdr. Arifur Rahman Khan Vs. DLF Southern
Homes Pvt. Ltd., (2020) 16 SCC 512. ”
(quoted verbatim from paperbook)
23. We are, however, unable to accept this reasoning. So far as
start of the running time for quantifying delayed payment of compensation
from March 2013 is concerned, we find that the builder themselves had
modified the relevant clause by their letter dated 26th Marc h 2009,
amending the starting date for computing delayed pa yment of
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
compensation from end of three years from the date of Agreeme nt to
three years from the date of booking. Thus, the date of booking i n the
case of the allottee being March 2008, the State Commission had rightly
directed payment of delayed compensation from March 2011.
24. Mr. Mishra has urged that the entire responsibility for delivery
of possession of the flat should not fall on his clients as th e allottee
himself could have applied before the adjudicatory forum for possession
thereof subject to outcome of the case. But this argument in our view is
fallacious. The dispute between the parties primarily arose as the builder
denied substantial benefits to the allottee for nine days’ delay in clearing
instalment. This allegation of delay has been rejected by the Consumer
Fora and their concurrent finding is that no proper demand wa s made
for payment of such instalment. Mr. Mishra has, in his subm issions,
emphasised on the “offer for possession” letter dated 10 th June 2013
and his submission is that obligation to pay delayed payment compensation
cannot go beyond that date. The builder’s case is that they c annot be
held responsible if the allottee does not take possession of the flat, when
offered. A copy of this letter has been annexed at page 235 of the builder’s
paperbook. On a plain reading of this letter, we find that the builder
offered physical possession only on remitting of pay ments as per
statement of accounts, which was for a sum of Rs.9,00,382/- and on
furnishing an undertaking. The National Commission found that t he
statement of account dated 10 th June 2013 and demand on that basis
was illegal. As the offer for possession was conditional on s ettling of
accounts and, as the accounts reflected illegal demand, the builder cannot
argue that there was a valid offer for possession under the lett er dated
10th June 2013. In this background, in the event the allottee wanted
proper adjudication of his rights and liabilities before asking for interim
possession of the flat which would have had carried with it unspecified
obligations, no fault can be found in such conduct of the allotee.
25. Reliance has been placed on the judgments of two coordinate
Benches of this Court in the cases of DLF Homes Panchkula Pvt.
Ltd. vs D.S. Dhanda and Ors. [(2020) 16 SCC 318] and DLF Home
Developers Ltd. And Another vs Capital Greens Flat Buyers
Association & Ors. [(2020] SCC Online SC 1125] in support of the
argument of the builder that “Delay Compensation” could be awarded
only upto the date of offer of possession. But in this case, we ha ve
already held that there was no valid offer for possession. In the case
477
reported in [(2020) 16 SCC 318], interest was directed to be paid by
way of compensation on deposited amount from the promised date of
possession to the actual date of handing over possess ion, and the
coordinate Bench directed, inter-alia, payment of interest at the rate of
9% per annum for a period of two months from the date of offer f or
possession. In the case of Capital Greens Flat Buyers Association
(supra), interest was awarded as compensation for delay in delivery of
possession. The latter judgment was delivered in th e special
circumstances of that case. We accept the argument advanced on behalf
of the builder that time for payment of compensation for delayed payment
shall stop running from the date of offer for possession. But in this case,
there was no valid offer for possession. Mr. Mishra also sought to bring
to our notice the proposals made in course of mediation proceeding. But
mediation obviously failed between the parties and we cannot r efer to
what transpired during the process of mediation while adjudicating the
right of the parties in an appeal.
26. The ratio of the judgment in the case of Wing Commander
Arifur Rahman Khan and Aleya Sultana and Others vs DLF
Southern Homes Pvt. Ltd. and Others [(2020) 16 SCC 512] does
not apply in the facts of the present case. The aforesaid decision was
rendered in a context in which a coordinate Bench of this Court found
the Agreement involved in that case was lopsided, giving unjus tified
advantage to the builder. The relevant paragraph from the judgment is
reproduced below:-
“25. The only issue which then falls for determination i s
whether the flat buyers in these circumstances are constraine d
by the stipulation contained in Clause 14 of ABA provi ding
compensation for delay @ Rs 5 per square feet per month. In
assessing the legal position, it is necessary to record that the
ABA is clearly one-sided. Where a flat purchaser pa ys the
instalments that are due in terms of the agreement with a delay,
Clause 39(a) stipulates that the developer would “at it s sole
option and discretion” waive a breach by the allottee of fail ing
to make payments in accordance with the schedule, sub ject
to the condition that the allottee would be charged interest @
15 per cent per month for the first ninety days and thereafte r
at an additional penal interest of 3% p.a. In other w ords, a
delay on the part of the flat buyer attracts interes t @ 18%
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
p.a. beyond ninety days. On the other hand, where a developer
delays in handing over possession the flat buyer is restric ted
to receiving interest at Rs 5 per square feet per mont h under
Clause 14 (which in the submission of Mr Prashant Bhushan
works out to 1-1.5% interest p.a.). Would the condition which
has been prescribed in Clause 14 continue to bind t he flat
purchaser indefinitely irrespective of the length of t he delay?
The agreement stipulates thirty-six months as the date for the
handing over of possession. Evidently, the terms of the
agreement have been drafted by the developer. They d o not
maintain a level platform as between the developer and
purchaser. The stringency of the terms which bind t he
purchaser are not mirrored by the obligations for m eeting
timelines by the developer. The agreement does not reflec t an
even bargain.”
27. So far as the present appeals are concerned, the quantum of
delayed compensation has been enhanced by the builder themselve s,
along with provision for enhancement with respect to the delay in payment
if made by the allottee in taking possession. In such circumstances, we
do not think the National Commission ought to have had deviated from
the modified contractual terms contained in the communicati on dated
26th March 2009 and replace the said terms with 6% interest per annum
from July 2013 till the date of fresh offer of possession wa s made. In
our opinion, on the point of payment of delayed compensation, the State
Commission’s view was the right view.
28. Now comes the question as to which date shall be treated to
be the date for fresh offer of possession. Both the fora have dire cted
the builder to issue fresh offer of possession as per the dates specified in
the order. The directions of the State and National Commissions were
not to operate with retrospective effect, from 10 th June 2013. The
argument of the builder is that a possession offer letter was issued on
that date. This letter showed certain sum of balance and als o included
certain demands on account of cost of increase in apartment size ar ea,
further EDC and IDC charges, stamp duty charges, etc. Some rebates
were also denied to the allottee on account of delay in payme nt of
instalment by nine days, which we have discussed in the pre ceding
paragraphs of this judgment. In an application dated 15th November 2018,
which was filed on 7th January 2019 before the State Commission, the
479
builder admitted their fault in not providing any compensation for delayed
payment in the aforesaid letter of 10 th June 2013 and prayed that the
complainant (i.e., the allottee) be directed to pay excess amount as
specified in the said application and take possession of the a partment.
The State Commission found that, as per the said application, the builders
had admitted wrong calculation in settling the credits in the account of
the allottee. In fact, the builders then had given the credit for a sum of
Rs.2,40,210/- and issued a cheque for the said sum, which the allottee
did not encash. Such conduct on the part of the allottee was justified as
the dispute was still pending before the State Commission. The State
Commission found deficiency of service on the part of the buil der by
sending wrong statement of accounts along with the letter of possession
and as per the finding of the State Commission, the allottee was deprived
in taking possession of the flat, which was offered, because of these
factors. The National Commission did not take a contrary view and i n
fact came to a finding that the statement of account dated 10 th June
2013 and demand on that basis was illegal. These findings arrived by the
two fora were on appreciation of evidence and we do not find any
perversity in such finding. So, the letter of 10 th June 2013 cannot be
treated as a valid offer letter.
29. (i) We, accordingly, hold the finding of the National Commission
as also the State Commission that the allottee would be required to pay
maintenance charges as erroneous and that part of the find ings of the
two Commissions are set aside.
(ii) The entity to whom such charge is due has not raised any
claim. In such circumstances, direction to the allottee to pay maintenance
charges was not warranted as the entity entitled to receive such charges
is not a party to these proceedings. Such directions assume the character
of declaration of liability or obligation of the allottee in absence of the
admitted claimant, who had not brought any action or staked their claim
in any other manner through these proceedings. Such declaratory relief
cannot be given in vacuum.
(iii) We sustain the order of the National Commission as also the
State Commission that fresh offer of possession ought to be issued. We
extend the time for issuing such offer of possession by a period of eight
weeks from this date. Execution of Deed shall be effected wit hin the
aforesaid period.
UTPAL TREHAN v. DLF HOME DEVELOPERS LTD.
[ANIRUDDHA BOSE, J.]
(iv) We modify the direction of National Commission relating to
payment of delayed compensation and while restoring the directions of
the State Commission, we direct that delayed compensation be paid at
the rate of Rs.10 per square feet per month for the entire period from
March 2011 till the date on which the fresh offer of possession is issued.
(v) The delayed possession compensation shall be paid to the
allottee after adjusting the delayed compensation already paid. The early
payment rebate of Rs.95,136/- shall also be adjusted, as has been directed
by the National Commission. The said sum was mentioned in the
statement of account dated 10th June 2013.
(vi) We retain the order as to costs to be paid to the allo ttee
quantified by the National Commission as Rs.50,000/-.
30. Both the appeals are disposed of in the above terms. W e,
however, make it clear that in this judgment, we have addressed only the
two questions on which leave is granted. Rest of the findings or directions
of the National Commission shall remain undisturbed.
31. Connected applications, if any, shall stand disposed of, without
any order as to costs.
Devika Gujral Appeals disposed of.
(Assisted by : Mahendra Yadav, LCRA)