STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

PUNJAB, CHANDIGARH.

Consumer Complaint No.1022 of 2018

Date of institution : 31.12.2018

Reserved On : 12.06.2020
Date of decision : 17.06.2020

Abdul Hafiz S/o Sh. Mohd. Aslam, aged about 40 years, R/o New
Abadi Sirhandi Gate, Malerkotla, Sangrur, Punjab-148023.

….Complainant
Versus

Greater Mohali Area Development Authority, PUDA Bhawan, Sector

62, S.A.S. Nagar, Mohali, Punjab.
E-mail Address:eo@gmada.gov.in
.…Opposite Party

Consumer Complaint under Section 17 of

the Consumer Protection Act, 1986.
Quorum:-
Hon’ble Mr. Justice Paramjeet Singh Dhaliwal, President

1) Whether Reporters of the Newspapers may be allowed to see

the Judgment? Yes/No
2) To be referred to the Reporters or not? Yes/No
3) Whether judgment should be reported in the Digest? Yes/No

Argued By:

For the complainant : Sh. Arjun Grover, Advocate

For the opposite party : Sh. Anuj Kohli, Advocate.

JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT

The complainant has filed this complaint, under Section 17

of the Consumer Protection Act, 1986 (in short, “the Act”), against the

opposite party, seeking following directions to it:

i) to refund the principal amount of ₹63,30,750/-, along with

interest at the rate of 12% per annum with effect from

22.05.2015 calculated up to 28.12.2018, which comes to

Consumer Complaint No.1022 of 2018 2

₹28,10,853/- (Annexure C-6), along with future and pendent-lite

interest @ 12% per annum till the date of actual realization;

ii) to pay compensation of ₹2,00,000/-, on account of mental agony

and harassment suffered by the complainant; and

iii) to pay ₹50,000/- towards litigation expenses.

iv) It has also been prayed that any other relief, which may be

deemed fit in view of the facts and circumstances of the case,

may also be awarded.

Facts of the Complaint

2. Brief facts, as set out in the complaint, are that the

opposite party issued advertisement/brochure in the year 2011-12,

stating that it was going to launch a new project/scheme in Sector-68,

S.A.S. Nagar, Mohali in the name of “Purab Premium Apartments”.

Being allured by the claims made by it, the complainant booked Type-

3 residential apartment, measuring 3133.15 sq.ft. for sale price of

₹69,00,000/-. Vide letter dated 23.03.2012, the complainant was

informed that he was declared successful in the draw of lots held on

20.03.2012 and he was directed to submit documents as per the

scheme. Accordingly, the complainant submitted the requisite

documents and deposited ₹6,90,000/- i.e. 10% of the total price of the

apartment. Letter of Intent (LoI) dated 22.05.2012 was issued to the

complainant. As per Clause 2 (Payment Schedule) of LoI, payment of

₹13,80,000/- being 20% of sale price of apartment was to be made by

22.06.2012 to complete 30% of sale price; failing which the paid

amount was to be refunded with 10% deduction and allotment was to

Consumer Complaint No.1022 of 2018 3

be cancelled. However, the said period was extendable up to 30 days

with 2% penalty, up to 60 days with 3% penalty and up to 90 days with

5% penalty on prior written request. As per Plan-A given under Clause

2.2 of LoI, a sum of ₹42,60,750/- being balance 65% of tentative price

of apartment was payable within 60 days of issue of LoI with rebate of

5% on the balance amount payable. As per Plan-B, the sum of

₹44,85,000/- being balance 65% of the tentative price could be paid

with 12% interest in 6 half yearly instalments of ₹7,47,500/- each from

the date of issue of LoI up to 22.05.2015. The balance amount of

₹3,45,000/- being 5% of tentative price was payable at the time of

possession. As per Clause-3 of LoI, possession of the apartment was

to be delivered after completion of development works at site in a

period of 36 months from the date of issuance of LoI; failing which the

allottee had the right to withdraw from the scheme by moving an

application to Estate Officer, in which case the Authority was to refund

the entire amount deposited by the applicant along with 8% interest

compounded annually. The complainant opted for Plan-A, under which

on deposit of ₹42,60,750/-, the complainant was supposed to get 5%

rebate i.e. ₹2,24,250/- on the payable amount of ₹44,85,000/-, as

mentioned in Plan-B. It means the complainant had to deposit the last

instalment of ₹3,45,000/- being 5% of the remaining balance amount

of ₹69,00,000/-. The complainant deposited a total sum of

₹63,30,750/- with the opposite party towards the price of the

apartment, as per Property Ledger Ex.C-3. However, the opposite

party failed to deliver possession of the apartment within the stipulated

Consumer Complaint No.1022 of 2018 4

period. The complainant received allotment letter/offer of possession

dated 06.06.2017 Ex.C-4 after delay of two years from expiry of

stipulated period for delivery of possession; whereby Type-3

apartment No.401, Tower-2, Block-A, Floor-3 was allotted to him.

Demand of balance amount of 5% was also raised before delivery of

possession. Feeling aggrieved, the complainant wrote letters dated

29.11.2017 and 08.02.2018 Ex.C-5 (colly.) to the opposite parties,

seeking refund of the entire deposited amount, along with interest, on

the ground that it failed to deliver possession within the stipulated

period. However, neither the amount was refunded, nor any reply was

given by the opposite party. The complainant is entitled to the refund

of the principal amount, along with interest at the rate of 12% per

annum, totaling ₹91,41,603/- approximately (i.e. ₹63,30,750/- towards

principal amount plus ₹28,10,853/- towards interest at the rate of 12%

per annum). However, as per terms and conditions of the agreement,

the opposite party would have charged interest at the rate of 18%, if

there would have been any delay in payment of instalment by the

complainant. The aforesaid act and conduct of the opposite party

amount to deficiency in service. Hence, the present complaint.

Defence of the Opposite Parties

3. Upon notice, the opposite party appeared and filed reply to

the complaint, raising preliminary objections that there is no deficiency

in service on the part of the opposite party. The complainant

purchased the plot for speculative purpose and therefore he does not

fall under the definition of ‘consumer’ as provided under the Act. As

Consumer Complaint No.1022 of 2018 5

per Arbitration Clause-21 in allotment letter, the dispute between the

parties, if any, is to be referred to sole arbitrator i.e. Chief

Administrator, GMADA, SAS Nagar or any other person appointed by

him. The complaint involves disputed and complicated questions of

facts and law; which cannot be decided in summary manner. The

complainant has not approached this Commission with clean hands.

Cause of action for seeking refund occurred to the complainant in May,

2015 and, as such, the complaint is time barred. The complainant has

already been issued allotment-cum-offer of possession letter dated

06.06.2017 and only thereafter, he made a request for refund of entire

deposited amount, vide letter dated 08.02.2018. The refund can be

made only after cancelling the allotment and after making deduction of

10% of the total amount of consideration money, interest and other

dues payable under provisions of Section 45 (3) of the Punjab

Regional and Town Planning and Development (Amendment) Act,

2013. On merits, facts qua the complainant being successful in the

draw of lots held on 20.03.2012, issuance of LoI dated 22.05.2012,

allotment letter dated 06.06.2017 and payment of amount towards sale

price, as mentioned in the complaint, were not disputed. It was

pleaded that the opposite parties proposed to build 4500 flats. Draw of

lots was held on 20.03.2012 and about 1400 applicants were declared

successful. However, only 1075 successful allottees were found

eligible. Accordingly, the opposite party proposed to build 1620 flats.

During execution of project, approximately 400 allottees had defaulted

in making due payments and approximately 75 allottees opted for

Consumer Complaint No.1022 of 2018 6

refund of their money. The development of a Group Housing Project is

always planned in such a manner that contribution from all the

allottees is taken into consideration for its timely completion and any

delay on the part of even one allottee seriously prejudices the

completion schedule. The opposite party could have developed

individual flats of only those persons, who allegedly paid the sale

consideration in time. Sewer line, electric infrastructure or any other

basic amenity could not have been laid for an individual flat. It was

further pleaded that the opposite party has already invested in

construction of flats and allotment letters as well as offer of possession

letter have already been issued to the successful allottees and they

are residing there. The complainant was under contractual obligation

to make payment of requisite instalments and as per terms of LoI, no

separate notice was to be sent in this regard. It was denied that the

opposite party failed to deliver possession in time. The complainant

submitted letter dated 08.02.2018, surrendering the flat and seeking

refund of deposited amount after 8 months of issuance of allotment

letter/offer of possession dated 06.06.2017. He was duly informed,

vide letter dated 18.09.2018, that as per policy of GMADA, there was

no provision for surrender of flat after lapse of such a long period.

Instead of taking possession, the complainant filed this complaint, with

malafide intention. It was denied that the dispute raised by the

complainant falls within the pecuniary jurisdiction of this Commission.

There is no deficiency in service on the part of the opposite party. All

Consumer Complaint No.1022 of 2018 7

other allegations levelled in the complaint were denied and it was

prayed that the complaint be dismissed.

Evidence of the Parties

4. To prove his claim, the complainant filed his affidavit, along

with copies of documents i.e. letter dated 23.03.2012 Ex.C-1, LoI

dated 22.05.2012 Ex.C-2, Property Ledger Ex.C-3, allotment letter

dated 06.06.2017 Ex.C-4, letters dated 29.11.2017 and 08.02.2018

Ex.C-5 (colly.) and calculation sheet Ex.C-6.

5. The opposite party, in support of its defence, filed self

attested affidavit of Sh. Mahesh Bansal, Estate Officer and copy of

letter dated 18.09.2018 Ex.OP-1.

Contentions of the Parties

6. I have heard learned counsel for the parties and have also

gone through the written arguments submitted on behalf of the parties

and record carefully.

7. The written arguments submitted on behalf of the

complainant are on the lines of averments of the complaint. The sum

and substance of the arguments is that the opposite party failed to

deliver possession of the flat, in question, within the stipulated period

of 36 months from the date of issuance of the LoI, despite receipt of

substantial sale price of the flat from the complainant. The complainant

committed no default in making payment of instalments, but the

opposite party failed to complete the development works at the site.

The allotment letter dated 06.06.2017 Ex.C-4 was issued after two

years from expiry of stipulated period of delivery of possession. The

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complainant sought refund of the entire amount deposited by him,

along with interest, vide letters dated 29.11.2017 and 08.02.2018

Ex.C-5 (colly.). However, it failed to refund the amount, along with

interest. There is deficiency in service on the part of the opposite party.

Therefore, the complaint is liable to be allowed and all the reliefs, as

prayed for therein, are liable to be awarded in favour of the

complainant. In support of his contentions, learned counsel for the

complainant relied upon Consumer Case No.2712 of 2017 (Amal

Ganguli & Anr. v. M/s Unitech Limited) decided by the Hon’ble

National Commission, vide order dated 09.05.2019

8. Similarly, the written arguments submitted on behalf of the

opposite party are also on the lines of pleadings of its reply. The sum

and substance of its arguments is that the complaint is barred by

limitation, as the cause of action for seeking refund occurred to the

complainant in May, 2015, whereas the complaint was filed in

December, 2018. This Commission has no pecuniary jurisdiction to

entertain and decide the complaint. As per Arbitration Clause-21 of

allotment letter, the dispute between the parties, if any, is to be

referred to sole arbitrator i.e. Chief Administrator, GMADA, SAS Nagar

or any other person appointed by him. It was further contended that

the complainant has already been issued the allotment-cum-offer of

possession letter dated 06.06.2017. However, instead of taking the

possession, he made a request to refund the amount deposited by

him, along with interest, vide letter dated 08.02.2018 i.e. after more

than one and half year of issuance of the allotment letter. Vide letter
Consumer Complaint No.1022 of 2018 9

dated 18.09.2018 Ex.OP-1, the complainant was asked to take

possession of the plot on the ground that there was no provision for

surrender of flat. However, as per terms of the LoI regarding refund,

the refund can be made only after cancelling the allotment under

provisions of Section 45(3) of Punjab Regional and Town Planning and

Development (Amendment) Act, 2013 after deducting 10% of total

amount of consideration money, interest and other dues payable by

the allottee. It was further contended that during execution of the

project, approximately 400 allottees had defaulted in making due

payments and approximately 75 allottees opted for refund of their

amount. Completion of the project was subject to timely and regular

payments by the allottees and default by the allottees adversely affects

the completion of the project. There is no deficiency in service on the

part of the opposite party and the complaint is liable to be dismissed.

In support of his contentions, learned counsel for the opposite party

relied upon judgment dated 17.10.2012 rendered by the Hon’ble Delhi

High Court in CS (OS) 2678/2012 and I.As Nos. 16212-16213 of 2012

(C.P. Kapur v. The Chairman & Ors.).

Consideration of Contentions

9. I have given my thoughtful consideration to the respective

contentions raised by the learned counsel for the parties.

10. First of all, I would like to deal with the preliminary

objection raised by the opposite party that the complainant does not

fall under the definition of “consumer”, on the ground that he

purchased the flat for speculative purpose.

Consumer Complaint No.1022 of 2018 10

11. In this regard, it is relevant to mention that there is no

evidence from the side of the opposite party to prove that the

complainant is indulging in sale/purchase of property for commercial

purpose. Therefore, simple assertion in this regard in the reply of the

opposite party, without any cogent and convincing evidence in support

thereof, is not sufficient to prove this fact. Hon’ble National

Commission in M/s IREO FIVERIVER PVT. LTD. v. SURINDER

KUMAR SINGLA & OTHERS First Appeal No.1358 of 2016, decided

on 29.11.2016, while relying upon its earlier decision in KAVITA

AHUJA & OTHERS v. SHIPRA ESTATE LTD. & JAI KRISHNA

STATE DEVELOPERS PVT. LTD. & OTHERS Consumer Case

No.137 of 2010, decided on 12.02.2015, held the complainants as

consumers, observing that that the appellant failed to show any cogent

evidence, which may indicate that the respondents/complainants or

any of them has been indulging in sale/purchase of the properties or

that the complainants or any one of them had booked the subject plots

in the development project undertaken by the appellant with the

intention to sell the plot on subsequent date for earning profit. In III

(2015) CPJ 63 (NC) Beatty Tony versus Prestige Estate Projects

Pvt. Ltd., the Hon’ble National Commission also held that merely on

booking of the plot it cannot be presumed that it is booked for

‘commercial purpose’ and the complainant was considered as a

‘consumer’. In the instant case also, as already discussed above,

there is no evidence led by the opposite party to prove that the

complainant indulged in sale/purchase of properties or that he

Consumer Complaint No.1022 of 2018 11

purchased the flat, in question, for further sale or for earning profits.

Accordingly, the above said objection/contention of the opposite party

is rejected and the complainant is held to be ‘consumer’, under the

Act.

12. So far as the objection raised by the opposite party in their

reply that as per Arbitration Clause-21 of allotment letter, the dispute

between the parties, if any, is to be referred to sole arbitrator i.e. Chief

Administrator, GMADA, SAS Nagar or any other person appointed by

him, is concerned, it needs to be mentioned that the Larger Bench of

the Hon’ble National Commission, vide order dated 13.07.2017,

passed in Consumer Complaint No.701 of 2015 titled as Aftab Singh

v. EMAAR MGF Land Limited & Anr., also held that an Arbitration

Clause in the afore-stated kind of Agreements between the

Complainants and the Builder cannot circumscribe the jurisdiction of a

Consumer Fora, notwithstanding the amendments made to Section 8

of the Arbitration Act, 1996. The Civil Appeal No.(s) 23512-23513 of

2017 (M/s EMAAR MGF Land Limited & Anr. Vs. Aftab Singh) filed

against the said order of the Hon’ble National Commission has also

been dismissed by the Apex Court, vide order dated 13.02.2018.

Review Petition (C) Nos. 2629-2630 of 2018 in Civil Appeal Nos.

23512-23513 of 2017 filed against the above said order dated

13.02.2018 was also dismissed by the Hon’ble Supreme Court, vide

order dated 10.12.2018. Consequently, the existence of an Arbitration

Clause in the allotment letter, if any, is not a bar to resolve this dispute
Consumer Complaint No.1022 of 2018 12

by this Commission. Accordingly, the said objection of the opposite

party is also rejected.

13. Further objection raised by the opposite party is regarding

pecuniary jurisdiction of this Commission. It needs to be mentioned

that the tentative cost of flat, in question, was fixed as ₹69,00,000/-.

The complainant has specifically pleaded that as per the calculation

sheet Ex.C-6, the total relief claimed by him was ₹93,91,603/-. It needs

to be emphasized that the complainant has every right to restrict his

claim. Be that as it may, the fact remains that the Fora has to consider

pecuniary jurisdiction as per the relief prayed for, keeping in view all

the facts and circumstances of case as well as the gravity of the loss

suffered by the complainant. In such circumstance, the pecuniary

jurisdiction of this Commission is not barred and, as such, the

aforesaid plea of the opposite party is also rejected.

14. The opposite party also raised the objection that the

complaint is barred by limitation. Admittedly the complainant made the

substantial payment towards the price of the flat, in question, to the

opposite party, but neither the possession of the flat has been

delivered to him till date, nor the amount so deposited by him has been

refunded. It is now well settled that in such cases there is a continuous

cause of action till the possession is delivered or the amount is

refunded. Hon’ble National Commission in “Navin Sharma (Dr.) &

others v. Unitech Reliable Projects Pvt. Ltd. & Anr.” 2016(2) CLT

457 has held that unless or until the complainants get possession of

the flats, they have got continuous cause of action. In para 8 of the
Consumer Complaint No.1022 of 2018 13

said judgment it has been observed by the Hon’ble National

Commission as under:-

“8. The first submission made by the counsel for the opposite
party was that the case is barred by time. This argument was
raised merely for the sake of cavil. It is now well settled that
unless or until the complainants get the possession of the flats,
they have got continuous cause of action. This view finds
support from this authority reported in “Raghava Estates Ltd.
v. Vishnupuram Colony Welfare Association” Special
Leave to Appeal (Civil) No.35805 of 2012, decided on
07.12.2012.”

15. In another case Satish Kumar Pandey & Anr. v. M/s

Unitech Ltd. 2015 (3) CPJ 440 (NC), the Hon’ble National

Commission held in Para-17 as follows:

“17. It was next contended by the learned counsel for the

respondent that since the last date stipulated in the buyers
agreement for giving possession of the flat to them expired
more than two years ago, the complaint is barred by limitation
prescribed in Section 24A of the Consumer Protection Act. It
is now settled legal proposition that failure to deliver
possession being a continuous wrong it constitutes a recurrent
cause of action and, therefore, so long as the possession is
not delivered to him the buyers can always approach a
Consumer Forum. It is only when the seller flatly refuses to
give possession that the period of limitation prescribed in
Section 24A of the Consumer Protection Act would begin to
run. In that case, the complaint has to be filed within two years
from the date on which the seller refuses to deliver possession
of the flats to the complainants at any point of time and,
therefore, the cause of action continues to subsist in favour of
the complainants. Reliance in this regard may be placed upon
the decision of the Hon’ble Supreme Court in Meerut
Development Authority v. M.K. Gupta IV (2012) CPJ 12,
where the Hon’ble Supreme Court held that in such a case the
buyer has a recurrent cause for filing a complaint for non-
delivery of possession of the plot.”

Similarly, in the present case, there is no denial on the part of the

opposite party to deliver the possession. Since neither possession has

been delivered nor the amount deposited by the complainant has been

refunded till date, so in view of the ratio of the law laid down in the
Consumer Complaint No.1022 of 2018 14

above noted authorities, it is a continuous cause of action and the

complaint filed by the complainant is within limitation.

16. Now, coming to merits of the case, admittedly the

complainant applied for a Type-3 residential apartment in the above

noted scheme of the opposite party and, after being declared

successful in the draw of lots held on 20.03.2012, he was issued Letter

of Intent (LoI) dated 22.05.2012, Ex.C-2. The tentative price of the flat

was ₹69,00,000/-. Admittedly, the complainant never committed any

default in making payment of instalments and deposited a total sum of

₹63,30,750/- with the opposite party towards the price of the flat, as

per Property Ledger Ex.C-3. As per Clause 3(II) of the LoI, possession

was to be delivered within 36 months from the date of issuance of the

LoI, which reads as under:

“Possession of the apartment shall be handed over

after completion of development works at site in a
period of 36 months from the date of issuance of the
Letter of Intent. In case for any reason, the Authority is
unable to deliver possession of apartments within
stipulated period, allottee shall have the right to
withdraw from the scheme by moving an application to
the Estate Officer, in which case, the Authority shall
refund the entire amount deposited by the applicant,
along with 8% interest compounded annually. Apart
from this, there shall be no other liability of the
Authority.”

17. The stipulated period for delivery of possession expired on

21.05.2015. However, the opposite party failed to deliver possession

of the apartment, in question, within the above said stipulated period.

No evidence has been led by it to prove that the project, in question, is

complete in all respects, so as to deliver complete physical possession

of the apartment to the complainant, along with all the agreed basic
Consumer Complaint No.1022 of 2018 15

facilities. The allotment letter dated 06.06.2017 Ex.C-4 was issued

after more than two years from the expiry of stipulation period for

delivery of possession. As per Clause-5 of the allotment letter, the

allottee was required to take physical possession of the flat within 30

days from the issuance thereof. However, the complainant sought

interest at the rate of 8% on the deposited amount on account of delay

in delivery of possession as per terms of the LoI, vide application letter

dated 29.11.2017, Ex.C-5 (colly.), but without any effect. Thereafter,

vide letter dated 08.02.2018 Ex.C-5 (colly.), the complainant sought

refund of the entire amount deposited by him, along with interest, on

the ground that the possession of flat was not delivered within the

stipulated period. The opposite parties gave reply, vide letter dated

18.09.2018 Ex.OP-1, stating that as per policy of GMADA, there is no

policy for surrender of flat after issuance of allotment letter and the

possession could be taken after depositing the balance sale price.

However, it is well settled that the allottees have right to ask for

refund, if the legal possession is inordinately delayed and particularly

beyond one year after stipulated period, as has been held by the

Hon’ble National Commission Consumer Case No. 1702 of 2016

(Shalabh Nigam v. ORRIS Infrastructure Pvt. Ltd. & Anr.) decided

vide order dated 06.05.2019.

18. It also needs to be mentioned that Completion/Occupation

Certificate is required to be obtained by every promoter, before

delivery of possession of the plot/flat/unit etc. to the allottee. The

opposite party falls under the definition of “Promoter”, as defined in the

Consumer Complaint No.1022 of 2018 16

Explanation-1 given under Section 2 (y) of Punjab Apartment and

Property Regulation Act, 1995 (in short, “PAPRA”), which is

reproduced below:

“(y) “promoter’ means the person,-

(a) who constructs or causes to be constructed a building
consisting of apartments, or, converts an existing building
or a part thereof into apartments, for the purpose of selling
all or some of the apartments to other person, and includes
his assigns; or
(b) who develops land into a colony, whether or not be also
constructs structures on any of the plots, for the purpose of
selling to other persons, all or some of the plots, whether
open or with structures thereon; and
(c) where the person who constructs or convert a building
or develops a colony and the person who sells apartments
or plot are different persons, the term includes both of
them;
Explanation-(1): Any development authority and any
other public body so notified by the State Government
are deemed to be promoter in respect of allottees of,-
(i) buildings constructed by them on land owned by them or
placed at their disposal by the State Government; or
(ii) plots owned by them or placed at their disposal by the
State Government;
Explanation,- (2) A person who acts as described in sub-
clause (c) of clause (y) shall be deemed to be a promoter,
even if,-
(i) he styles himself as a builder, colonizer, contractor,
developer, estate promoter or by any other name; or
(ii) he claims to be acting as the holder of a power of
attorney from the owner of the land on which the building is
constructed or colony is developed;”

19. Similar question has also been resolved by this

Commission in Execution Application No.79 of 2016 in Consumer

Complaint No.113 of 2015 (Group Captain Bhupinder Singh v.

Chief Administrator, GMADA & Anr.), decided by this Commission

on 29.05.2018, holding that opposite parties-GMADA squarely fall

within the definition of “Promoter”, as defined in Section 2 (y) of

PAPRA and discussed above. It was also held in that case that the
Consumer Complaint No.1022 of 2018 17

opposite parties, being promoter, were duty bound to obtain

Completion/Occupation Certificate from the competent authority before

delivering possession of the particular property to the allottee. Similar

proposition of law was laid down by this Commission in Consumer

Complaint No.420 of 2018 (Usha Rani v. Punjab Urban Planning &

Development Authority & Anr.) decided, vide order dated

11.09.2018.

20. Furthermore, Section 14 of Punjab Apartment and Property

Regulation Act, 1995 (in short, “PAPRA”) deals with responsibility of

the promoter to obtain Completion and Occupation Certificate from the

competent Authority, which reads as under:

14. It is the responsibility of the promoter-

(i) in the case of apartments, to obtain from the authority
required to do so under any law completion and occupation
certificates for the building and if a promoter, within a
reasonable time, after the construction of the building, does
not apply for an occupation certificate from the aforesaid
authority, the allottee of an apartment may apply for an
occupation certificate from the said authority; and
(ii) in the case of a colony, to obtain completion certificate
from the competent authority to the effect that the
development works have been completed in all aspects as
per terms and conditions of the licence granted to him under
section 5.
(2) The authority referred to in sub-section (1) shall, after
satisfying itself about the agreement of sale between the
promoter and the allottee, and the compliance of the building
regulations and all other formalities, issue an occupation
certificate.”

21. Clause 3.12 (i) of the Notification dated 07th July, 2015

published in the Punjab Government Gazette Extraordinary by

Department of Local Government (Town Planning Wing), which is

applicable to the properties falling within the Municipal Limits, provides

as under:
Consumer Complaint No.1022 of 2018 18

“No person shall occupy or allow other person to occupy

any new building or part of a new building for any
purpose whatsoever until such building or part thereof
has been certified by the local authority or of any person
authorized by it in this behalf to be in every respect
completed according to the sanctioned plan and fit for
the use for which it is erected.”

22. Further, Section 272 of The Punjab Municipal Corporation

Act, 1976, reads as under:-

“272. Completion Certificate. –

(1) Every person who employs a licensed architect or
engineer or a person approved by the Commissioner to
design or erect a building or execute any work shall,
within one month after the completion of the erection of
the building or execution of the work, deliver or send or
cause to be delivered or sent to the Commissioner a
notice in writing of such completion accompanied by a
certificate in the form prescribed by byelaws, made in
this behalf and shall give to the Commissioner all
necessary facilities for the inspection of such building or
work.
(2) No person shall occupy or permit to be occupied any
such building or use or permit to be used any building or
a part thereof effected by any such work until permission
has been granted by the Commissioner in this behalf in
accordance with bye-laws made under this Act: Provided
that if the Commissioner fails within a period of thirty
days after the receipt of the notice of completion to
communicate his refusal in grant such permission, shall
be deemed to have been granted.”

23. No evidence has been led by the opposite party on record

to prove that the flat, in question, or a part thereof has been got

certified from the local/competent authority, so as to deliver its

complete possession to the complainant for his occupation. Thus, the

opposite party has committed violation of Section 14 of PAPRA and

Clause 3.12 (i) of the Notification dated 07th July, 2015 published in the

Punjab Government Gazette Extraordinary by Department of Local

Government (Town Planning Wing) as well as Section 272 of The

Consumer Complaint No.1022 of 2018 19

Punjab Municipal Corporation Act, 1976, reproduced above. Without

issuance of such a certificate by the competent authority, the opposite

party cannot be said to be in a legal position to hand over possession

of the flat, in question. In such circumstances, it is held that the

opposite party failed to deliver possession of the flat, complete in all

respects, to the complainant within the stipulated period, as per terms

and conditions of the LoI.

24. Hon’ble Punjab and Haryana High Court in CWP No.19117

of 2018 (Asheesh Aggarwal v. Greater Mohali Area Development

Authority & Anr.), decided vide order dated 12.12.2019, dealt with the

issue regarding allotment of flat in the same very project of the

opposite party and held it deficient in not delivering possession within

the stipulated period. By placing reliance on its earlier decision dated

27.07.2016 rendered in CWP No.22500 of 2015 (Vikas Goyal v.

Greater Mohali Area Development Authority & Anr.), which also

pertained to same scheme of the opposite party, it was held by the

Hon’ble High Court as under:

“On perusal of the aforesaid clause of LOI, it is apparent

that the possession of apartment/flat was to be delivered on
completion of development works within a period of 36 months
from the date of issuance of the LOI. In case, the possession is
not handed over within the aforesaid period, the allottee is
entitled for refund of amount deposited along with 8% interest
compounded annually after making an application for
withdrawal from scheme.
Admittedly, the petitioner had paid 95% of the tentative
price of the apartment/flat within the stipulated period and
remaining 5% was to be paid at the time of possession but
possession was not handed over to the petitioner within a
period of 36 months. Meaning thereby, the petitioner complied
with the terms and conditions of the LOI. The fault was there of
respondent-GMADA in not offering the possession within the
stipulated period. There was no lapse on the part of the
Consumer Complaint No.1022 of 2018 20

petitioner in making payment of the amount. Accordingly, the

petitioner is entitled for refund of amount along with interest as
per terms and conditions of the LOI.
Same controversy was there before the Division Bench of
this Court in Vikas Goyal's case (supra). In that case also, the
possession of flat was not handed over within a period of 36
months from the date of issuance of LOI and allottee in that
case, paid the entire amount within the stipulated period. Said
petition was allowed and respondent-GMADA was directed to
pay interest in terms of clause 3(ii) of LOI from the date of
deposit of installments till the date of final payment @ 8%
compounded annually. A further direction was also issued to
make payment of interest @ 12% per annum till the date of
refund.
The judgment relied upon by learned senior counsel
appearing for respondents-GMADA is not applicable to the facts
and circumstances of the case as in that case, there was fault
on the part of the allottee in making payment whereas in the
present case, there was no fault on the part of the allottee and
the 95% amount of apartment/flat was paid within the stipulated
period. Moreover, judgment rendered by the Division Bench of
this Court in Vikas Goyal's case (supra) has attained finality as
SLP filed against said judgment by respondent-GMADA had
also been dismissed.”

25. It would also be appropriate to refer the “Objects and

Functions” given under Section 28 of the Punjab Regional and Town

Planning & Development Act, 1995; which are reproduced as under:

28. Objects and Functions of the Authority:-

(1) The objects of the Authority shall be to promote and

secure better planning and development of any area of the
State and for that purpose the Authority shall have the
powers to acquire by way of purchase, transfer, ex-change or
gift or to hold, manage, plan, develop and mortgage or
otherwise dispose of land or other property or to carry out
itself or in collaboration with any other agency or through any
other agency on its behalf, building, engineering, mining and
other operations to execute work in connection with supply of
water, disposal of sewerage, control of pollution and other
services and amenities and generally to do anything with the
prior approval or on direction of the State Government, for
carrying out the purposes of this Act.
(2) In particular and without prejudice to the generality of
the foregoing provisions, the Authority itself or in
collaboration with any other agency or through any other
agency on its behalf,-
Consumer Complaint No.1022 of 2018 21

(i) if so required by the State Government or the Board,

take up the works in connection with the preparation and
implementation of Regional Plans, Master Plans and New
Township Plans and town improvement schemes;
(ii) undertake the work relating to the amenities and
services to be provided in the urban areas, urban estates,
promotion of urban development as well as construction of
houses;
(iii) promote research, development of new techniques of
planning, land development and house construction and
manufacture of building material;
(iv) promote companies, association and other bodies for
carrying out the purposes of the Act ; and
(v) perform any other function which are supplemental,
incidental or consequential to any of the functions referred to
in this sub-section or which may be prescribed.”

Perusal of the above said “Objects and Functions” shows that in

pursuance of the same, Punjab Urban Planning and Development

Authority (PUDA) has been floating Schemes for setting up developed

colonies for general public in various cities in Punjab. Before

undertaking such a Scheme, it has to prepare a proper Scheme, in

accordance with the provisions of the Punjab Regional and Town

Planning & Development Act, 1995 and presumption is that the

Scheme must have been framed, keeping in view the provisions of the

said Act. All the financial implications and other things must have been

taken care of by PUDA. After considering the pros and cons, the

Scheme is supposed to have been launched by the development

authority, being a public authority. Taking the same into consideration,

the applicant applies for allotment of a plot in such a Scheme,

specifically when such a Scheme is launched by the Government

Authority for the welfare of the general public. It also puts various

types of riders, such as the applicant or his spouse or his minor child

must not be having any residential plot in the area. Be that as it may,
Consumer Complaint No.1022 of 2018 22

we are not going to deal with the same, but reference has been made

just to indicate that the said Scheme was launched by the opposite

party for the welfare of the general public, so that needy person can

have his own house, if he/she or his/her spouse or other dependents

were not having any house. Keeping in view all these terms and

conditions, the complainant might have applied for allotment of the flat,

for which he had paid the above said huge amount towards the sale

price, as per terms and conditions of the LoI/allotment letter. However,

the opposite party failed to deliver physical possession of the flat, in

question, within the stipulated period. The judgment relied upon by

learned counsel for the opposite party is not applicant to the facts and

circumstances of the present case, in view of the ratio of law laid down

in the aforesaid cases.

26. Hence, the complainant is entitled to the refund of the

entire amount deposited by him, along with compensation for causing

financial loss and depriving the complainant of the use of the said

amount during the period it remained with the opposite party at the

rate of 8% compounded annually from the respective dates of deposit

till realization, as per Clause 3(II) of LoI. For the mental agony and

harassment suffered by him due to deficiency in service on the part of

the opposite party, he is also entitled to suitable compensation,

including litigation expenses.

27. In view of my above discussion, the complaint is allowed

and following directions are issued to the opposite party:

Consumer Complaint No.1022 of 2018 23

i) to refund the entire amount deposited by the complainant i.e.

₹63,30,750/-, along with compensation for causing financial loss

and depriving the complainant of the use of the said amount

during the period it remained with the opposite party at the rate

of 8% compounded annually, from the respective dates of

deposit till realization as per Clause 3(II) of LoI; and

ii) to pay ₹66,000/-, as compensation for the mental agony and

harassment suffered by the complainant, including cost of

litigation.

iii) The compliance of this order shall be made by the opposite party

within a period of 30 days of the receipt of certified copy of the

order.

28. The complaint could not be decided within the stipulated

timeframe, due to heavy pendency of Court cases.

(JUSTICE PARAMJEET SINGH DHALIWAL)

PRESIDENT
June 17, 2020.
(Gurmeet S)