This post covers Consumer Complaint against Hero Reality Pvt. Ltd. In state consumer commission wherein the forfeiture of amount is justified by court.
Importance of the signed application
This case study will focus on how the state commission gave importance to the obligation of the complainant which it is supposed to fulfil. The commission gave the upper hand on the clauses of an application and emphasised on how one can’t ask for refund without fulfilling the provisions in the application between parties.
Nidhi Gupta v.s M/s Hero Reality Pvt. Ltd.
Also Read- Open Forum about Hero Homes, Mohali – Commonfloor.com
Facts
The complainant who is neither a property dealer nor in the sale of buy and purchase of property, purchased a residential unit developed by the opposite party. The opposite party claimed and gave assurance to the complainant that they are in the possession of all necessary legal approvals and sanctions for the sale of the said residential unit. The complainant paid Rs.2,50,000 and Rs,3,00,000 and thereafter the opposite party issues allotment letter for the residential unit. When the complainant visited the location, no construction development work has been started. Opposite party also obtained signature of the complainant in the application form without executing the buyer’s agreement till now. The complaint further wrote two letters requesting it to supply the statuary permission and approvals for the development of the project which the complainant did not get any response from the opposite party. Thereafter, the complainant wrote a letter regarding the refund of the amount the complainant gave to the opposite party which she gave towards sale of the unit under the provisions of the PARA Act, 1995. Opposite party was not in the possession of the requisite approvals and permissions at the time of receiving money from her. The complainant has filed the complaint under the Section 17 of Consumer Protection Act and request relief against Opposite party which are
- Refund the amount of Rs. 5,50,000 with the interest of 18% from the respective date till realisation along with suitable interest till realisation.
- Rs.2,00,000 for mental harassment
- Rs.2,00,000 for litigation
Reply by the opposite party
Also Read- Nidhi Gupta v. M/s Hero Reality Pvt. Ltd. – Casemine
Upon notice, the opposite party filed a written reply informing that the complainant submitted an expression of interest along with the part earnest money of Rs.2,50,000 for booking of the said unit and further undertook to pay further instalments thereof to opposite party. The complainant also accepted that in the event of she not able to pay the further instalment, the opposite party will have the rights to forfeit the earnest money deposit by her. An application was submitted by the complainant for allotting the said unit and opted to book apartment under regular construction linked plan as specified by her in the said application. One of the clause in the said application was forfeiture of the earnest money and other charges in the event of cancelation of the allotment. The opposite party later acknowledged the payment of Rs. 2,50,000 and Rs.3,00,000 and a receipt of payment Rs.5,00,000 was send to the complainant as well. The complainant was informed by the opposite party regarding allotment of apartment via letter. The opposite party further demanded the payment of Rs. 5,39,989 and Rs.5,42,492 but received no response from the complainant. The opposite party raised the demand of payment of Rs.5,50,641 and Rs.8,26,091 with the photographs of the evacuation being carried out but didn’t get any response from the complainant. The opposite party further demanded the payment of Rs. 14,39,245 but received no response from the complainant including when the opposite party send a reminder three times which the opposite party didn’t get any response.
The opposite party denied the claims of the complainant and prayed dismissal of the complaint.
Also Read- UERC – M/s Hero Realty Pvt. Ltd.
Arguments of the complainant
The opposite party failed to provide the necessary sanctions, approvals of the said unit to the complainant which is the violation of the PARA Act,1995. The complainant has written letters for supply for approvals and sanctions which the complainant got no response.
The complainant’s father stated that the documents were not read over and explained by the opposite party and opposite party for the purpose of the refund told him to sign at various pages of the documents. The father of the complainant is nether the GPA or SPA or authorised agent of the complainant.
The complainant has deposited the amount of Rs.2,50,00 and Rs.3,00,000 to the opposite party, after that the opposite party have send the welcome letter and allotment letter.
The opposite party have to executed the buyer’s agreement in her favour
Now demands the refund with interest
Argument by the opposite party
Also Read- Real Estate Regulatory Authority
The complainant submitted an Expression of interest and paid the sum of Rs.2,50,000 to the opposite party to book the said property and undertaking further instalments and accepting the forfeiture clause in the event of the failure of the payment by the complainant.
The opposite party send the receipt of Rs.5,50,000 and intimated the complainant that the unit in question is allotted to her.
The complaint was further told to pay these sum of amount
- Rs.5,39,989
- Rs.5,45,492
- Rs.8,53,043
No response was received by the complainant even after the reminder letter and including photographs of construction status.
Observation by the commission
Also Read- Orders/ Judgements – RERA Punjab
The said project is a commercial project developed by the opposite party and the complainant is a consumer since she has applied for purchasing the unit for her own residential purpose. There is no dispute the complainant has paid the sum of Rs.5,50,000 to the opposite party after which the opposite party send welcome letter and allotment letter to the complainant. The complainant did not pay the further instalment as per staged of the construction as per the documents.
On the other hand, the father of the complainant has signed the documents where it is recorded that he is GPA of the complainant. The opposite party must have allowed the father of the complainant to sign the application being GPA at that time, as mentioned in the application. The complainant has only paid the sum of Rs.5,50,000 and did not pay the further instalment as per different stage of the construction.
The complainant did not get the information that the opposite party do not have the right to develop the project and do not have necessary sanction and approval from the competent authority. The complainant has stated this fact orally which was not admitted by the opposite party. The complainant must have obtained the information from RTI regarding the sanction and approval from the appropriate authority to establish that the opposite party received the amount of without having the authority to develop the project. Unless there is specific admission by the opposite party that they do not hold proper sanction and approval to develop the project, it can not be said the complainant have proven the fact in question. The proper course would have been obtaining information from RTI.
The reason why the complainant has not paid the further amount is not explained by her even after the opposite party have sent her pictures of the development in constructions.
The point of adjudication is whether the complainant is entitled to seek refund of the amount deposit. One of the clauses of the application states that if the applicant cancels the allotment of the apartment, the earnest money together with interest paid shall stand forfeited by the company within 90 days of such cancellation, subject to the all the receipt of the original documents of the allotment. It is now proven fact that the complainant did not pay the further instalment that was to be paid at different stages of construction. The complainant wants to refund without any forfeiture on the part of Opposite Party. The complainant filed the complaint before the date of deliver of the possession which is stated in the document that is 42 months. The complainant relied upon the decision by the state commission in Dilip Goyal and another vs Omax Chandigarh Extension Developers pvt Ltd and in Jaspreet Singh vs M/s Manohar Infrastructure & Construction pvt. Ltd. the commission find default on the part of the complainant who did not deposit the further payment as per different stages of the construction. No photograph has been submitted from the complainant to prove her point. As per the document, the Opposite Party is authorised to forfeit the earnest money with interest in case of cancellation of allotment in failure of payment by the complainant.
Also Read- Before the chairperson, real estate regulatory – RERA Punjab
Decision
No merit in the complaint and same is hereby dismissed.
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