Complaint Case No. 840 of 2016. Case: Amolak Singh Sandhu and Ors. Vs Emaar MGF Land Limited and Ors. Chhattisgarh State Consumer Disputes Redressal Commission

Case NumberComplaint Case No. 840 of 2016
Party NameAmolak Singh Sandhu and Ors. Vs Emaar MGF Land Limited and Ors
CounselFor Appellant: Kulvir Narwal, Advocate Proxy for M.P.S. Mann, Advocate and For Respondents: Sanjeev Sharma, Advocate
JudgesJasbir Singh, J. (President), Dev Raj and Padma Pandey, Members
IssueArbitration And Conciliation Act, 1996 - Section 8; Consumer Protection Act, 1986 - Sections 17, 2(1)(d), 3; Income Tax Act, 1961 - Section 54
Judgement DateMarch 29, 2017
CourtChhattisgarh State Consumer Disputes Redressal Commission

Order:

Padma Pandey, Member, (Chandigarh)

  1. The facts, in brief, are that the Opposite Parties invited applications for booking of Bungalows (300 sq. yards) in their project titled The Bungalows, Sector 109, SAS Nagar, Mohali on 'first come first served' basis. The complainants approached the Opposite Parties for the purchase of a residential Bungalow vide application dated 09.04.2010 and made the booking against an amount of Rs. 5 lacs. The Opposite Parties allotted Bungalow No. TBN300-AP-46, Sector 109, Augusta Park in the project of the Opposite Parties (Annexure C-1). Thereafter, Buyer's Agreement dated 26.05.2010 was executed between the parties (Annexure C-2). It was stated that the Opposite Parties vide letter dated 09.07.2010 informed the complainants that the unit area of the allotted Bungalow has been revised from 300 sq. yards to 311.609 sq. yards and also increased the total cost of the unit (Annexure C-4). The complainants paid the total amount of Rs. 69,30,581/- upto September, 2012, as per the statement of account (Annexure C-5). As per the Agreement, possession was of the said bungalow was to be delivered within a period of 24 months from the date of allotment i.e. on or before 26.05.2012. It was further stated that the Opposite Parties promised to provide all the amenities and conveniences at the site but nothing was existed and the area was totally inhabitable. It was further stated that the Opposite Parties failed to offer/deliver possession of the said Bungalow to the complainants, despite receipt of the huge amount from them. Then, the complainants sent an email to the Opposite Parties (Annexure C-7), in which, they sought refund of the deposited amount but to no avail. It was further stated that the aforesaid acts, on the part of the Opposite Parties, amounted to deficiency, in rendering service, and indulgence into unfair trade practice. When the grievance of the complainants, was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (in short the 'Act' only), was filed.

  2. The Opposite Parties, in their joint written version, have taken objection regarding arbitration clause in the Agreement, and also they separately, moved an application u/s. 8 of Arbitration and Conciliation Act, 1996 taking a specific objection in this regard for referring the matter to the Arbitrator in terms of the agreed terms and conditions of the Agreement. It was stated that this Commission has no territorial jurisdiction to try and entertain the complaint, as the unit is situated at Mohali, Punjab and as per the Agreement, only the Courts having territorial jurisdiction over the unit/property shall have the territorial jurisdiction. It was further stated that this Commission has no pecuniary jurisdiction to try and entertain the complaint, in view of the judgment of Ambrish Kumar Shukla v. Ferrous Infrastructure, the interest is to be added to the relief claimed and in the present case, the amount, as claimed, alongwith interest certainly exceeds the pecuniary jurisdiction of this Commission. It was further stated that both the parties are bound by the terms and conditions of the Agreement and in case of failure of the allottee to perform all obligations as set out in the Agreement, the allottee has authorized the Company to forfeit the earnest money, as stipulated in Clause 2(f) of the Agreement alongwith any interest paid, due or payable, any amount of non refundable nature. It was further stated that the complainants being husband and wife are NRI and their family is also residing at UK, England, as such, the complainants are speculators and they have no intention of returning and settling in India. It was admitted regarding booking and allotment of the bungalow; execution of the Agreement and receipt of the amount of Rs. 69,30,581/- from the complainants. It was further stated that as per the Agreement, the Company was supposed to try and endeavor to hand over possession of the said Bungalow within 24 months from the date of execution of the Agreement. It was further stated that the compensation is payable for delay in possession (@Rs. 100/- per sq. feet per month) as per the Agreement and the same is payable at the time of intimation of possession. It was averred that the bungalow has been constructed and even occupation certificate was received on 26.09.2013. Copy of the occupation certificate is Annexure R-4. It was further stated that the bungalow has been completed and work till start of painting is complete on the said unit and the unit would be ready soon and possession is likely to be offered by February, 2017. It was further stated that the complaint is barred by limitation, as the complaint has been filed by the complainants after delay. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice.

  3. The Parties led evidence, in support of their case.

  4. We have heard the Counsel for the parties, and have gone through the evidence and record of the case, carefully.

  5. The first question, that falls for consideration, is, as to whether, in the face of existence of arbitration clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint. This question has already been elaborately dealt with by this Commission in case titled ' Sarbjit Singh v. Puma Realtors Private Limited', IV (2016) CPJ 126. Paras 25 to 35 of the said order, inter-alia, being relevant, are extracted hereunder:-

    "25. The next question, that falls for consideration, is, as to whether, in the face of existence of arbitration Clause in the Agreement, to settle disputes between the parties through Arbitration, in terms of provisions of Section 8 (amended) of 1996 Act, this Commission has no jurisdiction to entertain the consumer complaint.

  6. To decide above said question, it is necessary to reproduce the provisions of Section 3 of the Consumer Protection Act 1986 (in short the Act), which reads as under;

    3. Act not in derogation of any other law.-

    The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.

  7. It is also desirable to reproduce unamended provisions of Section 8 of 1996 Act, which reads thus:-

    8. Power to refer parties to arbitration where there is an arbitration agreement.-

    (1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.

    (2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof

    (3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.

  8. Many a times, by making reference to the provisions of Section 8 of 1996 Act, in the past also, such objections were raised and the Hon'ble Supreme Court of India, when interpreting the provisions of Section 3 of 1986 Act, in the cases of Fair Air Engg. Pvt. Ltd. & another v. N.K. Modi (1996) 6 SCC 385, C.C.I Chambers Coop. Housing Society Ltd. v. Development Credit Bank Ltd. (2003) 7 SCC 233, Rosedale Developers Private Limited v. Aghore Bhattacharya and others, (Civil Appeal No. 20923 of 2013) etc., came to a conclusion that the remedy provided under Section 3 of 1986 Act, is an independent and additional remedy and existence of an arbitration clause in the agreement, to settle disputes, will not debar the Consumer Foras, to entertain the complaints, filed by the consumers.

  9. In the year 2015, many amendments were effected in the provisions of 1996 Act. After amendment, Section 8 of 1996 Act, reads as under:-

    8. Power to refer parties to arbitration where there is an arbitration agreement.-

    (1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.

  10. Now it is to be seen, whether, after amendment in Section 8 of the principal Act, any additional right has accrued to the service provider(s), to say that on account of existence of arbitration agreement, for settling the disputes through an Arbitrator, the Consumer Foras have no jurisdiction to entertain a consumer complaint. As has been held...

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