| Address: Bangalore, Karnataka |
BEFORE
THE HON'BLE STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE
COMPLAINT
No. /2014
BETWEEN:
1.
SRI
SOUMYA KUMAR NAYAK,
S/o Sarat Chandra
Nayak,
Aged about 35 years,
2. SMT. URBASHI NAYAK,
W/o Sarat Chandra Nayak,
Aged about 65 years,
3. SMT. SAMITA MOHANTY,
D/o Ramesh Chandra Mohanty,
Aged about 33 years,
All are residing at:
SMS Residency,
Flat No. G2, 7th Main, 19th Cross,
BTM Layout 2nd Stage,
Bangalore – 560076 : COMPLAINANTS
AND:
1.
DLF SOUTHERN HOMES (P) LTD,
Corporate Office:
DLF Centre
Sansad Marg,
New Delhi- 110001,
Tel: +[protected]
Website: http://www.dlf.in/
Registered office at:
DLF Ltd.
DLF Shopping
Mall, 3rd Floor
Arjun Marg, DLF City Phase-I
Gurgaon-122002
Tel: +[protected]
Marketing office at:
Property
No. 356/1/1,
Akshay
Nagar Main Road,
Bangalore
Urban, Bengaluru – 560 068
Tel:
+91-[protected]
Represented by its authorized signatory
Smt. G. Revathy
2.
ANNABEL BUILDERS & DEVELOPERS (P) LTD,
Registered office at No. 1-E,
Jhandewalan Extension,
New Delhi- 110055
& Marketing office at No. 7/4,
Represented by its authorized signatory
Sri Jai Ganesh : OPPOSITE PARTIES
MEMORANDUM
OF COMPLAINT UNDER SECTION 12 OF THE CONSUMER PROTECTION ACT 1986
The complainant above named
respectfully submits as follows:-
1. The
address of the parties for the purpose of service of summons, notices etc., and
is as furnished in the cause title. The complainant may also be served through
their Counsel Sri R. George
Lazarus, Advocate, No. 159. 8th Cross, First Floor, HMT Layout, Bangalore -
560032.
2. The
address of the opposite parties for the similar purpose is as furnished in the
cause title.
3. The
complainants are consumers as defined under Section 2 (d) of the Consumer
Protection Act (herein after referred to as the Act) and the present complaint
fulfills the requirement of a "complaint" as defined under Section 2
(c) of the Act. The services offered by the Opposite Parties come under the
ambit of 'services' availed for consideration and are covered under the Act. Aggrieved
by the unfair trade practice and the deficiency in service on the part of the
opposite parties, on account of their failure to perform their obligations
required under Karnataka Ownership of Flats (Regulation of promotion of
construction, management, sale and transfer) Act 1972, the complainant presents
this complaint on the following facts and circumstances:
4. The
Complainants submit that the first Opposite Party is a Public limited company
engaged in the business of construction and development. The second Opposite
Party is the owner and in possession of the scheduled property. That the first
Opposite Party is intending to develop the schedule property owned by the
second Opposite Party into a residential apartment.
5.
That the complainants intended to
purchase an apartment in Bangalore and were interested in the project promoted
by the First Opposite party known as "Westend Heights", New Town,
located at Bannerghatta Road, Begur Hobli, Bangalore South Taluk with 19 towers
multistoried residential complex, each tower comprising of 100 to 200
apartments. That the complainants on perusing the brochure and being satisfied
with the design specifications, facilities and amenities offered by the first
Opposite Party and after verifying the title and all documents relating to the
scheduled property booked a flat bearing No. NWB1036 in Block No. B1 in the project known as -Westend Heights, New Town- DLF BTM
Extension, situated at Begur Village, Begur Hobli, Bangalore South Taluk
and measuring super area 1365 sq ft, apartment area 1075 sq ft together with
undivided share, right, title, interest and ownership of land along with
facilities and amenities offered by the Opposite Parties for a total
consideration of Rs 25, 93, 500/- (Rupees Twenty Five Lakhs Ninety Three Thousand
Five Hundred only) into Apartment Buyers Agreement with the first and second
Opposite Parties for a valuable sale consideration of Rs 25, 93, 500/- (Rupees
Twenty Five Lakhs Ninety Three Thousand Five Hundred Only) and the Complainants
paid an Earnest money of Rs 3, 00, 000/- (Rupees Three Lakhs only) which was
acknowledged (via receipt No. 0324, dated[protected] by both the First and
Second Opposite Parties and agreed to pay the balance amount as per the terms
and conditions spelt out in the agreement. That the First Opposite Party, as
per the agreement for sale undertook to complete the construction and hand over
possession of the flat within 36 months from the date of agreement i.e., on or
before 03/08/2012. A copy of the aforesaid Agreement is annexed hereto as ANNEXURE -A1
6. The
complainants submit that they have been promptly making the payment as per the
payment schedule in the agreement apart from the payment of earnest money of Rs. 3, 00, 000 on 09/03/2009. That the Opposite
Parties vide letters dated 04/05/2009 Rs. 301000/-, on 26/11/2009 Rs. 10, 51, 750/-,
on 30/06/2011 Rs. 2, 45, 211/-, on 23/11/2011 Rs. 3, 09, 294/-, on 20/07/2012 Rs.
3, 11, 054/-, have acknowledged the payment of aforesaid amounts which totals Rs. 25, 18, 309/-. The
copies of the demand notices and receipts issued by the 1st opposite party with
respect of the payment of the aforesaid amount are annexed hereunto and marked
as ANNEXURE-A2 series.
7. The
Complainants submit that in order to make the entire payment they obtained a
loan from LIC Housing Finance Ltd., for which the complainant has been paying
interest every month in the form of EMI. A copy of loan documents are produced
hereto as ANNEXURE- A3
8. The Complainants submit that till June 2014,
they have made a total payment of Rs.
30, 41, 175/- which has been acknowledged by the first Opposite Party.
9. The
complainants submit that as per the payment plan fixed by the opposite parties
every buyer of the flat required to pay 95% of the total amount at terrace slab
stage. But the opposite parties so far have collected Rs. 30, 41, 175/- which is more than the total consideration amount,
but only managed to complete the work at terrace slab stage by August 2012, in
spite of collecting entire amount payable to the Second Opposite party. The
construction was not completed as assured and promised by the First Opposite
party.
10. The
complainant had sent multiple legal notices through advocates of repute to
inform DLF regarding the complaints related to the malpractices executed by
them, but to no avail. The first notice was sent by Advocate Mr. SANDEEP BAGMAR R. (MS3181/10,
Advocate – Madras High Court) on
11-June-2013 which clearly mentioned the grievances and suggested
remedies but DLF responded simply by sending the certificate from the CA which
deliberately suppressed information sought, by mentioning a vague cause in the
Agreement. Another similar mail was sent to DLF requesting clarification on
their tax demand on 28-Sep-2013, which DLF chose to ignore. Copies of the legal
notices and other correspondence between DLF and my lawyers and me has been
provided in ANNEXURE- A5.
11. The complainant had also sent multiple legal
notices through advocates of repute to the CA Firm ARUN JAIN (PARTNER, PREM ARUN JAIN
& CO., Membership No. 81455, ‘PREM VILLA’, B-3/19, DLF QUTAB ENCLAVE, PHASE
1, GURGAON- 122002) enquiring about the illicit and unjustifiable
charges certified by the CA firm on behalf of DLF. The legal notice was sent by Advocate Mr. Kiron Noronha on 20-September-2013 and
as usual, the CA firm chose to ignore it. A copy of this Notice was also sent to Mr. Surojit Basak, Director, Prem Arun Jain
& Co. Copies of the legal notices and other correspondence between DLF,
the CA firms representing DLF, my lawyers and me have been provided in ANNEXURE- A5.
12. The
complainants state that DLF has reduced
the project cost from Rs 536 Crores to 264 Crores and reduced the no. of
flats to 1922. That means DLF needs only 264 Crores to complete this project.
It can be noted that this was estimated on Oct 2012, hence must be accurate.
Why did DLF reduce the cost? Are they compromising on quality of material? Who
knows? As all 1922 flats have been sold and considering that each has paid
an average of Rs 40 Lakhs till date, the
total amount collected is Rs 768 Crores, which is thrice the amount estimated
by DLF. It is possible that they would have collected Rs 264 Crores by 2010
itself, when 3-4 installments were paid. It is conclusively proven that DLF had
thrice the amount required to complete the WH project. Till now, they have not
invested that money in this project. So where has the entire amount gone??
Further, DLF demanded Rs 129/sft as tax
share (as mentioned in Para. 11 above). Total
taxes share of all the buyers would
amount to Rs 44 Crores. So buyers have paid in the excess of Rs 825 Crores.
Still the project is far from complete. The details can be found in the
submission DLF made to get the State Environmental Impact assessment
Authority's NOC for DLF WH project. It can be accessed at: http://seiaa.kar.nic.in/56%20SEIAA%20Meeting%20(3.10.2012).pdf.
DLF
has made a similar fraudulent commitment to SEBI in the year 2012, as mentioned
in the web link (from the SEBI Official Website) at the end of this paragraph below.
Details
of the Red Herring Prospectus submitted to SEBI on 29-April-2013 shows
serious discrepancies among the information furnished by DLF to SEBI and the
reality (as promised to gullible buyers that their flats would be handed over
by mid-2012. This makes it amply clear that DLF is either furnishing fraudulent
and false information to the buyers or to
SEBI). Few examples of such discrepancies are provided in the snapshots below.
The RHP document (especially Extracts
from Page 122/391 of the Red Herring Prospectus submitted to SEBI on
29-April-2013) has been obtained from the SEBI official website link (below):
http://www.sebi.gov.in/cms/sebi_data/attachdocs/[protected].pdf
13. The
Complainant agrees and understands that as per Clause 1.10 of the ABA the Complainant
shall be liable to pay all Taxes, which shall be charged and paid as follows:
a. A
sum equivalent to the proportionate share of Taxes in addition to the Total
Price. The proportionate share shall be the Super Area of the Said Apartment to
the Super Area of all the apartments and other buildings in the Said Complex.
b. The
Company shall periodically intimate to the Allottees, on the basis of
certificates from a chartered engineer and / or a chartered accountant, and the
Allottees shall make payment within 30 (thirty) days from the date of such
written intimation.
Nowhere does this mention about VAT
and any other taxes arising out of engaging contractors and/or material costs
escalating due to delay (more than the promised 36 months for possession as
exclusively mentioned in the Agreement) on part of DLF.
Also, nowhere does the Agreement
mention that buyers are liable to pay for penalties imposed on DLF by the
government due to any reason whatsoever.
14. The
complainants submit that the First Opposite Party has accepted total amount
payable without executing the registered sale deed in favour of the complainant
and hence violated Section 4 of the
Karnataka Ownership of flats (Regulation of promotion of construction,
management, sale and transfer) Act, 1972. The progress of construction of
project was satisfactory in the initial stages and the builder used to inform
the buyers regularly about the progress. The work progress dipped in 2011. When
buildings completed the stage of ‘terrace slab’, the progress drastically
slowed down and communication stopped completely. It is highlighted that the ‘terrace slab’
stage is where every buyer in that building would have paid 95% of the total
amount to the builder. The builder,
having collected minimum of 95% of total cost from each buyer, ignored his
responsibilities of completing the flats & handover on time. Respondent
neither progressed on the work satisfactorily nor communicated with buyers.
Buyers wrote many emails, letters and tried to meet the builder’s officials
on-site, however failed to get any satisfactory replies. Due to abysmal service
and callous attitude of the builder, buyers even staged ‘Protest’ on several
occasions in 2013 & 2014, demanding the early handing over of flats and the
news was carried in prominent newspapers too. Only after that the builder came
up with a letter in Aug 2013 and promised new handover dates.
15. Maintenance Agency &
Maintenance Charges –
The
complainants further charge that DLF on its part is imposing a fraudulent
maintenance agency on the buyers of D
Block (for which possession has started) which is nothing more than a money
making scheme to fleece buyers and siphon off their money to DLF, in the name
of maintenance. Towards this end, DLF in its final letter to owners of D block
has mentioned as below:
In
the body of the aforesaid indemnity-cum-undertaking document clause (5)
mentions, “I/We understand that the Company has appointed ‘Westend Heights
Condominium Apartment Owners Welfare Association’ to provide maintenance
services to the Common Areas of the Said Building/Said Complex.”
Further, clause 16 & 17 of the Agreement stipulates that the
M/S DLF Southern Homes Pvt. Ltd. (henceforth referred to as DSHPL) will appoint
the maintenance agency and the maintenance charge as fixed by the proposed
maintenance agency shall be payable by the buyers and no questions in this
regard from the buyers shall be entertained. Further, as per the FSOA (Final Statement of Accounts) received
by the buyers from D1/D2 block, M/s DSHPL is demanding Rs 3.90/- per sq ft per
month as the maintenance charges to be paid to ‘Westend Heights Condominium
Apartment Owners Welfare Association’, WHCAOWA. Rs 3.90/- per sq ft per
month is quite a high charge when compared with similar apartment complexes of
equivalent size in Bangalore. The Hon’ble Commission may please note that
WHCAOWA is a registered Association under Karnataka Societies Act, 1960 (Regn.
# 276/10-11) and hence WHCAOWA may please be treated as an independent entity
or a service provider.
The
Complainants therefore contend the following –
a)
M/s DSHPL has put a condition in Agreement
(and again mentioned it in the FSOA prior to delivery) that the buyer has to
avail the services of an agency which shall be appointed by M/s DSHPL itself.
Buyers are also forced to pay maintenance charges which are inflated,
unilateral and non-negotiable. The Complainant believe that such a condition is
a restrictive trade practice u/s 2 (b) of the Consumer Protection Act, 1986
b)
Since WHCAOWA is being considered as an
independent entity from DLF and if buyers/ flat owners enter into separate
agreement with WHCAOWA for providing maintenance services, the demand to pay
maintenance charges should come directly from WHCAOWA and not via DLF. The
Complainants contend that if DLF
continues to pressurize the buyers to pay up to WHCAOWA, it should be counted
towards a restrictive trade practice u/s 2.nnnb of Consumer Protection Act,
1986
c)
Furthermore, the Association itself is
based on the foundation of lies and
should be immediately pronounced null and void as per the following clauses in
Karnataka Apartment Ownership Act 1972:
·
The Association was formed when there
was no existence of any apartment/society at all. Just a barren piece of land!
·
All the office bearers are past and
present direct employees of DLF and Annabel Builders
·
All the addresses provided by these
people are false and fraudulent and we would request the court to setup an
investigation against the Registrar of Societies, who in his capacity had given
his seal of approval for the registration of such a society whose office
bearers have submitted fraudulent addresses!
·
Even as per these addresses non-of the
office bearers is a resident of block D at DLF Westend Heights. How on earth
will they be cognizant of the day to day issues being faced by the residents of
D Block and resolve them promptly if they themselves do not stay there ?
·
No election was conducted to elect the
office bearers
·
No AGM has been held till date. In fact,
it was with great difficulty that DLF shared the documents pertaining to the
Association Registration, a copy of which is attached in Annexure 6
16. The
complainants state that in spite of several requests and demands to execute a
registered sale deed and hand over possession of the apartment in question, the
second Opposite Party has only been assuring to execute the registered sale
deed in favour of the complainants.
17. The
Complainants state that they are residing in a rented house paying rent (Rs.
20, 000 plus per month) for a period of 4-5 years from August 2009. The delay in
completion of the construction of the apartment and failure in handing over possession
and executing the registered sale deed has resulted in substantial loss to the complainants
which is approximately Rs.5, 00, 000/-.
The complainants will have to
continue to pay rent till such time the apartment is handed over and
registration complete. The complainants’ state that they are entitled to the
aforesaid amount towards loss of rental income throughout this period, till the
apartment in question is handed over and sale deed registered in his favour.
18. The
complainants submit that the act of the Opposite party of having received the
payment and failing to hand over possession as assured as per the agreement and
register the sale deed amounts to cheating and unfair trade practice. Further,
the conduct of the Opposite party to demand taxes which is contrary to the
terms of the agreement and that too on 31/08/2013 i.e., after four years of
execution of Apartment
Buyers
Agreement is totally unjustified and illegal. The complainants submit that the
non-delivery of possession of the schedule property entitles the complainant to
damages @ Rs 600 per sq ft.
19. The complainants state that observing the
unprofessional conduct in lackadaisical approach and deprecating attitude, the
first and second Opposite Party had a preconceived intention to cheat the
complainants and to make illegal profits of their hard earned money. The act of
first and second Opposite Party in collecting money in the form of taxes which
is even contrary to the agreement reflects their conduct that since inception,
they had an intention to cheat the complainants and make illegal gain of their
hard earned money and causing 'wrongful loss to the complainants.
20. The
complainants submit deprecating conduct by the first Opposite party has caused
the complainants severe stress, trauma
and mental agony as they have invested their life savings and hard earned money
with the hope of securing an Apartment in the project promoted and developed by
the first and second Opposite party.
21. The
complainants submit that being aggrieved and frustrated by the conduct of the
Opposite parties for the delay caused to them in handing over the possession
and execute registered sale deed, recently the allottees including the
complainant were forced to make a protest against the opposite parties and
demanded early completion of the flat and hand over the possession of the same
to them. The photographs to that effect are annexed hereunto and marked as ANNEXURE-A4
22. The
complainants state that the deprecating conduct of the Opposite parties has
caused the complainants severe stress and mental agony as opposite parties.
23. The complainants crave leave to amend the
complaint and to produce documents and additional evidence found necessary
during the course of hearing of the complaint.
24. That,
without prejudice to the rights of the complainants to initiate appropriate
action against the Opposite parties for the offences and breaches committed by
them, the complainants in the present claim are seeking compensation and
damages from the Opposite Parties as spelt out below:
SCHEDULE PROPERTY
All the piece and parcel of the flat bearing
No. NWB1036, Block No B1 in the project known as Westend Heights at New Town - DLF
BTM Extension, situated at Begur Village, Begur Hobli, Bangalore South Taluk
and measuring super area 1365 sq ft.
Apartment area 1075 sq ft together
with undivided share, right, title, interest and ownership of land along with facilities
and amenities related to the aforesaid project formulated by the opposite
parties.
PRAYER
WHEREFORE under the above mentioned
circumstance, it is humbly prayed that this Hon'ble Forum be pleased to:
a.
Direct
the Opposite Parties to execute and register
a sale deed for apartment number NWB1036 in block B1 in the project measuring super area 1365 sq
ft, apartment area 1075 sq ft together with undivided share, right, title,
interest and ownership of along with facilities and amenities related to the
aforesaid project formulated by the opposite parties in favour of the
complainants by complying with all mandatory provisions as required under the
promotion of construction, management, sale and transfer) Act 1972 immediately
before the concerned Sub-Registrar Office;
b. Direct the Opposite Parties to
pay the complainants a sum of Rs 20, 00, 000/as damages for the loss of rentals
and expenses they incurred along with interest @ 18% p.a.
c. Direct the Opposite Parties to
pay the complainant a compensation of Rs. 10, 00, 000/- along with interest @ 18%
p.a. towards mental agony, hardship and consequential loss suffered by the
complainants due to the negligent and deliberate act of the opposite Parties.
d. Direct the Opposite Parties to
pay compensation of Rs. 25, 000/-
towards expenses and other costs incurred by the complainants in filing the complaint.
e. Grant such other relief as this
Hon'ble Commission deems fit in the facts and circumstances of this case and in
the interest of equity.
VERIFICATION
We, SOUMYA KUMAR NAYAK, S/o Sarat
Chandra Nayak, SMT. URBASHI NAYAK, W/o Sarat Chandra Nayak, and SMT. SAMITA
MOHANTY, D/o Ramesh Chandra Mohanty, the complainants in the above case hereby
verify and declare that all the facts and information stated at Para 1 to 19 of
the memorandum of complaint are true to the best of my knowledge, information
and belief.
Date Place:
BANGALORE
1.
2.
3.
Complainants
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