DHARMENDRA SHARMAversusAGRA DEVELOPMENT AUTHORITY
- Citation
- 2024 INSC 667
- Decided
- 6 September 2024
- Disposal
- Disposed off
- Bench
- VIKRAM NATH
Holding
An offer of possession without the requisite completion and firefighting clearance certificates is legally invalid, the consumer complaint was not barred by limitation, and the NCDRC had proper pecuniary jurisdiction.
Summary
The appellant, Dharmendra Sharma, purchased an apartment from the Agra Development Authority (ADA) and sought possession after paying the agreed price, but ADA's offer of possession on 4 December 2014 was made without a completion certificate or firefighting clearance certificate. The appellant filed a consumer complaint alleging deficiency in service and unfair trade practice, which the NCDRC partially allowed, ordering a refund with interest and directing ADA to return stamp duty. ADA appealed, arguing the complaint was barred by limitation and that the NCDRC lacked pecuniary jurisdiction. The Supreme Court held that the limitation period was extended by ADA's reminders and acceptance of part payment, and that the claim's total relief exceeded Rs 1 crore, affirming the NCDRC's jurisdiction. It also ruled that an offer of possession without the statutory completion and firefighting certificates is invalid under the UP Apartment Act and RERA, justifying the appellant's refusal to take possession. Consequently, the Court ordered the refund with interest from the filing date, additional compensation of Rs 15,00,000, and return of the stamp duty, while dismissing ADA's appeal.
Issues considered
- Whether an offer of possession made by a developer is valid in the absence of a completion certificate and firefighting clearance certificate under the UP Apartment Act, 2010 and RERA Act, 2016.
- Whether the consumer complaint filed by the appellant was barred by the limitation period prescribed under the Consumer Protection Act, 1986.
- Whether the National Consumer Disputes Redressal Commission had jurisdiction to entertain the complaint given the quantum of the claim.
Legislation cited
- Consumer Protection Act, 1986s. 21, s. 23, s. 24A
- Limitation Act, 1963s. 18, s. 19
- Real Estate (Regulation and Development) Act, 2016s. 19(10)
- UP Apartment (Promotion of Construction, Ownership & Maintenance) Act, 2010s. 4(5)
Subjects
Judgment
[2024] 9 S.C.R. 97 : 2024 INSC 667
Dharmendra Sharma
v.
Agra Development Authority
(Civil Appeal Nos. 2809-2810 of 2024)
06 September 2024
[Vikram Nath* and Prasanna Bhalachandra Varale, JJ.]
Issue for Consideration
Whether the possession as offered by Agra Development Authority
on 04.12.2014 should be taken as a valid offer of possession even
if there was no completion certificate and whether the firefighting
clearance certificate was available with the ADA or not. Absence
of these documents, if vitiated the offer of possession made by
the ADA.
Headnotes†
Consumer Protection – Deficiency in service – UP Apartment
(Promotion of Construction, Ownership & Maintenance) Act,
2010 – s.4(5) – RERA Act, 2016 – s.19(10) – Offer of possession
made without completion certificate and firefighting clearance
certificate, if valid and lawful:
Held: No – Appellant consistently raised this issue asserting that a
valid offer of possession cannot be made without these documents –
s.4(5) of the UP Apartment (Promotion of Construction, Ownership
& Maintenance) Act, 2010 and s.19(10) of the RERA Act, 2016
mandate that a developer must obtain these certificates before
offering possession – Despite the appellant’s repeated requests,
ADA failed to produce these certificates, rendering its offer of
possession incomplete and legally invalid – ADA’s failure to provide
the required certificates justifies the appellant’s refusal to take
possession – Thus, appellant entitled to additional compensation to
compensate for the delay caused by ADA’s breach of its statutory
obligations – On facts, in view of the shortcomings on the part of both
the appellant and the ADA, compensation provided to the appellant
apart from what was awarded by NCDRC – Therefore, apart from
the refund of the entire amount deposited by the appellant @ 9%
interest p.a. from 11.07.2020 (the date of the complaint) till the
date of refund, ADA to pay an additional compensation amount of
* Author
98 [2024] 9 S.C.R.
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Rs. 15,00,000/- to the appellant – ADA also to return the non-judicial
stamp worth Rs. 3,99,100/- back to the appellant. [Paras 20, 21]
Consumer Protection – Limitation Act, 1963 – ss.18, 19 –
Complaint of the appellant, if was barred by limitation – Plea
of the respondent-Agra Development Authority (ADA) that the
complaint was filed by the appellant in 2020 after six years
from the date of offering possession in 2014 and as such was
barred by limitation:
Held: The complaint was not barred by limitation – The ongoing
interactions between the parties, including ADA’s acceptance of
part payment in 2019 and the reminders sent, effectively extended
the limitation period – NCDRC correctly applied ss.18 and 19 of
the Limitation Act, 1963, which extend the limitation period where
part payments or acknowledgments are made – Thus, cause of
action continued to exist and the filing of the complaint in July
2020 was within the limitation period. [Paras 16, 17]
Consumer Protection Act, 1986 – Pecuniary jurisdiction –
Value of the claim – Determination – Objection raised by
the respondent-Agra Development Authority as regards the
pecuniary jurisdiction of the NCDRC contending that as the
amount deposited by the appellant was only Rs. 59,91,000/- i.e.
less than Rs. 1 crore, the complaint ought to have been filed
before the State Consumer Disputes Redressal Commission
and the NCDRC would have no pecuniary jurisdiction to
entertain the complaint with a value of less than Rs. 1 crore:
Held: No merit in this argument – In consumer disputes, the value
of the claim is determined not just by the amount deposited but
by the aggregate relief sought, which includes compensation and
other claims – Claim made by the appellant was not limited to the
deposit amount alone but also included compensation for mental
agony, harassment, and loss of income, which brought the total
claim well above Rs. 1 crore – NCDRC rightly held that it had the
requisite pecuniary jurisdiction to entertain the complaint. [Para 19]
Case Law Cited
Debashis Sinha & Ors. v. R.N.R. Enterprise (2023) 3 SCC 195;
Pioneer Urban Land and Infrastructure Limited v. Union of India &
Ors. [2019] 10 SCR 381 : (2019) 8 SCC 416; Treaty Construction
v. Ruby Tower Cooperative Housing Society Ltd [2019] 9 SCR 606 :
(2019) 8 SCC 157 – relied on.
[2024] 9 S.C.R. 99
Dharmendra Sharma v. Agra Development Authority
Ghaziabad Development Authority v. Balbir Singh [2004] 3 SCR 68 :
(2004) 5 SCC 65; Rishab Singh Chandel & Anr. v. Parsvnath
Developers Ltd. & Anr. Civil Appeal No.3053 of 2023; Lucknow
Development Authority v. M.K.Gupta [1993] Suppl. 3 SCR 615 :
(1994) 1 SCC 243; Marvel Omega Builders Pvt. Ltd. v. Shri Hari
Gokhale & Ors. [2019] 10 SCR 375 : (2020) 16 SCC 226; Ex-
perion Developers Pvt. Ltd. v. Sushma Ashok Shierror [2022] 5
SCR 590 : (2022) 6 SCALE 16 – referred to.
List of Acts
Consumer Protection Act, 1986; UP Apartment (Promotion of
Construction, Ownership & Maintenance) Act, 2010; RERA Act,
2016; Limitation Act, 1963; Supreme Court Rules.
List of Keywords
Agra Development Authority; Offer of possession; Completion
certificate; Firefighting clearance certificate; Deficiency in service;
Refusal to take possession; Complaint not barred by limitation;
Additional compensation; Limitation period extended; Part payments
or acknowledgments; Cause of action continued to exist; Pecuniary
jurisdiction.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 2809-2810 of
2024
From the Judgment and Order dated 15.09.2023 and 30.10.2023 of
the National Consumers Disputes Redressal Commission, New Delhi
in CC No.600 of 2020 and RA No.335 of 2023 respectively
Appearances for Parties
Vipin Sanghi, Sr. Adv., Om Prakash, Vikas Singh Jangra, Sudhir
Kulshreshtha, Advs. for the appearing parties.
Judgment / Order of the Supreme Court
Judgment
Vikram Nath, J.
1. Civil Appeals 2809-2810 of 2024, by the appellant filed under Section
23 of the Consumer Protection Act, 1986,1 read with Order XXIV of
1 CPA, 1986
100 [2024] 9 S.C.R.
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the Supreme Court Rules, assail the correctness of the final judgment
and order dated 15.09.2023 passed by the National Consumer
Disputes Redressal Commission2 in CC No.600/2020 as also the
order dated 30th October, 2023 passed on the Review Application
No.335/2023. By the aforesaid orders, the NCDRC allowed the CC
No.600/2020 partly to the extent that it directed refund of the entire
amount deposited by the Complainant (appellant) (except non-judicial
stamp paper worth Rs. 3,99,100/- deposited on 15.02.2014) along
with interest @9% p.a. from the date of the complaint i.e. 11.07.2020
till the date of refund within a period of two months from the date
of the order.
2. Further, Civil Appeal No. 6344 of 2024 has been filed by the Agra
Development Authority3 assailing the correctness of the same
judgment of the NCDRC dated 15.09.2023 partly allowing the
complaint.
3. The appellant-Dharmendra Sharma had applied for allotment and
purchase of an apartment (residential flat) in the category of Super
Deluxe 2 on 28.07.2011 and had deposited the booking amount
of Rs. 4,60,000/- along with the application. This application was
submitted pursuant to an advertisement issued by the ADA for
a group housing project lodged in the name of ADA Heights, Taj
Nagari, Phase II at Fatehabad Road, near Taj Express Way, Ring
Road, Agra. The allotment was done by lottery system on 29.08.2011
whereby the appellant was allotted Flat No.DT-1/1204 which was
communicated vide letter dated 19.09.2011, according to which the
tentative price of the apartment was Rs. 56,54,000/- which could be
deposited in 24 equal quarterly instalments or could be paid in full
with certain other relaxations. The appellant, opted for full payment
and accordingly vide letter dated 21.10.2011, attached two cheques,
one by the appellant of Rs. 6.94 lakhs and the other of Rs. 45 lakhs
issued by the LIC Housing Finance Limited. Possession was to be
given within six months under the scheme.
4. Upon completion of six months, the appellant requested for
possession vide communication dated 03.04.2012. Apparently, the
construction was not completed and, in any case, not ready for
2 NCDRC
3 ADA
[2024] 9 S.C.R. 101
Dharmendra Sharma v. Agra Development Authority
delivery of possession, as such no possession was delivered even
after six months. The appellant thereafter received a communication
dated 04.02.2014 offering possession subject to further payment of
Rs. 3,43,178/- along with non-judicial stamp paper for execution of
the deed amounting to Rs. 3,99,100/-. The demand so raised was
under the following three heads:
i) Rs. 84,300/- for solar system;
ii) Rs. 46,878/- as leased premium; and
iii) Rs. 2,12,000/- for covered parking area.
5. On receipt of the said letter, the appellant visited the site as also the
office of ADA on 15.02.2014. He deposited the non-judicial stamp
papers as required of Rs. 3,99,100/-. But after inspection of the site,
he found various deficiencies in the construction which were reported
to the Assistant Engineer of the ADA with the request that once the
deficiencies are removed, he may be communicated for taking over
possession. ADA sent reminders dated 22.09.2014 and 20/21.11.2014
for depositing the balance amount of Rs. 3,82,748/-. The appellant, on
the other hand, was demanding for completion certificate. There is a
further communication by the ADA dated 17.01.2018 demanding an
amount of Rs. 6,11,575/- and for taking possession after depositing
the same and getting the deed executed. On the other hand, the
appellant, vide communication dated 02.04.2018, requested for waiver
of interest on the balance amount and also sought confirmation
whether the flat was ready for physical possession.
6. It was thereafter that the appellant along with letter dated 04.06.2019,
sent a cheque dated 01.06.2019 for Rs. 3,43,178/- and again requested
for confirmation of the date of possession. The ADA encashed the said
cheque but did not inform any date for handing over possession. It
looks like the appellant got the loan transferred to the State Bank of
India4 whereupon the SBI is writing letters demanding the title deed
of the apartment vide communications dated 14.03.2017, 25.06.2019
and 19.10.2019. These communications further mention that in case
the title deed is not deposited, then penal interest @2% p.a. would
be levied. The appellant again reiterated his earlier request for waiver
of interest on balance amount vide reminder dated 18.09.2019 and
4 SBI
102 [2024] 9 S.C.R.
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again requested for confirmation whether the flat was ready for
physical possession. The appellant again visited the office of ADA on
23.11.2019 and requested for completion certificate and firefighting
clearance certificate, which were not provided. He again visited the
site and found that the apartment was not in a habitable condition.
The appellant thus proceeded to institute a complaint before the
NCDRC on 10.07.2020 alleging deficiency in service as also unfair
trade practice on the part of ADA.
7. The ADA filed its reply in which the amounts as deposited by the
appellant, as noted above, were admitted. Further, according to
ADA, the construction was ready and possession was offered on
04.02.2014 along with demand of Rs. 3,43,178/- which the appellant
did not pay and continued to claim for waiver of interest and had
ultimately paid the said amount on 04.06.2019 vide cheque dated
01.06.2019. According to ADA, after adjustment there was still an
outstanding amount of Rs. 4,71,159/- as on 05.02.2021. It was also
stated in the written statement that in 2011, at the time of allotment,
the tentative price was Rs. 56,54,000/- and under Clause 45 of the
Registration and Allotment Rules, it was clearly mentioned that the
price could vary upto 10%. Further, according to ADA, the demand
raised by the letter dated 04.02.2014 of solar system, lease premium
and car parking were apart from the cost of the flat and not due to
increased cost. The appellant had unnecessarily delayed payment of
the demand raised on 04.02.2014. It was also stated in the written
statement that out of the 582 apartments built under the project
in question, except for 20 allottees, all other allottees had taken
possession. The ADA further pleaded that the complaint was barred
by time and secondly, that as the total payment made by the appellant
was Rs. 59,97,178/-, as such it would not fall within the pecuniary
limit of the NCDRC, and therefore, the complaint was liable to be
dismissed for the above two reasons also.
8. The parties led their evidence. The NCDRC rejected technical
objections raised by the ADA regarding limitation as also the pecuniary
jurisdiction. In so far as the limitation is concerned, the NCDRC
held that as subsequent demand and reminders were sent by the
ADA and the ADA even accepted the cheque of Rs. 3,43,178/- in
2019, it was not open for the ADA to raise the plea of limitation.
In so far as the pecuniary jurisdiction is concerned, the NCDRC
held that the claim was of more than Rs. 2 crores as such the said
[2024] 9 S.C.R. 103
Dharmendra Sharma v. Agra Development Authority
objection was also not sustainable. The NCDRC, however, held that
the additional demand made by the ADA vide communication dated
04.02.2014 although was other than additional cost of 10% which
was permissible but, in any case, it was within the 10% admissible
clause, as such could not be held to be illegal. The NCDRC also held
that if the possession was delayed beyond two years, the appellant
would be entitled for a refund but in the present case, Clause 27
of the Registration and Allotment Rules would not be applicable.
The NCDRC further held that although the appellant had deposited
the non-judicial stamps worth Rs. 3,99,100/- on 15.02.2014 but he
continued to delay payment of additional demand of Rs. 3,43,178/-
and was continuously requesting for waiver of interest resulting
into the presumption that he was avoiding payment of the balance
amount. On such finding the NCDRC denied to grant interest from
the date of deposit but made it applicable from the date of the filing
of the complaint. In so far as the deficiency in construction was
concerned, the NCDRC found that only bald allegations have been
made by the appellant and he never made any effort to get a report
from the Commissioner and allowed the apartment in question to
remain locked for six years.
9. After considering the pleadings and evidence on record and in
view of the above findings, the complaint was partly allowed by the
NCDRC on 15.09.2023.
10. The appellant preferred a Review Application which was dismissed
by the NCDRC by its order dated 30th October, 2023. In the Review
Application also, the NCDRC reiterated that the review was liable
to be rejected as while offering possession, the ADA vide letter
dated 04.12.2014 had made a further demand which amount was
not deposited within the time and it was only deposited in 2019 and
that too without interest and the complaint was made after six years
and, therefore, the appellant would not be entitled to interest from
the date of deposit.
11. In the two appeals filed by the appellant, the relief claimed is to the
extent that the payment of interest be awarded from the date of deposit
while refunding the same and not from the date of the complaint.
Whereas in the appeal filed by the ADA, it is submitted that in view
of the fact that the petition had been filed after six years from the
date of offering possession, as such it was barred by limitation and
also as the amount deposited was only Rs. 59,91,000/- i.e. less
104 [2024] 9 S.C.R.
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than Rs. 1 crore, the complaint ought to have been filed before the
State Consumer Disputes Redressal Commission and the NCDRC
would have no pecuniary jurisdiction to entertain the complaint with
a value of less than Rs. 1 crore.
12. We have heard Shri Vipin Sanghi, learned senior counsel appearing
for the appellant and Shri Sudhir Kulshreshtha, learned counsel for
the ADA in all the three appeals.
13. The facts as recorded above are not disputed. Even the NCDRC
did not find any contradiction in the factual aspect. The only issue
is as to whether the possession as offered on 04.12.2014 should be
taken as a valid offer of possession even if there was no completion
certificate and also whether the firefighting clearance certificate was
available with the ADA or not. Despite specific requests and demands
by the appellant for providing the completion certificate and firefighting
clearance, the ADA failed to produce the same. Senior Counsel for
the appellant has relied upon the following judgments in support of
his submission that offer for possession would be invalid where the
completion certificate and firefighting clearance certificate have not
been obtained by the developer i.e. ADA:
(a) Debashis Sinha & Ors. vs. R.N.R. Enterprise5
(b) Pioneer Urban Land and Infrastructure Limited vs. Union
of India & Ors.6
(c) Treaty Construction vs. Ruby Tower Cooperative Housing
Society Ltd.7
It is then submitted that even before the NCDRC the completion
certificate and the firefighting clearance certificate could not be
produced by the respondent -ADA.
14. It is also submitted on behalf of the appellant that under the provisions
of RERA Act, 2016 as also the UP (Promotion of Apartment and
Ownership and Maintenance) Act, 2010 offer of possession would
be valid only after a developer obtains the completion certificate,
which had not been done so far by the developer ADA in the present
case. On behalf of the appellant, it is also argued that the demand
5 (2023) 3 SCC 195
6 [2019] 10 SCR 381 : (2019) 8 SCC 416
7 [2019] 9 SCR 606 : (2019) 8 SCC 157
[2024] 9 S.C.R. 105
Dharmendra Sharma v. Agra Development Authority
of Rs. 3,43,178/- along with alleged offer of possession dated
14.02.2014 was totally unjustified and illegal. It was also submitted
that the appellant having deposited the amount of approximately
Rs. 60 lakhs and that too after taking loan from financial institutions,
cannot be deprived of counting the interest from the date of deposit
rather than from the date of filing of the complaint. In support of this
submission, reliance has been placed upon the following judgments:
(a) Ghaziabad Development Authority vs. Balbir Singh8
(b) Rishab Singh Chandel & Anr. vs. Parsvnath Developers
Ltd. & Anr.9
(c) Lucknow Development Authority vs. M.K.Gupta10
(d) Marvel Omega Builders Pvt. Ltd. vs. Shri Hari Gokhale &
Ors.11
(e) Experion Developers Pvt. Ltd. vs. Sushma Ashok Shierror12
15. On such submissions it was prayed by the appellant that his appeals
be allowed and the interest be awarded from the date of deposit
and to that extent the impugned judgment and order of NCDRC be
modified. Further that the appeal filed by the respondent be dismissed.
16. Having considered the submissions of both parties, we are of the
opinion that both have contributed to delays at various stages. The
respondent ADA raised an objection that the complaint was barred
by limitation, claiming that the complaint was filed on 10.07.2020,
well beyond the statutory limitation period prescribed under Section
24A of the Consumer Protection Act, 1986, which mandates that a
complaint must be filed within two years from the date on which the
cause of action arises. ADA argued that the offer of possession made
on 04.02.2014 should have triggered the limitation period. However,
the NCDRC, in its impugned order, rightly rejected this argument by
considering that the respondent ADA issued reminders to the appellant
on 22.09.2014, 21.11.2014, and 17.01.2018. Additionally, ADA
accepted the appellant’s payment of Rs. 3,43,178/- on 20.06.2019
8 [2004] 3 SCR 68 : (2004) 5 SCC 65
9 Civil Appeal No.3053 of 2023
10 [1993] Suppl. 3 SCR 615 : (1994) 1 SCC 243
11 [2019] 10 SCR 375 : (2020) 16 SCC 226
12 (2022) 6 SCALE 16
106 [2024] 9 S.C.R.
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without any reservations. Given these facts, the NCDRC correctly
applied Sections 18 and 19 of the Limitation Act, 1963, which extend
the limitation period where part payments or acknowledgments are
made. Consequently, the cause of action continued to exist, and
the filing of the complaint in July 2020 is within the limitation period.
17. This Court concurs with the NCDRC’s reasoning and affirms that
the complaint was not barred by limitation. The ongoing interactions
between the parties, including ADA’s acceptance of part payment in
2019 and the reminders sent, effectively extended the limitation period
under established legal principles. However, while the complaint is
within limitation, we also recognize that the appellant delayed making
the balance payment of Rs. 3,43,178/- for over five years, from
2014 to 2019. This delay was largely due to the appellant’s requests
for a waiver of interest, which, while understandable, contributed
significantly to the delay in finalizing the transaction.
18. In light of these circumstances, while the appellant is entitled to a
refund along with interest, it would be inequitable to award interest
from the date of the original payment in 2011 given the appellant’s
role in the delay.
19. The respondent ADA has also challenged the pecuniary jurisdiction
of the NCDRC, contending that the total payment made by the
appellant amounted to Rs. 59,97,178/-, which was less than Rs. 1
crore. As such, ADA argued that the complaint should have been
filed before the State Consumer Disputes Redressal Commission
and not the NCDRC, which has jurisdiction over matters exceeding
Rs. 1 crore as per Section 21(a)(i) of the Consumer Protection Act,
1986. This Court finds no merit in ADA’s argument. The NCDRC,
in its impugned order, correctly observed that the claim made by
the appellant was not limited to the deposit amount alone but also
included compensation for mental agony, harassment, and loss of
income, which brought the total claim well above Rs. 1 crore. In
consumer disputes, the value of the claim is determined not just
by the amount deposited but by the aggregate relief sought, which
includes compensation and other claims. Therefore, the NCDRC
rightly held that it had the requisite pecuniary jurisdiction to entertain
the complaint, and this Court affirms that finding.
20. The appellant’s key contention regarding the absence of the
completion certificate and firefighting clearance certificate merits
[2024] 9 S.C.R. 107
Dharmendra Sharma v. Agra Development Authority
serious consideration. The appellant consistently raised this issue,
asserting that a valid offer of possession cannot be made without
these documents. Section 4(5) of the UP Apartment (Promotion of
Construction, Ownership & Maintenance) Act, 2010 and Section
19(10) of the RERA Act, 2016 mandate that a developer must obtain
these certificates before offering possession. Despite the appellant’s
repeated requests, ADA failed to produce these certificates, rendering
its offer of possession incomplete and legally invalid.
21. The appellant has rightly cited relevant precedents to bolster this
argument. In Debashis Sinha v. R.N.R. Enterprise (2023),13 this
Court held that possession offered without the requisite completion
certificate is illegal, and a purchaser cannot be compelled to take
possession in such circumstances. The Court in that case held:
“20. Finally, we cannot resist but comment on the perfunctory
approach of Ncdrc while dealing with the appellants’
contention that it was the duty of the respondents to apply
for and obtain the completion certificate from KMC and
that the respondents ought to have been directed to act in
accordance with law. The observation made by Ncdrc of
the respondents having successfully argued that it was not
their fault, that no completion certificate of the project could
be obtained, is clearly contrary to the statutory provisions.
21. Sub-section (2) of Section 403 of the KMC Act was
referred to by Ncdrc in the impugned order [Debashis
Sinha v. R.N.R. Enterprise, 2020 SCC OnLine NCDRC
429] . Sub-section (1) thereof, which finds no reference
therein, requires every person giving notice under Section
393 or Section 394 or every owner of a building or a work
to which the notice relates to send or cause to be delivered
or sent to the Municipal Commissioner a notice in writing of
completion of erection of building or execution of work within
one month of such completion/erection, accompanied by
a certificate in the form specified in the rules made in this
behalf as well as to give to the Municipal Commissioner all
necessary facilities for inspection of such building or work.
13 (2023) 3 SCC 195
108 [2024] 9 S.C.R.
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22. Section 393 mandates every person, who intends
to erect a building, to apply for sanction by giving notice
in writing of his intention to the Municipal Commissioner
in such form and containing such information as may
be prescribed together with such documents and plans.
Similarly, Section 394 also mandates every person who
intends to execute any of the works specified in clause (b)
to clause (m) of sub-section (1) of Section 390 to apply
for sanction by giving notice in writing of his intention to
the Municipal Commissioner in such form and containing
such information as may be prescribed.
23. It is, therefore, evident on a conjoint reading of
Sections 403, 390 and 394 of the KMC Act that it is the
obligation of the person intending to erect a building or to
execute works to apply for completion certificate in terms
of the Rules framed thereunder. It is no part of the flat
owner’s duty to apply for a completion certificate. When
the respondents had applied for permission/sanction to
erect, the Calcutta Municipal Corporation Buildings Rules,
1990 (hereafter “the 1990 Rules” for short) were in force.
Rule 26 of the 1990 Rules happens to be the relevant
Rule. In terms of sub-rules (1) to (3) of Rule 26 thereof,
the obligation as cast was required to be discharged by
the respondents. Evidently, the respondents observed the
statutory provisions in the breach.”
This position is supported by other decisions, including Pioneer Urban
Land and Infrastructure Ltd. (supra) and Treaty Construction
(supra), where the absence of these certificates was found to
constitute a deficiency in service. In the present case, the ADA’s
failure to provide the required certificates justifies the appellant’s
refusal to take possession. This strengthens the appellant’s claim
for additional compensation to compensate for the delay caused by
ADA’s breach of its statutory obligations.
22. This Court is of the considered view that both parties have exhibited
lapses in their respective obligations. On the one hand, the appellant,
despite having paid the tentative price of Rs. 56,54,000/- in 2012,
failed to remit the additional amount of Rs. 3,43,178/-, as demanded
by the ADA, even after being repeatedly reminded. Instead, the
appellant persistently sought a waiver of the penal interest on the
[2024] 9 S.C.R. 109
Dharmendra Sharma v. Agra Development Authority
delayed payment, eventually settling the amount only on 04.06.2019,
a significant delay that cannot be overlooked and that too without
the interest component which had further accrued over a period of
about five years. On the other hand, the ADA, despite making an
offer of possession in 2014, did not fulfil its statutory obligations by
providing the requisite completion certificate and firefighting clearance
certificate, both of which are essential for a valid and lawful offer
of possession. The absence of these documents, which were also
not furnished before the NCDRC, unquestionably vitiates the offer
of possession made by the ADA.
23. In light of the aforementioned observations and taking into account the
shortcomings on the part of both the appellant and the ADA, this Court
deems it appropriate to provide a compensation of Rs. 15,00,000/-
(Fifteen Lakhs only) apart from what was awarded by the NCDRC.
Therefore, apart from the refund of the entire amount deposited
by the appellant @ 9% interest per annum from 11.07.2020 till the
date of refund, the ADA is directed to pay an additional amount of
Rs. 15,00,000/- (Fifteen Lakhs only) to the appellant. The entire
amount should be rendered to the appellant within three months of
this order. We also order the ADA to return the non-judicial stamp
worth Rs. 3,99,100/- back to the appellant.
24. Furthermore, we refrain from imposing any exemplary costs on either
party, recognizing that both have contributed to the situation at hand.
It is also to be noted that the ADA, being a civic body tasked with
serving the public and operating on a non-profit basis, should not
be unduly penalized in a manner that could impede its functioning.
25. The Civil Appeals 2809-2810 of 2024 are disposed of accordingly.
26. The appeal filed by the ADA i.e. Civil Appeal No. 6344 of 2024 stands
dismissed, as its primary arguments regarding both limitation and
pecuniary jurisdiction are found to be without merit.
Result of the case: Civil Appeal Nos. 2809-2810 disposed of;
Civil Appeal No. 6344 of 2024 dismissed.
†
Headnotes prepared by: Divya Pandey
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