CASE DETAILS v. HIMANSHU DEWAN AND SONALI DEWAN & Ors.

Laureate Buildwell Private Limited v. Charanjeet Singh 2021 SCC OnLine SC 479; Kunhayammed and Others v. State of Kerala and Another (2000) 6 SCC 359: [2000] 1 Suppl. SCR 538; Khoday Distilleries Limited and Others v. Sri Mahadeshwara Sahakara Sakkare Karkhane Limited (2019) 4 SCC 376: [2019] 3 SCR 411; State of Rajasthan v. Nemi Chand Mahela and Others (2019) 14 SCC 179: [2019] 18 SCR 995; Malook Singh and Others v. State of Punjab and Others (2021) SCC OnLine SC 876; Makhija Construction & Engg. (P) Ltd. v. Indore Development Authority and Others (2005) 6 SCC 304 – relied on. Wing Commander Arifur Rahman Khan and Aleya Sultana and Others v. DLF Southern Homes Private Limited and Others (2020) 16 SCC 512: [2020] 9 SCR 136; Abbai Maligai Partnership Firm and Another v. K. Santhakumaran and Others (1998) 7 SCC 386: [1998] 1 Suppl. SCR 535; Fida Hussain and Others v. Moradabad Development Authority and Another (2011) 12 SCC 615: [2011] 9 SCR 290 – referred to. Pawan Gupta v. Experion Developers Private Limited 2020 SCC OnLine NCDRC 788 – referred to. OTHER CASE DETAILS INCLUDING IMPUGNED ORDER AND APPEARANCES CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1434 of 2023. From the Judgment and Order dated 16.01.2023 of the National Consumer Disputes Redressal Commission, New Delhi in Consumer Case No. 34 of 2022. 1122 SUPREME COURT REPORTS [2023] 12 S.C.R. Appearances: Dr. Abhishek Manu Singhvi, Amit Sibal, Sr. Advs., Debmalya Banerjee, Ms. Manmeet Kaur, Rohan Sharma, Kartik Bhatnagar, Anmol, Nicholas Choudhury, Gurtejpal Singh, Ms. Suditi Batra, Shreesh Chadha, Amit Bhandari, Abhishek Grover, Abhishek Rana, Ms. Ashna Arora, M/s. Karanjawala & Co., Advs. for the Appellant. Bishwajit Bhattacharyya, Sr. Adv., Chandrachur Bhattacharyya, Sahil Tagotra, Advs. for the Respondents. JUDGMENT / ORDER OF THE SUPREME COURT JUDGMENT SANJIV KHANNA, J. The instant appeal fi led by M/s. Experion Developers Private Limited1 under Section 67 of the Consumer Protection Act, 20192, is directed against the order and judgment dated 16.01.2023 passed by the National Consumer Disputes Redressal Commission3, in the Consumer Case No. 34/2022, whereby the appellant has been directed to refund to Himanshu Dewan & Sonali Dewan & Others4, the amount collected towards excess sale area, and to execute supplementary correction deeds within six weeks from the date of the order.

The appellant in the instant case had developed and constructed the apartments in a housing project, namely “Windchants”, situated in Gurgaon, Haryana. The respondents are the allottees or the subsequent purchasers/ buyers of their apartments. The contractual terms inter-se are governed by the “Apartment Buyer Agreement” 5.

Clause 8 of the agreement pertains to the “CHANGES AND VARIATIONS IN THE SALE AREA”. The relevant part of Clause 8.6(ii) and Clause 8.7 read: - 1 2 3 4 5 For short, “the appellant”. For short, “the Act”. For short, “National Commission”. For short, “the respondents”. For short, “the agreement”. EXPERION DEVELOPERS PVT. LTD. v. HIMANSHU DEWAN AND SONALI DEWAN [SANJIV KHANNA, J.] 1123 “8.6 While every attempt shall be made to adhere to the Sale Area, in case any changes result in any revision in the Sale Area, the Company shall advise the Buyer in writing along with the commensurate increase/decrease in Total Sale Consideration based, however, upon the BSP as agreed herein. Subject otherwise to the terms and conditions of this Agreement, a maximum of 10% variation in the Sale Area and the commensurate variation in the Total Sale Consideration is agreed to be acceptable to the Buyer and the Buyer undertakes to be bound by such increase/decrease in the Sale Area and the commensurate increase/decrease in the Total Sale Consideration. For any increase/ decrease in the Sale Area, the payment for the same shall be required to be adjusted at the time of Notice of Possession or immediately in case of any transfer of the apartment before the Notice of Possession or as otherwise advised by the Company.

8.7 If any of the Changes leads to any change in sale area of the apartment in excess of Ten Percent (10%) of the Sale Area mentioned herein at any time prior to the execution of the Conveyance Deed for the Apartment and such variation is unacceptable to Buyer, all attempts shall be made by the Company to off er an alternate apartment of a sale area similar to the Sale Area of the Apartment within a maximum of 10% variation in the Sale area within the Group Housing Colony subject to availability. If such alternate apartment is available, the applicable Total Sale Consideration for such alternate apartment shall be payable/refundable, as the case may be, for the sale area of the alternate apartment at the BSP mentioned herein and there shall be no claim against the Company in respect of the Apartment nor shall otherwise be raised by the Buyer in this regard at any time.”

The expression “Sale Area” as defi ned in Clause 1(xlviii), reads: -

1. (xlviii) - ‘Sale Area’ shall include the covered area, inclusive of areas enclosed by the periphery walls, balconies/ decks, area under the columns and wails, half of the area of walls common with other premises, cupboads, projections/ledges, area utilized for the common services and facilities provided viz. areas in/under staircases, circulation areas, walls atriums, stilts, lift shafts and lobbies, lift machine rooms, service shafts, passages/ corridors, refuge areas, common washrooms/ 1124 SUPREME COURT REPORTS [2023] 12 S.C.R. toilets, mails rooms, all electrical plumbing and fi re shafts, community facilities, common service rooms, security rooms, sewage treatment plants, underground and overhead water storage tanks, DG/panel room, terrace gardens, air handling units, pantries and any other areas which have been paid for or are constructed by the Company for common use, but shall exclude the areas under the following:- a) Sites for retail shops and other commercial areas in the Project. b) Amenities such as schools, medical centre/dispensary, creche, other health centers and the like. c) Dwelling units for the economically weaker sections as prescribed under Applicable Laws. d) Car Parking Spaces

According to the appellant, there was an increase in the sale area, earlier provisionally allotted to the respondents, and therefore vide communication/letter dated 27.04.2017, the respective allottees were informed about the increase and revision in the sale area of their apartments. Accordingly, the diff erential demand letters on account of such increase were issued by the appellant to the allottees of the apartments, including the respondents. The respondents/their respective previous allottees made payments towards the diff erential demand without any demur or protest between the period December 2017 to August 2018, and the appellant executed the conveyance deeds in their favour between the period April 2018 to September 2019.

Subsequently, the respondents on 25.02.2022 fi led a complaint being Consumer Case No. 34/2022 before the National Commission seeking a refund of the amounts paid by them towards the increased sale area alleging, inter alia, that there was neither increase in the carpet area nor in the built- up area, and that the demand towards increase in the sale area made by the appellant was illegal. The respondents relied upon the decision dated 26.08.2020 rendered by the National Commission in the case of Pawan Gupta v. Experion Developers Private Limited.6 6 2020 SCC OnLine NCDRC 788. EXPERION DEVELOPERS PVT. LTD. v. HIMANSHU DEWAN AND SONALI DEWAN [SANJIV KHANNA, J.] 1125

The case was resisted by the appellant by fi ling a reply challenging the very maintainability of the consumer case and contending, inter alia, that no ‘cause of action’ had arisen. According to the appellant, respondent nos. 1, 2 and 5 were the subsequent allottees, who came into picture much after the increase in the sale area and raising of demand therefor. Even the payments for the same were made by their concerned predecessor allottees without any protest. In case of respondent no. 6, the predecessor allottee was already intimated about the increase in the sale area and had not objected to the increase. Respondent no. 6 was, thus, well aware of the increase in the sale area and had made payments towards the same without any protest. Other respondents also had made payments towards the increase in the sale area without any protest. It was further contended that as per Section 69 of the Act, a consumer complaint could be fi led within two years from the date when the ‘cause of action’ arises. In the instant case, the ‘cause of action’ had arisen on 27.04.2017, when the demand for the increased area was raised by the appellant. The complaint was fi led before the National Commission on 25.02.2022, that is, about fi ve years after the ‘cause of action’ had arisen and three years after the lapse of limitation period. Relying upon the certifi cates, reports and affi davits of the architects, it was contended that there was an actual increase in the sale area of the apartments as mentioned therein and therefore, the charges demanded were valid and legal, in terms of Clause 8 of the agreement.

The respondents in the rejoinder had contended that due to the Covid pandemic, the period of limitation was suspended during the period from 15.03.2020 to 28.02.2022 by this Court in terms of the directions issued in Suo Moto Writ Petition (Civil) No. 3 of 2020, and hence, the claim of the respondents was within the period of limitation. In the communication/ letter dated 27.04.2017, intimating the purported increase in the sale area, the appellant had not placed any material or evidence to justify the increase in the area. They allege that the reports and certifi cates of the architects are all post-dated records, which cannot be taken as the basis for justifying the increase in the sale area.

The National Commission, as stated herein above, by the impugned judgment has directed the appellant to refund the amount and execute 1126 SUPREME COURT REPORTS [2023] 12 S.C.R. supplementary/correction deeds. The appellant being aggrieved by the same, has preferred the present appeal.

Heard the learned Senior Advocates Dr. Abhishek Manu Singhvi and Mr. Amit Sibal appearing for the appellant, and the learned Senior Advocate Mr. Bishwajit Bhattacharyya appearing for the respondents.

At the outset, we must record our disagreement with the fi nding recorded by the National Commission as to the ‘continuing cause of action’ till 26.08.2020, which is the date when the question of the excess sale area was decided by the National Commission in CC Nos. 285/2018 and 286/2018 titled Pawan Gupta v. Experion Developers Private Limited. The issue of limitation has to be decided as per the provisions in the enactment, in the instant case Section 697 of the Act, which prescribes a two years limitation to fi le a complaint from the date on which the ‘cause of action’ has arisen. The ‘cause of action’ means every fact, which, if traversed, is necessary to prove in order to support the claimant’s right to judgment, is not dependant on a decision in another case by an allottee raising a similar issue.

As per the respondents, the ‘cause of action’ arose when the payments towards the increase in the sale area were made, and thereupon, the conveyance deeds were executed between April 2018 to September 2019. They also submit, on account of the Covid pandemic, the period from 15.03.2020 to 28.02.2022 has to be excluded in terms of the directions issued by this Court in Suo Moto Writ Petition (Civil) No. 3 of 2020. Since the complaints were made on 25.02.2022, and on exclusion of the period between 15.03.2020 to 28.02.2022, the complaints would be well within the limitation of two years from the date on which the ‘cause of action’ had arisen as prescribed in Section 69 of the Act. 7

Limitation period.—(1) The District Commission, the State Commission or the National Commission shall not admit a complaint unless it is fi led within two years from the date on which the cause of action has arisen. (2) Notwithstanding anything contained in sub-section (1), a complaint may be entertained after the period specifi ed in sub-section (1), if the complainant satisfi es the District Commission, the State Commission or the National Commission, as the case may be, that he had suffi cient cause for not fi ling the complaint within such period: Provided that no such complaint shall be entertained unless the District Commission or the State Commission or the National Commission, as the case may be, records its reasons for condoning such delay. EXPERION DEVELOPERS PVT. LTD. v. HIMANSHU DEWAN AND SONALI DEWAN [SANJIV KHANNA, J.] 1127

The appellant, relying upon Section 98 of the Limitation Act, 1963, which provides that once limitation starts running no subsequent disability or inability to institute a suit or make an application would stop it, have argued that the ‘cause of action’ arose and commenced on 27.04.2017, which is when the appellant had intimated the increase in the sale area and, consequently, the enhancement of price. Accordingly, in terms of Section 69 of the Act, which prescribes the limitation of two years from the date on which the ‘cause of action’ has arisen, the limitation had come to an end on 26.04.2019. Therefore, the respondents would not be entitled to the benefi t of exclusion of the period from 15.03.2020 to 28.02.2022.

Having gone through the wording of the communication/letter dated 27.04.2017, we do not fi nd any merit in the submission of the appellant. The communication/letter dated 27.04.2017 by the appellant states that the construction work was in progress and that the appellant would soon be starting the occupation certifi cate process. Further, with the project reaching the handover stage, the appellant had got clarity on the overall areas and subsequent impact on the respective units. As per the calculation, the sale area of the apartment had increased by the square feet as indicated in the communication dated 27.04.2017. We do not read the communication/letter as the starting point of the ‘cause of action’. ‘Cause of action’ being the foundation of the claim refers to the entire set or bundle of facts necessary and material to prove in order to get a judgment. It refers to a defi nite point of time when the requisite ingredients constituting that ‘cause of action’ are complete. The ‘cause of action’ is complete when they provide the aggrieved party with the right to invoke jurisdiction of the court/forum. The test is to determine when the aggrieved person could have fi rst maintained action for a successful result. In our opinion, the communication/letter dated 27.04.2017 was an assertion, albeit without any specifi c details or particulars. The appellant, as per the contractual terms, is well within their right to ask for enhanced 8

9. Continuous running of time.—Where once time has begun to run, no subsequent disability or inability to institute a suit or make an application stop it: Provided that, where letters of administration to the estate of a creditor have been granted to his debtor, the running of the period of limitation for a suit to recover the debt shall be suspended while the administration continues. 1128 SUPREME COURT REPORTS [2023] 12 S.C.R. sale consideration on increase in the sale area as defi ned. The respondents have not questioned and challenged this right of the appellant. They have challenged the computation and calculations. The respondents have the right to ask for calculations and details, when the appellant had stated that the sale area had increased. On being satisfi ed with the calculation, the respondents could have accepted the increase in the sale area, if the same was in accordance with the agreement. The ‘cause of action’ arose when the appellant insisted and compelled the respondents/allottees to make payment, but did not furnish the details and particulars to enable the respondents/allottees to ascertain the actual allocated sale area. One would not expect the allottee or the consumer to challenge the demand, which is in terms of the contract between the parties, and is therefore not questionable. In such cases, no ‘cause of action’ arises. Further, the onus to justify and substantiate the claim and calculations of increased sale area was, and is on the appellant. In the context of the present case, it is an accepted position that the sale deeds were executed with the respondents between the period from 13.04.2018 to as late as 09.01.2020. In view of the aforesaid, the complaints fi led by the respondents cannot be dismissed on the ground of being barred by limitation under Section 69 of the Act. We also observe that the consumer forums have the power to condone the delay when suffi cient cause is shown, even after two years of the ‘cause of action’ having arisen. While no application for condonation of delay was fi led, the National Commission could have always granted an opportunity to the respondents.

At the same time, we should notice the argument raised by the appellant on acquiescence and estoppel, as the respondents are seeking a refund of the amount paid without any demur or protest about four years after the payments were made. Therefore, it is submitted that the plea of defi ciency of service is hit by the legal bar of acceptance and ones’ previous action and conduct. It is highlighted that the conveyance deeds were executed by the appellant on the respondents/allottees upon making full payment, including the payments with regard to the increased area, and such payment, it is submitted, was voluntary and without reservation. It is also argued by the appellant that it is not even the case of the respondents that they/original allottees had made payments under some threat, coercion or duress. Therefore, it does not lie in the mouth of the respondents to say, EXPERION DEVELOPERS PVT. LTD. v. HIMANSHU DEWAN AND SONALI DEWAN [SANJIV KHANNA, J.] 1129 rather, they were estopped from saying four years after the execution of the conveyance deeds in their favour that there was no actual increase in the sale area and the demand raised by the appellant in that regard was not justifi ed or was illegal.

Similar issues had arisen before this Court in Wing Commander Arifur Rahman Khan and Aleya Sultana and Others v. DLF Southern Homes Private Limited and Others9. This Court accepted the argument by the consumers that execution of a deed of conveyance by a fl at buyer would not preclude a consumer claim for compensation for delayed possession in a case where the allottees were not given an option, but were rather told that the possession would not be given and the conveyance deed would not be executed without the acceptance of the off er of possession terms. In the said case, the builder/developer had stated that it would not handover the possession and execute the conveyance deed without acceptance of the off er of possession terms. Any request to take over possession and execute the documents under protest was untenable. The consumers were, in fact, asked to fi le an unconditional affi davit/undertaking to that eff ect, as execution of documents under protest or claim of coercion was not to be entertained.

As these aspects and questions are essentially factual, albeit have not been ascertained and addressed in the present case, we would pass an order of remand to the National Commission to examine the issue in light of the dictum laid down by this Court. Upon the facts being fi rst ascertained, the legal principles have to be applied.

There is yet another and a stronger reason why we are inclined to pass an order of remand. For this purpose and for the sake of convenience, we would reproduce the observations by the National Commission in Pawan Gupta (supra) on the merits for rejecting the claim made by the builder/developer (the appellant) for the increase of the sale area. These are as under: “The complaints have been fi led mainly for two reasons. The fi rst is that the opposite party has demanded extra money for excess area and second is the delay in handing over the possession. In respect of excess area, the complainant has made a point that without any basis the opposite party sent the demand for excess area and the certifi cate of the architect was sent to the complainant, which is of a later date. The justifi cation given by the opposite party that on the basis of the internal report of the architect the demand was made for excess area is not acceptable because no such report or any other document has been fi led by the opposite party to prove the excess area.

The appellant had challenged the said decision of the National Commission by fi ling the appeals being Civil Appeal Nos. 3703-3704 of 2020 before this Court. However, they were dismissed vide the order dated 12.01.2021. The order reads as under: “1. We are not inclined to interfere with the order of the National Consumer Disputes Redressal Commission dated 26 August 2020 in Consumer Complaint Nos. 285 and 286 of 2018.

2. The appeals are accordingly dismissed.

3. Pending application, if any, stands disposed of.”

The review petitions, being R.P. (C) Nos. 1357-1358 of 2021, in the said civil appeals fi led by the appellant, were also dismissed by this Court on 11.01.2022 by passing the following order: “1. Application for oral hearing is dismissed.

2. We have carefully gone through the review petitions and the connected papers. We fi nd no merit in the review petitions and the same are accordingly dismissed.

3. Pending applications, if any, stand disposed of.” EXPERION DEVELOPERS PVT. LTD. v. HIMANSHU DEWAN AND SONALI DEWAN [SANJIV KHANNA, J.] 1133

The order dated 12.01.2021 of this Court dismissing the civil appeals and the order dated 11.01.2022 dismissing the subsequent review petitions fi led in the case of Pawan Gupta (supra) are non-reasoned orders that do not state what has weighed with the court while dismissing the appeals and the review petitions. However, the result is that the order passed by the National Commission in the case of Pawan Gupta (supra) has attained fi nality and binds the parties to the decision.

Learned counsel for the parties have made elaborate submissions on the issue of whether the orders passed by this Court in the case of Pawan Gupta (supra) by applying the doctrine of merger, principle of res judicata and in view of the rule of precedential value, would foreclose the submissions raised by the appellant in the present case. Learned Senior Advocate, Mr. Bhattacharyya, appearing on behalf of the respondents, has submitted that the fi ndings recorded in the judgment by the National Commission in Pawan Gupta’s (supra), which is a case related to the same housing project, has merged with the order passed by this Court in the appeals preferred by the appellant and it will be binding on the appellant on subsequent cases, including the cases fi led by the respondents.

On the other hand, it is submitted by learned Senior Advocates, Dr. Abhishek Manu Singhvi and Mr. Amit Sibal, that the complaint preferred by Pawan Gupta was in his individual capacity and not in a representative capacity. Pawan Gupta had made specifi c prayer for handing over possession of his unit, for awarding interest on the amount paid by him for the delay that occurred in handing over possession and also for a refund of the amount charged by the appellant towards service tax, car parking and increase in the common area. Hence, upon the dismissal of the statutory appeals fi led by the appellant in case of Pawan Gupta (supra), the judgment of the National Commission would merge into the order of this Court through a non-speaking order. The result would be that the litigation inter se the parties in case of Pawan Gupta (supra) had attained fi nality in the said case. Nonetheless, it could not be construed by any stretch of imagination that the National Commission was barred from examining or deciding the issues involved in the instant case as the appellant had placed on record details and evidence in the form of the architect’s certifi cate dated 23.09.2020 and a report of 1134 SUPREME COURT REPORTS [2023] 12 S.C.R. the same date with calculations to show and justify the increase in the sale area. The architect’s certifi cate and the report dated 23.09.2020 were not placed before the National Commission in the case of Pawan Gupta (supra). No doubt, the same were fi led before this Court as additional documents, but the appeal itself was dismissed in limine without taking the additional documents on record, and that too by a non-reasoned order. In the present case, the architect’s certifi cate and the report dated 23.09.2020 were placed before the National Commission, but they were not examined and considered in the reasons set out by the National Commission. Decision in Pawan Gupta (supra) was simply applied.

Specifi cally on the question of additional documents, it is submitted by Learned Senior Advocate, Mr. Bhattacharyya, appearing on behalf of the respondents, that once an application for additional documents was fi led in this Court, the doctrine of merger would apply and, therefore, the present appeal merits dismissal on this short ground.

This Court has examined doctrine of merger in several decisions, but we would, for the purpose of this case, refer to only two decisions in Kunhayammed and Others v. State of Kerala and Another11 and Khoday Distilleries Limited and Others v. Sri Mahadeshwara Sahakara Sakkare Karkhane Limited.12, which approves of the ratio in Kunhayammed (supra).

Kunhayammed (supra) refers to several other decisions of this Court and has crystallised the legal position as under: “44. To sum up, our conclusions are: (i) Where an appeal or revision is provided against an order passed by a court, tribunal or any other authority before superior forum and such superior forum modifi es, reverses or affi rms the decision put in issue before it, the decision by the subordinate forum merges in the decision by the superior forum and it is the latter which subsists, remains operative and is capable of enforcement in the eye of law.