PIONEER URBAN LAND & INFRASTRUCTURE LTD.versusGOVINDAN RAGHAVAN

                       [2019] 5 S.C.R. 1169                             1169


    PIONEER URBAN LAND & INFRASTRUCTURE LTD.                            A
                                 v.
                     GOVINDAN RAGHAVAN
                 (Civil Appeal No. 12238 of 2018)
                          APRIL 02, 2019                                B

      [UDAY UMESH LALIT AND INDU MALHOTRA, JJ.]
       Consumer Protection Act, 1986 – s.23 – Deficiency of service
– Appellant-Builder launched a residential project and respondent-
flat purchaser entered into an Apartment Buyer’s agreement to           C
purchase an apartment in the said project for a total sale
consideration of Rs.4,83,25,280/- – As per agreement, the appellant
was to apply for the occupancy certificate within 39 months from
the date of excavation with grace period of 180 days – However,
Appellant-builder failed to apply for occupancy certificate as per
agreement – Consumer complaint filed before the National                D
Commission – During the pendency of the proceedings, the appellant
obtained the occupancy certificate and pleaded National
Commission to direct the respondent to take possession of the flat –
However, the respondent refused to take possession as there was
an inordinate delay of almost 3 years – National Commission allowed     E
the consumer complaint and held that respondent could not be
compelled to take possession at such belated stage – Further,
appellant was directed to refund Rs.4,48,43,026 i.e. the amount
deposited by the respondent along with interest @ 10.7% S.I. p.a.
towards compensation – On appeal, held: The respondent-flat
purchaser made out a clear case of deficiency of service on the         F
part of the appellant-builder – Appellant failed to fulfill his
contractual obligation of obtaining the occupancy certificate and
offering possession of the flat to the respondent within the time
stipulated in the agreement, or within a reasonable time thereafter
– Respondent was justified in terminating the Apartment Buyer’s         G
Agreement by filing the Consumer Complaint, and cannot be
compelled to accept the possession whenever it is offered by the
Builder – Respondent was legally entitled to seek refund of the money
deposited by him along with appropriate compensation –
Respondent had to also service a loan that he had obtained for
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                                1169
1170            SUPREME COURT REPORTS                       [2019] 5 S.C.R.


 A     purchasing the flat by paying interest @10% to the Bank – In the
       circumstances, no illegality in the impugned order passed by the
       National Commission – Haryana Real Estate (Regulation And
       Development) Rules, 2017 – r.15.
             Consumer Protection Act, 1986 – s.2(r) – Unfair and
 B     unreasonable apartment buyer’s agreement – Held: A term of a
       contract will not be final and binding if it is shown that the flat
       purchasers had no option but to sign on the dotted line, on a contract
       framed by the builder – The contractual terms of the Buyer’s
       Agreement in the instant case was ex-facie one-sided, unfair and
       unreasonable – The incorporation of such one-sided clauses in an
 C     agreement constitutes an unfair trade practice as per s.2(r) of the
       Consumer Protection Act since it adopts unfair methods or practices
       for the purpose of selling the flats by the Builder.
             Dismissing the appeals, the Court
 D             HELD: 1. A term of a contract will not be final and binding
       if it is shown that the flat purchasers had no option but to sign on
       the dotted line, on a contract framed by the builder. The
       contractual terms of the Agreement dated 08.05.2012 are ex-
       facie one-sided, unfair, and unreasonable. The incorporation of
       such one-sided clauses in an agreement constitutes an unfair trade
 E     practice as per Section 2 (r) of the Consumer Protection Act,
       1986 since it adopts unfair methods or practices for the purpose
       of selling the flats by the Builder. This Court has no hesitation in
       holding that the terms of the Apartment Buyer’s Agreement
       dated 08.05.2012 were wholly one-sided and unfair to the
 F     Respondent-Flat Purchaser. The Appellant-Builder could not seek
       to bind the Respondent with such one-sided contractual terms.
       [Paras 6.7 and 7][1183-B-D]
             2. In the present case, the National Commission has passed
       an equitable Order. The Commission has not awarded any Interest
 G     for the period during which the Order of stay of cancellation of
       the allotment was in operation on the request of the Respondent-
       Flat Purchaser. The National Commission has rightly awarded
       Interest @10.7% S.I. p.a. by applying Rule 15 of the Haryana
       Real Estate (Regulation And Development) Rules, 2017 from

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   PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                          1171
              GOVINDAN RAGHAVAN

the date of each installment till 05.02.2017 i.e. till the date after   A
which the Order of stay of cancellation of the allotment was passed;
and thereafter, from the date of the Commission’s final Order till
the date on which the amount is refunded with Interest.
[Para 8.1][1183-G-H; 1184-A-B]
      3. There is no illegality in the Impugned Order dated             B
23.10.2018 passed by the National Commission. The Appellant-
Builder failed to fulfill his contractual obligation of obtaining the
Occupancy Certificate and offering possession of the flat to the
Respondent-Purchaser within the time stipulated in the
Agreement, or within a reasonable time thereafter. The
Respondent-Flat Purchaser could not be compelled to take                C
possession of the flat, even though it was offered almost 2 years
after the grace period under the Agreement expired. During this
period, the Respondent-Flat Purchaser had to service a loan that
he had obtained for purchasing the flat, by paying Interest @10%
to the Bank. In the meanwhile, the Respondent-Flat Purchaser            D
also located an alternate property in Gurugram. In these
circumstances, the Respondent-Flat Purchaser was entitled to
be granted the relief prayed for i.e. refund of the entire amount
deposited by him with Interest. [Para 9][1184-B-E]
      Lucknow Development Authority v. M.K. Gupta (1994)                E
      1 SCC 243 : [1993] 3 Suppl. SCR 615; Fortune
      Infrastructure & Anr. v. Trevor D’Lima & Ors. (2018) 5
      SCC 442: [2018] 3 SCR 273 ; Central Inland Water
      Transport Corporation Limited and Ors. v. Brojo Nath
      Ganguly and Ors. (1986) 3 SCC 156 : [1986] 2 SCR
      278 – relied on.                                                  F

      Bharathi Knitting Company v. DHL Worldwide Express
      Courier Division of Airfreight Ltd. (1996) 4 SCC 704 :
      [1996] 2 Suppl. SCR 653 ; Bangalore Development
      Authority v. Syndicate Bank (2007) 6 SCC 711 :
      [2007] 7 SCR 47 – referred to.                                    G
                       Case Law Reference
[1996] 2 Suppl. SCR 653          referred to          Para 8
[1993] 3 Suppl. SCR 615          relied on            Para 6.6
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1172            SUPREME COURT REPORTS                         [2019] 5 S.C.R.


 A     [2018] 3 SCR 273                   relied on               Para 6.1
       [1986] 2 SCR 278                   relied on              Para 6.1
       [2007] 7 SCR 47                     referred to           Para 4.3


 B           CIVIL APPELLATE JURISDICTION: Civil Appeal No.12238
       of 2018.
             From the Judgement and Order dated 23.10.2018 of the National
       Disputes Redressal Commission in Consumer Complaint No.239 of 2017.
             C.A. Sundram, Sr. Adv., Nikhil Nayyar, T.V. S. Raghavendra
 C
       Sreyas, Advs. For the Appellant.
            Sushil Kasushik, Manoj Yadav, Himanshu Shekhar, Advs. For the
       Respondents.
             The Judgment of the Court was delivered by
 D            INDU MALHOTRA, J. 1. The present statutory Appeals have
       been filed under Section 23 of the Consumer Protection Act, 1986 to
       challenge the Final Judgment and Order dated 23.10.2018 passed in
       Consumer Case No. 238 of 2017 and Consumer Case No. 239 of 2017
       by the National Consumer Disputes Redressal Commission (hereinafter
 E     referred to as “the National Commission”).
             2. Since a common issue arises in both the Civil Appeals, they are
       being disposed of by the present common Judgment and Order.
             3. For the sake of brevity, the facts in C.A. No. 12238 of 2018
       are being referred to, being the lead matter.
 F
             The factual matrix of the said Civil Appeal is as under :
          3.1. The Appellant – Builder launched a residential project by the
               name “Araya Complex” in Sector 62, Golf Course Extension
               Road, Gurugram.
 G              The Respondent – Flat Purchaser entered into an Apartment
                Buyer’s Agreement dated 08.05.2012 with the Appellant –
                Builder to purchase an apartment in the said project for a total
                sale consideration of Rs. 4,83,25,280/-.


 H
PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                              1173
  GOVINDAN RAGHAVAN [UDAY UMESH LALIT, J.]

     As per Clause 11.2 of the Agreement, the Appellant – Builder        A
     was to make all efforts to apply for the Occupancy Certificate
     within 39 months from the date of excavation, with a grace
     period of 180 days.
3.2. The excavation of the project commenced on 04.06.2012. As
     per Clause 11.2 of the Agreement, the Builder was required to       B
     apply for the Occupancy Certificate by 04.09.2015, or within a
     further grace period of 6 months i.e. by 04.03.2016, and offer
     possession of the flat to the Respondent – Flat Purchaser.
     The Appellant – Builder however failed to apply for the
     Occupancy Certificate as per the stipulations in the Agreement.     C
3.3. The Respondent – Flat Purchaser filed a Consumer Complaint
     before the National Commission on 27.01.2017 alleging
     deficiency of service on the part of the Appellant – Builder for
     failure to obtain the Occupancy Certificate, and hand over
     possession of the flat.                                             D
     The Respondent prayed inter-alia for :-
      Refund of the entire amount deposited being
      Rs. 4,48,43,026/-, along with Interest @18% p.a.; and
      Compensation of Rs. 10,00,000/- for mental agony, harassment,
                                                                         E
      discomfort and undue hardship; and
      Refund of the wrongfully charged taxes including Service
      Tax, and other charges along with Interest @18% p.a.; and
      Litigation Costs of Rs. 1,00,000/-.
3.4. On 06.02.2017, the National Commission passed an ex-parte           F
     Interim Order restraining the Appellant – Builder from cancelling
     the allotment made in favour of the Respondent – Flat Purchaser
     during the pendency of the Consumer Case.
3.5. During the pendency of the proceedings before the National
     Commission, the Appellant – Builder obtained the Occupancy          G
     Certificate on 23.07.2018, and issued a Possession Letter to
     the Respondent – Flat Purchaser on 28.08.2018.


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1174         SUPREME COURT REPORTS                         [2019] 5 S.C.R.


 A     3.6. The Appellant – Builder submitted before the National
            Commission that since the construction of the apartment was
            complete, and the Occupancy Certificate had since been
            obtained, the Respondent – Flat Purchaser must be directed to
            take possession of the apartment, instead of directing refund of
            the amount deposited.
 B
       3.7. The Respondent – Flat Purchaser however submitted that he
            was not interested in taking possession of the apartment on
            account of the inordinate delay of almost 3 years. The
            Respondent – Flat Purchaser stated that he had, in the
            meanwhile, taken an alternate property in Gurugram, and sought
 C          refund of the entire amount of Rs. 4,48,43,026/- deposited by
            him along with Interest @18% p.a.
       3.8 The National Commission vide Final Judgment and Order dated
            23.10.2018 allowed the Consumer Complaint filed by the
            Respondent – Flat Purchaser, and held that since the last date
 D          stipulated for construction had expired about 3 years before
            the Occupancy Certificate was obtained, the Respondent – Flat
            Purchaser could not be compelled to take possession at such a
            belated stage.
             The grounds urged by the Appellant – Builder for delay in
 E          handing over possession were not justified, so as to deny
            awarding compensation to the Respondent – Flat Purchaser.
            The clauses in the Agreement were held to be wholly one –
            sided, unfair, and not binding on the Respondent – Flat Purchaser.
           The Appellant – Builder was directed to refund Rs. 4,48,43,026/
 F          - i.e. the amount deposited by the Respondent – Flat Purchaser,
            along with Interest @10.7% S.I. p.a. towards compensation.
            The rate of Interest @10.7% S.I. p.a. was fixed in accordance
            with Rule 15 of the Haryana Real Estate (Regulation and
            Development) Rules, 2017 which reads as follows :
 G        “15. An allottee shall be compensated by the promoter for
          loss or damage sustained due to incorrect or false statement
          in the notice, advertisement, prospectus or brochure in the
          terms of Section 12. In case, allottee wishes to withdraw from
          the project due to discontinuance of promoter’s business as
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    PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                               1175
      GOVINDAN RAGHAVAN [UDAY UMESH LALIT, J.]

      developers on account of suspension or revocation of the                A
      registration or any other reason(s) in terms of clause (b) sub-
      section (I) of Section 18 or the promoter fails to give
      possession of the apartment/ plot in accordance with terms
      and conditions of agreement for sale in terms of sub-section
      (4) of section 19. The promoter shall return the entire amount
                                                                              B
      with interest as well as the compensation payable. The rate of
      interest payable by the promoter to the allottee or by the allottee
      to the promoter, as the case may be, shall be the State Bank of
      India highest marginal cost of lending rate plus two percent.
      …”
                                                     (emphasis supplied)      C

      However, for the period when the Interim Order dated 06.02.2017
      was in operation, which restrained the Appellant – Builder from
      cancelling the Respondent’s allotment, no Interest was awarded.
      The National Commission ordered payment of Interest from the
      date of each installment till 05.02.2017; and from the date of the      D
      Order passed by the Commission till the date on which the amount
      would be refunded.
     3.9. Aggrieved by the Order dated 23.10.2018 passed by the
         National Commission, the Appellant – Builder preferred the
         present statutory Appeal under Section 23 of the Consumer            E
         Protection Act, 1986.
       4. Mr. C.A. Sundaram, Senior Counsel appeared for the Appellant
– Builder, and drew our attention to the following Clauses in the Apartment
Buyer’s Agreement dated 08.05.2012 viz. Clause 11.5 (ii), (iv) and (v)
along with Clause 20 which read as under :                                    F
      “11.5. (ii) In the event of further delay by the Developer in
      handing over of the possession of the Unit even after 12
      months from the end of grace period, then in such case, the
      intending Allottee shall have an additional option to terminate
      this Agreement by giving termination notice of 90 days to the           G
      Developer and refund of the actual installment paid by him
      against the Unit after adjusting the taxes paid / interest /
      penalty on delayed payments.
      …
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1176       SUPREME COURT REPORTS                        [2019] 5 S.C.R.


 A     (iv) Developer shall, within ninety (90) days from the date
       of receipt of termination notice of said Unit, refund to the
       intending Allottee, all the monies received excluding the service
       tax collected on various remittances, till the date of the refund,
       from the Intending Allottee under this Agreement. In case the
       Developer fails to refund the Sale Price, the Developer shall
 B
       pay interest to the Intending Allottee @ 9% per annum for
       any period beyond the said period of ninety (90) days. The
       Intending Allottee shall have no other claim against the
       Developer in respect of the said Unit along with the parking
       space. The Intending Allottee in this event shall have no right
 C     to seek any compensation apart from the interest as stipulated
       herein.
       …
       (v) If the Intending Allottee fails to exercise his right of
       termination within the time limit as aforesaid, by delivery to
 D     the Developer of a written notice acknowledged by the
       Developer in this regard, then he shall not be entitled to
       terminate this Agreement thereafter and he shall continue to
       be bound by the provisions of this Agreement, provided that
       in such case, the Developer shall continue to pay the
 E     compensation provided herein.
       20. RIGHT OF CANCELLATION BY THE ALLOTTEE
       Except to the extent specifically and expressly stated elsewhere
       in this Agreement, the Intending Allottee shall have the right
       to cancel this Agreement solely in the event of the clear and
 F     unambiguous failure of the warranties of the Developer that
       leads to frustration of the contract on that account. In such
       case, the Allottee shall be entitled to a refund of the installments
       actually paid by it along with interest thereon @ 6% per
       annum, within a period of 90 days from the date of
 G     communication to the Developer in this regard less any
       payments made towards taxes paid by the Developer or interest
       paid due or payable, any other amount of a non-refundable
       nature. No other claim, whatsoever, monetary or otherwise
       shall lie against the Developer nor shall be raised otherwise

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PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                                  1177
  GOVINDAN RAGHAVAN [UDAY UMESH LALIT, J.]

   or in any manner whatsoever by the Allottee. Save and except              A
   to this limited extent, the Allottee shall not have any right to
   cancel this Agreement on any ground whatsoever.”
                                                   (emphasis supplied)
4.1. It was submitted that the Respondent – Flat Purchaser was not
     entitled to refund of the amount deposited, since the Apartment         B
     Buyer’s Agreement was not terminated by the Respondent –
     Flat Purchaser in accordance with Clause 11.5 (ii) of the
     Agreement, which stipulates that the allottee has to terminate
     the Agreement by giving a Termination Notice of 90 days to
     the Developer.                                                          C
     Since the Respondent – Flat Purchaser had not terminated the
     Agreement by a written notice as per Clause 11.5, the Builder
     could not sell the apartment, and refund the money to the
     Respondent – Flat Purchaser. On the contrary, the Respondent
     filed a Consumer Complaint and obtained an ex-parte Interim             D
     Order dated 06.02.2017 restraining the Builder from cancelling
     the allotment made in favour of the Respondent.
4.2. It was further submitted that if the filing of the Consumer
      Complaint is considered as an act of termination of the
      Agreement, then the same was pre-mature. As per Clause 11.5            E
      (ii), the Respondent – Flat Purchaser could have claimed refund
      only after the expiry of 12 months after the grace period came
      to an end i.e. after 04.03.2017. However, the Consumer
      Complaint was filed on 27.01.2017. In these circumstances,
      even if it is found that the Appellant – Builder is liable to refund
      the amount deposited with Interest, then the date of the               F
      Impugned Order i.e. 23.10.2018, must be treated as the date of
      serving the Termination Notice as per Clause 11.5 (ii) of the
      Agreement, and the Appellant – Builder should be held liable to
      pay Interest only after 90 days from the date of termination i.e.
      from 23.01.2019.                                                       G
4.3. With respect to rate of Interest awarded by the National
     Commission, it was submitted that the Commission erred in
     granting Interest @10.7% S.I. p.a. even though Clause 20 of

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1178                SUPREME COURT REPORTS                            [2019] 5 S.C.R.


 A                  the Agreement provided Interest @6% p.a. in case of delay in
                    handing over possession. Even under Clause 11.5 of the
                    Agreement, the Builder was liable to pay Interest @9% p.a.,
                    but not @10.7% S.I. p.a. The learned Senior Counsel relied
                    upon this Court’s Judgment in Bharathi Knitting Company v.
                    DHL Worldwide Express Courier Division of Airfreight Ltd.,1
 B
                    and submitted that the National Commission could not have
                    granted compensation in excess of the rate prescribed by the
                    Agreement.
             5. Mr. Sushil Kaushik, learned Counsel represented the Respondent
       – Flat Purchaser.
 C
             5.1. It was submitted that the filing of the Consumer Complaint may
                    be treated as his Termination Notice under Clause 11.5 (ii) of
                    the Agreement. Under the Agreement, the Builder was obligated
                    to apply for the Occupancy Certificate within 39 months from
                    the date of excavation, with a grace period of further 6 months.
 D                  The period got over by 04.03.3016 after taking into account the
                    grace period.
                   Admittedly, the Appellant – Builder offered possession after an
                   inordinate delay of almost 3 years on 28.08.2018. On account
                   of the inordinate delay, the Respondent – Flat Purchaser had
 E                 no option but to arrange for alternate accommodation in
                   Gurugram. Hence, he could not be compelled to take possession
                   of the apartment after such a long delay.
                   It was in these circumstances that the Respondent – Flat
                    Purchaser sought stay of the cancellation of the allotment as a
 F                  collateral, till his claim for refund was adjudicated by the National
                    Commission.
             5.2. It was further submitted that the Clauses of the Agreement were
                   one-sided. As per Clause 6.4 (ii) of the Apartment Buyer’s
                   Agreement, the Appellant Builder could charge Interest @18%
 G                 p.a. for delayed payments.
                   However, the Appellant – Builder was not required to pay
                   equivalent Interest to the Respondent – Flat Purchaser for delay
                   in handing over possession of the flat.
       1
 H         (1996) 4 SCC 704.
   PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                             1179
     GOVINDAN RAGHAVAN [UDAY UMESH LALIT, J.]

        On the contrary, as per Clause 11.5 (iv) of the Agreement, in      A
        case of delay on the part of the Appellant – Builder in handing
        over possession of the flat, the Respondent – Flat Purchaser
        was entitled to Interest @9% p.a. only.
   5.3. The Respondent further submitted that the National Commission
         had ordered payment of Interest as per the statutory Rules i.e.   B
         Rule 15 of the Haryana Real Estate (Regulation and
         Development) Rules, 2017 @10.7% S.I. p.a.
       The Respondent – Flat Purchaser submitted that he had obtained
        a loan for Rs. 3,30,00,000/- from Standard Chartered Bank to
        purchase the flat in question, and had entered into a Tripartite   C
        Loan Agreement with the Bank and the Builder. The Respondent
        – Flat Purchaser had to pay Interest @10% p.a. for servicing
        the loan for the entire period. Hence, Interest @10.7% S.I.
        p.a. awarded by the National Commission was just and fair.
       It was pointed out that even though the National Commission         D
        had not granted Interest for the period during which the Order
        of stay of cancellation of the allotment was in operation, the
        Respondent – Flat Purchaser had to pay Interest to the Bank
        even for this period.
   5.4. The Respondent – Flat Purchaser submitted that the present         E
        Appeal be dismissed, and the Builder be directed to pay the
        amount awarded by the National Commission with Interest,
        within 1 week, so that the Respondent can discharge his loan
        liability.
      6. We have heard the learned Counsel for both the parties, and       F
perused the pleadings, and written submissions filed.
   6.1. In the present case, admittedly the Appellant – Builder obtained
         the Occupancy Certificate almost 2 years after the date
         stipulated in the Apartment Buyer ’s Agreement. As a
         consequence, there was a failure to hand over possession of
                                                                           G
         the flat to the Respondent – Flat Purchaser within a reasonable
         period. The Occupancy Certificate was obtained after a delay
         of more than 2 years on 28.08.2018 during the pendency of the
         proceedings before the National Commission.

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1180             SUPREME COURT REPORTS                            [2019] 5 S.C.R.


 A              In Lucknow Development Authority v. M.K. Gupta,2this Court
                 held that when a person hires the services of a builder, or a
                 contractor, for the construction of a house or a flat, and the
                 same is for a consideration, it is a “service” as defined by Section
                 2 (o) of the Consumer Protection Act, 1986. The inordinate
                 delay in handing over possession of the flat clearly amounts to
 B
                 deficiency of service.
                 In Fortune Infrastructure & Anr. v. Trevor D’Lima & Ors.,3
                this Court held that a person cannot be made to wait indefinitely
                for possession of the flat allotted to him, and is entitled to seek
                refund of the amount paid by him, along with compensation.
 C
           6.2. The Respondent – Flat Purchaser has made out a clear case of
                deficiency of service on the part of the Appellant – Builder.
                The Respondent – Flat Purchaser was justified in terminating
                the Apartment Buyer’s Agreement by filing the Consumer
                Complaint, and cannot be compelled to accept the possession
 D              whenever it is offered by the Builder. The Respondent –
                Purchaser was legally entitled to seek refund of the money
                deposited by him along with appropriate compensation.
           6.3. The National Commission in the Impugned Order dated
                23.10.2018 held that the Clauses relied upon by the Builder
 E              were wholly one-sided, unfair and unreasonable, and could not
                be relied upon.
                The Law Commission of India in its 199th Report, addressed
                the issue of ‘Unfair (Procedural & Substantive) Terms in
                Contract’. The Law Commission inter-alia recommended that
 F              a legislation be enacted to counter such unfair terms in contracts.
                In the draft legislation provided in the Report, it was stated
                that :
                 “A contract or a term thereof is substantively unfair if such
                 contract or the term thereof is in itself harsh, oppressive
 G               or unconscionable to one of the parties.”
           6.4. A perusal of the Apartment Buyer’s Agreement dated 08.05.2012
                reveals stark incongruities between the remedies available to
                both the parties.
       2
        (1994) 1 SCC 243.
 H     3
       (2018) 5 SCC 442.
PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                              1181
  GOVINDAN RAGHAVAN [UDAY UMESH LALIT, J.]

      For instance, Clause 6.4 (ii) of the Agreement entitles the        A
     Appellant – Builder to charge Interest @18% p.a. on account
     of any delay in payment of installments from the Respondent –
     Flat Purchaser.
    Clause 6.4 (iii) of the Agreement entitles the Appellant – Builder
     to cancel the allotment and terminate the Agreement, if any         B
     installment remains in arrears for more than 30 days.
     On the other hand, as per Clause 11.5 of the Agreement, if the
     Appellant – Builder fails to deliver possession of the apartment
     within the stipulated period, the Respondent – Flat Purchaser
     has to wait for a period of 12 months after the end of the grace    C
     period, before serving a Termination Notice of 90 days on the
     Appellant – Builder, and even thereafter, the Appellant – Builder
     gets 90 days to refund only the actual installment paid by the
     Respondent – Flat Purchaser, after adjusting the taxes paid,
     interest and penalty on delayed payments. In case of any delay
     thereafter, the Appellant – Builder is liable to pay Interest @9%   D
     p.a. only.
6.5. Another instance is Clause 23.4 of the Agreement which entitles
     the Appellant – Builder to serve a Termination Notice upon the
     Respondent – Flat Purchaser for breach of any contractual
     obligation. If the Respondent – Flat Purchaser fails to rectify     E
     the default within 30 days of the Termination Notice, then the
     Agreement automatically stands cancelled, and the Appellant
     – Builder has the right to forfeit the entire amount of Earnest
     Money towards liquidated damages.
     On the other hand, as Clause 11.5 (v) of the Agreement, if the      F
     Respondent – Flat Purchaser fails to exercise his right of
     termination within the time limit provided in Clause 11.5, then
     he shall not be entitled to terminate the Agreement thereafter,
     and shall be bound by the provisions of the Agreement.
6.6. Section 2 (r) of the Consumer Protection Act, 1986 defines          G
     ‘unfair trade practices’ in the following words :
   “‘unfair trade practice’ means a trade practice which, for the
   purpose of promoting the sale, use or supply of any goods or

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1182                 SUPREME COURT REPORTS                        [2019] 5 S.C.R.


 A               for the provision of any service, adopts any unfair method or
                 unfair or deceptive practice …”,and includes any of the
                 practicesenumerated therein. The provision is illustrative, and not
                 exhaustive.
             In Central Inland Water Transport Corporation Limited and
 B     Ors. v. Brojo Nath Ganguly and Ors.,4this Court held that :
                  “89. … Our judges are bound by their oath to ‘uphold the
                 Constitution and the laws’. The Constitution was enacted to
                 secure to all the citizens of this country social and economic
                 justice. Article 14 of the Constitution guarantees to all persons
 C               equality before the law and equal protection of the laws. This
                 principle is that the courts will not enforce and will, when
                 called upon to do so, strike down an unfair and unreasonable
                 contract, or an unfair and unreasonable clause in a contract,
                 entered into between parties who are not equal in bargaining
                 power. It is difficult to give an exhaustive list of all bargains
 D               of this type. No court can visualize the different situations
                 which can arise in the affairs of men. One can only attempt
                 to give some illustrations. For instance, the above principle
                 will apply where the inequality of bargaining power is the
                 result of the great disparity in the economic strength of the
 E               contracting parties. It will apply where the inequality is the
                 result of circumstances, whether of the creation of the parties
                 or not. It will apply to situations in which the weaker party is
                 in a position in which he can obtain goods or services or
                 means of livelihood only upon the terms imposed by the
                 stronger party or go without them. It will also apply where a
 F               man has no choice, or rather no meaningful choice, but to
                 give his assent to a contract or to sign on the dotted line in a
                 prescribed or standard form or to accept a set of rules as
                 part       of the contract, however unfair, unreasonable and
                 unconscionable a clause in that contract or form or rules
 G               may be. This principle, however, will not apply where the
                 bargaining power of the contracting parties is equal or almost
                 equal. This principle may not apply where both parties are
                 businessmen and the contract is a commercial transaction. …
                 …
       4
 H         (1986) 3 SCC 156
       PIONEER URBAN LAND & INFRASTRUCTURE LTD. v.                             1183
         GOVINDAN RAGHAVAN [UDAY UMESH LALIT, J.]

          These cases can neither be enumerated nor fully illustrated.         A
          The court must judge each case on its own facts and
          circumstances.”
                                                       (emphasis supplied)
      6.7. A term of a contract will not be final and binding if it is shown
            that the flat purchasers had no option but to sign on the dotted   B
            line, on a contract framed by the builder.
            The contractual terms of the Agreement dated 08.05.2012 are
             ex-facie one-sided, unfair, and unreasonable. The incorporation
             of such one-sided clauses in an agreement constitutes an unfair
             trade practice as per Section 2 (r) of the Consumer Protection    C
             Act, 1986 since it adopts unfair methods or practices for the
             purpose of selling the flats by the Builder.
       7. In view of the above discussion, we have no hesitation in holding
that the terms of the Apartment Buyer’s Agreement dated 08.05.2012
were wholly one-sided and unfair to the Respondent – Flat Purchaser.           D
The Appellant – Builder could not seek to bind the Respondent with
such one-sided contractual terms.
       8. We also reject the submission made by the Appellant – Builder
that the National Commission was not justified in awarding Interest
@10.7% S.I. p.a. for the period commencing from the date of payment            E
of each installment, till the date on which the amount was paid, excluding
only the period during which the stay of cancellation of the allotment
was in operation.
       In Bangalore Development Authority v. Syndicate Bank,5 a
Coordinate Bench of this Court held that when possession of the allotted       F
plot/flat/house is not delivered within the specified time, the allottee is
entitled to a refund of the amount paid, with reasonable Interest thereon
from the date of payment till the date of refund.
      8.1. In the present case, the National Commission has passed an
           equitable Order. The Commission has not awarded any Interest        G
           for the period during which the Order of stay of cancellation of
           the allotment was in operation on the request of the Respondent
           – Flat Purchaser.

5
    (2007) 6 SCC 711.
                                                                               H
1184            SUPREME COURT REPORTS                          [2019] 5 S.C.R.


 A            The National Commission has rightly awarded Interest @10.7%
               S.I. p.a. by applying Rule 15 of the Haryana Real Estate
               (Regulation And Development) Rules, 2017 from the date of
               each installment till 05.02.2017 i.e. till the date after which the
               Order of stay of cancellation of the allotment was passed; and
               thereafter, from the date of the Commission’s final Order till
 B             the date on which the amount is refunded with Interest.
               9. We see no illegality in the Impugned Order dated 23.10.2018
       passed by the National Commission. The Appellant – Builder failed to
       fulfill his contractual obligation of obtaining the Occupancy Certificate
       and offering possession of the flat to the Respondent – Purchaser within
 C     the time stipulated in the Agreement, or within a reasonable time
       thereafter. The Respondent – Flat Purchaser could not be compelled to
       take possession of the flat, even though it was offered almost 2 years
       after the grace period under the Agreement expired. During this period,
       the Respondent – Flat Purchaser had to service a loan that he had obtained
 D     for purchasing the flat, by paying Interest @10% to the Bank. In the
       meanwhile, the Respondent – Flat Purchaser also located an alternate
       property in Gurugram. In these circumstances, the Respondent – Flat
       Purchaser was entitled to be granted the relief prayed for i.e. refund of
       the entire amount deposited by him with Interest.

 E           10. The Civil Appeals are accordingly dismissed, and the Final
       Judgment and Order dated 23.10.2018 passed by the National Consumer
       Disputes Redressal Commission is affirmed. The appellant is granted a
       period of three months from today to refund the amount to the respondent.
       All pending Applications, if any, are accordingly disposed of.

 F
       Ankit Gyan                                                 Appeals dismissed.




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