2024 INSC 667 C.A. No.2809-2810/2024 Page 1 of 19

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.2809 -2810 OF 2024

DHARMENDRA SHARMA …APPELLANT(S)

VERSUS

AGRA DEVELOPMENT AUTHORITY…RESPONDENT(S)

WITH

CIVIL APPEAL NO.6344 OF 2024

J U D G M E N T

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 the Supreme

Court Rules, assail the correctness of the final

judgment and order dated 15.09.2023 passed by

the National Consumer Disputes Redressal

Commission

2 in CC No.600/2020 as also the order

dated 30

th October, 2023 passed on the Review

Application No.335/2023. By the aforesaid orders,

the NCDRC allowed the CC No.600/2020 partly to

1

CPA, 1986

2

NCDRC

C.A. No.2809-2810/2024 Page 2 of 19

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 Authority

3

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 sys tem on

29.08.2011 whereby the appellant was allotted Flat

No.DT-1/1204 which was communicated vide letter

3

ADA

C.A. No.2809-2810/2024 Page 3 of 19

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 acco rdingly 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 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.

C.A. No.2809-2810/2024 Page 4 of 19

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

C.A. No.2809-2810/2024 Page 5 of 19

appellant got the loan transferred to the State Bank

of India

4 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 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

4

SBI

C.A. No.2809-2810/2024 Page 6 of 19

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.

C.A. No.2809-2810/2024 Page 7 of 19

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 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

C.A. No.2809-2810/2024 Page 8 of 19

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

30

th 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.

C.A. No.2809-2810/2024 Page 9 of 19

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 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

C.A. No.2809-2810/2024 Page 10 of 19

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.

Enterprise

5

(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

5

(2023) 3 SCC 195

6

(2019) 8 SCC 416

7

(2019) 8 SCC 157

C.A. No.2809-2810/2024 Page 11 of 19

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 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 Singh

8

(b) Rishab Singh Chandel & Anr. vs.

Parsvnath Developers Ltd. & Anr.

9

(c) Lucknow Development Authority vs.

M.K.Gupta

10

(d) Marvel Omega Builders Pvt. Ltd. vs. Shri

Hari Gokhale & Ors.

11

(e) Experion Developers Pvt. Ltd. vs. Sushma

Ashok Shierror

12

15. On such submissions it was prayed by the

appellant that his appeals be allowed and the

8

(2004) 5 SCC 65

9

Civil Appeal No.3053 of 2023

10

(1994) 1 SCC 243

11

(2020) 16 SCC 226

12

(2022) 6 SCALE 16

C.A. No.2809-2810/2024 Page 12 of 19

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 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

C.A. No.2809-2810/2024 Page 13 of 19

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

C.A. No.2809-2810/2024 Page 14 of 19

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 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,

C.A. No.2809-2810/2024 Page 15 of 19

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

13

(2023) 3 SCC 195

C.A. No.2809-2810/2024 Page 16 of 19

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.

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 docume nts 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

C.A. No.2809-2810/2024 Page 17 of 19

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 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.

C.A. No.2809-2810/2024 Page 18 of 19

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

C.A. No.2809-2810/2024 Page 19 of 19

arguments regarding both limitation and pecuniary

jurisdiction are found to be without merit.

……………………………………J.

(VIKRAM NATH)

……………………………………J.

(PRASANNA BHALACHANDRA VARALE)

NEW DELHI

SEPTEMBER 06, 2024