Vivek Chopra & 41 Ors. vs M/S. Orris Infrastructure Pvt. Ltd. on 29 August, 2022
Author: R.K. Agrawal
Bench: R.K. Agrawal
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI EXECUTION APPLICATION NO. 13 OF 2021 IN CC/2088/2016 1. VIVEK CHOPRA & 41 ORS. ...........Appellants(s) Versus 1. M/S. ORRIS INFRASTRUCTURE PVT. LTD. ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE R.K. AGRAWAL,PRESIDENT
For the Appellant : For the DHs/Complainants : Mr. Aditya Parolia, Advocate
Mr. Nithin Chandran, Advocate
Ms. Sumbhul Ismail, Advocate
Ms. Keshvi Thapar, Advocates For the Respondent : For the JD/Opposite Party : Ms. Jyoti Taneja, Advocate
Ms. Bhavya Vijay Tangri, Advocate
Dated : 29 Aug 2022 ORDER
The present Execution Applications have been filed by the Complainants / Decree Holders against Orris Infrastructure Pvt. Ltd. and its Directors (hereinafter referred to as the Opposite Parties/Judgment Debtors).
Brief facts leading to filing the present Execution Applications are that the Complainants/Decree Holders being allottees of the Units in the Project namely 'Orris Aster Court Premier' located at Sector 85, Gurgaon, Haryana, launched by the Judgment Debtor/Opposite Party Orris Infrastructure Private Ltd., filed Consumer Complaint in the representative capacity under Section 12(1) (c), being CC No. 2288 / 2016, before this Commission seeking refund of the entire amount paid by them alongwith compensation as the Opposite Parties/Judgment Debtors failed to complete the Project within stipulated period. Vide Order dated 28.09.2020, this Commission partly allowed the Consumer Complaint No. CC/2288/2016 in following terms:-
"Accordingly, following the decision rendered by a Coordinate Bench of this Commission in the aforesaid case, we dispose of the present Complaint and direct the Opposite Party Developer to refund the entire principal amount received from the Complainants alongwith compensation in the form of simple interest @ 8% p.a instead of @12% p.a. due to unavoidable and unforeseen circumstances beyond the control of the Opposite Party on account of pandemic Covid -19 situation, from the respective dates of deposit till the actual date of payment together with costs of Rs.25,000/- to each of the Complainants. The aforesaid directions shall be complied with within a period of eight weeks from the date of receipt of a copy of order failing which the amount shall carry interest @ 10% p.a. for the same period."
As the Opposite Parties/Judgment Debtors failed to satisfy the Decree/Order dated 28.09.2020, the Decree Holders/Complainants had filed present Execution Applications seeking enforcement of the Decree/Order as well as penalties to be imposed upon Judgment Debtors, Orris Infrastructure Ltd. and its Directors for non-compliance with the Decree/Order dated 28.09.2020.
For ready reference the particulars of the Execution Applications can be summarized in following table:-
Sl.
No. Execution Application Name of Allottee(s) Unit Number EA/13/2021 Sanjay Deshpande & Meghna Bareja Unit-602 Tower-3N EA/31/2021 Sumit Singh Unit-301, Tower-3K EA/32/2021 Rachna Sharma and Vikas Sharma Unit-102, Tower-3P EA/33/2021 Amit Ahi and Pratibha Ahi Unit-302, Tower-3K EA/34/2021 Anil Yadav and G.C. Yadav Unit-602, Tower-3P EA/35/2021 Ankur Khanna and Sakshi Khanna Unit-801, Tower-3P EA/36/2021 Navin Nath Unit - 801, Tower-3N EA/37/2021 Nitin Chaudhary Unit-702, Tower-4F EA/38/2021 Prithpal Arora, Neelam Arora & Isha Arora Unit-502, Tower-3K EA/39/2021 Sajjan Yadav & Urmila Yadav Unit-701, Tower-4F EA/41/2021 M/s Juneja Coals Unit-602, Tower-3K EA/43/2021 Rajeev Kumar Sharma & Dolly Sharma Unit 501, Tower-3P EA/45/2021 Deepika Ahluwalia Unit-202, Tower-4E EA/46/2021 Saket Kumar Unit-401, Tower-3K EA/48/2021 V. Ganesh Unit-601, Tower-4E EA/50/2021 Bhujvir Singh Chauhan Unit-401, Tower-4A EA/51/2021 Abhishek Gupta Unit-602, Tower-4E EA/52/2021 Jagsish Poply, Raghav Poply, Madhu Poply & Kanta Poply Unit-301, Tower-3P EA/53/2021 Manish Kumar Malviya, Rashmi Malviya & Savitri Malviya Unit-801, Tower-4F EA/54/2021 Vineet Bharti Unit-401, Tower-3P EA/55/2021 Birender Singh Siwach Unit-302, Tower-3P EA/56/2021 Puneet Pant, Deepika Pant & Bhagwati Prasad Pant Unit-502, Tower-3K EA/57/2021 Pradeep Kumar Goswami & Komal Goswami Unit-402, Tower-3P EA/58/2021 Anil Chaudhary Unit-201, Tower-4E EA/59/2021 Vivek Chopra & Ritu Chopra Unit-502, Tower-4E EA/96/2021 Samar Vikram Singh & Suman Lata Singh Unit-801, Tower-4E EA/109/2021 Phool Kumari Sharma Unit-402, Tower-4B EA/110/2021 Roopak Vashisht & Subhlata Vashisht Unit-1102, Tower-4E EA/114/2021 Dharmesh Pratap Singh & Simran Bedi Singh Unit-802, Tower-4E Since the facts and question of law involved in all these Execution Applications are similar, these Execution Applications are being disposed off by this common Order.
The Opposite Parties / Judgment Debtors has contested the Execution Applications by submitting that the present Execution Applications have a different memo of parties as the Complaint was filed only against the Oriss Infrastructure Pvt. Ltd. whereas in the present Execution Applications, Managing Director / Director of the Opposite Party / Judgment Debtor have been arrayed as parties, which makes it unsustainable in law since the decree can be executed only as per the decree sheet that is drawn.
It was further submitted that some of the Complainants/Decree Holders in CC No. 2088 / 2016 in addition to filing Execution Applications before this Commission, have also filed Application under Section 7 of the IBC, 2016 before NCLT for the refund of money for the same Unit. In such circumstances, having elected to pursue the remedy before NCLT they are now stopped from pursuing the same relief before this Hon'ble Commission and this Hon'ble Commission and NCLT having concurrent jurisdiction, the Decree Holder cannot pursue two proceedings for the same cause of action.
It was further stated that the 'Aster Court Premier', where the Units have been allotted to the Complainants/Decree Holders, is a part of the overall Project, which contains 1490 units, out of which 1359 have already been delivered and about 1000 families now reside on the premise. It was further submitted that unforeseeable force majure events caused delay in completing the construction and after completion of construction, they have given the possession of the Units to 6 Complainants and the dispute has been settled with the Complainants in EA No. 47/2021, EA No. 43/2021, EA No. 40/2021, EA No. 49/2021, EA No. 44/2021 and EA No. 42/2021 and accordingly EA No. 47/2021, EA No. 40/2021, EA No. 49/2021, EA No. 44/2021 and EA No. 42/2021 arising out of CC No.2088/2016 have already been disposed off.
It was further submitted that after acquiring Occupation Certificate they have offered possession of the original allotted Units and alternative units to the Complainants/Decree Holders but the Complainants/Decree Holders have not come-forward to complete the formalities and take the possession. It was prayed that the Complainants/Decree Holders be directed to take possession and the Execution Applications be dismissed.
In reply, it was submitted on behalf of the Complainants/Decree Holders that the Judgment Debtors have settled the matter with only 6 Decree Holders out of the 34 Complainants/Decree Holders. It was further submitted that the Judgment Debtors are trying to use undue pressure on the Complainants/Decree Holders to settle the dispute in order to evade the compliance of the Order dated 28.09.2020 passed by this Commission in CC No. 2088 of 2016.
With regard to proceedings initiated before the NCLT, it was submitted that the Hon'ble Supreme Court vide Order dated 19.01.2021 in Manish Kumar vs. Union of India & Anr. (W.P. (c) No. 26 of 2020), has upheld the constitutionality of the amendment in the Insolvency and Bankruptcy Code 2016 imposing a threshold on the filing of petitions under Section 7 of the IBC, hence by virtue of the said amendment the right of a homebuyer to approach the Hon'ble National Company Law Tribunal has now been curtailed and all applications filed under Section 7 of the IBC are being dismissed, if not met with the said threshold.
It was further submitted that Order under Execution Proceedings has attained finality and the Judgment Debtors are duty bound to comply with it. It is settled law that the merits of the claim or dispute cannot be considered during Execution Proceedings and the Executing Court cannot go behind the decree even if it be erroneous is still binding between the Parties. It was prayed that the Execution Applications be allowed.
I have heard Mr. Aditya Parolia, learned Counsel appearing on behalf of the Complainants/Decree Holders, Ms. Jyoti Taneja, learned Counsel for Judgment Debtors, have given a thoughtful consideration to the various pleas raised by the learned counsel for the Parties and perused the averments made in the Applications as also the Order dated 28.09.2020 passed in CC No. 2288 of 2016 which is sought to be executed by means of the present Execution Applications.
In respect of EA No. 43 / 2021, learned Counsel for the Judgment Debtors submitted that the matter has been settled between the Parties, which was confirmed by the learned counsel for the Decree Holders/Complainants. Accordingly, EA No. 43 / 2021 stands disposed off in terms of the settlement arrived at between the Parties.
As far as the contention of the Judgment Debtors/Opposite Parties that whereas the Complaint was filed against Orris Infrastructure Pvt. Ltd. and in addition to Orris Infrastructure Pvt. Ltd., the Managing Director and Director have been arrayed as Parties in the present Execution Applications is concerned, the issue as to whether the proceedings u/s 27 of the Consumer Protection Act, 1986 can be initiated against Managing Director/Director of the Judgment Debtor Company has been dealt by the Hon'ble Supreme Court in 'Lalit Kumar Jain vs. Union of India & Ors.' (2021) SCC Online SC 396, wherein it has been held as under:-
"125. In view of the above discussion, it is held that approval of a resolution plan does not ipso facto discharge a personal guarantor (of a corporate debtor) of her or his liabilities under the contract of guarantee. As held by this Court, the release or discharge of a principal borrower from the debt owed by it to its creditor, by an involuntary process i.e. by operation of law, or due to liquidation or insolvency proceeding, does not absolve the surety/guarantor of his or her liability, which arises out of an independent contract."
Further it may be relevant to mention here that the Hon'ble Supreme Court in the case of "Anjali Rathi & Ors. Vs. Today Homes & Infrastructure Pvt. Ltd. & Ors. SLP (C) No. 12150 / 2019 and connected Civil Appeal Nos. 5231 - 38 of 2019 and SLP (C) Nil of 2021 decided on 08.09.2021" has held that even if there is Moratorium declared by the National Company Law Tribunal under Section 14 of the Insolvency and Bankruptcy Code, 2016, Proceedings can be initiated against the Promoters of the Corporate Debtors. For ready reference, Para 15 of the decision passed by the Hon'ble Supreme Court in the case of "Anjali Rathi & Ors. Vs. Today Homes & Infrastructure Pvt. Ltd. & Ors." (supra) is reproduced below:-
"15. At this juncture, we must however clarify the right of the petitioners to move against the promoters of the first respondent Corporate Debtor, even though a moratorium has been declared under Section 14 of the IBC. In the judgment in P. Mohanraj v. Shah Bros. Ispat (P) Ltd. [(2021) 6 SCC 258], a three judge Bench of this Court held that proceedings under Section 138 and 141 of the Negotiable Instruments Act 1881 against the Corporate Debtor would be covered by the moratorium provision under Section 14 of the IBC. However, it clarified that the moratorium was only in relation to the Corporate Debtor (as highlighted above) and not in respect of the directors/management of the Corporate Debtor, against whom proceedings could continue. Speaking through Justice Rohinton F Nariman, the Court held:
"102. Since the corporate debtor would be covered by the moratorium provision contained in Section 14 IBC, by which continuation of Sections 138/141 proceedings against the corporate debtor and initiation of Sections 138/141 proceedings against the said debtor during the corporate insolvency resolution process are interdicted, what is stated in paras 51 and 59 in Aneeta Hada [Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661 : (2012) 3 SCC (Civ) 350 : (2012) 3 SCC (Cri) 241] would then become applicable. The legal impediment contained in Section 14 IBC would make it impossible for such proceeding to continue or be instituted against the corporate debtor. Thus, for the period of moratorium, since no Sections 138/141 proceeding can continue or be initiated against the corporate debtor because of a statutory bar, such proceedings can be initiated or continued against the persons mentioned in Sections 141(1) and (2) of the Negotiable Instruments Act. This being the case, it is clear that the moratorium provision contained in Section 14 IBC would apply only to the corporate debtor, the natural persons mentioned in Section 141 continuing to be statutorily liable under Chapter XVII of the Negotiable Instruments Act."
(emphasis supplied) We thus clarify that the petitioners would not be prevented by the moratorium under Section 14 of the IBC from initiating proceedings against the promoters of the first respondent Corporate Debtor in relation to honoring the settlements reached before this Court...."
In view of the principles laid down in the above-mentioned Judgments passed by the Hon'ble Supreme Court, the objections regarding maintainability of the present proceedings against Opposite Party/Judgment Debtor Nos. 2 & 3, i.e., Mr. Vijay Gupta, Managing Director and Mr. Joginder Kumar, Director of the Opposite Party/Judgment Debtor No. 1 Company, raised by the learned Counsel for the Judgment Debtors, are rejected and it is held that the present Execution Applications are maintainable against Opposite Party/Judgment Debtor Nos. 2 & 3, i.e., Mr. Vijay Gupta, Managing Director and Mr. Joginder Kumar, Director of the Judgment Debtor Company.
As far as the contention of the Opposite Party / Judgment Debtor regarding filing of Application under Section 7 of IB Code before NCLT is concerned, in Manish Kumar vs. Union of India and Anr. [W.P. (C) No. 26 / 2020], the Hon'ble Supreme Court has held that the Application under Section 7 of IBC, 2016 is not meant to be recovery mechanism by observing as under:
"357. .......the application under Section 7 is not meant to be a recovery mechanism. The Code, as is clear from its title, deals with insolvency resolution, to begin with. If there is insolvency, the application, with reference to any of the large number of creditors, suffices."
The Hon'ble Supreme Court in Manish Kumar (supra) has upheld the constitutionality of the amendment in the Insolvency and Bankruptcy Code 2016 imposing a threshold on the filing of petitions under Section 7 of the IBC, hence by virtue of the said amendment the right of a homebuyer to approach the NCLT has now been curtailed and all applications filed under Section 7 of the IBC are being dismissed, if not met with the said threshold. Further, in the Reply to the Affidavit, filed on 20.10.2021, the Complainants/Decree Holders have categorically denied that they have approached the Hon'ble NCLT through C.P. (IB) No. 529 / 2020 titled G.C. Yadav and Ors. Vs. Orris Infrastructure Pvt. Ltd. for refund of the money for the same Units.
The present Execution Applications have been filed to execute the Order dated 28.09.2020 passed by this Commission in CC No. 2088 of 2016 which was filed by the Decree Holders / Complainants in the year 2016. The Doctrine of Election, as laid down by the Hon'ble Supreme Court in the case of "M/s. Imperia Infrastructure Ltd. vs. Anil Patni and Anr." reported in 2020 10 SCC 783, is applicable and it is always open to a person either to approach the fora under the Consumer Protection Act, 1986/2019 or to approach any other Authority under Real Estate Regulatory Authority Act, 2016 or NCLT under the provisions of Insolvency and Bankruptcy Code, 2016 for redressal of his grievance. The person who has approached to any of the Authorities referred to above, at the first instance, is estopped from approaching other two Authorities as Doctrine of Election applies. Admittedly, in the present cases, the Complainants had approached this Commission for redressal of their grievance by filing Consumer Complaint No. 2088 / 2016 before filing the Application before NCLT. Thus, strictly speaking the Doctrine of Election has to be applied and the Complainants would be estopped from approaching any other Authority as they had already approached this Commission. In view of above, the contention raised by the Opposite Parties / Judgment Debtors regarding maintainability of the present Execution Applications before this Commission are rejected.
In 'Satyawati vs. Rajinder Singh and Another' (2013) 9 SCC, 491), the Hon'ble Supreme Court has held the executing court should not have looked into other reports which had been submitted to it afterwards, by observing as under:
"Looking to the facts of the case and upon hearing the learned counsel, we are of the view that the order passed by the executing court dated 16-3-2009, which has been confirmed by the High Court is not correct for the reason that the executing court ought not to have considered other factors and facts which were not forming part of the judgment and the decree passed in favour of the appellant-plaintiff. Once the decree was made in favour of the appellant-plaintiff, in pursuance of the judgment dated 19-1-1996 delivered by the District Judge, Faridabad, in our opinion, the executing court should not have looked into other reports which had been submitted to it afterwards."
The Hon'ble Supreme Court in 'Karnataka Housing Board vs. K.A. Nagamani (2019) 6 SCC 424 has held that the merits of the claim or dispute cannot be considered during Execution Proceedings. It is also settled law that the Executing Court cannot go behind the Decree even if it be erroneous is still binding between the Parties, as has been held by the Hon'ble Supreme Court in 'Vasudev Dhanjibhai Modi vs. Rajabhai Abdul Rehman (1970) 1 SCC 670' by observing as under:
"A court executing a decree cannot go behind the decree: between the parties or their representatives it must take the decree according to its tenor, and cannot entertain any objection that the decree was incorrect in law or on facts. Until it is set aside by an appropriate proceeding in appeal or revision, a decree even if it be erroneous is still binding between the parties"
In the present cases, the Consumer Complaint No. 2088 / 2016 filed by the Decree Holders / Complainants was allowed vide Order/Decree dated 28.09.2020 by which Opposite Party Developer was directed to refund the entire principal amount received from the Complainants alongwith compensation in the form of simple interest @ 8% p.a. Undisputedly the Opposite Parties / Judgment Debtors have miserably failed to comply with the Decree / Order dated 28.09.2016. As per settled law, in Execution Proceedings, this Commission cannot go beyond the Decree/Order dated 28.09.2020 passed in CC No. 2288/2016 and the merits of the claim or dispute cannot be considered during Execution Proceedings.
For the reasons stated hereinabove and respectfully following the principles laid down by the Hon'ble Supreme Court in above quoted Judgments, the Execution Applications, i.e., EA/13/2021, EA/31/2021, EA/32/2021, EA/33/2021, EA/34/2021, EA/35/2021, EA/36/2021, EA/37/2021, EA/38/2021, EA/39/2021, EA/41/2021, EA/45/2021, EA/46/2021, EA/48/2021, EA/50/2021, EA/51/2021, EA/52/2021, EA/53/2021, EA/54/2021, EA/55/2021, EA/56/2021, EA/57/2021, EA/58/2021, EA/59/2021, EA/96/2021, EA/109/2021, EA/110/2021 and EA/114/2021 stand disposed off with a direction to the Opposite Parties/Judgment Debtors to comply with the Order/Decree dated 28.09.2020 passed in the CC No. 2088/2016 and refund the entire principal amount deposited by the respective Complainants/Decree Holders alongwith compensation as awarded by this Commission vide Order dated 28.09.2020 within three months from today failing which proceedings under Section 25 & 27 of the Consumer Protection Act, 1986, will be initiated against them.
The Execution Application No. EA/43/2021, stands disposed off in terms of the settlement arrived at between the Parties.
Keeping in view the facts and circumstances of the case, there shall be no order as to costs. All the pending applications, if any, also stand disposed off.
......................J R.K. AGRAWAL PRESIDENT
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