BEFORE STATE CONSUMER DISPUTES REDRESSAL COMMISSION
OF TELANGANA : AT HYDERABAD
CC NO.344 OF 2014
Between :
- Smt C.N.Lavanya W/o C.N.Gaja Mohan
Aged about 47 years, R/o H.No.276/2 RT
Vijayanagar Colony, Hyderabad-500057
- C.N.Gaja Mohan S/o late Sri C.N.Bheema Reddy
Aged about 52 years, R/o H.No.276/2 RT
Vijayanagar Colony, Hyderabad-500057
Complainants
And
- M/s Hill County Properties Ltd.,
(IL&SF Group) Formerly known as
M/s Maytas Properties (P) Ltd.,
Rep. by its Managing Director
Hill County, Bachupally,
- M.D.Khattar, Managing Director
M/s Hill County Properties Ltd.,
Hill County, Bachupally,
Opposite parties
Counsel for the Complainants : Sri Srinivasa Karra
Counsel for the Opposite parties : M/s K.Visweswara Reddy
QUORUM :
HON’BLE SRI JUSTICE B.N.RAO, PRESIDENT
&
SRI PATIL VITHAL RAO, MEMBER
THURSDAY THE SIXTH DAY OF JULY
TWO THOUSAND SEVENTEEN
Oral Order : (per Hon’ble Sri Justice B.N.Rao Nalla, Hon’ble President)
***
The complaint is filed under section 17(1)(a)(i) of the Consumer Protection Act, 1986 by the Complainants complaining deficiency in service against the Opposite parties and claimed refund of Rs.29,28,096/- with interest @ 24% per annum; to award compensation of Rs.5,00,000/- for the delay and mental agony and also Rs.10,000/- towards cost of the complaint.
2. The complaint pertains to deficiency of service on the part of the opposite parties in not completing the construction of the apartment No.499-6D Type-5 at 6th floor in Ooty Block together with built-up area admeasuring 1579 sft and undivided share of land measuring 73 sq. yds, out of Ac.16-95 guntas, forming part of Sy.No.194/P, 196/P and 197/P for the construction of apartment complex, out of total extent of Ac.85-36 guntas, situated in the lay-out known as Hill County, Bachupally Village, Qutbullapur mandal, Ranga Reddy District pursuant to the agreement of sale dated 22.12.2006 which is agreed to be delivered on or before 30.08.2008.
3. The opposite parties failed to construct the project due to improper management and various allegations against the management of the opposite party no.1 company. The total sale consideration of the flat was Rs.49,01,794/- and the complainants paid the amount of Rs.29,28,096/-. Though considerable period had elapsed, the opposite parties failed to complete the construction of the flat. While so the complainants received a mail in the month of January 20014 whereunder the opposite party no.1 informed that the project is going to be completed and requested the complainants to come forward for registration of sale deed by paying the balance sale consideration. On receipt of the letter the complainants visited the site and found that there were no amenities provided as promised by the opposite party no.1. Having not satisfied with the quality of work and also with the amenities provided, the complainants demanded for refund of the amount by sending legal notice dated 01.02.2014. In response to the said legal notice, the opposite party no.1 gave reply by not controverting the reasons stated in the legal notice for cancellation of the agreement however made unwarranted and unnecessary comments on the complainants. However, the complainant no.2 personally met Mr.Mandeep Jaggi who is authorized representative of the opposite party no.1 on 7.4.2014 and informed that he is willing to take the apartment provided if they compensate for the loss sustained by them due to delay in the project. Mr.Mandeep Jaggi has promised that he would discuss with the company with regard to the compensation to be paid for the delay of 54 months in completing the apartment. On 11.04.2014 the complainant received a mail from Mr.Mandeep Jaggi whereunder he has informed the complainants that the company would pay only an amount of Rs.4,00,000/- towards compensation for the delay, mental agony, legal fees etc. On receipt of the said mail, the complainants made enquires with the other purchasers and found that the other purchasers who have approached the State Commission had got orders for refund of their amounts apart from compensation of Rs.20 lakhs. But the opposite party no.1 did not agree to compensate the complainants for that amount instead they offered to compensate by paying Rs.5 lakhs only. In the year 2006 when the complainants purchased the apartment, the rate of the apartment was fixed at Rs.3105/- per sq.ft and now the opposite party company offering the apartments at the same rate at Rs.3,149/- per sq.ft . Thus it is clear from the said fact that the value of the apartment is also not appreciated. The complainants have invested about Rs.30 lakhs which are lying ideal with the opposite party company without much appreciation. Apart from that the complainants received a notice dated 11.12.2013 from the opposite party no.1 demanding the balance sale consideration within 15 days otherwise it threatened to terminate the agreement in respect of the apartment. In view of the high handed and discriminative action of the opposite party company, the complainants are constrained to file the complaint with the reliefs, as stated, at paragraph no.1, supra.
4. The opposite party no.1 filed written version which was adopted by the other opposite parties. While resisting the claim, the opposite party no.1 contended that the above complaint is not maintainable and that there is no deficiency of service on its part. As per agreement of sale dated 22.12.2006, they have to deliver the unit on or before 22.12.2008 therefore, the complaint is barred by limitation, hence, cause of action for filing the complaint arose on 22.12.2008 and the present complaint is lodged after 6 years as an arm-twisting method to make the opposite parties to come to its terms. Section 24A of the C.P.Act clearly specifies the time limit for filing a consumer complaint within 2 years from the date of cause of action. The complaint filed by the Complainants is hopelessly barred by limitation and is liable to be dismissed. There is no deficiency in service on its part. Further, the unit has been completed and the same was intimated to the complainants on 26.07.2013 itself and the complainant instead taking the flat has lodged the present complaint.
5. The opposite party no.1 started a venture at Bachupally under the name and style of “ Maytas Hill County”. The complainants after learning about the construction being undertaken by the opposite party no.1 approached the opposite party with a request of purchasing apartment and after discussions and deliberations, complainant agreed to purchase apartment. Subsequently the opposite party no.1 along with 14 land owing companies executed an agreement of sale dated 22.12.2006 thereby agreeing to sell the said apartment for a total consideration for Rs.49,01,794/- excluding other payments etc. The project commenced as per schedule and was proceeding as per the projected rate but on a wholly incorrect understanding of its association with Satyam Group of Companies, various investigations and proceedings were instituted against it. The resulting adverse media reports and other reports led to doubts and wrongful perceptions about its independent and unrelated status. Resulting which, the investors and lenders who had committed to funding the Hill County project of opposite party no.1, sought to resile and withdraw from the project causing serious and acute shortage of funds. On account of the fall-out of the events following enquiries against Satyam Computers Ltd., the opposite party no.1 was subjected to series of compelling economic circumstances which derailed the Hill County Project.
6. Various attachments and court orders had also delayed the project. The various steps taken by it brought back the project on track. In compliance of the Company Law Board orders dated 13.01.2011 IL&FS, the new management of OP No.15 commenced the construction at Hill County project and infused about 1072 crores into the OP No.15 to complete Hill County project. The customers were also invited to visit for completing the final inspection of their respective units and Complainants were kept continuously informed about the status of construction, its completion apart from letters and e-mails.
7. Complainants appear to have developed a wrongful motive and intention to make an immoral and unlawful gain and have therefore, filed the present complaint seeking refund of the amount on wholly incorrect, untenable and illegal basis. In fact, the unit purchased by the Complainants has been completed in all respects and possession is delivered. The infrastructure of the project like power sub-stations, permanent sewage plant (STP), supply of manjeera water for 24 hours, storm water drainage, club house, gas pipeline connection, e-deck environment, security systems, etc., are completed.
8. Considering the difficulties faced by the customers, the management of opposite party no.1 company proposed compensation @ Rs.5/- per sft for the period of delay caused in delivering the apartment to the complainant and the same is already intimated to all the apartment customers.
9. The delay in completing the project is only because of above force majeure events, which are beyond the control of opposite party no.1 company. As such, there is no wilful default or deficiency of service on its part. This opposite party intimated the complainants about the completion of their apartment and for inspection of the apartment and taking possession of the same through letters dated 26.07.2013, 06.12.2013, 11.12.2014 and emails dated 07.07.2014, 14.10.201 . The complainant is not entitled to any of the amounts. Therefore, it prayed for dismissal of the complaint with costs.
10. The complainant no.1 had filed her evidence affidavit and the documents, Exs.A1 to A11. On behalf of the Opposite parties , its authorized signatory by name Neerav Kapasi has filed the affidavit and the documents, Ex.B1 to B34.
11. The counsel for the complainants and the Opposite parties have advanced their arguments reiterating the contents of the complaint, the written version affidavit evidence and also have filed written arguments. Heard both sides.
12. The points that arise for consideration are :
i) Whether the complainants are entitled for refund of the amount, if so, to what amount?
ii) To what relief?
13. It is an undisputed fact that the complainants had booked the subject flat and paid major part of sale consideration to opposite party no.1 basing on the agreement entered into between the complainants and the developer. The developer had agreed to complete the construction and hand over possession within stipulated period from the date of execution of agreement. It also agreed to pay Rs.5/- per sft. for the delayed construction.
14. Unfortunately, the developer stopped the construction and it has come to a standstill, when Satyam group of companies in which developer is one of the constituent company, went into liquidation. The complainants, therefore, seek refund of the amount paid together with interest, compensation and costs.
15. The developer resisted the complaint on the ground that on account of ‘force-majeure’ problems, the project could not be completed on time and thereafter they took every care to complete the project and therefore, the complaint is not maintainable before this Commission.
16. Though the Opposite party no.1 contended that various steps were taken to complete the project on time, no evidence is placed to show the exact stage of the project. Affidavit of none of the Directors of the company was filed to show the stage of construction, nor the fact that any of the projects were completed. However, the learned counsel for the Opposite party no.1 while advancing arguments stated that there is change in circumstances as the subject apartment is completed now. In this regard, we may state that as on the date of filing of the complaint, the subject flat was incomplete which necessitated the Complainant to seek refund of the amount. The developer except contending that the construction has been taken up and is in progress could not deny the statement of the complainant when he contended that no work was taken up. It could have sought for appointment of Commissioner or filed documents evidencing the construction activity.
17. The complainants by issuing the notice dated 01.02.2014 demanded the developer to pay/refund the consideration received so far, as no construction was taken up nor completed within the stipulated time, and sought for refund of the amount paid by the bank to it. On failure to comply with the request made in the notice, the present complaint is filed. Naturally, when the project was delayed by not following the terms of the agreement of sale the complainant can seek refund of the amounts paid by them.
18. We may also state that recovery of money by the complainant against the developer depends on the principle of unjust enrichment. This principle requires first that the developer has been enriched by receipt of a benefit, secondly, that this enrichment is at the expense of the complainants, and thirdly, that the retention of the enrichment be unjust. This justifies restitution/refund.
19. We may also state here that the orders of this Commission against the very same developer (vide C.C.30/2009) directing to refund the amount with interest @ 12% p.a., has been upheld by the National Commission in F.A. No.189/2010 while reducing the compensation from Rs.5 lakhs to Rs.1 lakh. The SLP moved by the developer before the Hon’ble Supreme Court in Appeal (Civil) No.26256/2010 was dismissed on 27.09.2010. Therefore, these matters are covered by the above decisions and there is no need for any distinction to be made between these cases.
20. It is an undisputed fact that agreement for purchase of apartment is between the complainants and the developer. It is also not in dispute as per the above said agreement the amount is to be paid and accordingly the Complainants paid the amount by contributing their own funds, which is not in dispute. The opposite party no.1 would contend that the complaint is barred by limitation in view of the fact that as per agreement of sale dated 22.12.2006, the unit was agreed to be delivered on or before 22.10.2008 therefore, the complaint is barred by limitation. In the present case, the Complainants are seeking refund of amount on account of non-compliance of the terms of the agreement. The monies paid by the Complainants are lying with the opposite party no.1, which is nothing but a debt repayable to the Complainants. In this regard, we may state that limitation does not extinguish the debt or preclude its enforcement, unless the debtor chooses to avail himself of the defence and specially pleads it. An indebtedness does not lose its character as such, merely because, it is barred; it still affords sufficient consideration to support a promise to pay, and gives a creditor an insurable interest." The general rule, at least with respect to debts or money demands, is that a statute of limitation bars, or runs "against, the remedy and does not discharge the debt or extinguish or impair the right, obligation, or cause of action." The position then is that under the law a debt subsists notwithstanding that its recovery is barred by limitation. The rules of limitation are not meant to destroy the rights of the parties. Section 3 of the Limitation Act, 36 of 1963, only bars the remedy, but does not destroy the right to which the remedy relates. The right to the debt continues to exist notwithstanding that the remedy is barred by limitation. The only exception in which the remedy also becomes barred by limitation is when the right is destroyed. Except in such cases which are specially provided under the right to which the remedy relates, in other cases the right subsists. Though the right to enforce the debt by judicial process is barred under Section 3 read with the relevant article in the Schedule, the right to the debt remains. The time barred debt does not cease to exist by reason of Section 3. That right can be exercised in any other manner than by any means. The debt is not extinguished, but the remedy to enforce the liability is destroyed. What Section 3 refers to is only the remedy but not the right of the creditors. Such debt continues to subsist so long as it is not paid. Under these circumstances, we do not accept the contention of the learned counsel for OP No.1. Admittedly, it is not denied that the OP No.15 had been addressing letters under Ex.B8 to B17 apprising the progress of construction, by which, they submitted to the cause of action and the present complaint is filed on 26.12.2014. Viewed from any angle, the complaint is not barred by limitation.
21. In the above facts and circumstances, the points (i) and (ii) are answered accordingly holding that the opposite parties are liable to pay the amounts to the Complainants.
In the result, the complaint is allowed in part and we direct the opposite parties to refund the amount of Rs.29,28,096/- paid by the complainants with interest @ 12% p.a., from the date of last payment till the date of payment/refund, together with compensation of Rs.1,00,000/- and costs of Rs.5,000/- and in case sale deed was executed, the complainants shall re-convey the same to the developer on compliance of above directions. The registration charges and stamp duty etc., shall be borne by the developer opposite parties. Time for compliance : four weeks. IAs, if any shall stand disposed of.
PRESIDENT MEMBER
Dated: 06.07.2017
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
For Complainants : For Opposite parties :
Affidavit evidence of C.N.Gaja Mohan Affidavit evidence of Neerav Kapasi ,
Complainant No.2 as PW1. as RW1 (on behalf of OP No.1)
For Complainants :
Ex.A1 Copy of Form 32
Ex.A2 Copy of Agreement of Sael dated 22.12.2006
Ex.A3 O/c legal notice dated 25.02.2014
Ex.A4 Reply notice dated 05.03.2014
Ex.A5 Copy of email dated 03.03.2014
Ex.A6 Copy of email dated 11.04.2014
Ex.A7 Copy of email dated 20.11.2014
Ex.A8 Copy of email dated 27.11.2014
Ex.A9 Copy of email dated 29.11.2014
Ex.A10 Copy of letter dated 11.12.2014 of the Op No.1 to the complainants
Ex.A11 Newspaper cutting.
For Opposite parties
Ex.B1 Photostat copy of extract of minutes of the meeting of the Board of Directors of M/s Hill County Properties Limited, dated 23.06.2013.
Ex.B2 Photostat copy of the Fresh Certificate of Incorporation, dated 16.08.2013 issued by Registrar of Companies, Andhra Pradesh with respect to change of name of Maytas Properties Limited as Hill County Properties Limited.
Ex.B3 Photostat copy of Orders dated 05.03.2009 passed in CP No.4/2009 by the Company Law Board, New Delhi.
Ex.B4 Photostat copy of Attendance sheet of the hearing of the Company Law Board, dated 13.01.2011 in CP No.04/2009.
Ex.B5 Photostat copy of Form 32 showing resignation of Byrraju Rama Raju as whole-time director of Maytas Properties Limited w.e.f. 07.02.2011; and of Datla Gopala Krishnam Raju as Director w.e.f. 07.02.2011 and of Datla Venkata Satya Subba Raju as Director w.e.f. 07.02.2011; appointment of Sri Aun Kumar Saha as additional director w.e.f. 22.01.2011; Vimal Kishore Kaushik as additional director w.e.f. 22.01.2011, Ramesh Chander Bawa as additional director w.e.f. 22.01.2011 and Ramchand Karunakaran as additional director w.e.f. 22.01.2011.
Ex.B6 Copy of attendance-cum-order sheet of hearing of principal Bench of the Company Law Board, dated 12.03.2013.
Ex.B7 Copy of attendance-cum-order sheet of hearing of principal Bench of the Company Law Board, dated 10.07.2013.
Ex.B8 Photostat copy of letter dated 25.02.2011 addressed by Ops 1 and 2 to its customers appraising the progress of construction.
Ex.B9 Photostat copy of letter dated 08.04.2011 addressed by the Ops 1 and 2 to its customers appraising the progress of construction.
Ex.B10 Photostat copy of letter dated 17.06.2011 and 28.07.2011 addressed by
the Ops 1 and 2 to its customers appraising the progress of construction.
Ex.B11 Photostat copy of letter dated 08.09.2011 addressed by the Ops 1 and 2 to
its customers appraising the progress of construction.
Ex.B12 Photostat copy of letter dated 25.10.2011 addressed by the Ops 1 and 2 to
its customers appraising the progress of construction.
Ex.B13 Photostat copy of letter dated 29.12.2011 addressed by the Ops 1 and 2 to its customers appraising the progress of construction.
Ex.B14 Photostat copy of letter dated 02.03.2012 addressed by the Ops 1 and 2to its customers appraising the progress of construction.
Ex.B15 Photostat copy of letter dated 16.05.2012 addressed by the Ops 1 and 2 to its customers appraising the progress of construction.
Ex.B16 Copy of letter dated 26.09.2012 addressed by OP No.1 to its customers
appraising the progress of construction.
Ex.B17 Copy of letter dated 23.08.2013 addressed to all customers regarding
Compensation for delay in construction
Ex.B18 Copy of letter of Gram Panchayat dated 20.07.2012
Ex.B19 Copy of Occupancy Certificate obtained for Ooty Owner
Ex.B20 Copy of Orders dated 05.12.2012 passed by the Hon’ble High Court of A.P. regarding lifting the ban on IT department on registration of units in Hill County project.
Ex.B21 Photostat copy of letter dated 12.12.2012 addressed by the Ops 1 and 2 to its customer regarding lifting of IT attachment and commencement of registrations.
Ex.B22 Copy of letter dated 26.07.2013 addressed to the complainants by Op.1
Ex.B23 Copy of letter dated 6.12.2013 address to the complainants to take handover/possession of the unit
Ex.B24 Copy of letter dated 11.12.2014 addressed to the complainants regarding payment of dues towards sale consideration
Ex.B25 jCopy of emails dated 07.07.2012 and 14.10.2014
Ex.B26 Copy of letter dated 31.05.2013 regarding progress of construction of the project.
Ex.B27 Copy of letter dated 17.01.2014 and 27.05.2014 regarding developments like club house, etc., of the project
Ex.B28 Copy of letter dated 22.08.2014 regarding developments of the project
Ex.B29 Copy of letters dated 16.05.2015 and 14.09.2015 regading developments like mini cricket stadium and other facilities
Ex.B30 Copy of reply dated 5.03.2014
Ex.B31 Copy of Dist. Panchayat Officer proceedings dated 28.08.2013
Ex.B32 Copy of High Court order dated 02.12.2014
Ex.B33 Copy of Competent Authority proceedings dated 07.11.2015
Ex.B34 Photographs of Unit No.A449-6D, Ooty Tower.
PRESIDENT MEMBER
