BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION : HYDERABAD
C.C.No.101/2012
Between:
Laxmi Narayana Villa Residents Welfare Association,
Rep. by its President Sri Harprith Singh,
S/o.Bhagat Singh, Aged 61 years, H.No.6-3-166/1,
Laxmi Narayan Villa, Aramghar X Road,
Shivarampally, Rajendranagar,
Ranga Reddy District (GHMC). … Complainant
And
1.M/s. P.Suryaprakash & Company,
A Partnership Firm, rep. by Managing Partner,
P.Surya Prakash, S/o.P.Veeraiah, Aged 55 years,
R/o.6-3-166/618 ( Flat No.618),
Laxminarayana Villa, Aaramghar Cross Road,
Shivarampally, Hyderabad-52.
2. P.Surya Prakash,
Managing Partner of M/s. P.Suryaprakash & Company,
R/o.6-3-166/618 ( Flat No.618),
Laxminarayana Villa, Aaramghar Cross Road,
Shivarampally, Hyderabad-52.
3. Vantage Advertising Private Limited,
Rep. by its Head-Sales & Marketing
La Paloma Caves,
Plot No.403/45/D, Flat No.103,
Road No.12, Banjara Hills, Hyderabad–34.
4. The General Manager,
Reliance Infocomm Ltd.,
No.38, Reliance House,
Hitech City, Madhapur,
Adj. to Ananth Building,
Hyderabad – 500 081. … Opp.parties
Counsel for the Complainant : M/s. Gogineni Krupa Chand
Counsel for the Opp.parties : M/s. R.Nageshwara Reddy-OPs.1 and 2.
M/s.K.B.Ramanna Dora-O.P.No.3.
M/s. Srinivas Modhali-O.P.No.4.
QUORUM:SRI T.ASHOK KUMAR, HON’BLE MEMBER,
AND
SRI S.BHUJANGA RAO, HON’BLE MEMBER.
THURSDAY, THE TWENTY FOURTH DAY OF APRIL,
TWO THOUSAND FOURTEEN.
Oral Order: (Per Sri S.Bhujanga Rao, Hon’ble Member)
***
This is a Consumer Complaint filed by the complainant u/s.17(1)(a)(i) of the Consumer Protection Act, 1986, alleging deficiency in service on the part of the opposite parties.
The brief case of the complainant as set out in the complaint is that the opposite party no.1 is a Partnership Firm and opposite party no.2 is its Managing Partner. The opposite party no.3 is an advertising agency erecting hoardings in the premises of the complainant and the opposite party no.4 is the telecom services, who erected its tower in the premises of the complainant. Attracted by the advertisement of opposite parties 1 and 2 that they are constructing a deluxe residential apartments with all luxury amenities, the members of the complainant association booked the flats and paid amounts, as demanded by the opp.parties 1 and 2 and they have also registered the flats and are in possession and enjoyment of the said flats. At the time of booking the flats, the opposite parties 1 and 2 have promised to provide all the facilities/amenities on the flat cost itself. But contrary to their promise, they have demanded each member of the complainant association to pay Rs.38,500/- towards amenities including corpus fund, Rs.11,000/- towards water connection and an amount of Rs.15,000/- towards electricity connection. The said amounts were paid by the members of the complainant association. Opposite party no.2 declared himself as President without forming proper Association and without registering any Society and he informed the flat owners that he will maintain all the maintenance of the building. The opp.parties have collected an amount of Rs.700/-( Rs.600/- + Rs.100/- municipal water bill) as monthly maintenance from each flat owner and subsequently enhanced the said amount to Rs.900/-. The opposite parties 1 and 2 used to collect rental amounts from the opp.parties 3 & 4 as mentioned below:
1. Reliance Infocomm Ltd. :
From 6.12.2006 to 05.12.2009 @
Rs.12,000/- p.m. For 3 years comes
to Rs.12,000/- x 36 = Rs.4,32,000/- : Rs.4,32,000-00
From 6.12.2009 to 05.4.2012 @
Rs.13,800/- p.m. For total 28 months it
comes to Rs.13,800/- x 28 = Rs.3,86,400/- : Rs.3,86,400-00
Six months advance : Rs. 72,000-00
____________
Total : 8,90,400-00
2.Vantage Advertising Hoardings:
Rs. 3 lakhs (per month comes to Rs.25,000/-)
From 01-01-2008 unto April 2012 comes to
3 years 4 months: Rs.12,00,000/-+
Rs.1,00,000/-= Rs.13,00,000/- :Rs.13,00,000-00
On 08.01.2012 opposite party no.2 sent a letter stating that he resigned the post of President of the Association. On enquiry, the members of the complainant association came to know that the opposite parties 1 and 2 have collected the amounts from the flat owners, Reliance Infocomm Ltd. and Vantage Advertising Pvt. Ltd., but no payments were made towards municipal water bills and an amount of Rs.11,42,263/- is due to the Municipal Water and Sewerage Department. The members of the complainant association also came to know that opposite party no.2 has not even registered the association. Therefore, the flat owners have registered the association with the Registrar of Society and it was allotted a registered no.216/12.
Thereafter, the elected body of the complainant association repeatedly approached and requested the opposite party no.2 to return the amounts collected by him from opp.parties 3 and 4 and also additional amount of Rs.38,500/- (inclusive of corpus fund) collected from the members of the complainant association ( Rs.38,500/- x 86 = 33,11,000/-) in total Rs.55,01,400/-. The complainant association also requested opp.party no.2, to furnish the particulars of payments, if any, made by him, on behalf of the association and also requested to hand over all plans, extra keys and transfer assets. The opposite party neither responded to the said request of the complainant association nor paid any amount. Vexed with the attitude of the opposite parties, the complainant got issued a legal notice dt.17.04.2012, for which, the opp.parties issued a reply dt.29.04.2012 denying the averments made in the notice, without giving any reasons. The complainant had also sent notice dt.23.05.2012, to theopp.parties 3 and 4 calling upon them to enter fresh agreement with them and to pay the amount to it, for which the opposite parties neither replied nor paid any amount. Hence the complaint seeking following reliefs against the opp.parties in favour of the complainant which are as follows:
a). to pass an award of Rs.55,61,400/- in favour of the complainant against the opp.parties 1 & 2 with interest @ 24% p.a. till the realisation;
b). to furnish the statement of expenditure of monthly maintenance collected from the each flat from 2007 onwards and return the balance amount;
c). to provide III phase electricity connection to the flats instead of single phase connection ( as per the specification mentioned in the development agreement dt.24.05.2005);
d). to provide windows as per the specifications mentioned in the development agreement dt.24.05.2005;
e). to handover plans, extra keys of all flats and transfer assets i.e. office rooms, store rooms, lift rooms etc. on the name of the complainant ;
f). to direct the opposite parties 3 and 4 to pay amount in the name
of the complainant, instead of paying to opposite parties 1 and 2 and
also further direct them to enter fresh agreement with the
complainant;
g. to award costs.
After receipt of the notices in the above case, the opposite parties made their appearance through their counsel and the matter was adjourned from time to time for filing their written version and ultimately their right to file written version was forfeited by this Commission. Aggrieved by the said order, the opp.parties 1 and 2 filed Revision Petition no.724/2013 before the Hon’ble National Commission, Delhi. After hearing both sides, the National Commission passed order in I.A.No.1320/2013 in R.P.No.724/2013 on on 01.03.2013 observing as follows:
“However, it is made clear that the opposite party shall be entitled to join the proceedings and advance the arguments. He is also permitted to file written submission. It is also made clear that the petitioner will not raise any new plea or defence. The petitioner is permitted to attack the case of the appellant sans any defence plea.
Consequently, the revision petition is without merit and the same is dismissed”.
In view of the orders of the National Commission in Revision Petition No.724/2013, the opp.parties 1 and 2 were not permitted to adduce any evidence in support of their case. However, they were permitted to advance their arguments without raising any new plea or defence.
Opposite parties 1 and 2 filed written submissions denying the allegations made in the complaint and contended that the complaint is barred by limitation as the construction of the complex was completed in the year 2007 and handed over to the flat owners. The opposite parties denied the allegation of the complainant that they have collected Rs.38,500/- towards amenities, but they have collected the said amount towards providing solar water system & community pipeline gas connection to all the flat owners. Some of the flat owners have not paid the said amount and hence the opposite parties have issued notice dt.04.06.2012 to them to pay the said amount within 15 days, which was received by the flat owners, but neither they gave reply nor paid the said amount.
The opp.parties 1 and 2 submit that the flat owners have not cooperated for registering the Society and as such, some of the flat owners have gathered and nominated opposite party no.2 as the President and one G.Anil as Secretary of the Association of the complex on 9.9.2007, for a period of two years. Thereafter, opp.party no.2 was elected as President and G.Anand was elected as Secretary and thus the association elected body continued till the resignation of opposite party no.2. The Secretary of the association used to collect the maintenance amount from the flat owners, but he has not collected amount of Rs.100/- towards municipal water charges at any point of time. The Association used to issue receipts for collection of maintenance charges for each and every month.
The opp.parties 1 and 2 submit that it is true that the opposite party no.2 collected rents from Reliance Infocom Ltd. That opposite party no.1 and G.Anil & G.Anand used to collect rents from Vantage Advertising Ltd. as they are having exclusive terrace rights, as per their ratio mentioned in the Development Agreement i.e. opposite party no.2 has share of 64% and the owners of land have share of 36% and as such, the land lords and opposite party no.2 have collected Rs.6 lakhs per annum as rent. Opp.party nos.1 and 2 collected rent w.e.f. 6.12.2006 to 05.12.2009 @ Rs.12,000/- p.m. and w.e.f. 06.12.2009 to 05.04.2012 @ Rs.13,800/- p.m. and Rs.72,000/- as advance for six months from Reliance Infocom Ltd. That the Land Lords & opposite party no.2 have collected Rs.6 lakhs as annual rent w.e.f. 01.01.2008 to April,2010 i.e. for three years from Vantage Advertising Hoardings. A fresh deed of license got prepared on 16.11.2011 between the landlords and opp.parties 1 and 2, with fresh understanding and the rent is fixed for a period of six years commencing from 01.10.2011 to 30.09.2017 and will be renewed for six years on mutually agreed terms. The license fee fixed at Rs.3,50,000/- p.a. and payable quarterly, 20% increase in the lease rent from fourth year onwards with TDS deduction. The terrace rights are kept only with the builder and the owners, according to their ratio laid down in the Development Agreement and the same was shown in the sale deeds of the flat owners of the land. Hence, the allegations made by the complainant , regarding the rents collected from opp.parties 3 & 4 is false and the said allegations were made to blackmail and to extract money.
The opp.parties 1 and 2 submit that the present executive body formed an association without conducting any meeting and election among the owners of the apartments, in order to extract the amounts from opposite party no.2 illegally by filing this false case. The opp.parties submit that the complainant requested to handover all claims, extra keys and transfer assets to it and got issued legal notice dt.17.04.2012, for which opp.party no.2 issued reply notice dt.29.04.2012 stating that the Secretary of the Association was the incharge of the office and he is the custodian of all the plans, accounts, vouchers, receipts right from the inception of the unregistered association. As a matter of fact, there was no office constructed for the Association Office, but the office was being operated from the opposite party no.2’s personal office, which is constructed by his own funds. The opposite parties submit that if the complainant association bears cost of the construction of room i.e. Rs.2,50,000/-, they are ready to surrender the room to the association. The complainant association is a welfare association and has no right to get any amounts from opp.parties 3 and 4, as the terrace rights are with opp.party no.2 and owners of the land
The Development Agreement dt.25.05.2005 is an unregistered Development Agreement and later, a registered development agreement was got registered between the land owners and the developer i.e. Opp.party no.1. As such, the complainant has filed false document and misled the Hon’ble Commission. In Regd. Sale Deed no.13233/2006 dt. 26.09.2006 Clause no.10, it is clearly mentioned that the purchasers have to pay the amount for electrical connections. The opp.parties have provided the 3 phase connection only to the flat owners, who have paid the amounts.
These opp.parties submit that document no.98 filed by the complainant is a forged document. The signature of opposite party no.2 is a forged signature. The opposite party no.2 has taken steps to initiate criminal action against the owner of the flat no.514 Mrs. Heena P.Shah. The builder has the right to modify, as per the suggestions of the Architect and landlords, so, regarding the windows modification was done and it was clearly mentioned in the brochure filed by the complainant vide Doc.No.84. It is for the Secretary of the earlier Association to furnish the statement of expenditure of the monthly maintenance collected from flat owners from 2007 onwards and the President is not answerable to the same.
Opp.party no.3 filed counter contending that they are no way connected or concerned with the transaction in between the complainant and other opp.parties, that the complaint is hopelessly barred by limitation and that the complainant is not a ‘Consumer’ within the meaning of the Consumer Protection Act. As far as the payments of the rentals are concerned, this opposite party has agreement with the owners Sri G.Anil, G.Anand, P.Surya Prakash and Smt. Balamani and accordingly this opposite party used to pay the rentals for the usage of the terrace of the complex for advertising their business over and above the said complex. This opp.party has license to run its business by putting hoarding on terrace under the revenue license dt. 16.11.2011 till 30.9.2017 and any interference is objectionable and unwarranted. This opp.party prayed for dismissal of the complaint with costs
Opp.party no.4 filed counter stating that it is India’s largest information and communication service provider, offering cellular mobile telephone services and has over 100 million individual subscribers. The opposite party submits that in the course of its business, it had entered into Lease and License agreement with one Sri G.Anand and M/s.P.Surya Prakash & Company in the year 2006 in respect of the roof top of the building, named as Laxminarayana Villa and the said lease is for 10 years commencing from 06.12.2006 with an option to renew further on mutually agreed terms and the said lease will be expired only on 05.12.216. The opp.party submits that a letter of authority dt.06.12.2006 was issued by Sri G.Anand and Sri G.Anil, who are land lords of the property unconditionally authorising to issue the lease rental to opp.party no.1 from the date of execution of lease and this opp.party was regularly paying rents to the opposite parties 1 and 2 without any default. There are disputes between the complainant and opposite parties 1 and 2 and this opposite party is not concerned with the said disputes. This opposite party is paying the regular rents as per the lease deed. The opposite party no.4 prayed for dismissal of the complaint.
During the course of enquiry, in order to prove their case, the complainant filed evidence affidavit and got marked Exs.A1 to A40.
We heard the counsel for the complainant and opposite parties and perused the entire material on record including the written arguments submitted by the complainant and the opposite parties 1 to 4.
Now the points that arise for consideration in this case are:
1.Whether the complaint is barred by limitation?
2.Whether there is deficiency in service on the opposite parties?
3. Whether the complainant is entitled to the claims made in the complaint?
4.To what relief?
Point No.1:-
Regarding limitation, the contention of the complainant is that cause of action for the complaint arose on 08.01.2012, when opposite party no.2 has resigned the post of the President of the unregistered Society, on 24.01.2012 when the panel members sent letter to opposite party nos.1 and 2 to handover the complete charges, on 13.02.2012 when the complainant association has been registered and approached the opposite parties for transfer of assets, handover extra keys and return the amount collected from flat owners and opp.parties 3 and 4, on 17.04.2012 when the legal notice was got issued by the complainant to opposite parties 1 and 2 and on 29.04.2012 when the reply notice was sent. The complaint was filed on 10.7.2012 i.e. within two years from 8.01.2012. Therefore, the complaint is filed within limitation .
On the other hand the contention of the opposite parties 1 and 2 is that the said cause of action is concocted and created for the purpose of filing of the case, the complex was completed in the year 2007 and if there is any deficiency in service on the part of the opposite parties 1 and 2, the complainant has to file the complaint within two years from the date, when the opposite parties fell due, any amount or any work, as such, the the complaint is barred by limitation and is liable to be dismissed on the ground of limitation.
It is the case of the complainant that the opposite parties 1 and 2 collected amounts from the flat owners through their employees till the date of opposite party no.2 resigned the post of President of the unregistered association vide Ex.A6 copy of resignation letter dt. 08.1.2012 sent by the opposite party no.2 to the panel committee members of the complainant association and Ex.A2 copy of the minutes of the meeting held by the nominated body on 09.09.2007 which speaks about the said fact. It is not in dispute that even till the date of filing of the complaint, the opposite parties 1 and 2 have been collecting the rental amount from the opposite parties 3 and 4. The notices exchanged between the complainant association and opposite party no.2 clearly show that after resignation by the opposite party no.2 to the post, as President of the complainant, new re-elected body, made several requests to opposite party no.2 to furnish the accounts of the association, regarding the amounts collected from the flat owners, under various heads, including the monthly rents from the opposite parties 3 and 4 and other amenities as mentioned in the complaint. Admittedly, the complainant after registering the society gave a notice vide Ex.A14 to opposite parties 1 and 2 and later filed the present complaint seeking direction to the opposite party no.2 to furnish the account for the amounts collected by him and remit the amount to the association. In these circumstances, in our considered view, the cause of action, so far as reliefs a, b, e, f mentioned in the prayer portion of the complaint, starts from the date on which, the opposite party no.2 resigned as President of the un registered association, without furnishing any accounts to the complainant i.e. 8.01.2012 vide Ex.A6. In the present case, the opposite party no.2 has admitted that he has been receiving the lease amounts from opposite parties 3 and 4 since the date of agreement. The complaint in this case has been filed on 10.07.2012.
The complainant filed Ex.A34 copy of the plaint in O.S.No.1092/12 filed on the file of District Court, R.R.Dist. by theopp.parties 1 and 2 herein against the owners and the tenants, regarding the flat no.608 of Laxmi Narayana Villa Residential Complex for declaration that the plaintiff is the absolute owner of flat no.608 and to direct the defendants 1 and 2 the owners to deliver possession of the schedule property etc., Ex.A35, the copy of the plaint in O.S.No.106/2012 on the file of Sr.Civil Judge Court, R.R.Dist., L.B.Nagar filed by the opposite parties 1 and 2 herein, against the owners Gotte Anil and Gotte Anand for recovery of an amount of Rs.1,71,360/- towards their share of lease amount paid by M/s.Vantage Advertising Pvt.Ltd. and Ex.A36 copy of the plaint in O.S.No.41/2013 on the file of Sr.Civil Judge, R.R.Dist. at L.B.Nagar filed by the opposite parties 1 and 2 herein against the owners for recovery of Rs.2,16,000/-, towards their share in lease amount realised from the tenants, in occupation of flat no.608 , to show that the said suits are filed based on Ex.A33 Development Agreement cum General Power of Attorney and that the opposite party no.2 herein has mentioned in the said plaints that the said suits are filed within limitation. As seen from the copies of the plaints, in first two suits, the limitation is computed basing on the Development Agreement dt.13.09.2005 and lease deed dt.5.12.2007 and the amount due is from 01.11.2009.
The learned counsel for the complainant submitted that the opposite party no.2 having filed the suits for recovery of the amounts from the land lords basing on Ex.A33 stating that the said suits, for recovery of the money and recovery of the possession of some portion of the land from the land lords are within limitation, now they cannot say that the present complaint is not within limitation. We are not inclined to accept the said submission of the learned counsel for the complainant. Even if the opposite parties 1 and 2 herein wrongly stated in the suits mentioned above that the above said suits filed for recovery of the amount etc. are within limitation, that cannot be taken as a ground to conclude in this complaint that this complaint is filed within limitation. We have to decide independently basing on the facts and circumstances of this case, whether the complaint is filed within limitation. Therefore, the above described documents filed by the complainant and Ex.A37 the copy of the complaint in C.D.No.65/2013 filed by some of the flat owners before the Dist.Forum, R.R.Dist. against the owners and the builders i.e. opposite parties 1 & 2 herein are of no help to the complainant. For the afore said discussion of facts and circumstances in our considered view the complaint filed by the complainant regarding the reliefs a, b, e, f mentioned in the prayer portion of the complaint is filed within the limitation period of two years as contemplated under Sec.24 A of the Consumer Protection Act. However, the reliefs c & d which are mentioned below are barred by limitation:
“c). To provide III Phase electricity connection to the flats instead of single phase connection (as per the specification mentioned in the development agreement dated : 24-05-2005);
d). To provide windows as per the specification mentioned in the development agreement dated : 24-05-2005”
The construction of the flats was completed and possession of the same was delivered to the individual purchasers in the year 2006 itself as is evident from Ex.A23 copy of the sale deed, dt.26.09.2006 executed in the name of one of the flat owners. Absolutely there is no evidence on record to show that at any point of time, after registration of the flats and delivery of possession, any one of the members of the complainant association demanded the builder i.e. opposite parties 1 and 2, to provide 3 phase electricity connection to the flats instead of single phase connection and to provide windows as per the specifications mentioned in the Development Agreement dt.24.1.2005 as mentioned above. Therefore, there is no proof that demand is made by any of the members of complainant association to the builder to comply with the above said deficiencies from the date of registration of the flats and delivery of possession of the flats to the individual flat owners in or about 2006, till filing of the complaint. There is no whisper in the notices got issued by the complainant to the opposite parties about the alleged demand for the above said amenities by the complainant to the opposite parties 1 and 2. Therefore, the complaint filed by the complainant in the year 2012 with regard reliefs c & d is clearly barred by limitation, by virtue of provisions of Sec.24 A of the Consumer Protection Act. For the afore said facts and circumstances, this point is answered accordingly .
Point no.2:
The admitted facts are:-
The opposite parties 1 and 2 have advertised in the print and electronic media offering to sell the apartments as per the specifications shown in the brochure and accordingly the flats have been sold to present purchasers, at different rates and that the opposite parties have promised at the time of booking the flats that immediately after completion of the project, an association of all purchasers will be formed and registered. Subsequently, the flats were delivered to all the purchasers, who are the members of the complainant association and they are in possession and in enjoyment of their respective flats, since the respective dates of their delivery.
The case of the complainant is that the opposite parties 1 and 2 have further demanded from each flat owner, an amount of Rs.38,500/- towards amenities including corpus fund (the amount collected in total is Rs.38,500/- x 86 = Rs.33,11,000/-), and also demanded and collected Rs.11,000/- towards water connection and an amount of Rs.15,000/- towards electricity connection. At the time of booking the flats, opp.parties 1 and 2 promised to provide all the facilities and amenities on the flat cost itself. But contrary to their promises, they have demanded to pay the said amount, otherwise they will not provide the said amenities. Thus, the flat owners have paid the said amount as per the demands made by the opposite parties 1 and 2. The further case of the complainant is that after completion of the project, without forming proper association and without registering any society, the opposite party no.2 being a builder, declared himself as President and informed the members of the complainant association that he would lookafter all the maintenance of the building complex. The opposite parties collected through their employees an amount of Rs.700/-(Rs.600/- + Rs.100/- for municipal water bill) as monthly maintenance from each flat initially and subsequently it has been increased to Rs.900/-. The complainant further contended that the opposite parties have collected rental amount of Rs.8,90,400/- including six months advance of Rs.72,000/- from Reliance Infocomm Ltd. and Rs.13 lakhs from Vantage Advertising Pvt. Ltd. on behalf of the unregistered association. On enquiry, the flat owners came to know that the opposite party no.2 had not even registered the association. Therefore, the members have formed into an association and got the same registered by the Registrar of Societies, who allotted a registered no.216/12 to the complainant association. Thereafter, the elected body of the complainant repeatedly requested the opposite party no.2 to return the above said amount to the association and also requested to furnish the particulars of payments, if any, on behalf of the association made by him and to handover all the plans, extra keys and transfer assets to the complainant. But the opposite parties did not pay any amount to the complainant. The complainant association is entitled to and the opposite party no.2 is liable to refund the collected amount to the association.
The complainants claimed returning of Rs.8,90,400/- including Rs.72,000/- towards six months advance that was collected by the opposite party no.2 from Reliance Infocom Ltd. and Rs.13 lakhs the lease amount that was collected by the opposite party no.2 from Vantage Advertising Hoardings contending that the terrace of the complex which was given to opp.parties 3 and 4 on lease by opposite party no.2 is the common area as defined in A.P.Apartments Act and as such, the complainant association is entitled to the said amount and the opposite parties 1 and 2 are liable to return the same to the complainant association furnishing statement of account.
The above case of the complainant has been proved by the evidence affidavit of Harprith Singh, President of complainant association, as the opposite parties have not filed any evidence affidavit rebutting the contents of affidavit of the President of the complainant association.
The opp.parties 1 and 2 have admitted that opposite party no.2 being the builder and land owners have granted licence to Reliance Infocom Ltd. and Vantage Advertising Hoardings and accordingly they have collected rents from them according to their respective shares, right from the completion of the project, but opposite party no.2 has contended that the opposite parties 1 and 2 and the land owners have not transferred any terrace rights either to the association or to any individual flat owners while alienating the flats and as such, the terrace rights of the building complex are kept only with the builder and the owners, according to their ratio laid down in the Development Agreement and the same was shown in the sale deeds of the flat owners of the land. Therefore, they are not liable to return any amount that was collected by the opposite party no.2 from the opposite parties 3 and 4 to the complainant association.
Ex.A33 is the copy of the Development Agreement cum General Power Attorney entered between the landlords and opposite parties 1 and 2 herein. Nowhere in this document, it is mentioned that the owners and the builder kept the terrace rights with them. Clause 15 at internal page no.3 of Ex.A33, which is relevant for the present purpose, is extracted as under:
“ After completion of the construction of the building complex and after formation of the Society by all the flat owners of the building complex, the open land forming part of the schedule property and the stair cases, passages and the common amenities shall be owned in common by all the flat owners of the building complex including the land owner.“
Clause 2 at Internal page no.5 of Ex.A33 Agreement is as follows:
“ The Land owners agrees to use and enjoy all the common amenities in the building complex along with other flat land owner. The common amenities include usage of staircase, corridors, lift, common parking areas, bore well, common areas, drainage, pipelines, common water pipelines, common electricity meter connections, over-head tank and other properties of common enjoyment. The owner or any other flat owner shall not demolish or caused to be demolished any part of the building complex which shall cause any damage to the structure of the building.”
The learned counsel for the complainant drew our attention to Section 3 of The Andhra Pradesh Apartments (Promotion of Construction and Ownership) Act,1987, which deals with definitions. Sec.3(d) of the Act extracted as under:
(d) “Common areas and facilities“ unless otherwise provided in the declaration, means:
(i) the land on which the building is located ;
(ii).foundation, columns, girders, beams, supporters, main walls, roofs including terraces, halls, corridors, stairs, stair-ways, fire-escapes and entrances and exits of the building;
(iii).Basements, cellars, yards, gardens, parking areas, children’s playground and storage spaces;
(iv) the premises for the lodging of janitors or caretakers or persons employed for the management of the property
(v) installations of general services , such as power, light, gas, hot and cold water, heating, refrigeration, air-conditioning and incinerating .
(vi) elevators, tanks, wells and bore-wells, pumps, motors, compressors, ducts and in general all apparatus and installations existing for common use;
(vii) such other community and commercial facilities as may be provided for in the building plan and declaration.
(viii) all other parts of the property necessary or convenient to its existence, maintenance and safety or normally in common use;
(f)”Common profits” means the balance of all income, rents, profits and other income from the common areas and facilities remaining after the deduction of the common expenses.
(n) “Property” comprises the land, the building and the common area and facilities”.
Section 9 Clause 1 and also Section 13 of The Andhra Pradesh Apartments (Promotion of Construction and Ownership) Act,1987, reads as follows:
9.Common areas and facilities: Each apartment owner shall be entitled to the percentage of undivided interest in the common areas facilities as expressed in the Declaration. Such percentage shall be computed by taking as basic, the value of the apartment in relation to the value of the property, and such percentage shall also reflect the limited common areas and facilities.
13.Common profits and expenses: the common profits of the property shall be distributed among and the common expenses shall be charged to, the apartment owners according to their percentage of undivided interest in the common areas and facilities.”
The learned counsel for the complainant placed his reliance on the decision of Hon’ble High Court of A.P. in CSR Estates, Flat Owners Welfare Association vs. Hyderabad Urban Development Authority reported in 1998 (6) ALD 547 whereunder it is clearly observed that “A builder cannot construct or make use of unsold flats or any common area in any way he likes”. The same observation was confirmed by the Division Bench of High Court of A.P. reported in 2003 (3) ALD 533 (DB).
The learned counsel for the opposite parties 1 and 2 submitted in his reply written submission filed on 22.08.2013 that Sec.2 of the A.P. Apartments (Promotion of Construction and Ownership) Act, 1987, says that the provisions of this Act, excepting Chapter III shall apply to property and provisions of Chapter III shall not apply to any property unless the sole owner or all the owners thereof submit the same to the provision of that Chapter by duly executing and registering a declaration as hereafter provided. There is no declaration by the owners before the competent authority. As such, the Act has no application to the facts of this case.
A combined reading of Sec.4 and Sec.9 of the A.P.Apartments Act, made it clear that after declaration of the plan by the builder, under Sec.4 of the Act, the builder has no right to touch the plan or the declaration plan as provided for whatever the reasons. When once, the first flat is purchased by any person, for the first time, such purchaser and builder become common owners for all amenities and facilities that are provided or to be provided only according to the plan approved.
The learned counsel for the opposite parties 1 and 2 simply submitted that no declaration was given by the owners before the competent authority. We are unable to accept the said submission of the learned counsel, for the reason that without any declaration given by the owners, the buider as well as the owners have no right to sell the flats to the intending purchasers. In this case, the flats were sold to the members of the complainant association and they have been in possession and enjoyment of the same along with the common areas, with absolute rights. However, the opposite parties 1 and 2 did not choose to file any evidence affidavit of the owners in support of the submission of the learned counsel that no declaration contemplated under the A.P.Apartments Act was given by the owners in this case. In these circumstances, the submission of he learned counse for heopposite parties 1 and 2 is liable to be rejected. Now the act and the conduct of the builder and owners made it clear that there was declaration given by the owners. Under these circumstances, the submission of the learned counsel is unsustainable and hence we rejected the same.
It is true that in the original of Ex.A23 sale deed under Clause 9 it is mentioned as follows:
“The terrace rights of the entire building is the exclusive property of the Vendors and the Vendee or his/her/their nominees, shall not have any right, claim of whatsoever nature over the terrace including to visit over the same.”
But there is no such Clause in Ex.A33, the Development Agreement cum General Power of Attorney. Clause 15 at internal page 3 and Clause 2 at internal page 5 of Ex.A33 made it clear that after completion of the construction of the complex and after formation of Society by all the flat owners, the common area and facilities shall be owned by all the flat owners of the complex including the land owner. In these circumstances, Clause 9 incorporated in the Sale Deed vide Ex.A23 contrary to the terms and conditions of Ex.A33 is nothing but unfair trade practice. Therefore, basing on the Clause 9 of the Sale Deed alone, the contention of the opposite parties 1 and 2 that the builder and the owner kept the terrace rights of the complex with them and that the complainant association has no right whatsoever over the terrace rights of the complex cannot be accepted. It is significant to note that the owners who are the members of the complainant association are not claiming any exclusive rights over the terrace of the complex.
In view of the admissions made by the opp.parties 1 and 2 in Ex.A33 and the provisions of A.P.Apartments (Promotion of Construction and Ownership) Act,1987, referred to above and the ruling of the Hon’ble High Court, we have no hesitation to hold that the builder has no exclusive right on the common areas including the terrace and that all the flat owners are having right in the common areas including the terrace. Therefore, the income realised from the common areas is to be shared by all the flat owners i.e. members of the complainant association.
In the written arguments, the opposite parties 1 and 2 have categorically admitted that opposite party no.2 and land lords have collected Rs.6 lakhs per annum w.e.f. 6.12.2006 to 05.12.2009 towards rents from the opp.party no.4 @ Rs.12,000/- per month and w.e.f. 06.12.2009 to 05.04.2012 @ Rs.13,800/- and Rs.72,000/- as advance for 6 months from RelianceInfocomm Ltd. and that they have also collected Rs.6 lakhs as annual rent w.e.f. 01.01.2008 to Apri,2010 i.e. for three years from Vantage Advertising Hoardings and appropriated the rentals for themselves. In view of our finding that income realised from the common areas is to be shared by all the flat owners, the opposite parties 1 and 2 are liable to pay the rents collected by them from opposite parties 3 and 4, i.e. which comes to Rs.21,90,400/- ( Rs 8,90,400/- + Rs.13 lakhs), to the complainant as claimed by it in the complaint.
It is the case of the complainant that at the time of booking the flats, the opposite parties 1 and 2 have promised to provide all the facilities /amenities on the flat cost itself, but contrary to their promise they have further demanded and collected additional amount of Rs.38,500/- towards the amenities including the corpus fund, from each flat owner, threatening that they would not provide the said amenities, unless the additional amounts are paid. The total amount collected from the flat owners comes to Rs.33,11,000/- (Rs.38,500/- x 86). The President of the complainant association has stated about the said claim in his evidence affidavit. The complainant has also issued Ex.A14 legal notice dt.17.04.2012 to the opposite parties 1 and 2 demanding to pay Rs.33,11,000/- which was collected by the opposite parties 1 & 2 inclusive of corpus fund @ Rs.38,500/- from each flat owner, who are 86 in number. The opposite parties 1 and 2 received the original of Ex.A14 and got issued Ex.A15 reply notice, wherein it is categorically mentioned that in the course of purchasing the flats by respective flat purchasers, it was agreed between the opposite parties 1 and 2 and the purchaser that the purchaser should pay a sum of Rs.38,500/- separately to the opposite parties 1 and 2 for providing additional amenities and with the collected amount, they have provided the additional amenities of Solar Water Plant etc. as mentioned in the notice. Ex.A30 the copy of the receipt dt.22.08.2006 given by the opposite party no.2 in favour of one G.Srinivas Reddy, one of the flat owners for receiving Rs.88,000/- including the amount of Rs.38,500/- towards amenities along with relevant papers. The papers enclosed to Ex.A30 revealed that Rs.38,500/- is paid towards the amenities.
In para 17, page 5 of the written submissions of opposite parties 1 and 2 it is submitted as follows:
“It is submitted that an amount of Rs.38,500/- was collected towards additional amenities like Gas, Solar Water System Erection for supply of hot water to the flat owners. But only 47 flat owners have paid the said amount and still 20 ½ flat owners i.e. Land Lords are due and are liable to pay Rs.38,500/- for each flat with bank interest ... It is submitted flat owners 106, 108, 201, 206, 212, 218, 303, 312, 316, 318, 412, 509, 512, 514 and 516 have not paid the solar water system for supply of hot water and community gas charges and as such OP.no.2 has got issued a legal notice dt.04-06-2012. The said owners, having received the said notice, have not replied the said notice nor paid the said amount. They are still due. The Hon’ble Forum may please to direct the above said persons to pay the said amount.”
From the said submission, it is evident that the opposite parties 1 and 2 have collected Rs.38,500/- towards the additional amenities like solar water system etc. from the each flat owners. The opposite parties 1 and 2 have not adduced any evidence to show that they have not agreed to provide these additional amenities at the time of booking the flat and that with the amount collected from the flat owners, they have provided the additional amenities and that some of the flat owners have not paid the additional amounts. In the absence of such evidence, we are not inclined to accept the said submission made on behalf of the opposite parties 1 and 2. The opposite parties are therefore liable to pay Rs.33,11,000/- to the complainant.
The contention of the complainant is that after registration of the Society on 13.02.2012, the elected body approached the opposite parties several times and requested to transfer the assets, handover extra keys and return the amount collected from the flat owners and opp.parties 3 and 4, but there is no response from the opposite parties.
As could be seen from the exchange of notices and letters by the complainant association and the opposite parties 1 and 2 and written submissions filed by the opp.parties 1 and 2, the opposite parties 1 and 2 have admitted that no registration of the flat owners association has been done till 13.02.2012, on which day the members of the complainant got registered the Association. They contended that the registration of the association was not done, as the flat owners have not cooperated for the same, as such, some of the flat owners have gathered and nominated opposite party no.2 as the President and one G.Anand was elected as Secretary of the unregistered association of the complex on 9.9.2007 for a period of two years and after completion of two years, election was held and opp.party no.2 was elected as President and G.Anand was elected as Secretary and thus the association elected body continued till the resignation of opposite party no.2 which was on 08.01.2012.
From the said contention of the opposite parties 1 and 2, it is evident that the opposite party no.2 was the President of the unregistered association from 09.09.2007 till 08.01.2012. The opposite parties have not denied the fact that the complainant association has been registered vide registration no.216/2012. Except the bald contention of the opposite parties 1 and 2 that the members of the association have not cooperated for registration of the association, they have not adduced any evidence in proof of the same. There is no evidence on record to show that the election of office bearers of the unregistered association was held and the opposite party no.2 was elected as President and one G.Anand was elected as Secretary. Clause 15 at internal page no.3 of Ex.A33 made it clear that till the formation of the registered Society of the flat owners of the building complex, the builder has to maintain the building complex. Therefore, in our considered view the opposite parties 1 and 2 are liable to account for all the amounts collected by them from the members of the complainant association till the formation of registered society.
The fact that the builder has to manage and maintain the complex till the formation of proper registered association of the flat owners and on the formation of registered association, the builder has to handover the charge to the complainant association by handing over the record maintained by him explaining how he spent the amount collected by him from the flat owners and what is the balance amount available with him, the opposite parties 1 and 2 have admitted in the written arguments at the bottom of page no.2 that the complainant requested to handover all the claims, extra keys and transfer assets to the complainant, but contended that opposite party no.2 had already handed over the extra keys and plans to the association. The opposite parties 1 and 2 have also admitted that the complainant has got issued legal notice dt.17.04.2012 Ex.A14 demanding to handover all the items including the amounts mentioned in the notice and asserted that after receiving the said notice, the opposite party no.2 got issued Ex.A15 notice dt.29.04.2012 stating that the Secretary of the association was the incharge of the office and he is the custodian of all the plans, accounts, vouchers, receipts right from the inception of the unregistered association. In view of the above, it is an admitted fact that the complainant got issued Ex.A14 notice and opposite parties 1 and 2 got issued Ex.A15 reply. The opposite parties 1 and 2 have not adduced any evidence to prove that opposite party no.2 has already handed over the extra keys and plans to the association. The said plea of the opposite parties 1 and 2 is contrary to the contents of Ex.A15 reply. The opposite parties 1 and 2 have not pleaded and adduced any evidence to prove that the Secretary of association as incharge of the office is the custodian of all the plans etc., as such, the Secretary is liable and not the President, to handover the plans, accounts, vouchers etc. to the complainant. At page 4 para 9 of the written submissions, the opposite parties 1 and 2 have submitted that opposite party no.2 has already informed the President of the Association by his letter dt.18.02.2011 by stating that G.Anil, the then Secretary has taken away the key of the association office and taken the lift keys, gas room keys, duct keys and other association papers, plans extra keys, as such, the opposite party no.2 again need not give any keys etc. to the association. Except the said submission, the opposite parties 1 and 2 have not adduced any evidence that G.Anil, the then Secretary has taken away the key of the association office etc. In the absence of any evidence it is not possible to accept the above submission of the opposite parties 1 and 2 which is inconsistent with his earlier submission.
The opposite parties 1 and 2 have also not adduced evidence to show that the Secretary of the unregistered association used to maintain the accounts and affairs of the Society and the President used to supervise the works in general. Being the builder and being the nominated President of the unregistered body, the opposite parties 1 and 2 cannot escape from their liability to handover the charge to the registered body i.e. the complainant on the premise that the Secretary of the earlier association used to maintain accounts and affairs of the Society and it is for the Secretary of the earlier association to furnish the statement of expenditure of the monthly maintenance collected from the flat owners from 2007 onwards.
In view of the facts and circumstances discussed above, we are of the view that the opposite parties 1 and 2 are liable to furnish statements of expenditure of monthly maintenance collected from the owner of the each flat from 2007 onwards and return the balance amount to the complainant association .
For all the afore said facts and circumstances, we are of the view that there is deficiency in service on the part of the opp.parties 1 and 2 . As we are granting interest on the amount payable to the complainant, we are not inclined to award any compensation to the complainant.
In the result, the complaint is allowed in part directing the opposite parties 1 and 2 to pay jointly and severally Rs.55,61,400/- to the complainant with interest at 12% p.a. from the date of the complaint till the date of realisation and to furnish the statement of expenditure of monthly maintenance collected from each flat owner from the year 2007 onwards and return the balance amount to the complainant association. They are also directed to handover all plans, extra keys of all flats and transfer assets i.e. office room, store rooms, lift rooms etc. in the name of the complainant. The opposite parties 3 & 4 are directed to enter into fresh agreements with the complainant and accordingly pay the rentals to the complainant, till such time, from the date of this order, the opposite parties 3 and 4 are directed to pay the existing rents to the complainant. The complaint, regarding other reliefs, is dismissed. The opposite parties 1 and 2 are directed to pay a sum of Rs.10,000/- to the complainant towards costs of the complaint. The opposite parties are directed to comply with this order within 6 weeks from the date of receipt of the copy of the order.
MEMBER
MEMBER
APPENDIX OF EVIDENCE
Witnesses examined
For the Complainant : nil For the opp.parties : nil.
Evidence in chief affidavit filed by the complainant.
Exhibits marked on behalf of the complainant:
Ex.A1 : Estimation of amenities in Laxmi Narayana Villa.
Ex.A2 : Minutes of the meeting dt. 09.09.2007 of Laxmi Narayana Villa
Residency Welfare Society.
Ex.A3 : Lr.dt.19.09.2007 by the builder to the flat owners.
Ex.A4 : Agreement of leave and license between Opp.party no.2 and
Reliance Infocomm Ltd. dt.6.12.2006.
Ex.A5 : Deed of Licence entered into on 16.11.2011 by builder with
M/s.Vantage Advertising Pvt. Ltd.
Ex.A6 : Lr.Dt.08.01.2012 from opp.party no.2 to the Panel Committee
Members, Laxminarayana Villa Residential Welfare Society.
Ex.A7 : Agenda dt. 22.01.2012 for the meeting of Laxminarayana Villa
Flat owners.
Ex.A8 : Lr. dt.24.01.2012 by one of the flat owner to the opp.party no.2.
Ex.A9 : Lr. dt.18.02.2012 from the builder to the President,
Laxminarayana Villa Residential Welfare Society.
Ex.A10:Certificate of registration dt. 13.2.2012 issued by Registrar of
Societies, Ranga Reddy Dist.
Ex.A11: Bye laws of complainant Association.
Ex.A12: Lr. dt.27.02.2012 from complainant to opp.party no.3.
Ex.A13: Lr. dt.04.03.2012 from complainant to opp.party no.4.
Ex.A14: Legal notice dt.17.04.2012 issued by complt. to O.Ps.1 and 2.
Ex.A15: Reply legal notice dt.29.04.2012 issued by Ops.1 & 2.
Ex.A16: Legal notice issued by O.P.No.2 to the Secretary of
complt. association.
Ex.A17: Reply legal notice dt.23.05.2012 issued by complt.
Ex.A18: Legal notice sent by the complt. to opp.party no.3. dt.23.05.2012.
Ex.A19: Acknowledgement
Ex.A20: Legal notice sent by complt. to opp.party no.4.
Ex.A21: Acknowledgement.
Ex.A22: Development Agreement dt.24.1.2005 between landlord & builder.
Ex.A23: Sale Deed dt. 26.09.2006.
Ex.A24: Brochure with regard to Lakshmi Narayana Villa.
Ex.A25: Water bill issued by HMWSSB dt. 18.01.2012.
Ex.A26: Water bill issued by HMWSSB dt. 03.03.2012.
Ex.A27: Disconnection notice for water supply & Sewerage, served
by the HMWSSB.
Ex.A28: Reply legal notice dt.01.6.2012 issued by builder.
Ex.A29: Rejoinder dt.13.06.2012 issued by the complainant counsel
to counsel for opp.party no.2.
Ex.A30: Receipt dt. 22.08.2006 issued by O.P.1.
Ex.A31: Minutes of the monthly meeting dt.02.04.2012.
Ex.A32: Minutes of the special meeting dt.17.06.2012.
Ex.A33: Development agreement-cum- General Power of Attorney
between landlords and opp.parties 1 and 2.
Ex.A34: Copy of the plaint in O.S.No.1092/12 filed by O.P.1.
Ex.A35: Copy of the plaint in O.S.No.106/2012 filed by O.P.No.1.
Ex.A36: Copy of the plaint in O.S.No.41/2013 filed by O.P.No.1.
Ex.A37: Copy of the complaint filed before the Dist.Cons.Forum,
Ranga Reddy Dist. in C.D.No.65/2013 by residents of
Laxminarayana Villa Apartments.
Ex.A38: Copy of the plaint in O.S.No.593/2013 before the Sr.Civil
Judge Court, R.R.Dist. by O.P.No.3.
Ex.A39: Deed of licence dt. 16.11.2011 in favour of O.P.No.3.
Ex.A40: Legal notice dt. 21.09.2012 issued by O.P.No.1
Exhibits marked on behalf of the opp.parties : nil
MEMBER
MEMBER
Pm* Dt. 24.04.2014
