BEFORE THE TELANGANA STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD
F.A.No. 353 OF 2014 AGAINST C.C.NO.592 OF 2010 DISTRICT CONSUMER FORUM-II HYDERABAD
Between
Ch.Krishnaiah S/o late Ch.Thimmaiah
Aged about 67 years, Occ: Business
D.No.17-71, Near Petrol Bunk
Kothakota Post & Mandal
Mahabubnagar District-509381
Appellant/ opposite party no.15
AND
- T.Ruchita D/o T.Bheem Reddy
Aged about 23 years, Occ: Student
R/o H.No.3-5-20, II Floor
Ramkote, Hyderabad
Respondent/complainant
- M/s Prestige Avenue Ltd.,
Rep. by tis Managing Director
Mr.M.Venkateswara Rao
Regd.Off 4th Floor, MCH No.3-6-262
Tirumala Estate, Himayatnagar
Hyderabad
- M.venkateswara Rao S/o late Venkata Ratnam
Aged about 52 years, Occ: Business
A/101, Sri Balaji Indraprastha
1-1-508/1, Gandhinagar
Hyderabad-500080
- JRV Sivarama Krishna S/o JRK Murthy
Aged about 45 years, Occ: Business
Flat No.303, 1-2-24, HImayatnagar
Hyderabad-500029
- P.Ravi Kumar, S/o P.Rajagopal
Aged Major, Occ: Business, B-402,
Srinivas Apts., 1-2-343, Street No.6
Domalguda, Hyderabad-500029
- R.Govinda Reddy S/o R.Raghava Reddy
Aged Major, Occ: Business, Plot No.61,
Siddhartha Colony, Sainikpur
Secudnerabad-16
- A.Narahari S/o not known
Aged: Major, Occ: Business
B-26, Madhuranagar,
Hyderabad-500038
- M.Krishna Gupta S/o MSM Gupta
Aged about 67 years, Occ: Business
980, MLAs Colony, Road NO.12,
Banjara Hills, Hyderabad-500034
- BB Raja S/o B.C.Veeranna
Aged about 52 years, Occ: Business
Raja State Co., 189, Mamaipet
Bangalore-560063
10. J.Madhusudhana S/o J.Seshachalam
Aged about 45 yrs, occ: Business
5/2/0, Bangalore Road, Bellary
Karnataka-583101
11. J.Lakshminarayana S/o JRK Murthy
Aged about 23 years, Occ: Bsuienss
1-2-24, Domalaguda, Hyderabad-500029
12. P.Chandrasekhar S/o P.Srinivasulu
Aged about 51 years, Occ: Bsuienss
15/22, R.J.Street, Guntakal-515801
13. A.Hari Haranath S/o A.Ram Subba Rao
Aged about 51 years, Occ: Business
27-19-14, Durgaiah Street, Governorpet
Vijayawada-520002
14. BSS Prasad S/o B.Sita Ramaiah,
Aged about 60 years, Occ: Business
C/o Soujanya Nursing Home
Renigunta-517520
15. HS Prakash S/o HP Shankar
Aged about 42 years, Occ: Business
650, Cinema Road, Doddaballapur
Bangalore-561203
16. M.Timamaih Gupta S/o M.Seshaiah Gupta
Aged : Major, Occ: Business
R/o 104, Jagannath Residency
Achyuta Reddy Marg, Street No.6
Vidyanagar, Hyderabad-500044
17. M.Ashok Kumar S/o Thimmaiah Gupta
Aged about 50 years, Occ: Business,
1-6-40/3, Station Road
Mahabubnagar-509001
18. J.Lakshminarasimaiah
S/o J.Gangaiah, Aged about 64 years
Occ: Business, Flat No.101,
D.No.1-9-329/101, PRK Mansion
Ramnagar Gundu, Hyderabad500044
(Respodnent Nos.2 to 18 are not necessary parties)
Respondents/opposite parties no.1 to 14 & 16 to 18
Counsel for the Appellant M/s V.Gourisankara Rao
Counsel for the Respondent No.1 Sri T.Bheem Reddy
Counsel for the Respondent Nos.2to18 Not necessary parties
QUORUM :
HON’BLE SRI JUSTICE B.N.RAO NALLA, PRESIDENT
&
SRI PATIL VITHAL RAO, MEMBER
FRIDAY THE NINETH DAY OF MARCH
TWO THOUSAND EIGHTEEN
Oral Order : (per Hon’ble Sri Justice B.N.Rao Nalla, Hon’ble President)
***
This is an appeal filed by the opposite party no.15 aggrieved by the orders of District Consumer Forum-II, Hyderabad, dated 11.07.2012 made in CC No.592 of 2010 wherein it allowed the complaint directing the opposite parties jointly and severally to refund to the complainant a sum of Rs.4,25,000/- paid by her towards sale consideration along with the agreed rate of interest @ 3% per month from the date of sale agreement i.e., 30.04.2007 till its realization besides a sum of Rs.2,0900/- towards compensation and Rs.1,000/- towards costs.
2. For the sake of convenience, the parties are referred to as arrayed in the complaint.
3. The case of the complainant, in brief, is that the opposite parties no.12 to 18 are the Managing Director and Directors of opposite party no.1 firm running in the name and style of M/s Prestige Avenue/Ocean Prestige floated real estate venture at Rachakonda and they made wide publicity regarding their venture. The complainant having trusted the opposite parties no.2 to 18 joined as a member and paid the entire sale consideration of Rs.4,25,000/-. The opposite party no.2 being the Managing Director and the opposite party no.15 being the Director of opposite party no.1 firm have executed an agreement of sale on 30.04.2007 reflecting the amenities, specifications to be provided along with infrastructures in favour of the complainant. In the month of October 2007 the opposite parties requested the complainant to submit photograph, finger print form along with details stating that the company will get it registered the developed house plot as per specifications. After submitting the above said required material, the opposite parties stated that they have developed the plot as per the specifications of agreement and they are waiting for permission for shifting Ocean Park from Gandipet to Rachakonda. The complainant thereafter came to know that the land in which the opposite parties started venture was Government Land and when he visited the said land there are no signs of development in the said land. The complainant also came to know that the land bearing some survey numbers are in dispute and the government has not approve the entire layout and refused for conversion from agriculture to non-agriculture and they have not obtained from competent authority for conversion of land and layout. The opposite parties having collected the entire sale consideration failed to keep up their promise in developing, allotting and registering developed house plots. As per the terms and conditions of agreement dated 30.04.2007 the opposite parties have agreed that they will refund the entire sale consideration amount of Rs.4,25,000/- with interest @ 3% per month in case of non-allotment of developed area due to any reason. The opposite parties not only failed to develop the venture and register the sale deed but also failed to refund the amount as agreed by them. Hence, the complaint praying to direct the opposite parties to pay a sum of Rs.4,25,000/- towards the sale consideration ; Rs.3,82,500/- towards interest @ 3% per month on the principle amount of Rs.4,25,000/- from 30.04.2007 till 28.10.2009 and Rs.1,00,000/- towards damages and future interest @ 36% p.a. on Rs.4,25,000/- from 29.11.2009 till the date of repayment and also the costs.
4. The opposite parties no.1 and 2 resisted the case contending that the complainant has not paid the entire sale consideration but has paid only an amount of Rs.2,25,000/- in cash and had defaulted the payment of rest of the sale consideration. An agreement is executed in favour of the complainant on 28.04.2007 but the same has been executed only on the assurance that the complainant will pay the balance sale consideration in a couple of months from the date of agreement and failed to comply the same. Since the complainant has not paid the entire sale consideration, the question of registration of the plot does not arise and he is not entitled for the amount and interest thereon. Hence, the opposite parties no.1 and 2 prayed for dismissal of the complaint.
5. The opposite parties no.7, 8 & 14 also resisted the case contending that since these opposite parties resigned from the directorship of the company long back and the same has been informed to the Registrar of Companies they are nowhere related to the said transaction and they are unnecessary parties to the present case and as such the question of deficiency of service or breach of trust does not arise. Hence, the opposite parties no.7, 8 and 14 prayed for dismissal of the complaint.
6. The opposite parties no.3 to 6, 9 to 13, 15 to 18 remained absent.
7. During the course of enquiry before the District Forum, in order to prove his case, the complainant filed his evidence affidavit and got marked Ex.A1 to A13 and the respondents/opposite parties filed Evidence Affidavit and got marked Ex. B-1 to B61.
8. The District Forum after considering the material available on record, allowed the complaint bearing CC No.592 of 2010 by orders dated 11.07.2012 as stated in paragraph No.1, supra.
9. Aggrieved by the said decision, the opposite party no.15 preferred the appeal contending that the Dist. Forum did not appreciate the facts in correct perspective. The District Forum failed to see that the complainant has to approach a competent civil court for the rederssal of her grievances if any as the dispute is with regard to the breach of terms and conditions of agreement and as such she has to approach civil court by filing suit for specific performance. As per Ex.a13 “Invest Proposal for Land Purchase in Ocean Prestige” is meant for earning profit. The amounts paid by the complainant were never reflected in Ex.A3 agreement dated 30.04.2007. The opposite party no.15 is only an agent of the opposite party no.1. The opposite party no.15 never issued Ex.A2 receipt for Rs.2,00,000/- in favour of the complainant. The opposite party no.15 was not a Director of opposite party no.1 as on 08.11.2006 much less he was an authorized signatory to receive any amounts on behalf of opposite partyno.1. The complainant created/fabricated Ex.A2 receipt. The complaint is barred by limitation u/s 24(A) of C.P.Act, 1986. The alleged last payment was made on 18.11.2006 whereas the complaint was filed on 06.04.2010. The Directors of the company are not personally liable for the debts of the company. The opposite party no.1 is not a partnership firm. The liabilities of the Directors of the company are totally different form the liability of partners in a firm. Hence, the opposite party no.15 prayed to allow the appeal by setting aside the order of the District Forum and dismissed the complaint.
10. None appears. Written arguments of both sides not filed.
11. The point that arises for consideration is whether the impugned orders as passed by the District Forum suffer from any error or irregularity or whether they are liable to be set aside, modified or interfered with, in any manner? To what relief?
12. There is no dispute that there was an agreement vide Ex. A3 between the complainant and the opposite parties no.1 and 15 wherein, they offered to sell 1000 sq. yards of developed plotted area in the proposed project Ocean prestige for a sale consideration of Rs.4,25,000/-. There is also no dispute that the brochure released by the respondents/opposite parties discloses that they offered the plots for " investment proposal for land purchase in Ocean prestige near Ramoji Film city, Hyderabad" which is meant for earning profit and that the complainant purchased the site for commercial purpose and hence the complainant is not a consumer. The complainant rebutted the same stating that he is not a businessman in purchasing and selling plots so far as there is no recital in the agreement Ex.A-3 creating an obligation on him to 'resell' or 'sell' the purchased land for profit. We have perused Ex.A13 brochure which shows that the said plots were for investment purpose.
13. We have perused Ex.A-3 Agreement dated 30.04.2007, wherein, condition No. 4 stipulates that the second party, i.e., the complainant is at liberty to sell the whole or part of the developed plotted area allotted to the second party to anybody at any price after the said allotment is made as per clause 4 for which the first party has agreed not to raise any objection whatsoever. This condition enables the complainant the right to sell the whole or part of the plot and that too after allotment was made. It means the opposite party no.1 gives the right to sell the plot for re-sale. It does not mean that he purchased the same for re-sale and it is for commercial purpose. If really, the complainant sells the plot, the opposite party no.1 also responsible for the same for encouraging to re-sale the same which was intended for investment purpose. . There is no evidence on record to show that the opposite party no.1 was allotted the plot for re-sale and the complainant is selling the same. When the plot was not allotted, the question of re-sale for commercial purpose does not arise. Ex.A-13 brochure itself reveals the said plots were for selling for investment purpose. The definition of ' commercial purpose' gives wide range of meaning. It cannot be said that investment of amount is for commercial purpose. Though investment of amount is profit oriented, it does not come under the definition of commercial purpose. The nature of commercial purpose is different from investment. Since the complainant claiming refund of amount from the opposite parties, the question of re-sale of the plot does not arise and hence it does not come under the purview of the ' commercial purpose'. The complainant nowhere stated that he purchased the same for commercial purpose. The opposite parties failed to prove that the /complainant purchased the plot for commercial purpose with documentary evidence.
14. The further contention of the opposite parties is that the complainant did not pay any consideration and even if assuming there is any amount of consideration paid by him towards investment in house plots for resale and profit motive, as per the brochure, he is not a consumer and hence the complaint is liable to be dismissed.
15. The complainant relied on Exs.A1 and A2 receipts acknowledgement said to have been issued by the authorized signatory of the opposite party no.1 company and the opposite party no.15. The said ExsA1 and A2 discloses that the opposite parties no.1 and 15 received a sum of Rs.2,25,000/- on 27.11.2006 and Rs.2,00,000/- on 28.11.2006 totaling to Rs.4,25,000/- .
16. We have considered the contentions of both sides. It is apparent on the face of record that the complainant has invested an amount of Rs.4,25000/- which supports the contention of the complainant that he paid an amount of Rs.4,25,000/- under Exs.A1 and A2. Since it was proved that the complainant paid consideration towards the plot, it can be said that he is a consumer. If Exs.A1 and A2 are forged documents, the opposite parties have every right to take appropriate action, at any point of time, as per law and it is not their stand but simply thrown a stone at the complainant to escape from their liability. . Mere averment, in the absence of any cogent evidence, in this regard will not be sufficient to prove this fact. A reference can be made to the judgment of the Hon'ble National Commission reported in II (2017) CPJ 25 (NC) Dr. Poonam Aggarwal versus Gujral Associates & Anr. wherein it was observed that unless there is evidence on record that complainant was engaged in business of selling and purchasing of properties on regular basis, it would not be proper to classify such acquisition as commercial activity merely on the basis of number of units booked by such person. The Hon'ble National Commission in III (2015) CPJ 63 (NC) Beatty Tony versus Prestige Estate Projects Pvt. Ltd., held that merely on booking of the flat/plot it cannot be presumed that it is booked for 'commercial purpose' and the complainant was considered as a 'consumer'. Therefore, the above said contention of the learned counsel for the opposite parties is also rejected, holding that the complainant is a 'consumer, under the Act.
17. The further contention of the first respondent/first opposite party is that the complaint is barred by limitation. Admittedly, the opposite parties did not obtain permission from the concerned authorities for converting the land into plots and its allotment to the respective members. As per condition no.3 of the agreement, it is stated that “ the exact location of the developed plots along with specific identity numbers will be allotted within one month after all the necessary approvals are obtained from the concerned authorities”. There is no specific period fixed in the agreement showing the approximate period for obtaining the necessary approvals from the concerned authorities. If such is the condition, there will not be any end of period for getting allotment of the plot and registration of the sale deed. However, the opposite parties have failed to develop/complete the project till the date of filing of the complaint despite receipt of substantial amount from the complainant. When no offer of possession has been given, then there will be a recurring cause of action and we are of the opinion that the complaint filed by the complainant is not barred by limitation. As such, there is continuous cause of action in favour of the complainant and the complaint cannot be said to be barred by limitation. Judgment of Hon'ble NCDRC, New Delhi reported in 2005 (2) CPR 1 NC, wherein it was held that the cause of action is a continuing one till the possession of the plot is delivered with all amenities. Judgment of Hon'ble NCDRC, New Delhi in WP No.30394 of 2011 reported in CDJ 2012 APHSC 421, wherein it was observed that where the amenities as promised are not provided, it can be construed as continuous cause of action and cannot be said to be barred by time. Another Judgment of Hon'ble NCDRC, New Delhi rendered in Fa No.890 of 2012 in the matter of Sreemitra Developers Pvt., Ltd., Vs. K.Venkateswara Rao, wherein it was held that since developers failed to provide the amenities as per the brochure, the developer is liable to refund the amount along with interest and compensation.
18. The further contention of the opposite party no.15 is that he acted as agent in between the complainant and OP.1 and they have not paid single pie to him for the transaction of sale of plotted area between them. Ex.A-3 agreement reveals that the opposite party no.15 is the First Party (2) and he has offered to sell 1000 sq yards of developed plotted area to the second party, i.e., the complainant, he also signed the agreement and hence he is also jointly and severally liable for compliance of the terms and conditions of the agreement.
19. After considering the foregoing facts and circumstances and also having regard to the contentions raised on behalf of the complainant and the opposite parties, this Commission is of the view that the complainant proved that the transaction is not commercial in nature , he paid an amount of Rs.4,25,000/- to the opposite parties, he is a consumer, the complaint is not barred by limitation and the opposite parties who are Managing Director and Directors are jointly and severally liable.
20. For the reasons stated above, we do not find any infirmity in the order passed by the Dist. Forum, and consequently, we do not see any ground to interfere with the order of the Dist. Forum. This Commission answered Point No. 11, accordingly.
21. In the result the appeal is dismissed confirming the order of the District Forum-II, Hyderabad in C.C.No.592 of 2010 dated 11.07.2012. There is no order as to costs. Time for compliance four weeks.
PRESIDENT MEMBER
09.03.2018
