BEFORE THE TELANGANA STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD
F.A.No. 266 OF 2014 AGAINST C.C.NO.128 OF 2013 DISTRICT CONSUMER FORUM RANGA REDDY
Between
Harvinder Singh Kohli S/o Bhupinder Singh Kohli
Aged 33 years, Occ: Manager IT, Flat No.504,
Shubam Matrix, Sy.92, Madinaguda, Miyapur
Hyderabad-500 081
Appellant/complainant
A N D
- M/s Aliens Developers Pvt Ltd.,
rep. by its Managing Director
Hari Challa, aged about 35 years
2. M/s Aliens Developers Pvt Ltd.,
rep. by its Associate Vice President
Sri Alaparthi Appa Rao S/o Subbaiah
aged about 30 years
3. M/s Aliens Developers Pvt Ltd.,
rep. By its Assistant Manager (Finance & Accounts)
P.Pandu Ranga Rao s/o P.Ekambareswara Rao
aged about 39 years
(All are having their regd. Off at Flat No.911
Teja Block, My Home, Navadweepa Apartments
Madhapur, Hyderabad-500081
Respondent/opposite parties
Counsel for the Appellant Sri C.Vikram Chandra
Counsel for the Respondent Sri P.Rajasripathi Rao
QUORUM :
HON’BLE SRI JUSTICE B.N.RAO, PRESIDENT
&
SRI PATIL VITHAL RAO, MEMBER
MONDAY THE FIFTH DAY OF JUNE
TWO THOUSAND SEVENTEEN
Oral Order : (per Hon’ble Sri Justice B.N.Rao Nalla, Hon’ble President)
***
This is an appeal filed by the complainant dissatisfied with the orders of the District Consumer Forum Ranga Reddy dated 26.03.2014 made in CC No.128 of 2013 in partly allowing the complaint directing the opposite parties to pay Rs.2,00,000/- with interest @ 18% per annum from 30.07.2011 till realization along with costs of Rs.5,000/-.
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 complainant entered into an agreement of sale for the purchase of a flat bearing No.1862 on 18th floor of “ Space Station-I” at Tellapur Village for a consideration of Rs.54,62,154/-. Complainant paid Rs.2,00,000/- as advance amount and upon directions of opposite parties, he applied for home loan from Corporation Bank and was sanctioned a loan of Rs.44,50,000/-. The complainant, opposite parties and the Bank entered into a Tripartite Agreement on 01.07.2011 on which date the bank paid Rs.22,00,000/- to the opposite parties as part payment. The opposite parties started a scheme called 'Pre-EMI Scheme' and entered into MoU with complainant wherein they agreed that the Pre EMIs shall be paid by the opposite parties to the Bank directly till 18 months and to pay interest from 19th moth onwards till handing over of the possession of the flat to the complainant. Opposite parties delayed the construction and failed to deliver the possession of the flat by November 2011 as per the terms of the sale agreement dated 13.05.2011, even after the lapse of the grace period of 9 months. When the complainant insisted for commitment, opposite parties executed a MoU on 28.06.2012 and promised to deliver the possession of the flat by 30.11.2014. Further, opposite parties agreed that if the complainant continues with the project, full EMI to the bank will be paid by them and if the complainant does not want to continue his decision will be honoured unconditionally and they would refund the complete amount, within 180 days from the date of decision to cancel the booing without any deductions. After acting upon the MoU conditions for certain period opposite parties have not paid EMIs/Pre-EMIs to the loan account of the bank, due to which the bank issued Over Dues Notice on 29.11.2012. Complainant replied to the notice on 15.03.2013 stating that bank can evoke the clause No.3 of the Tripartite Agreement dated 01.07.2011. Complainant also sent a notice to the opposite parties on 16.03.2013 and called upon the opposite parties to pay arrears of instalments. Opposite parties failed to reply to the notice and complainant lost all hopes and decided that opposite parties will not complete the project in the near future and requested opposite parties through e-mails, letters, telephone calls and legal notices to give possession of flat or refund advance amount. Hence the complaint praying to direct the opposite parties to return the advance amount of Rs.2,00,000/- with interest @ 18% p.a., to pay an amount of Rs.12,77,600/- due to enhancement in sq. ft rate together with compensation of Rs.50,000/-.
4. The opposite party resisted the case contending that the complainant cancelled his agreement of sale dated 13.05.2011 and hence the complaint is mainly for refund of amount paid and does not come within the purview of CP Act and complainant is not a consumer U/s 2(1)(d) of CP Act. Opposite parties are in the process of executing a project named as “ Space Station-II” at Thummalur Village, Ranga Reddy. The land upon which the project is coming up has been converted into non-agricultural land and requisite permissions has been accorded by the competent authorities and the building plans are also approved by HMDA. Complainant did not serve the notice to the opposite parties at the correct address even having knowledge about it. Opposite parties are committed to the project and are taking positive steps towards it and some towers are already completed and flats delivered to the owners. Opposite parties are adhering to the MoU terms and conditions and it is not true to say that due to irregular payments made by the opposite parties, complainant's account became NPA. No legal notice was received by opposite parties. It was agreed to extent date of delivery till 30.11.2014 and the complainant taking decision to cancel the booking was purely for his personal reasons. As there is no ' deficiency of service' on part of opposite parties. Hence, it prayed for dismissal of the complaint.
5. During the course of enquiry before the District Forum, in order to prove his case, the Complainant filed his evidence affidavit and the documents Ex.A1 to A8 while on behalf of the Opposite parties, Mr.Hari Challa, the Managing Director has filed his affidavit and no documents have been filed. During the pendency of the appeal, the appellants filed FAIA 996 of 2014 for marking documents and the same is allowed and the document was marked as Ex.A9
6. The District Forum after considering the material available on record, partly allowed the complaint bearing CC No.128 of 2013 by orders dated 26.03.2014 as stated in para 1 supra.
7. Aggrieved by the said decision, the complainant preferred the appeal contending that the Dist. Forum did not appreciate the facts in correct perspective. The District Forum erred in appreciating the evidence filed by the opposite parties which discloses that the price of the flats were enhanced and accordingly it ought to have taken into consideration of the enhanced price as submitted by the appellants in their evidence. The complainant has claimed only Rs.800/- per sq. ft however the opposite parties are selling the same flats at multifold rates i.e., approximately Rs.1650/- over and above the price at which the complainant has purchased the unit. Though the District Forum having discussed in detail regarding the suffering of the complainant from the date of entering into the transaction with regard to the purchase of the flat, the opposite parties had failed to award appropriate amounts towards damages and erred in awarding meager amount towards the same. Hence, the complainant prayed to allow the appeal.
8. 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 ?
9. It is not in dispute that the opposite parties had agreed to develop the venture Space Station-I at Tellapur Village, Ranga Reddy District and the booking of the flat no.1862 by the complainant booked in the said venture. As per Ex.A2 Tripartite Agreement the bank had paid an amount of Rs.22,00,000/- to the opposite parties on 01.07.2011 as evidenced by Ex.A2. This payment is in addition to the total amount of Rs.2,00,000/- paid by the complainant to the opposite parties on different dates. Ex.A3 is the Memorandum of Understanding between complainant and opposite parties wherein it was agreed that EMIs shall be paid to the banker directly by the opposite parties till the first 18 months. Ex.A8 is the over dues notice issued by the Corporation Bank to the complainant wherein it stated that the opposite parties had not paid the EMIs on time and the dues to the extent of Rs.22,89,621/- along with overdue charges of Rs.69,629/- and uncharged interest of Rs.23,242/- were shown as the outstanding balance. As per agreement of sale the delivery of the flat was to be made on or before November 2011 with a 9 months grace period but even after the grace period as the opposite parties failed to complete the construction and also not stated what is the stage of construction and when it is going to be completed. Hence, the District Forum rightly observed that there is deficiency of service for not completing the project within reasonable time having received a considerable part of the sale consideration from the complainant.
10. The District Forum allowed the complaint by directing to refund the advance amount of Rs.2,00,000/- with interest @ 18% per annum from 30.7.2011 with costs of Rs.5,000/- while dismissing the rest of the claim of the complainant. The complainant filed this appeal contending that the District Forum did not consider the enhanced price of the flats and it ought to have taken into consideration of the enhanced price as submitted by the complainant in his evidence. For that the District Forum observed that the complainant is not clarified on what basis he sought payment of Rs.12,77,000/- when he has not made any payment other than Rs.2,00,000/- as advance amount. It is not the case of the complainant that he made total sale consideration and the opposite parties failed to complete the construction of the flat due to which the complainant sustained loss and undergone mental agony.
11. In Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65, the Hon’ble Supreme Court inter alia observed and held as under:
“However, the power to and duty to award compensation does not mean that irrespective of facts of the case compensation can be awarded in all matters at a uniform rate of 18% per annum. As seen above what is being awarded is compensation i.e. a recompense for the loss or injury. It therefore necessarily has to be based on a finding of loss or injury and has to correlate with the amount of loss or injury. Thus the Forum or the Commission must determine that there has been deficiency in service and/or misfeasance in public office which has resulted in loss or injury. No hard and fast rule can be laid down, however a few examples would be where an allotment is made, price is received/paid but possession is not given within the period set out in the brochure…
…Along with recompensing the loss the Commission/Forum may also compensate for harassment/injury both mental and physical. Similarly, compensation can be given if after allotment is made there has been cancellation of scheme without any justifiable cause.
That compensation cannot be uniform and can best of illustrated by considering cases where possession is being directed to be delivered and cases where only monies are directed to be returned. In cases where possession is being directed to be delivered the compensation for harassment will necessarily have to be less because in a way that party is being compensated by increase in the value of the property he is getting. But in cases where monies are being simply returned then the party is suffering a loss inasmuch as he had deposited the money in the hope of getting a flat/plot. He is being deprived of that flat/plot. He has been deprived of the benefit of escalation of the price of that flat/plot. Therefore the compensation in such cases would necessarily have to be higher.
12. It would, thus, be seen that the Hon’ble Supreme Court recognized that the interest to the flat buyers in such cases is paid by way of compensation but it is not stated that the compensation should be given by way of escalation of the price of the flats. At the time of booking of the flat the complainant had paid the part of the amount at the rates prevailing at that time. Moreover there is no agreement that in case the complainant wants to cancel his booking the opposite parties would refund the amount with the enhanced rate of the flats as was fixed by the opposite parties from time to time. Further, as per Ex.A4 the opposite parties have agreed to refund the entire amount paid by the complainant with no deductions. As per the terms and conditions of the agreement of sale in case the complainant delayed in paying instalments the complainant shall pay interest @ 18% per annum in the same way the District Forum rightly awarded interest @ 18% per annum on the sum paid by the complainant from the date of last payment made till realization.
13. It is an undisputed proposition of law that ordinarily the parties are bound by the terms and conditions of the contract voluntarily agreed by them and it is not for a Consumer Forum or even a Court to revise the said terms. However, a term of a contract, will not be final and binding if it is shown that the consent to the said term was not really voluntary but was given under a sort of compulsion on account of the person giving consent being left with no other choice or if the said term amounts to an unfair trade practice. A person who, for one reason or the other, either cannot or does not want to buy a plot and raise construction of his own, has to necessarily go in for purchase of the built up flat. It is only natural and logical for him to look for an apartment in a project being developed by a big builder such as the opposite party in these complaints. Since the contracts of all the big builders contain a term for payment of a specified sum as compensation in the event of default on the part of the builder in handing over possession of the flat to the buyer and the flat compensation offered by all big builders is almost a nominal compensation being less than .25% of the estimated cost of construction per month, the flat buyer is left with no option but to sign the Buyer’s Agreement in the format provided by the builder. No sensible person will volunteer to accept compensation constituting about 2-3% of his investment in case of delay on the part of the contractor, when he is made to pay 18% compound interest if there is delay on his part in making payment.
14. In K.A. Nagmani Vs. Housing Commissioner, Karnataka Housing Board, CA No.6730-6731 of 2012 decided on 19-09-2012, the complainant who was awarded interest by this Commission at the rate of 12% per annum on the refund amount, felt aggrieved and approached the Hon’ble Supreme Court for grant of a higher interest. Despite the respondent in the above referred matter being a statutory body unlike the opposite party which is a private builder, the Hon’ble Supreme Court, relying upon its earlier decision in Ghaziabad Development Authority Vs. Balbir Singh and noticing that the complainant was suffering a loss inasmuch as she had deposited the money in the hope of getting a flat but was being deprived to get the flat and thereby deprived of the benefit of escalation of the price of the flat held, that the compensation would necessarily be higher. The Hon’ble Supreme Court, therefore, granted interest to the complainant at the rate of 18% per annum from the date of deposit till the date of realization along with further compensation quantified at Rs.15,000/- for deficiency in service and Rs.20,000/- towards the cost of litigation.
15. The Honble Supreme Court in State of Gujarath vs Shantilal Mangaldas AIR 1969 SC 634, held the compensation to mean in ordinary parlance the expression compensation means anything given to make things equivalent; a thing given to or to make amends for loss recompense, remuneration or pay, it need not therefore necessarily in terms of money. The phraseology of the Constitutional provision also indicates that compensation need not necessarily be in terms of money because it expressly provides that the law may specify the principles on which, and the manner in which , compensation is to be determined and given . If it were to be in terms of money along, the expression paid would have been more appropriate.
16. The Supreme Court held that the compensation to be awarded is to be fair and reasonable. In Charan Singh vs Healing Touch Hospital and others 2000 SAR(Civil) 935 the Apex Court stressed the need of balancing between the compensation awarded recompensing the consumer and the change it brings in the attitude of the service provider.
17. The Apex Court held While quantifying damages, consumer forums are required to make an attempt to serve ends of justice so that compensation is awarded, in an established case, which not only serves the purpose of recompensing the individual, but which also at the same time aims to bring about a qualitative change in the attitude of the service provider. Indeed calculation of damages depends on the facts and circumstances of each case. No hard and fast rule can be laid down for universal application. While awarding compensation, a Consumer Forum has to take into account all relevant factors and assess compensation on the basis of accepted legal principles, on moderation. It is for the Consumer Forum to grant compensation to the extent it finds it reasonable, fair and proper in the facts and circumstances of a given case according to established judicial standards where the claimant is able to establish his charge.
18. For the foregoing reasons and in the light of the ratio laid in the aforementioned decisions, we are of the considered view the refund of the amount paid by the complainant with simple interest at the rate of 18% per annum as a comprehensive all-inclusive compensation is fully justified in this case.
19. Having regard to the fact that the forum below had answered all the queries in a detailed manner, we do not see any infirmities or irregularities in the order and we hold the same to be justified. Accordingly, we answer the point framed for consideration at paragraph No.8, supra, against the Appellant and in favour of the respondent.
In the result, the appeal is dismissed confirming the order of the District Forum. No costs.
PRESIDENT MEMBER
Dated:05.06.2017
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
NIL
EXHIBITS MARKED
For complainant
Ex.A9 Email dated 26.04.2013
For opposite parties
NIL
PRESIDENT MEMBER
