Per Sri A. Hazarath Rao,  President:-

The complainant association filed this complaint under section 12 of the Consumer Protection Act seeking a direction to the opposite parties to complete the pending works or payment of Rs.9,91,000/- being the value of unfinished works; and Rs.5,00,000/- as compensation.

2.  In brief the averments of the complaint are these:

Flat owners of R.V. Towers situated in 2/17, Brodipet, Guntur formed into an Association under the name and style of R.V. Towers Flat Owner’s Association in November, 2010.  The opposite parties 1 & 2 being owners of the site entered into a development agreement with the 3^rd opposite party on 05-12-2006.  Some of the flat owners obtained sale deeds and some obtained sale agreements paying substantial amounts believing the representations of the opposite parties.  The unfinished construction work is going in a slow pace devoid of any interest to deliver in time.  Many item of work remain unattended to and the requests of the complainant to complete unfinished work on war footing did not evoke any response.   There is vast divergence what the opposite parties told at the time of booking to prospective purchaser and what they delivered.   The 3^rd opposite party though promised to provide neat and tidy flats for residential purpose are not at all showing requisite interest in completing the following unfinished works.

1. Flooring and car parking allotment worth of Rs.1,50,000/-;
2. Generator worth of Rs.2,50,000/-;
3. Drinking water connection worth of Rs.30,000/-;
4. Second coating paint to entire building worth of Rs.50,000/-;
5. Replacement of sub-mersible motor worth of Rs.20,000/-;
6. Polishing to main doors worth of Rs.80,000/-;
7. Terrace entrance gate worth of Rs.40,000/-;
8. Finalisation of payment of BPS tax revision Rs.1,86,000/-
9. Lift panel changing and paints worth of Rs.10,000/-;
10. Effecting repairs to water seepage to walls worth of Rs.50,000/-;
11. Repairs to leakage of proofs for flat Nos. 404 and 502 worth of Rs.50,000/-;
12. Amount due to Apple Elevators, Vijayawada worth of Rs.75,000/-

The 3^rd opposite party did not even pay the entire amount to M/s Apple Elevators Private Limited, Vijayawada.   On the assurance given by the complainant M/s Apple Elevators made the lift running.   There is no response for the notices issued by the complainant to the opposite parties on 17-11-10 and 13-01-10.   Not constructing flats as promised amounted to deficiency of service.   The complaint therefore may be allowed.

3.   The opposite parties 1 and 2 remained exparte.

4.   The contention of the 3^rd opposite party in brief is hereunder:

After purchasing flats, the flat owners of complainant association occupied the flats in 2009.   As per the agreed terms the developer has completed total construction works with all amenities.   The complainant as per agreement has to incur expenses for certain amenities.   Even after the 3^rd opposite party providing all amenities flat owners of the complainant association did not pay amount.   The 3^rd opposite party sustained huge loss by incurring extra amount in advance on various works in order to keep its reputation as well versed developer.  The stilt flooring is almost completed except finishing work.  As per oral agreement between the parties car parking will be allotted as per draw and the parties have to pay extra amount.   So far no flat owner came forward to participate in the draw inspite of best efforts made by the 3^rd opposite party.   Due to failure of flat owners the 3^rd opposite party is unable to provide generator.   The 3^rd opposite party will provide generator after payment by flat owners.   Drinking water connection already existed.  The painting and coloring of the entire building was completed.   Sub-mersible water was provided.    Painting for all doors and windows including main door polishing for all the flats has been completed.   There is no agreement regarding terrace entrance gate.   The 3rd opposite party is no way liable to pay any building regularization scheme as the construction was carried out with the knowledge and written consent of the complainant and the opposite parties 1 and 2.   Lift panel was changed

by the company people.  Paint for lift gate will be done after the completion of stilt flooring.   Seepage to walls if any is due to poor maintenance by flat owners.   The leakage in flat No.404 and 502 may be due to improper usage and maintenance but not due to defective construction.   The opposite parties 1 and 2 colluded with the complainant and that is why they remained exparte.   The complainant is not a consumer and as such the Consumer Forum has no jurisdiction to entertain the complainant.    The complainants calculated the figures as per their whims and fancies without any evidence.   The complaint is barred by limitation.   The 3^rd opposite party is unable to complete the nominal works due to non co-operation of the opposite parties 1 and 2.   The 3^rd opposite party kept required material to complete the finishing work in a room in stilt floor under the supervision of a watchman.   On 10-01-11 the opposite parties 1 and 2 and some of the flat owners bet the watchman, throw him out and lifted the material.   Under those circumstances, the 3^rd opposite party gave a complaint to police.   Instead of taking action the police tried to pacify the matter as theft was done by the Inspector of Police who is one of the land owner flats on his own.   The 3^rd opposite party preferred a complaint before the Judicial Magistrate of 1^st class, Guntur against the opposite parties 1 and 2 and some other flat owners vide CFR No.2845 of 2011.   To escape criminal liability the opposite parties 1 and 2 and other flat owners filed this complaint and gave legal notice on 24-01-11.   The 3^rd opposite party gave suitable reply.   The opposite parties 1 and 2 and many of the flat owners have not paid full amount towards additional works.   All the flat owners took possession and occupied the flats after satisfying with the work and service of the 3^rd opposite party.   The complaint is frivolous, vexatious and is liable to be dismissed.   The complainant is not entitled to any of the reliefs.   The complaint may be dismissed with exemplary costs.

5.   Exs.A-1 to A-27 and Exs.B-1 to B-9 were marked on behalf of complainant and 3^rd opposite party respectively.

6.  Now the points that arose for consideration in this complaint are:

1.  Whether the complainant is a consumer under the purview of   

     Consumer Protection Act?

2.  Whether this Forum has jurisdiction to entertain the complaint?

3.  Whether the complaint is barred by limitation?

4.  Whether the opposite parties committed deficiency of service?

5.  Whether the complainant is entitled to compensation?

6.  To what relief?

7.   POINT No.3:-   In Exs.A-16 and A-19 alone the delivery of possession was mentioned as 05-02-09 and 01-10-09 respectively.   In other sale deeds the date of delivery of possession was not specifically mentioned.   The complaint was also silent when its flat owners took possession of their respective flats.   In para 2 of his version the 3^rd opposite party mentioned that flat owners after purchase occupied their flats in 2009.   The complaint was filed on 05-02-2011.  In many of the sale deeds the nature of property was described as semi finished flat.   In view of the said admission, we are of the considered opinion that the complaint is in time.   Hence we answer this point in favour of the complainant.

8.    POINTS 1 & 2:-   The complainant alleged that the opposite parties committed deficiency in not making the construction as per specifications agreed.  The 3^rd opposite party herein was described as 2nd party to the development agreement dated 05-12-06 (Ex.A-6).  The grievance of the complainant is that the opposite parties did not construct the flats as promised.   Under those circumstances the contention of the 3^rd opposite party    that the complainant is not a consumer and this Forum has no jurisdiction is devoid of merit.   We therefore answer these points in favour of the complainant.

9.   POINT No.4:-

The National Consumer Disputes Redressal Commission in Birendra Kumar Shrivastava vs. Ajay Girish Verma 2012 (1) CPR 229 (NC) confirmed the findings of the District Consumer Forum and State Consumer Disputes Redressal Commission detailed infra while deciding the issue of deficiency of service in not constructing house as per contract.

Findings of District Forum:

The copy of the quotation filed by the complainant is of importance.   It cannot be said that it is an agreement.   No details are given opposite every work “As required” is written.   The contention of the Non-applicant is liable to be accepted.

The preliminary objection of the non-applicant shows it is a complicated issue therefore the case is of civil nature.   The jurisdiction of the consumer disputes redressal forum is limited.   The Forum can take a decision on the documents filed before the Forum.  It is clear that there is no written agreement.   Everything is not clear about the work.   Therefore complicated question of law has arisen.

Hon. National Commission in case of Chunnilal Pranjiwan Das vs. Tamilnadu Mercantile Banks Limited 2002 CTJ (III) in deciding the issue has held that where ever complicated question arise they will be out of the purview of the Forum where evidence is to be recorded such cases are to be decided by the Civil Court.    The jurisdiction of the Forum is very limited and the cases are to be decided within 90 days.   SincoIndustries vs. State Bank of Ajmer and  Jaipur C.P.J. (1) 16 in this case the Hon. Supreme Court has held that where complicated questions are in the time of the Forum will be wasted.   The present dispute there being no written agreement the Forum will not be able to take any decision, and the preliminary objection of the Non-applicant is decided by the Forum as the complaint being disposed of.   The complainant will be at liberty to approach the Civil Court for redressal of his grievance.   The preliminary objection of the Non-applicant is up held.”

Findings of State Commission:

“Since both the parties are absent; we perused the impugned judgment and record. We are finding that the order passed by the Forum is just and proper.  On the basis of quotation itself, no clear cut finding could be recorded and if there is an oral contract between the parties, it would be difficult for the Forum to decide the Consumer complaint in a summary manner.   For this, oral evidence will have to be adduced as to what sort of construction material was agreed to be used for the construction of the house by the opponent etc.   We agree with the District Forum that the quotation does not amount to conclusive contract between the parties.   The Forum was right in directing the complainant to approach Civil Court for redressal of his grievance since the Forum was unable to decide the matter in a summary jurisdiction.  Said order, in our considered view is just proper and sustainable in law and there is no substance in the appeal”

Since petitioner has based its complaint upon the quotation submitted by the respondent, the quotation under these circumstances is a material piece of document in this case so as to decide the controversy between the parties.   However, the so called quotation, has not been placed on the record and in the absence of that quotation, no relief can be granted to the petitioner.   Moreover, as per averments made in the complaint, petitioner has stated that he has made endorsement on the body of the quotation which amounts to an agreement”

        Taking a clue from the above decision, we are of the opinion that documentary evidence alone has to be considered by the Forum as the enquiry contemplated is of summary nature.  Purchasers of the flats entered into the shoes of the opposite parties 1 and 2 and 3^rd opposite party and as such they are entitled to question the deficiency in construction or failure to fulfill the promises.

10.   The complainant in order to prove the deficiency of service said to have been committed by the opposite parties relied on Ex.A-12 development agreement dated 05-12-06 among the opposite parties 1 and 2 (site owners) and 3^rd opposite party (builder) and Ex.A-14 agreement of construction for additional works executed by the 1^st opposite party in favour of Tunuguntla Yugandhar (flat owner of 502-Ex.A-13 and A-18).

11.   The 1^st opposite party and 11 others executed a registered general power of attorney in favour of the 2^nd opposite party on       02-12-06.   In pursuance of that GPA the 2^nd and 3^rd opposite parties entered into a development agreement on 05-12-06 (Ex.A-12).   The 3^rd opposite party (builder) is entitled to flat Nos.101, 103, 201, 203, 301, 303, 401, 403,501 and 503, while the opposite parties 1 and 2 (owners of the site) are entitled to the flats 102, 104, 202, 204, 302, 304, 402, 404,  502 and 504.  The opposite parties 1 and 2 are together entitled to 50% of car parking area, while the 3^rd opposite party is entitled to 50% car parking area.

12.   Clauses 21 of Ex.A-12 authorized its executants to enter into supplementary agreements. Neither of the parties filed such supplementary agreement into Court.     Clause 11 of Ex.A-12 reads as follows:

        “The second party is totally responsible for any claim          or damage that may raised by the prospective purchasers of the flat from the second party in respect of the          construction of the flat or any defect in the construction     or deficiency in service to the prospective purchasers of      the flats”.

        The above clause leads us to draw an inference that the                        3^rd opposite party is responsible for any defective construction in respect of flats purchased from it i.e., 101, 103, 201, 203, 301, 303, 401, 403, 501 and 503 (Exs.A-15, A-17, A-20 to A-27).   Ex.A-12 agreement was silent regarding the deficiency of work in the flats allotted to the opposite parties 1 and 2 i.e., 102, 104, 202, 204, 302, 304, 402, 404, 502 & 504.

13.    The opposite parties 1 and 2 and the vendee under Ex.A-18 enter into additional work agreement.  The said additional work agreement is not binding on the 3^rd opposite party being not a party to it.  It can therefore be said that the opposite parties 1 and 2 are responsible for the deficiency of work in the flats 102, 104, 202, 204, 302, 304, 402, 404, 502 & 504.

14.  Smt G. Padmavalli, advocate was appointed as commissioner to note physical features and pending works in R.V. Towers.   The said advocate commissioner filed her report along with photos.    Considering the objections raised by the contesting opposite party  this Forum re-entrusted the warrant to the advocate commissioner for execution.    The learned advocate commissioner returned the warrant on 06-02-12 for want of co-operation from the 3^rd opposite party.   Once again the 3^rd opposite party requested the Forum to re-entrust the warrant again to the advocate commissioner.   This Forum rejected the said contention of the 3^rd opposite party on 03-03-12.

15.  The contention of the 3^rd opposite party is that the complainant filed the complaint after it giving report to police (Ex.B-4 and B-5) to escape their liability and 3^rd opposite party did not receive Ex.A-2 notice.  The complainant filed the returned covers addressed to the opposite parties 1 and 3 (Exs.A-3 and A-5) and postal acknowledgment of the 2^nd opposite party (Ex.A-4).   The 3rd opposite party received Ex.A-6 notice at the same address mentioned in Ex.A-5.   Under those circumstances, the above contention of the 3^rd opposite party cannot be accepted.

16.  Generator:   Ex.A-12 development agreement provides fixing of generator without any additional cost.   It is the contention of the 3^rd opposite party that it could not provide generator as flat owners failed to pay amount for additional works.    It can therefore be inferred that the opposite parties did not provide generator.  The opposite parties            1 and 2 are directed to provide generator.

17.  Finalisation of payment of BPS tax division and tax division:-

        It is the contention of the 3^rd opposite party that it is not liable to pay any building regularization scheme fee as the construction was carried out with the knowledge and written consent of the complainants and the opposite parties 1 and 2.  To prove it the                3^rd opposite party relied on Ex.B-8 and the relevant portion is extracted below for better appreciation:

      “We are made to understand by the builder that there will be deviation from the sanctioned plan in respect of the property bearing D.No.5-19-42 with assessment No.07/8488 situated at 2/17 Brodipet, Guntur covered by the development agreement dated 05-12-06 by virtue of the vastu, financial feasibility etc., and we expressed our no objection for the same”.

        Ex.B-8 letter was signed by the opposite parties 1 and 2 only.  It can therefore be inferred that the flats in RV Towers were constructed with deviations.   The complainant association did not file any notice served by the local body regarding BPS.   At this stage the same cannot be gone into and we opine that it is premature to grant the relief.

18.   DRINKING WATER:-

        It is the contention of the 3^rd opposite party that they provided municipal water to the complainant.  The report of the commissioner was silent on this aspect.   To prove it the 3^rd opposite party relied on Ex.B-6 water tax demand notice issued for May, 2010.  In the absence of any observation by the learned commissioner we opine that the opposite parties provided drinking water.   Hence no relief can be granted on this point.

19.    Lift panel changing and paints and balance amount due to Apple Elevators, Vijayawada:-

        The opposite party relied on Ex.B-8 letter dated 10-05-01,             23-04-01.   The letter dated 10-05-01 says that M/s Apple Elevators have completed all the works including lift panel and painting of all gates quite long time and elevator given for public usage.  It can therefore be inferred that the opposite parties provided lift and paints to it.   The complainant did not file any receipt to show the payment.  M/s Apple Elevators Private Limited contacted with the complainant subsequent to Exs.A-10 and A-11 but not with the 3^rd opposite party.   The 3^rd opposite party has to provide lift without any additional cost.   Therefore, the 3^rd opposite party has to pay Rs.75,000/-.  In view of under taking given by the complainant under Ex.A-10 M/s Apple Elevators Private Limited made the lift in working condition.  It can therefore be inferred that the complainant paid the amount of Rs.75,000/-.to M/s. Apple Elevators. Therefore we opine that the 3^rd opposite party has to reimburse Rs.75,000/- to complainant association.

20.    Submersible motor replacement and terrace entrance

          gate:

        As Ex.A-12 agreement did not provide for the same it cannot be granted.  Therefore the complainant is not entitled for terrace entrance gate and submersible motor replacement.

21.    Second coat painting to entire building:-

        It is the contention of the opposite party that it did second coating to the building.   But the learned commissioner in her report observed that there was no second coating of paint for walls in the apartment.   Therefore the opposite parties are liable to apply second coating.

22.    Flooring and car parking allotment:-

a) Flooring:-    The 3^rd opposite party in its version categorically mentioned that the stilt flooring is almost completed except finishing work.   The learned commissioner in her report observed that the entire ground floor is filled with dust and waste materials of construction, the drainage hole is not covered properly, the holes made for arrangement for generator, electricity are all in open condition, the flooring on the top floor is not completed and it is in uneven condition and there is fungus in so many areas.   Therefore, the opposite parties have not done flooring in stilt area and on terrace.   Therefore, the 3^rd opposite party has to rectify the same. 

b) Car parking:-  Ex.A-12 agreement did not mention any thing regarding provision for car parking.   None of the sale deeds also did not mention specifically regarding car parking.   It is the contention of the 3^rd opposite party that the parties who were allotted parking in draw has to pay extra amount as per oral understanding.   It is also the contention of the 3^rd opposite party that the flat owners did not came forward to participate in the draw.   To prove his contention the 3^rd opposite party relied on Ex.A-9 reply dated27-01-11  given to the complainant by the opposite parties 1 and 2 to the notice dated            13-01-11.   Ex.A-9 is in torn condition.   The relevant portion in Ex.A-9 is extracted below for better appreciation:

                “It is to inform you that when your clients got issued legal notice on 27-12-2010 immediately after receipt of the said notice my 1^st client’s son Sri A.V.C.N. Nageswara Rao met your client at Guntur on 09-01-11 and discussed the problem ……………………………arrived a conclusion that all the flat owners including my clients has to contribute ………………………… to finish the unfinished works.  Apart from the works it is also noticed that ………….. your notice has left unfinished works in my clients flats”

        The above recitals in Ex.A-9 leads us to draw an inference that flat owners including the opposite parties 1 and 2 have to contribute some amount towards unfinished works.          In the absence of specific provision regarding car parking the contention of the complainant is devoid of merit. 

23.    Effecting repairs to leakage to roofs more particularly flat Nos.502 and 404:-

        Flats 502 and 404 fell to the share of opposite parties 1 and 2 as seen from Ex.A-12.     By virtue of clause 11 of Ex.A-12 the opposite parties 1 and 2 have to effect the repair to flats 502 and 404. 

24.    Main door polishing:-  

        The learned commissioner in her report observed that in five flats the main doors are not properly finished and there was no preliminary painting in two flats.   But the learned commissioner failed to mention the flat numbers in her report.   It can therefore be inferred that the 3^rd opposite party have not properly done the main door finishing.   Absence of flat numbers in commissioner’s report makes this Forum difficult to grant this relief.

25.  Effecting repairs to water seepage to the walls:-

        It is the contention of the 3rd opposite party is that due to improper maintenance the seepage has been occurring.   The learned commissioner in her report observed that there are wall cracks in all floors and seepage of water into the walls and in so many places in the ground floor and on the steps.   Cracks in the walls cannot be due to poor maintenance as contended by the 3^rd opposite party but only due to defective construction.   Therefore the opposite parties are liable to make the repairs to cracks appearing in the walls.

Clause 11 of Ex.A-12 reads as follows:

        “The second party is totally responsible for any claim          or damage that may raised by the prospective purchasers of the flat from the second party in respect of the          construction of the flat or any defect in the construction     or deficiency in service to the prospective purchasers of      the flats”.

        The above clause leads us to draw an inference that the                        3^rd opposite party is responsible for any defective construction in respect of flats purchased from it i.e., 101, 103, 201, 203, 301, 303, 401, 403, 501 and 503 (Exs.A-15, A-17, A-20 to A-27).   Ex.A-12 agreement was silent regarding the deficiency of work in the flats allotted to the opposite parties 1 and 2 i.e., 102, 104, 202, 204, 302, 304, 402, 404, 502 & 504.

        For the discussion mentioned supra the opposite parties committed deficiency of service.   Hence we answer this point accordingly in favour of the complainant.

26.    POINT No.5:-    The complainant claimed Rs.5,00,000/- as compensation.  No doubt members of the complainant association parted with huge amount to purchase the flats.   Not constructing the flats according to the specification and approved plan will cause agony and harassment to purchasers.   Under those circumstances, awarding Rs.10,000/- each to flat owner will meet ends of justice.   We therefore answer this point accordingly.

27.    POINT No.6:-  In view of above findings in the result the complaint is allowed in part as indicated below:

1. The 3^rd opposite party is directed to provide generator without insisting any additional payment to the complainant.
2. The 3^rd opposite party is directed to pay Rs.75,000/- (Rupees seventy five thousand only) being the provision for lift to the complainant.
3. The opposite parties 1 and 2 are directed to apply second coating to the flats 102, 104, 202, 204, 302, 304, 402, 404, 502 and 504.
4. The 3^rd opposite party is directed to apply second coating to the flats 101, 103, 201,203, 301, 303, 401, 403, 501 and 503.
5. The 3^rd opposite party is directed to do proper flooring on stilt area and terrace.
6. The opposite parties 1 and 2 are directed to arrest leakage of roofs in flat Nos.502 and 404.
7. The opposite parties 1 and 2 are directed to arrest seepage of water and fill the cracks and paint them properly in flat numbers 102, 104, 202, 204, 302, 304, 402, 404, 502 and 504.
8. The 3^rd opposite party is directed to arrest seepage of water and fill the cracks and paint them properly in flat numbers 101, 103, 201,203, 301, 303, 401, 403, 501 and 503.
9. The opposite parties 1 and 2 are directed to pay Rs.10,000/- (Rupees ten thousand only) towards compensation to each flat owner of 102, 104, 202, 204, 302, 304, 402, 404, 502 and 504.
10. The 3^rd opposite party is directed to pay Rs.10,000/- (Rupees ten thousand only) towards compensation to each flat owner of  101, 103, 201,203, 301, 303, 401, 403, 501 and 503.
11. The opposite parties 1 and 2 are directed to pay Rs.1,000/- (Rupees one thousand only) towards costs to the complainant.
12. The 3^rd opposite party is directed to pay Rs.1,000/- (Rupees one thousand only) towards costs to the complainant.     
13. The above order shall be complied within a period of six weeks from the date of receipt of the copy of the order.

Typed to my dictation by junior steno, corrected by me and pronounced in the open Forum, dated this the 4^th day of April, 2012.

MEMBER                             MEMBER                             PRESIDENT

APPENDIX OF EVIDENCE

DOCUMENTS MARKED

For Complainant:

For opposite party: 

                                                                                                                  PRESIDENT