Chandigarh

StateCommission

A/251/2024

RATTAN SINGH - Complainant(s)

Versus

ABHISHEK RATAN PAL - Opp.Party(s)

JPS AHLUWALIA

04 Dec 2024

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(Additional Bench)

 

Appeal No.	:	251 of 2024
Date of Institution	:	12.07.2024
Date of Decision	:	04.12.2024

 

Rattan Singh son of S.Balkar Singh, resident of House No.3074, Sector 40-D, Chandigarh  

……Appellant/Complainant

V e r s u s

Abhishek Ratan Pal, Proprietor M/s. A. R. Construction Co., SCO 31, First Floor, New Sunny Enclave, Sector 125, Kharar, Mohali 140301

2^nd Address:- Abhishek Ratan Pal, Proprietor M/s. A. R. Construction Co. H.No.10011, ATS CASA ESPANA, Near Milk Plant, Sector 121, Mohali.

…..Respondent/opposite party

 

BEFORE:    JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                   MRS.PADMA PANDEY, MEMBER

                   MR. PREETINDER SINGH, MEMBER

                            

Present:-     Sh.JPS Ahluwalia, Advocate alongwith Sh.Rattan Singh, appellant in person.

Sh.Sukhwinder Singh, Advocate alongwith Sh.Abhishek Ratan Pal, Respondent in person.

 

PER JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                   The complainant (appellant in this appeal) by way of filing this appeal is seeking enhancement of the relief already awarded to him, vide order dated 11.06.2024 passed by the District Consumer Disputes Redressal Commission-II, U.T., Chandigarh (in short the District Commission), in consumer complaint bearing no.424 of 2023. Following relief has been granted by the District Commission while partly allowing the said consumer complaint:-

“…Taking into consideration the above discussion & findings, the present complaint deserves to be partly allowed against OP. Accordingly the complaint stands Partly Allowed against OP. The OP is directed to compensate the complainant by paying an amount of Rs.7,90,051/- (i.e. Rs.5,44,400/- incurred by the complainant for pending work and Rs.2,45,651/- paid extra to the OP) along interest @6% per annum from the date of filing the present complaint i.e. 22.8.2023 till its actual payment to the complainant.

This order be complied with by the OP within a period of 60 days from the date of receipt of its certified copy.

The pending application(s) if any, stands disposed of accordingly...…”    

 

Factual scenario:-

2.           Before the District Commission it was the case of the complainant that  he hired the service of opposite party for construction of house on his Plot No.3060, Sector 40-D, Chandigarh measuring 208 sq. yd. and the opposite party assured him that he has a team of expert and technical skilled people to undertake different jobs and would handover the building complete in all respect inclusive of civil electrical, plumbing, wooden, paint and other jobs within time.  Accordingly, an Agreement dated 13.1.2023 (Annexure C-1) was executed between the complainant and opposite party, whereby the rate of Rs.1950/- per sq. ft. was settled for construction of building on the said plot of complainant as per approved plan.  It was averred that it was also decided that the construction work will be executed under the supervision of Architect D.S.Virdi. The work commenced on 05.12.2022 and the completion time of the building, as per agreement, was fixed to 05.06.2023.  Before entering into agreement, the complainant paid Rs.18.50 lacs to the opposite party  and in total paid amount of Rs.36 lacs.  It was pleaded that the opposite party failed to complete the building on the date fixed i.e. 05.06.2023; failed to complete the structure of the building within specified time and also the opposite party was negligent in arranging the work force to carry out the jobs.  The Architect D.S.Virdi, who was supervising the construction work, submitted detailed report Annexure C-2 showing that excess amount of Rs.2,45,651/-  has been taken by the opposite party as the job performed was for Rs.33,54,339/- whereas he has been paid complete amount of Rs.36 lacs and as such, Rs.2,45,651/- was recoverable from the opposite party.  It was further stated that the jobs not completed by the opposite party  within scheduled time incurred extra cost for their completion to the tune of Rs.5,44,400/- (Annexure C-2). It was asserted that the cement used by the opposite party for civil constriction work in the building was below the desired standards, which the complainant got checked from M/s APS Engineers (Annexure C-3 & C-4).  The opposite party left the work in between that too without any notice and failed to complete the building work within schedule time and was not responding the calls of the complainant as a result, the complainant faced lot of harassment.  Accordingly, the complainant sent legal notice to the opposite party (Annexure C-5) in the matter but to no avail. Hence consumer complaint was filed before the District Commission seeking directions to the opposite party to refund excess amount of Rs.2,45,651/- with interest; pay Rs.5,44,400/- an excess amount added for completion of incomplete structural jobs; Rs.18,25,305/- to be incurred on completion of finishing jobs; to pay rent of Rs.90,000/- per month from 5.6.2023 till Dec., 2023 as well as to pay compensation and litigation cost. 

 

Written reply filed by opposite party:-

3.           The opposite party contested the complaint and filed written reply wherein it admitted qua execution of the agreement for constructing a three-storey house on 13.01.2023, with a rate of Rs.1950 per sq. ft., but stated that the construction work was started earlier. The total cost for the area of 4230 sq. ft. construction was Rs.82,48,500/-, but the complainant paid only Rs.36 lacs. The opposite party claimed that the complainant was supposed to make payments in installments but failed to pay the full amount, leaving a deficit of Rs.6,92,465/- by 13.04.2023. The complainant stopped payments after March 2023 and requested the opposite party to halt work in July 2023, but never resumed the payments or provided instructions to restart the work. The opposite party alleged that the complainant made excuses for non-payment, including financial losses and joblessness, and accused the complainant of colluding with the architect to fabricate inflated estimates. All other averments made in the consumer complaint were denied being wrong.

 

Evidence filed by the parties

4.           The contesting parties led evidence by way of affidavits and numerous documents before the District Commission.

 

Decision of the District Commission:-

5.           The District Commission after hearing the contesting parties and on going through the material available on record, partly allowed the consumer complaint, in the manner stated above.
6.           Hence this appeal has been filed by the appellant/complainant seeking enhancement of the relief already granted by the District Commission.
7.           Record of the District Commission has been requisitioned.
8.           We have heard the contesting parties and have scanned the entire record of this case.

Submissions of the parties:-  

9.           During arguments, counsel for the appellant/complainant vehemently contended that although the District Commission partly allowed the consumer complaint, finding the respondent deficient in service for leaving the construction work incomplete and for charging excess amounts relating to the partial construction completed, it erred in not awarding compensation for mental agony, harassment, and litigation expenses. Relying on the report dated 18.08.2023 (at page 28 of the paper book) prepared by Virdi and Associates, Architects, Planners, Interior Designers, and Property Consultants, the counsel further contended that the District Commission failed to consider that the appellant would have to incur an additional Rs.18,25,305/- due to increased labour and construction costs for completing the work left unfinished by the respondent. Additionally, it has been submitted that the interest awarded by the District Commission on the excess amount to be refunded to the appellant was inadequate and should have been higher.
10.           On the other hand, counsel for the respondent submitted that the appellant has failed to pay to the respondent for the extra work got done by him. He further submitted that the appellant has failed to place on record any concrete evidence to establish that any extra amount is needed for completion of the left-out work. He further submitted that it was the appellant who was responsible for terminating the agreement in question, as he always delayed in making payment to the respondent. The reports produced by the appellant are one sided, self contradictory and there is no mention regarding extra work done by the respondent at the site. He further submitted that no independent expert report has been placed on record by the appellant to prove his case. He further submitted that the consumer complaint was liable to be dismissed but the District Commission fell into a error by holding to the contrary.

 

Observations and findings of this Commission:-

11.           The following questions arise for consideration in this appeal:-
    1. Whether the appellant is entitled for an amount of Rs.18,25,305/- extra, over and above the actual amount to be spent for the construction work left by the respondent, as has been claimed by him, on account of alleged increase in labour and construction work?
    2. Whether the interest awarded by the District Commission, @6% p.a. on the amount of refund i.e. Rs.7,90,051/-, is adequate and fair and if not, whether appellant is entitled for any  enhancement of interest and  if yes from which date?
    3. Whether the appellant is entitled for compensation for mental agony & harassment for delay in completing the work; leaving the construction work in the middle; and also litigation expenses and if yes, to what extent?
12.           First coming to the question, as to whether, the appellant is entitled for an amount of Rs.18,25,305/- extra, over and above the actual amount to be spent for the construction work left by the respondent, as has been claimed by him on account of alleged increase in labour and construction work, by placing reliance on the report dated 18.08.2023 (at page 28 of the paper book) having been prepared by Virdi and Associates, Architects, Planner, Int. Designer and Properties Consultant (in short the Architect/Expert. It may be stated here that the appellant's claim is primarily based on the report dated 18.08.2023 of the Architect/Expert to substantiate the demand for the increased amount, which is said to account for the alleged escalation in costs. However, a comprehensive review of the aforementioned report reveals several significant shortcomings that cast doubt on the validity of the appellant's claim. While the Architect/Expert has opined that the appellant would need to incur an additional Rs.18,25,305/- for completing the remaining work, above and beyond the original amount of Rs.40,99,770/-, the report fails to provide any concrete or detailed supporting evidence to substantiate this figure. One of the key deficiencies is the absence of a comparison chart or a thorough analysis illustrating the fluctuation in labour and material costs over the relevant period. The report does not provide any breakdown or explanation of the factors contributing to the alleged inflation in these costs, nor does it demonstrate how these inflationary trends have specifically affected the pricing for the remaining construction work. In addition, there is a lack of a clear and logical calculation to support the claim of an additional Rs.18,25,305/-. Given that the respondent has already completed the entire superstructure of the building, the report fails to clarify why such a substantial increase in costs is required, especially when the bulk of the work i.e. super structure has been finished by the respondent. This omission significantly undermines the credibility of the claim. In light of these considerable deficiencies and the absence of any robust, verifiable evidence to support the appellant's claim, it is clear that the demand for the additional sum of Rs.18,25,305/- remains unsubstantiated. The report provided by the Architect/Expert lacks the necessary clarity, precision, and justification to make a convincing case for the alleged increase in construction costs. The failure to provide detailed cost comparisons, explanations of inflationary trends, or reliable calculations means that the appellant’s entitlement to the claimed amount is unsupported by sufficient factual and analytical foundation. Consequently, this claim appears to be speculative and inadequately backed by the requisite documentation and evidence, rendering it untenable and  is not acceptable by this Commission. Under these circumstances, the District Commission was right in not considering this claim of the appellant and on the other hand, has rightly ordered refund of the excess amount of  Rs.7,90,051/-
13.           Now coming to the question as to whether, the appellant is entitled for enhancement of interest on the amount of Rs.7,90,051/- and if yes from which date?  It is pertinent to note that in refund cases, now  a days, both the Hon’ble National Commission and the Hon’ble Supreme Court are consistently awarding rate of interest at 9% per annum, when the refund amount remains unsettled for an extended period. Considering this prevailing judicial trend, the rate of interest awarded by the District Commission in the present case, which is set at 6% per annum, appears to be on the lower side and does not align with the established norms set by higher authorities. The rationale behind awarding a higher rate of interest, such as 9% per annum, is to ensure fair compensation for the loss of use of funds during the period of delay, as well as to encourage prompt resolution of disputes. Therefore, in light of the established precedents and the principles of equity and fairness, it would be more just and reasonable to consider an adjustment in the interest rate to 9% per annum, in keeping with the standard judicial practice. This adjustment would also serve to uphold the consistency of legal rulings and foster a sense of fairness in the adjudication of similar cases. In light of this, enhancing the interest rate of interest to 9% per annum, as opposed to the earlier 6%, would better serve justice. Accordingly, it is held that the appellant is entitled to interest @9% on the amount of Rs.7,90,051/- instead of 6% p.a.
14.           Now, the question arises as to from which date the appellant should be entitled to interest on the amount of Rs.7,90,051/- aforesaid. In our considered view, once it has been held by the District Commission that the respondent is liable to refund the excess amount of Rs.7,90,051/-  received from the appellant alongwith, then the interest should have been awarded from the date of receipt of such amount. However, the District Commission erred by awarding interest from the date of filing the consumer complaint instead of, from the date of receipt of the said excess amount by the respondent from the appellant. Therefore, it is now held that the appellant is entitled to get refund of the said amount of Rs.7,90,051/- along with interest @ 9% per annum, from the  date of receipt thereof by the respondent. This adjustment will ensure that the appellant is properly compensated for the financial loss suffered by him.
15.           Now coming to the next question, as to whether, the appellant is entitled for compensation for mental agony & harassment and also litigation expenses and if yes, to what extent? It is significant to mention here that the words interest and compensation are sometimes used interchangeably and, on other occasions, they have distinct connotation. Interest in general terms is the return or compensation for the use or retention by one person of a sum of money belonging to or owed to another. In its narrow sense, interest is understood to mean the amount, which one has contracted to pay for use of borrowed or  pending money. In whatever category interest in a particular case may be put, it is a consideration, paid either for the use of money, or for forbearance in demanding it, after it has fallen due, and, thus, it is a charge for the use or forbearance of money. In this sense, it is a compensation allowed by law or fixed by parties, or permitted by custom or usage, for use of money, belonging to another, or for the delay in paying money after it has become payable. The interest in the present case has been granted to the appellant/complainant, for improper and illegal retention of the excess amount of Rs.7,90,051/- by respondent/opposite party, for a long time.

                   At the same time, according the provisions of Section 39 (d) of CPA 2019 this Commission can award compensation to the consumers for any loss and injury suffered by them at the  hands of the opposite  parties, over and above interest on the amount of refund. The word compensation is again of very wide connotation. It has not been defined, in the Act. According to the dictionary, it means, compensating or being compensated, thing given as recompense. In legal sense, it may constitute actual loss or expected loss and may extend to physical, mental or even emotional suffering, insult or injury or loss. Therefore, when the Consumer Commissions have been vested with the jurisdiction to award value of goods or services and compensation, it has to be construed widely enabling the Consumer Foras, to determine compensation, for any loss or damage suffered by a consumer, which in law is otherwise, the wide meaning of compensation. The provision, in our opinion, enables a consumer to claim and empowers the Consumer Fora to redress any injustice done. The State Commission, is, thus, entitled to award not only the value of the goods or services/interest on the amount to be refunded but also to compensate a consumer for injustice suffered by him/her.

                   In the present case, one can well imagine the plight of the appellant whose hopes to shift in his newly constructed house were dashed to the ground and apart from delay in completing the construction work, the respondent had left the work after completing the super structure only, as a result of which, the appellant was forced to get the work done from alternative sources. Under these circumstances, the appellant has definitely been caused   mental agony, and harassment and infact it can be said that he has been caused injury by the respondent/opposite party. The term injury has been defined in  Section 2 (23) of the CPA 2019 as under:-

“..23. “injury” means any harm whatever legally caused to any person, in body, mind or property..”

Under above circumstances, it can safely be said that over and above the interest @9% p.a. awarded by this Commission on the sum of Rs.7,90,051/-, in the manner, referred to above, the appellant is also entitled to get compensation for the mental agony, harassment and injury suffered by him, at the hands of the respondent/opposite party.  In many cases, the Hon’ble National Commission and also the Hon’ble Supreme Court has also awarded interest on the amount ordered to be paid/refunded alongwith compensation for mental agony and harassment.  In Paramvir Singh Vs P.H.Houses Pvt. Ltd. Revision Petition No.2779 of 2010 decided on 11.5.2011 decided by the Hon’ble National Commission, refund of the amount was ordered to be made with interest and also compensation for mental agony and harassment. In Revision Petition No.575-576 of 2010, Dr. K.D. Soni  and another Versus HUDA and Ors., decided on 06.07.2017, the Hon’ble National Commission upheld the order of the State Commission of simultaneous award of interest alongwith compensation for mental agony and harassment and also litigation by observing as under:-

“……..It is also well settled that the word ‘Compensation’ is of very vide connotation and once the Forum is satisfied that the Complainant has suffered harassment or mental agony and is entitled to compensation, it is obliged to adequately compensate the Complainant for the actual loss or expected loss, which would extend to compensation for the physical, mental or emotional sufferings….”

 

In this view of the matter, it is held that the appellant is entitled to get compensation to the tune of Rs.1 lac for mental agony, harassment and injury suffered by him, at the hands of the respondent/opposite party.

          Now coming to the last question, as to whether, the appellant is entitled to litigation expenses? It may be stated here that it is settled principle of law, that the cost of litigation awarded by the Courts/ Foras, must provide adequate indemnity to the successful litigant, for the expenditure incurred by him/her, for prosecuting the litigation. The cost of litigation should not be too meagre, to discourage the genuine litigants, from approaching the Courts/Foras, for redressal of their grievance. In Vinod  Seth Versus Devinder Bajaj  (2010) 8 SCC 1, it was held by the Hon`ble Supreme Court of India that the litigation cost awarded by the Courts or Foras, should not be a punishment to the defeated party, but as a recompense to the successful party, for the expenses to which he/she had been subjected, or for whatever appeared to the Courts/Foras,  to be the legal expenses incurred by the party, for prosecuting his/her suit or defence. The principle of law laid down in the aforesaid case is fully applicable to the facts of the instant case. The appellant/complainant is thus entitled to get litigation expenses, especially, when he is a successful litigant. The District Commission fell into an error by not awarding litigation expenses to the appellant/complainant.

16.           Keeping in view the above discussion, this appeal stands partly allowed. The impugned order passed by the District Commission is modified and respondent/opposite party is directed as under:-
    1. To refund to the appellant/complainant, excess amount of Rs.7,90,051/- alongwith interest @9% per annum from the date of receipt of the same onwards;
    2. To pay of Rs.1 lac as compensation for causing mental agony & harassment and injury to the appellant/complainant
    3. To pay cost of litigation of Rs.35,000/- to the appellant/ complainant.
    4. The directions given above, be complied within a period of 30 days from the date of receipt of a certified copy of this order,  failing which, thereafter, the awarded amounts shall  entail penal interest @12% p.a. from the date of default, till realization.
17.           Consequently, miscellaneous application bearing no.840 of 2024 stands disposed off.
18.           Certified copies of this order be sent to the parties, free of charge, forthwith and one copy be placed in the District Commission file.
19.           The concerned file be consigned to Record Room, after completion and the record of the District Commission-II, U.T., Chandigarh, after annexing the additional documents, if any, submitted before this Commission in this appeal, be sent back immediately.

Pronounced

04.12.2024

Sd/-

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

Sd/-

(PADMA PANDEY)

MEMBER

 

 

Sd/-

 (PREETINDER SINGH)

MEMBER