Date of Filing: 21/04/2011, 13.05.2011

        Date of Order: 28/06/2011

BEFORE THE I ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SESHADRIPURAM BANGALORE -  20

Dated:  28^th DAY OF JUNE 2011

PRESENT

SRI.H.V.RAMACHANDRA RAO,B.SC.,B.L., PRESIDENT

SRI.KESHAV RAO PATIL, B.COM., M.A., LL.B., PGDPR, MEMBER

SMT.NIVEDITHA .J, B.SC.,LLB., MEMBER

 COMPLAINT NO.773 OF 2011

(1) Mr. Mallari Rao M S,

S/o. Late Sri Rama Rao,

Aged About 40 years,

R/at: No.96, 2^nd Main Road,

1^st Block, Thyagaraj Nagar,

BANGALORE-560 028.

COMPLAINT NO.918 OF 2011

(2) Mr. B.N. Sudarshan,

S/o. Sri. B.R. Narasimhan,

Aged About 37 years,

R/at: No.20, Ground Floor,

1^st Main, 1^st Cross, Hosakerehalli

Extension, BSK III Stage, Near NCERT,

BANGALORE-560 085.

COMPLAINT NO.919 OF 2011

(3) Mr. B.N. Narayana,

S/o. Sri. B.R. Narasimhan,

Aged About 39 years,

R/at: No.20, Ground Floor,

1^st Main, 1^st Cross, Hosakerehalli

Extension, BSK III Stage, Near NCERT,

BANGALORE-560 085.

COMPLAINT NO.920 OF 2011

(4) Mr. Madhusudan,

S/o. Sri. Srinivasa Iyengar,

Aged About 40 years,

R/at: No.20, Ground Floor,

1^st Main, 1^st Cross, Hosakerehalli

Extension, BSK III Stage, Near NCERT,

BANGALORE-560 085.

COMPLAINT NO.921 OF 2011

(5) Mrs. Mala K,

W/o. Sri. B.N. Sheshadri,

Aged About 37 years,

R/at: No.20, Ground Floor,

1^st Main, 1^st Cross, Hosakerehalli

Extension, BSK III Stage, Near NCERT,

BANGALORE-560 085.

COMPLAINT NO.922 OF 2011

(6) Mr. B.N. Sheshadri

S/o. Sri. B.R. Narasimhan,

Aged About 44 years,

R/at: No.20, Ground Floor,

1^st Main, 1^st Cross, Hosakerehalli

Extension, BSK III Stage, Near NCERT,

BANGALORE-560 085.

COMPLAINT NO.923 OF 2011

(7) Mrs. B.N. Seethalakshmi,

W/o. Sri. Madhusudan,

Aged About 34 years,

R/at: No.20, Ground Floor,

1^st Main, 1^st Cross, Hosakerehalli

Extension, BSK III Stage, Near NCERT,

BANGALORE-560 085.                                                                  ……Complainants.

-V/s-

1) Akila Karnataka Brahmins’ Welfare Society,

Bangalore, No:3317, 1^st Floor, 7^th Main, 4^th Cross,

RPC Layout, Vijayanagar, 2^nd Phase,

Bangalore – 560 040

Rep. by its Secretary.

2) Mr. B.V. Manjunath, Secretary,

Akila Karnataka Brahmins’ Welfare Society,

No:3317, 1^st Floor, 7^th Main, 4^th Cross,

RPC Layout, Vijayanagar, 2^nd Phase,

Bangalore – 560 040.                                            …….. Opposite parties.

BY SRI.H.V.RAMACHANDRARAO, PRESIDENT

-: COMMON ORDER:-

Since all these cases are between different complainants who are the members of the opposite parties regarding the very matter, all are taken up together and common order is passed and in each of the cases one set of the order is ordered to be kept.  Hereinafter the complainant in complaint No.773/2011 will be referred to as complainant No.1, the complainant in complaint No.918/2011 will be referred to as complainant No.2, the complainant in complaint No.919/2011 will be referred to as complainant No.3, the complainant in complaint No.920/2011 will be referred to as complainant No.4, the complainant in complaint No.921/2011 will be referred to as complainant No.5, the complainant in complaint No.922/2011 will be referred as complainant No.6, and the complainant in complaint No.923/2011 will be referred as complainant No.7 and the opposite parties as opposite parties.

2.      The brief antecedents that lead to the filing of the complaints U/s 12 of the Consumer Protection Act seeking direction to the Opposite Parties that the complainants are entitled to site measuring 30 x 40 feet or in the alternative to pay interest on Rs.2,00,000/- from the date of payment till the date of realization and to pay compensation of Rs.5,00,000/- each in each of the cases to the complainants, are necessary:-

The opposite party had promoted a layout in 42 acres near Bidadi.  The complainants had opted for sites measuring 30’ x 40’ feet wherein the opposite party had fixed the rate at 208 per square foot and fix the price at Rs.2,50,000/-.  Each of the complainants have paid Rs.50,000/- each in four installments.  That is they have paid Rs.2,00,000/- each in each of the cases.   The opposite party raised the point of escalation in price of sites and claimed the complainants to pay at the rate of Rs.500/- to Rs.650/- per Sq.Ft and the members who are not ready to pay at the enhanced rate, they can opt for taking back the money with interest of 8%.  In this regard, a meeting was held on 04/07/2010.  Opposite party has cancelled the membership and returned the money with interest.  Simply returning the amount with interest of 7.5% and cancelling the membership is illegal.  Hence, the complainants issued legal notice to the opposite party, to which the opposite party has not replied.  Hence, the complaints.   

3.      In brief, the versions of the opposite party are:-

The complainants are the member of the opposite party’s Society. The opposite party has agreed to develop the housing layout and allot residential sites to its members.  The complainants have applied for sties in the proposed layout agreed to the rate to be fixed by the Society on the basis of the amount to be paid for the land, Development of the same and forming of the layout.  The complainants have paid Rs.2,00,000/- each for the sites measuring 30 x 40 feet is admitted.  The opposite party has entrusted the development work to M/s Aishvarya Developers (R) Builders and Developers on turnkey basis and after the development the developer has fixed the amount at the rate of Rs.500/- per Sq.Ft. taking into account of the rate of site, Development charges and layout charges.  The opposite party has intimated the same to its members including the complainant by letter dated 13/09/2010.  On 08/11/2010 the opposite party called upon all the members including the complainants to pay the amount fixed or take back the advance amount within seven days.  Some members agreed to pay at the enhancement rate, but complainants have refused to pay the amount at the enhanced rate, thereafter the opposite party had no other alternative but to cancel the membership and refunding the amount to the complainant.  Accordingly the opposite party returned the amount with cancellation letter, which the complainants have received.  All the allegations to the contrary are denied.      

4.      To substantiate their respective cases, the parties have filed their respective affidavits.  The arguments were heard.

5.      The points that arise for our consideration are:-      

:- POINTS:-

1. Whether there is any deficiency in service?
2. What Order?

6.      Our findings are:-

Point (A)   :        In the Positive

Point (B)    :        As per detailed order

                                      for the following:- 

-:REASONS:-

Point A & B:-

7.      The pleadings of the parties are summarized supra.  The same be read herein again.  Reading the pleadings in conjunction with the evidence both oral and documentary on record it is an admitted fact that the complainants were the members of the opposite party, the opposite party is forming layout and is allotting sites to its members.  The complainants had become the members of the opposite party and applied for sites measuring 30’ X 40’ respectively.  It is also an admitted fact that the complainant had to pay certain amount at the rates mentioned when the proposed layout were to be formed i.e., about 208 per Sq.Ft in the year 2005-2007.  It is also an admitted fact that till today no layout has been formed, no sites have been formed.  Except purchasing the land, nothing has been done.  The land has to be converted, layout has to be formed, which cannot be done by the opposite party and the opposite party had to entrust the matter to any Developer who is well versed in the matter.

8.      It is also an admitted fact that the opposite party had entrusted the development work of the layout to Aishwarya Developers and after negotiations the rate per Sq.Ft of the site to be formed is fixed at Rs.550/- and accordingly the complainants and other members were informed.  The complainants being aggrieved agreed and they were not ready to pay at the enhanced rate. 

9.      The main contention of the complainants are that the enhancement of the rate is illegal.  Let us look to the law in this regard. 

10.    In a case between DELI DEVELOPMENT AUTHORITY V/S KAMI, REPORTED IN 1996 CTJ, 1337, it has been read thus:-

“The question of pricing cannot be gone into by the Consumer’s Forum constituted under the Consumer’s Protection Act”.

In a case between PURUSHOTHAM SINGH GUPTA V/S DEVELOPMENT AUTHORITY AND OTHERS in Revision Petition No.1490/2001 disposed off on 11/04/2002 reported in Supreme Court and National Commission Court Cases Vol.V, Edition 2011 NCDRC 4358, it has been ruled thus:-

“These circumstances, relating to the pricing of the Flat, which cannot be gone into by the Consumer’s Forum”.

In a case between RADHA NAND SINGH (DR.) V/S BIHAR STATE HOUSING BOARD, REPORTED IN III (2006) CPJ 206 (NC), it has been ruled thus:-

“Consumer Protection Act 1986 Sections 11, 17 and 21 – Jurisdiction of For a Complaint alleging increase of price from Rs.1,90,000 to Rs.2,81,143 – Contetnion, O.P. bound by price as originally fixed, rejected – Original cost only estimated one – Further Consumer Fora Cannot go into question of pricing – No merit in plea of complainant”.

Further, in a case between AMRITH VIDLAYAM V/S AMRITH VIDLAYAM PARENTS AND STUDENTS WELFARE ASSOCIATION reported in 2011 CPJ 236, it has been ruled thus:-

 “Pricing is not a matter to be adjudicated by the Authorities under the Consumer’s Protection Act”.

This is also the law laid down in RADHA NAND SINGH (DR.) V/S BIHAR STATE HOUSING BOARD, REPORTED IN III(2006) CPJ 206(NC), MAHARASTRA STATE ELECTRICITY BOARD V/S SHESHA RAO, REPORTED IN 1997 CTJ 68 AND THE MANAGER, MILK CHILLING CENTRE V/S MAHABOOB NAGAR CITIZEN COUNSEL REPORTED IN II 1991(2) CPR 177.  That means to say the pricing cannot be decided or cannot be gone into by the Forum created under the consumer’s Protection Act.  That is the Authority and prerogative of the Developer, the Society etc.,  The pricing has to be done by the concerned looking to the escalation in the prices of the cost involved in purchasing the land, the cost involved in getting the agricultural land converted into non agricultural use, the cost involved in forming the Roads, acquiring the area, putting the boundaries for the sites, reserving the lands for civic amenities, drawing the pipe lines for water, drawing the lines for electricity, drawing the liens for many other things.  These costs and also the unforeseen expenditure, the salary to its employees all has to be looked into and calculated, that cannot be decided by the Forum constituted under the Consumer’s Protection Act.

Hence, this Forum cannot decide whether the increase in price is justified or not.  Pricing is outside the scope of C.P.Act.   When the complainants have been cancelled of their membership and amounts have been paid to them, the question of complainants be the Consumer’s vis.a.vis. the opposite party does not arise.  The cancellation of the membership cannot be gone into by this Forum.  They have to approach any other court seeking appropriate relief for which this order will not come in the way.

11.    The complainants want site and membership to be restored and they have to be given sites at the old rate.  When the pricing is not in the arina of the Consumer’s Forum, the question of asking the opposite party to allot a site does not arise.  Even otherwise when the layout itself is not formed, the question of allotting the site does not arise.  When the amount is not paid, the opposite party cannot get the layout formed, without forming the layout, no site could be granted.  This remains of a proverb in Kannada ºÀÄZÀÄÑ ©lÖ ºÉÆgÀvÀÄ ªÀÄzÀÄªÉ DUÀĪÀÅ¢®è, ªÀÄzÀÄªÉ DzÀ ºÉÆgÀvÀÄ ºÀÄZÀÄÑ ©qÀĪÀÅ¢®è Hence, the complainants has to blame for themselves.

12.    Here, it is an admitted fact for the delayed payment of the installments, the members were charged penal interest at 12% and collected money.  But while returning the money, the opposite parties have returned it with interest at 7.5%.  Hence, this discrimination is nothing but an unfair trade practice.  When the members had to pay the amounts, the opposite party charges 12% interest, when it has gives back the amount, it charges 7.5% interest.  Hence, it is arbitrary, discriminatory and unfair trade practice.  Hence, if we direct the opposite party to pay the balance of interest at the rate of 4.5%, we think that will meet the ends of justice. Hence, to this extent there is deficiency in service.  In these cases opposite party No.2 has been added in his individual capacity.  He is already representing the first opposite party as secretary.  Hence he need not be impleaded as a party to the proceedings and the case against opposite party No.2 has to be dismissed.  Opposite party No.1 might not have charged penal interest on complainants.  Since they have not defaulted in paying installments.  This Forum already passed orders in similar cases in complaint Nos. 42/2011, 136/2011 and 137/2011 on 15.03.2011, the same holds good herein again.  Hence, we hold the above points accordingly and proceed to pass the following:-  

ORDER

1. The complaints are Allowed-in-Part.
2. The opposite party No.1 is directed to pay to each of the complainant a sum of Rs.22,500/- each in each of the cases within 30 days from the date of this order.
3. The opposite party No.1 is directed to pay Rs.2,000/- each to each of the complainants as costs.
4. The complaint so for as opposite party No.2 is Dismissed with costs and each of the complainants has to pay Rs.2,000/- each to the opposite party No.2.
5. Keep the original order of this in Complaint No.773/2011 and copies thereof shall be kept in Complaint Nos.918/2011 & 923/2011.
6. The opposite party No.1 is directed to send the amount as ordered at Serial Nos. 2 & 3 above to each of the complainants in each of the cases and complainants to opposite party No.2 through DD by registered post acknowledgment due and submit the compliance report complying with the order stated above to this Forum with necessary documents within 45 days.
7. Return the extra sets filed by the parties to the concerned as under Regulation 20(3) of the Consumer’s Protection Regulation 2005.
8. Send a copy of this order to both parties free of costs, immediately.

(Dictated to the Stenographer, transcribed and typed by him, corrected and then pronounced by us in the Open Forum on this the 28^th Day of JUNE 2011).

MEMBER                                         MEMBER                              PRESIDENT