BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM,

ERNAKULAM.

Date of filing : 13/09/2012

Date of Order : 31/01/2014

Present :-

Shri. A. Rajesh, President.

Shri. Sheen Jose, Member.

Smt. V.K. Beena Kumari, Member.

C.C. No. 563/2012

Between

And

O R D E R

A. Rajesh, President.

1. The facts leading to this complaint are as follows :-

Attracted by the advertisement about the housing project 'Apple New Cochin' of the opposite parties, the complainant entered into agreements with the opposite parties to purchase 0.15% of undivided share in 253.25 cents of land in Thaikkattussery Village and to avail the services of the opposite parties to construct an apartment of super built up area of 618 sq.ft. on the 10^th floor of the proposed building Nano homes (Phase V). The complainant paid Rs. 9,88,000/- towards total consideration for the above purpose. The opposite party had also arranged a loan for the construction of the apartment from SBI, Palarivattom and the loan amount with interest is being paid by the complainant. While so on 13-04-2010, the complainant received a letter from the opposite parties intimating their inability to carry on with the project and that the project would be completed by another company. The complainant approached the opposite parties for settlement, but in vain. Hence, this complaint filed before this Forum seeking direction against the opposite parties to refund the consideration paid to the opposite parties with interest, to pay the insurance amount and processing charge paid by the complainant to the bank, to pay Rs. 10,000/- towards compensation for the mental agony suffered by the complainant and costs of the proceedings.

2. The version of the opposite parties 1 to 3 is as follows :-

The opposite parties contended that there is no deficiency in service on the part of the opposite parties, that the complainant is not a consumer as defined in the Consumer Protection Act 1986, that this Forum has no jurisdiction to entertain this complaint, that the opposite parties are not liable for the alleged insurance charge of Rs. 35,415/- and the processing fee of Rs. 4,974/- paid to the bank for availing the loan. It is contended that even if any dispute persists between the opposite parties and the complainant, the remedy lies elsewhere, that as per the agreement the dispute between the parties must be referred for arbitration. It is prayed that this complaint may be dismissed as not entertainable with costs to the opposite parties.

3. The complainant was examined as PW1. The documentary evidence adduced by the complainant were marked as Exts. A1 to A12. Neither oral nor documentary evidence adduced by the opposite parties. Heard the counsel for the complainant.

4. The issues that arose for consideration are as follows :-

1. Whether the complaint is maintainable in this Forum?

2. Whether the complainant is entitled to get refund of the consideration paid of Rs. 7,05,000/- with interest the insurance premium of Rs. 35,415/- processing fees of Rs. 4,674/- collected by the bank for processing the loan application.

3. Whether the complainant is entitled to get Rs. 10,000/- towards compensation for the mental agony suffered and costs of the proceedings?

5. Point No. i. :- The opposite party contended that the complainant is not a consumer within the purview of the Consumer Protection Act 1986 and that an arbitration clause included in the agreement for joint venture develop entered between the parties. But the Ext. A1 agreement clearly stated that “the First party builder is developing the said property and the adjoining properties having a total extent of 72 acres …........” Moreover, the Hon'ble Supreme Court in Lucknow Development Authority Vs. M.K. Gupta reported in III (1994) CPJ 7 (SC) held that housing construction is a 'service' as defined in Section 2 (1)(o) of the Consumer Protection Act 1986. The complainant entered into an agreement with the opposite party for the construction of Nano Homes as evident by Ext. A2. Thus, the complainant is a consumer who had availed services of the opposite parties. Therefore, the contention of the opposite parties that the complainant is not a consumer is found incorrect and is therefore rejected. Another contention of the opposite party is that in view of the arbitration clause in the agreement, the complainant ought to have referred his dispute for arbitrator. The Hon'ble Kerala State Consumer Disputes Redressal Commission in Awman Capital Market (India) Ltd. Vs. Viswanathan reported in III (2013) CPJ 4 Ker, held that the existence of arbitration clause in the agreement is no bar to entertain the complaint by redressal agency under the Consumer Protection Act, 1986. In view of the above, we find that this complaint is maintainable in this Forum.

6. Point No. ii. :- The complainant and the opposite parties entered into two agreements on 23-05-2009, one agreement for sale of undivided share in 253.25 cents of land in Thaikkattussery Village as evidenced by Ext. A1 and the other agreement for the construction of Nano Homes (Phase 5) for a total cost of Rs. 10,37,000/- in which the cost of the car parking area of Rs. 49,000/- is also included. The opposite parties vide Ext. A11 letter dated 13-04-2010 informed the complainant “that the entire construction activities of all the projects of Apple A Day has now been taken over by TCL a leading experienced construction group from Delhi. TCL has already taken up our projects and is in the process of mobilizing man power and materials.” Thus, we find that the opposite parties failed to develop the property, and to construct the apartment for the complainant as agreed in Ext. A1 and A2 agreements eventhough the complainant has paid around Rs. 7,02,000/- stage wise. There is no dispute as to the payment of the above amount to the opposite parties by the complainant. We, therefore, find that the complainant is entitled to get refund of the above amount with interest. The complainant claimed that he is entitled to get Rs. 35,415/- paid towards insurance charges and Rs. 4,974/- paid to the State Bank of Travancore, Palarivattom towards processing fee of loan application. The above claims are found not allowable, since they are remote and indirect to the agreements entered into between the complainant and the opposite parties.

7. Point No. iii. :- The complainant claimed Rs. 10,000/- towards compensation for the mental agony suffered and inconveniences caused by the opposite parties on account of dropping the project as agreed between them. The complainant deposed before this Forum that the only work done by the opposite parties is 'Foundation piling' despite payment of Rs. 7,02,000/- as per the payment schedule. From the above facts and circumstances, we find that there is deficiency in service on the part of the opposite parties, that the complainant suffered severe mental agony and the conduct of the opposite parties inflicted a lot of inconveniences to the complainant. We, therefore, find that the complainant is entitled to get compensation and we fix it at Rs. 10,000/-.

8. In the result, we partly allow the complaint and direct as follows :-

1. The opposite parties shall jointly and severally refund Rs. 7,02,000/- (Rupees Seven lakhs and two thousand only) with interest @ 12% p.a. from the date of filing this complaint till realisation.

2. The opposite parties shall jointly and severally pay Rs. 10,000/- (Rupees Ten thousand only) towards compensation for the mental agony suffered and for the inconveniences caused to the complainant.

The order shall be complied with, within a period of thirty days from the date of receipt of a copy of this order.

Pronounced in the open Forum on this the 31^st day of January 2014.

Forwarded/By order, Sd/- A. Rajesh, President.

Sd/- Sheen Jose, Member.

Sd/- V.K. Beena Kumari, Member.

Senior Superintendent.

A P P E N D I X

Complainant's Exhibits :-

Opposite party's Exhibits :: Nil

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