Between:

D.Srinivasa Rao, S/o late Ramachanda Rao, Hindu, 52 years,

Resident of D.No.27-4-24, Dasannapeta, Goll Veedhi,

Vizianagaram Town.

                                                                                                                                ...Complainant

And

1. B.R.Constructions represented by its proprietor, Behara Ramesh Patro, S/o late Adilakshminarayana Patro, Builder, Hindu, aged 51 years, resident of Flat No.105, Mahalakshmi Towers, 100 Feet Ring Road, Opp: New Saibaba Temple, Vizianagaram Town – 535 002.

2. Kandregula Ramachandra prabhu, S/o Appalanaidu, Business, Hindu, aged 54 years, resident of D.No.1-85-1/1, Sector-IV, M.V.P.Colony, Visakhapatnam.

3. Kandregula Anjamma, W/o Ramachandra prabhu, Housewife, Hindu, aged 45 years, rest-do-.

                                         …. Opposite Parties    

          This case is coming on for final hearing before us in the presence of Sri G.Tirupathi Rao, Advocate for the Complainant and OP No.1 called absent and Advocate for O.P’s No.2 and 3 R.S.S.Swarup and having stood over for consideration the Forum made the following:-

O R D E R

SRI T.SRIRAMA MURTHY,PRESIDENT

     This is a complaint filed U/s-12 of C.P.Act seeking the reliefs to direct the O.P’s to commence the work and complete the construction of flat and hand over the same to the complainant and to pay interest @  18% per annum on Rs.6,35,000/- till the date of handing over the flat and to pay Rs.25,000/- towards damages for causing mental agony to the complainant and to pay Rs.5,000/- per month as rent from 22-7-2011 till the date of commencement of work and to grant costs on the following averments:-

          The 1^st O.P. was appointed as an agent on behalf of O.P’s 2 and 3 to develop the vacant site admeasuring 1013 square yards situated at Sri Jagannadha Nagar in Vizianagaram municipality bearing the town survey No.817 part.  The O.P’s 2 and 3 have executed power of attorney document dated 17.03.2010 under document No.798/2010 in favour of 1^st O.P. enabling them to act as their agent to develop the above mentioned site.  The complainant was told by the O.P’s that they are going to construct an apartment on the above mentioned site under the name and style of B.R.Jagannadha enclave and offered to sell the flat bearing  in 2^nd floor, for a sum of Rs.6,35,000/-.  The complainant agreed to purchase the flat and paid the entire cost of the flat to the 1^st O.P.  The 1^st O.P. has executed a registered sale deed as well as agreement for construction of the flat in favour of the complainant vide document Nos. 3385 and 3386 respectively.  As per terms of agreement for construction of flat, the 1^st O.P. has to complete the construction and hand over the flat to the complainant in 18 months and though the said period was completed the 1^st O.P. did not commence the construction till date.  Though the complainant approached the 1^st O.P. many a time and requested to make construction of the flat they did not respond to his request.  The complainant got issued a notice dated 18.12.2013 to the 1^st O.P. calling upon them to commence the construction of the apartment but to no effect.  Since the O.P’s were in dereliction of their duties and as there is deficiency in service on their part the complainant was constrained to file the complaint for the above said reliefs. 

The respondents 2 and 3 filed counter traversing the material allegations made in the complaint and have averred that the complainant did not pay any amount to O.P’s 2 and 3 and there is no relationship of consumer and service provider in between them.  It is averred that 1^st O.P. obtained GPA from O.P’s 2 and 3 on 17.03.2010 having promised that he would pay the amounts to them for developing the property and as the 1^st O.P. did not pay any amounts to them they have cancelled the General power of attorney given to the 1^st O.P.  It is averred that as the O.P’s 2 and 3 did not receive any amount from the complainant and did not execute any documents in his favour, he cannot contend that there is deficiency in service on the part of O.P’s 2 and 3 and as the complaint is devoid of merits the same is liable to be dismissed. 

In support of complainants case he filed his evidence affidavit and got marked exhibits A1 to A4 per contra the O.P’s 2 and 3 filed the evidence affidavit of RW-1 and got marked exhibits B1 to B4.

Perused the material placed on record and heard the counsel for respective parties.

Now the point for consideration is whether there is deficiency in service and dereliction in duty on the part of O.P’s towards the complainant and whether the complainant is entitled to get the reliefs prayed for.

The contention raised by the complainant in this complaint is that 1^st O.P. was appointed as an agent of O.P. 2 and 3 to develop a vacant site situated at Jagannadha  Nagar in Vizianagaram municipality and by virtue of power of attorney executed by O.P’s 2 and 3 the O.P.1 who is the developer cum general power of attorney holder sold the flat bearing No.306 in the 2^nd floor of the apartment for a sum of Rs.6,35,000/- under a registered sale deed vide document No.3385/2011 and it is his further contention that the 1^st O.P. has also executed agreement for construction of flat in her favour vide document No.3386/2011 agreeing to complete the construction of flat and to handover the same to the complainant in 18 months and though the above said period  was lapsed he did not make construction of the flat and though the complainant got issued a notice calling upon the 1^st O.P. to commence and complete the construction of the flat he did not respond to the notice and as the complainant suffered mental agony for the deficiency in service on the part of O.P’s and hence he filed the complaint to get his grievances redressed.

Though the 1^st O.P. was served with a notice in this case he did not come to the Forum to contest the matter.  The O.P’s 2 and 3 filed counter denying the allegations made in the complaint and have averred that they did not receive any consideration given by the complainant and did not execute any document in his favour and as there is no relationship of consumer and service provider in between them, the complaint is liable to be dismissed.

In this case certain facts are directly or indirectly admitted by O.P’s 2 and 3. As it is settled law that evasive denials are no denials and the admissions made by the parties in a lis, need not be proved.  In the counter filed by O.P’s 2 and 3 it is averred that they are having house site bearing flat No.4 to 7 admeasuring 1013 square yards at Sri Jagannadha Nagar, South ward, Vizianagaram and the complainant is put to strict proof of the execution of development agreement and power of attorney dated 17.03.2010 in favour of 1^st respondent vide document No.798/2010.  If really the O.P’s 2 and 3 had nothing to do with O.P.No.1 and did not execute any general power of attorney in his favour they would have clearly mentioned the said fact in their counter but they did not do so.  With regard to execution of registered sale deed and agreement of construction of flat by the 1^st O.P. in favour of complainant, the O.P’s 2 and 3 did not deny the said facts. They have simply stated that the complainant is put to strict proof of the same.  Similarly with regard to the period of construction there is no specific denial by the O.P’s in their counter the complaint is liable to be partly allowed.  They have simply expressed their ignorance with regard to the period of construction mentioned in the agreement of construction.

It is averred in the counter that 1^st O.P. obtained GPA from O.P’s 2 and 3 on 17.03.2010 and 1^st O.P. has promised to pay some amount to them and as the 1^st O.P. did not pay any amount to them, disputes arose in between them and as such they have cancelled the GPA and that they are not aware of the transactions made by 1^st O.P. with complainant and as they did not receive any amount from him the acts done by him are not binding on them.  When the above said pleadings made by the O.P’s 2 and 3 in their counter are taken into consideration it lends support to the case of complainant to believe that the O.P’s 2 and 3 are the owners of site having flat nos.4 to 7 admeasuring 1013 square yards and to develop the same they have executed a GPA in favour of 1^st O.P and by virtue of the existence of GPA he executed sale deeds as well as development agreements in favour of complainant. In this case though a notice was served on the 1^st O.P sent by this Forum, he did not come to contest the matter.  Prior to filing of the complaint the complainant got issued exhibit A3 notice to the 1^st O.P and though he received the said notice as evident from exhibit A4 postal acknowledgement he did not respond to the said notice.  Since the 1^st O.P did not come to the Forum to contest the matter and as he did not give any reply to exhibit A3 notice an inference can be drawn to the fact that the averments made in the complaint as well as in Exhibit A3 notice are true and correct.  Exhibit A1 is the copy of the registered sale deed dated 22.7.2011 and exhibit A2 is the registered agreement for construction of flat executed by the 1^st O.P. in favour of complainant.  As we have already stated supra the O.P’s 2 and 3 did not specifically deny the execution of above said 2 documents in favour of complainant.  As the 1^st O.P. who executed the said document did not come to the Forum to contest the matter an inference can be drawn to the fact that the 1^st O.P. being the GPA holder of O.P’s 2 and 3 has executed the above said two documents having received consideration from the complainant and as per its contents the 1^st O.P. agreed to make construction of flat within 18 months and to deliver the same to the  complainant as agreed.   The O.P’s 2 and 3 have filed the copy of GPA, dated 17.03.2010 and cancellation deed of GPA dated 16.08.2012 and got the same marked as exhibits B1 and B2.  As seen from the contents of above said documents it is manifest that the 1^st O.P. was given GPA for making construction of an apartment consisting of stilt+Ground+Four upper floors and O.P’s 2 and 3 have agreed to take 35% of the total built up area and 1^st O.P. was given the exclusive right for the remaining 65% of built up area with a liberty to enter into agreements with intending purchasers in respect of their share and to receive advance from them.  Exhibit B1 GPA was in force till exhibit B2 cancellation deed was executed by O.P’s 2 and 3.  The O.P’s 2 and 3 have not placed any evidence to prove that O.P.1 has acted in adverse to their interest.  No notice was got issued by O.P’s 2 and 3 to 1^st O.P by mentioning the grounds upon which they were going to cancel the GPA.  When Exhibit B1 GPA was in force the 1^st O.P. has executed the sale deed and construction agreement in favour of complainant for making construction of flat No.402 within stipulated time and to put the complainant in possession of the same.  Since the complainant paid the consideration to 1^st O.P. under exhibit A1 registered sale deed and as the 1^st O.P. agreed to make construction and to put the complainant in possession of the same as stated in exhibit A2 agreement, the O.P’s 2 and 3 being the principals of O.P.1 are bound by the acts of O.P.1.  As per Section-188 of the Indian Contract Act an agent having an authority to do an act has authority to do every lawful thing which is necessary in order to do such act. An agent having an authority to carry on a business, has authority to do every lawful thing necessary for the purpose, or usually done in the course of conducting such business.  Coming to case on hand under exhibit B1 GPA the O.P’s 2 and 3 being the owners of the site have given authority to O.P.1 to make construction of an apartment and was given right to enjoy 65% of built up area and to enter into agreements with intending purchasers in respect of their share and receive advance from them.  Since the complainant paid due consideration for purchase of flat No.402 to 1^st O.P. the said sale is valid and is binding on O.P’s 2 and 3 also.  As per terms of exhibit A2 development agreement, the 1^st O.P. had to complete the construction of flat within 18 months and to put the complainant in possession of the same.  The above said development agreement is also binding on O.P’s 2 and 3.  Since the 1^st O.P. executed exhibit A1 and A2 documents in favour of complainant when exhibit B1 GPA was in force all the lawful acts done by O.P.1 in relation to the above said property is binding on O.P’s 2 and 3 also. As per terms of exhibit A2 development agreement the 1^st O.P. had to complete the construction of flat within 18 months and to put the complainant in possession of the same.  The above said development agreement is also binding on O.P’s 2 and 3.  Since the 1^st O.P. executed exhibit A1 and A2 documents in favour of complainants when exhibit B1 GPA was in force, all the lawful acts done by O.P.1 in relation to the above said property is binding on O.P’s 2 and 3. As per Section-208 of the Indian Contract Act the termination of the authority of an agent does not so far as regards the agent take effect before it becomes known to him, or  so far as regards third persons before it becomes known to them. Coming to case on hand no cogent evidence is adduced to prove that O.P.1 and complainant had knowledge about cancellation of GPA by O.P’s 2 and 3.  Even if it is believed that O.P.1 and complainant had knowledge about cancellation of GPA it cannot be said that execution of exhibit A1 sale deed and A2 development agreement are void. Since the said documents were executed by O.P.1 in favour of complainant before cancellation of exhibit B1 GPA, the O.P’s 2 and 3 are bound by the acts done by 1^st O.P in this regard as they are lawful. Hence under the above said facts and circumstances we are of the considered opinion that as the O.P’s 1 to 3 did not adhere to the terms and conditions of exhibits A1 and A2 documents it can safely be held that they are dereliction of their duty and there is deficiency in service on their part.  Hence the complainant are right in approaching this Forum to get his grievances redressed.

In the result, the complaint is partly allowed directing the O.Ps to complete construction of flat No.402 within six months from today and to pay interest @ 12% p.a., on Rs.6,35,000/- from the date of sale deed till the date of handing over the plot to the complainant and to pay a sum of Rs.20,000/- (Rupees Twenty Thousand Only) towards damages for causing mental agony to the complainant and to pay a sum of Rs.5,000/- (Rupees Five Thousand Only) towards costs which includes the advocate fee of Rs.1,000/-(Rupees One Thousand Only).  The O.P’s are directed to pay the interest accrued on sale price, the amount awarded under the head damages and the costs awarded within 2 months from today.                          

Dictated to the Typist, transcribed by her, corrected by me and pronounced by us in the open Forum, this the 29th day of May, 2015.

MEMBER                                  PRESIDENT

                                              C.C.No.24 / 2014

APPENDIX OF EVIDENCE

WITNESSES EXAMINED

For complainant:-                   For opposite parties:-

PW 1                                   RW1  &  RW2

DOCUMENTS MARKED

For Compainant:-

Ex.A-1 Registered sale deed executed by 1^st Opposite party

       in favour of complainant on 22.07.2011, Original.

Ex.A-2 Registered Agreement for construction of flat

       executed by 1^st opposite party in favour of

       complainant on 22.07.2011, Original.

Ex.A-3 Registered Lawyer’s notice to the 1^st opposite party,

       O/copy dt.18-12-2013

Ex.A-4 Postal acknowledgement from 1^st opposite party,

       Original.

For OP’s:-

Ex.B-1 Development Agreement with Power of Attorney

       dt.17-3-2010

Ex.B-2 Cancellation Deed dt.16-8-12

Ex.B-3 Certificate of Encumberance on property.

Ex.B-4 Certificate of Encumberance on property.  

                                             President