Date of Filing:18.12.2007<br /> Date of Order: 20.05.2008<br /> <br /> <br /> <br /> BEFORE THE II ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SESHADRIPURAM BANGALORE-20<br /> <br /> Dated: 20TH DAY OF MAY 2008<br /> PRESENT<br /> <br /> <br /> <br /> Sri. S.S. NAGARALE, B.A, LL.B. (SPL.), President.<br /> Smt. D. LEELAVATHI, M.A.LL.B, Member.<br /> Sri. BALAKRISHNA. V. MASALI, B.A, LL.B. (SPL.), Member.<br /> <br /> <br /> <br /> <br /> <br /> <br /> COMPLAINT NO: 2526 OF 2007 <br /> <br /> <br /> Shyam Sunder,<br /> S/o M.S. Sheshadri,<br /> D-S/6, Himagiri Green Forest Apartments,<br /> I Cross Road, Silver Oak Layout,<br /> J.P. Nagar, 7th Phase, <br /> Bangalore-560 078. Complainant<br /> <br /> V/S<br /> Bokka Poornachandra Reddy,<br /> Proprietor,<br /> M/s Himagiri Meadows,<br /> Gottigere, Bannerghatta Road,<br /> J.P. Nagar, Bangalore-560 083. Opposite Party<br /> <br /> <br /> ORDER<br /> <br /> By the President Sri. S.S. Nagarale<br /> <br /> <br /> This is a complaint filed U/Sec.12 of the Consumer Protection Act, 1986 claiming Rs.1,14,861/- with interest and compensation.<br /> The facts of the case are that, the complainant purchased an apartment bearing No.S-6 on the II floor in Block “D” of the building known as Himagiri Green Forest from the opposite party vide sale deed dated 9/6/2006. The apartment so purchased by the complainant fell to the share of the opposite party as the developer as per the said joint development agreement and he has received the consideration for the same. The agreement of sale dated 22.1.2005 and sale deed dated 9.6.2006 are produced. <br /> The detailed break up of the amounts paid is as follows:-<br /> Category Amount Paid<br /> Cost of Apartment at Rs.1820/sq.ft (1435 sq.ft) Rs.26,48,100/-<br /> Legal Charges Rs.1,05,924/-<br /> Charges towards KEB and BWSSB Rs.1,16,400/-<br /> Parking space Rs,1,00,000/-<br /> Maintenance charges for 1 year Rs.10,000/-<br /> Club House Charges Rs.10,000/-<br /> Service tax Rs.1,14,861/-<br /> TOTAL Rs. 31,05,861/-<br /> <br /> As per the information given by the opposite party the complainant after realizing that he had unnecessarily paid a sum of Rs.1,14,861/- as service tax, approached the concerned tax department to seek refund of the same. The complainant was shocked to discover that the opposite party had not deposited the service tax to the department even though it was collected as a statutory due. Further, the complainant was informed that the opposite party had not registered himself with the authority as a service tax collector and neither was he issued a service tax number. The complainant immediately approached the opposite party and made several oral requests for the amount paid by him as service tax. The opposite party refused to refund the same. The complainant, after several attempts made, issued a notice on 29.5.2007 seeking refund of the said amount. The opposite party has not replied to the same despite having been served with the notice. Hence, the complaint.<br /> <br /> 2. Notice was issued to opposite party. The opposite party put in appearance through advocate and filed defence version stating that, the complainant does not come within the purview of the word “consumer” as defined in the Act and the opposite party does not come within the purview of the word “service provider” as defined in the Act, but he is a business man. The complainant has not approached this Forum with clean hands and made alternations after the word payment as “S tax” in the receipt No.2005 dated 16/6/2006. In fact the said receipt was issued by the opposite party to him without the word “S tax”. The amount mentioned in the receipt dated 16/6/2006 for Rs.1,74,000/- but the amount shown in the complaint under the head of service tax is Rs.1,14,861/- and does not tally with each other and the complainant also has not explained for what purpose RS.1,74,000/- was paid under the said receipt. The receipt dated 16/6/2006 is bearing Nos. 2005 and 2905 as stated in the complaint and the said receipt produced by him is altered by incorporating “S tax” in between the words payment and self. The said alteration was made by the complainant in his copy issued by the opposite party and thereafter produced in order to mislead this Hon’ble Forum and thereby obtain in order as sought for in the complaint, to which he has not right at all. There is no relationship of service provider and service recipient between the complainant and the opposite party and question of paying any service tax by the opposite party does not arise at all. In fact the complainant himself had given a satisfactory letter dated 9/6/2006 wherein the complainant had stated that there are no pending works to be attended. Hereinafter wards I shall have no claim against the builder in respect of any defect in any item of the work in the above flat and I shall be responsible for further works and defects. The complainant himself failed to prove for what purpose and under which account the said amount of Rs.1,74,000/- was paid and as such the complaint is liable to be dismissed in limine mainly based on the ground that the said receipt was altered by incorporating the words “S tax” in between the words payment and self. In view of all these reasons stated above, the opposite party prayed to dismiss the complaint. <br /> 3. Both the parties have filed affidavit evidence. Arguments heard.<br /> 4. The points for consideration are:-<br /> 1. Whether there was deficiency in service on the <br /> part of opposite party? <br /> <br /> 2. Whether the complainant is entitled for refund of Rs.1,14,861/- from the opposite party?<br /> <br /> REASONS<br /> 5. The case of the complainant is that, he has purchased apartment bearing No.S-6 in the II Floor, in Block-D of the building known as Himagiri Green Forest. He has paid in all sum of Rs. 31,05,285/- to the opposite party. The detailed break up of amount paid by the complainant is mentioned in para-6 of the complaint. As per the case of complainant he has paid Rs.1,14,861/- as service tax. As per government notification, the builder has engaged as a contractor for construction, then the contractor will be liable to pay the service tax or if the builder has undertaken construction on his own then the question of service tax does not arise. The purchasers are not liable to pay any service tax upon the purchase of apartment. The Finance Ministry exempted Developers/Builders from collecting service tax from property buyers. As regards this fact or aspect is concerned there is absolutely no dispute between the parties. The learned advocate for the opposite party has very fairly and rightly submitted during the course of argument that, payment of service tax is exempted under the Government of India, Finance Ministry’s Circular. Therefore, we need not discuss much on this aspect. The case of the complainant of knowing that he has paid service tax of Rs. 1,14,861/-. He approached the concerned tax department to seek refund the same he came to know that opposite party has not paid service tax to the department. Thereafter, the complainant approached the opposite party and requested for refund of the amount paid by him as service tax. The opposite party refused to refund the same. Thereafter, the complainant issued notice dated 29/5/2007 seeking refund of the amount paid by him. The opposite party has not replied to the notice. Copy of notice dated 29/5/2007 is produced. In this notice the complainant requested for the refund of Rs.1,14,861/-. He has also produced postal acknowledgement to show that notice has been served on the opposite party. Opposite party has not replied to the notice. Therefore, the complainant was forced to approach this Forum for getting the relief. As regards purchase of flat and payment of amount there is absolutely no dispute between the parties. It is the defence of the opposite party that opposite party has not collected any service tax from the complainant. The opposite party has taken specific defence in the defence version that the amount of Rs.1,14,681/- shown under the head of service tax as mentioned by the complainant pertains to extra works done by the opposite party on the directions of the complainant. Therefore, it is the specific defence of the opposite party that the amount was taken for the extra works done, but as regards payment is concerned there is admission. The complainant need not prove payment because opposite party has admitted the payments made by the complainant. An amount of Rs.1,14,861/- which has been paid by the complainant to the opposite party, account of the complainant which was towards service tax. As per the defence it was towards extra works done by the opposite party as per the directions of the complainant. Therefore, now the burden shifts on the opposite party to show or to prove that what was the extra work done to the apartment by the opposite party as per the directions of the complainant. The opposite party has not mentioned the nature of work done to the apartment. The opposite party has no documents or any receipts to show the execution of extra work. The opposite party has not produced any letter or agreement to show that the complainant has requested the opposite party for doing extra work to the flat. The opposite party has taken very bald and casual defence that the amount was taken towards extra works done by the opposite party as per the directions of the complainant. Except taking defence in the defence version, the opposite party has no proof or documents to show that he had executed or done any extra work to the apartment of complainant. So, under these circumstances, the opposite party has failed to prove or establish that he has undertaken some extra works to the apartment of complainant. In the absence of proof of extra work the irregisterable conclusion would be the amount shown by the complainant is Rs.1,14,861/- was towards service tax and therefore, the opposite party is bound to refund the said amount to the complainant because, as per the Government of India Finance Ministry’s Circular, collection of service tax is exempted, the builders/developers need not pay the service tax. The buyers of the flat/apartment need not have to pay the service tax. So, under these circumstances, the only conclusion would be that the sum of Rs.1,14,861/- (4.4%) collected from the complainant was in excess of the price of the flat and therefore, the opposite party has no right to retain that amount with him and he has to refund the said amount. The learned advocate for the opposite party has made much in respect of receipt dated 16/6/2006. This receipt is for Rs.1,74,000/-. The learned advocate for the opposite party argued that the complainant has altered or made some corrections in the receipt. Therefore, he is not entitled for any relief from the hands of this Forum. No doubt in the receipt No.2005 dated 16/6/2006 there appears to be some correction. The word “ST” appears to be inserted in the original receipt. The complainant could not have made alteration or insertion in the receipt. But this insertion or correction or manipulation in the receipt will not effect the case of the complainant. As regards the giving of receipt by the Himagiri Groups and receiving of amount of Rs.1,74,000/- on 16/6/2006 under receipt No.2005, there is absolutely no dispute. It is also not in dispute that this receipt had been issued by the opposite party. Therefore, any insertion or correction in the receipt has not effected the merits of the case. The point for consideration in this case is whether the opposite party is entitled to collect the service tax from the complainant? As already stated above as per the Government of India Finance Ministry’s Circular the Developers/Builders are exempted from collecting service tax from property buyers. Therefore, in this case the amount shown by the complainant under the head service tax is extra amount and the opposite party is not entitled to collect that amount necessarily he has to refund the said amount to the complainant. The complainant served notice demanding refund of the amount and the opposite party has not replied to the said notice. His silence speaks volume. The opposite party could have immediately replied to the notice of the complainant, but he has not done so. The defence taken by the opposite party that sum of Rs.1,14,861/- was received towards extra work done to the flat, but as already discussed above there is absolutely no proof of the extra works done by the opposite party to the flat of the complainant. So, under these circumstances, the complainant is entitled for refund of the amount. The complainant has sought 18% interest on the said amount + Rs.50,000/- as compensation. As regards interest is concerned a reasonable rate of interest could be granted. But the prayer of the complainant for grant of compensation cannot be considered. It is not a case to grant compensation to the complainant. The complainant issued notice on 29/5/2007 demanding refund of the amount. From that date interest could be awarded to the complainant. Taking into consideration all the facts and circumstances and documents advanced by both the learned advocate for the parties, I proceed to pass the following:-<br /> ORDER<br /> <br /> 6. The complaint is allowed. The opposite party is directed to refund Rs.1,14,861/- to the complainant. The complainant is entitled interest at 10% p.a on the said amount from 29/5/2007 till realization. The complainant is entitled to Rs.5,000/- towards costs of the present proceedings from the opposite party. The opposite party has to comply the order within 30 days from the date of this order.<br /> <br /> 7. The copy of this Order as per the statutory requirements be forwarded to the parties free of charge.<br /> <br /> <br /> 8. Pronounced in the Open Forum on this 20TH DAY OF MAY 2008.<br /> Order accordingly <br /> <br /> <br /> <br /> PRESIDENT <br /> <br /> We concur the above findings.<br /> <br /> <br /> MEMBER MEMBER <br /> <br /> <br />