KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION

VAZHUTHACAUD, THIRUVANANTHAPURAM

C.C. No.22/2019

JUDGEMENT DATED: 23.12.2022

PRESENT:

COMPLAINANT:

(by Adv. Aysha Rahman)

Vs.

OPPOSITE PARTIES:

(by Adv. Swathy Das)

JUDGEMENT

HON’BLE JUSTICE SRI. K. SURENDRA MOHAN : PRESIDENT

          This is a complaint filed under Section 12 of the Consumer Protection Act, 1986 (hereinafter referred to as the Act for short) seeking return of an amount of Rs.21,00,000/-(Rupees Twenty One Lakhs) paid for the purchase of an apartment, with interest and costs. Compensation for mental agony and trauma caused by the opposite parties are also claimed.

          2.       According to the complainant, he is employed as the Director, CLS Technologies Pvt. Ltd., Pune, Maharashtra.  The 1^st opposite party is a company engaged in the construction of villas and apartments having its registered office at Bangalore, represented in these proceedings by its Managing Director, who is the 2^nd opposite party.  Opposite parties 3 to 6 are the owners of an item of immovable property having an extent of 63.47ares comprised in Survey Nos.313/9, 10 and 12 of Maradu Village.  Opposite parties 1 to 6 were in the process of constructing a Multi Storied Apartment Complex by name “Fern Valley Kensington” at Maradu.  The 7^th opposite party is a partner of the apartment project and a friend of the complainant. 

          3.       The 7^th opposite party persuaded the complainant to purchase an apartment in the project that was being implemented by the opposite parties.  As per an agreement dated 11.04.2012 the opposite parties agreed to construct and sell a three bed room apartment numbered as A-602 in the project, having a super built up area of 1490sq.ft. together with proportionate undivided share in 63.47ares of land comprised in Survey Nos.313/9,10 and 12 of Maradu Village.  The property is particularly described in Schedule A of the agreement.  The total sale price agreed upon was Rs.41,86,750/-(Rupees Forty One Lakhs Eighty Six Thousand Seven Hundred and Fifty). 

          4.       As per the agreement, the three bed room apartment was to be located on the sixth floor of the building and was to be handed over along with a car parking space.  The construction was to be completed within a period of twenty four months from 01.01.2012 with a grace period of three months failing which the complainant was to be paid an amount of Rs.10,000(Rupees Ten Thousand) per month as compensation till the construction was completed.  Pursuant to the agreement, the complainant paid a total amount of Rs.21,00,000/-(Rupees Twenty One Lakhs), which is acknowledged receipt of by the opposite parties. However, they have not completed the construction of the apartment or handed over possession thereof till today. 

          5.       The complainant had been enquiring about the progress of the work with the opposite parties.  He was being assured that the project would be completed without delay and that the completed apartment would be handed over soon.  Therefore the complainant waited.  In the first week of November 2018 the complainant personally visited the site to assess the stage of the construction.  He was shocked to find that there was no work in progress and that the structure of the thirteen floor building was not complete even up to the sixth floor.  When he tried to contact the opposite parties, he was not able to do so.

          6.       The complainant therefore caused the issue of a notice dated 14.11.2018 to the opposite parties calling upon them to return the amount paid by him.  However there was no response.  Therefore he has filed the complaint seeking return of the amount of Rs.21,00,000/-(Rupees Twenty One Lakhs) paid by him, with compensation and costs.

          7.       On receipt of notice, the opposite parties 1 and 2 have appeared and filed a common version.  According to the version filed, they have entered into a joint venture with opposite parties 3 to 6 who are the land owners, for construction of the apartment complex.  It is stated that, opposite parties 3 to 6 had earlier entered into a similar agreement for the development of their property with a company by name, M/s Punarjani Projects Pvt. Ltd., Bangalore.  The 3^rd opposite party is the Managing Director of the said company. The said agreement was executed on 30.11.2007.  The 3^rd opposite party along with his wife, the 4^th opposite party hold the major portion of the land.  For the purpose of carrying out the construction, the 3^rd opposite party had taken a project loan from the State Bank of India, Ernakulam on the security of 157cents of the project land, during 2007.  The 3^rd opposite party thereafter commenced the piling work of the project site.  But, the work was stopped by the trade union on the allegation that 42 neighbouring houses were damaged due to the impact of the piling conducted by them.  The 3^rd opposite party was gheroaed by the trade unions on 30.06.2008 and compensation for the damage caused to the neighbouring houses was demanded of him.  The 3^rd opposite party was forced to issue a cheque in the name of the Union leader, one Sri. I.P. Snehajan for an amount of Rs.60,00,000/- towards settlement of the damage caused by the piling work.  While so the 3^rd opposite party stopped all construction work at the project site on 30.06.2008 and left without honouring the cheque issued to the union leader.  In the above circumstances, the 3^rd opposite party wanted a builder to take up the project work and complete the same on joint development basis.  Accordingly, opposite parties 1 and 2 took up the work of completing the project. However, the damage caused by piling work to the neighbouring houses and loan availed by the 3^rd opposite party were not disclosed to opposite parties 1 and 2. 

          8.       On the basis of an agreement entered into between opposite parties 1 and 2 on one hand and opposite parties 3 to 6, owners of the land, on the other hand, the construction of the apartment complex was undertaken by opposite parties 1 and 2.  The joint venture ratio of the builder and the land owners was 60-40, i.e. 60 percent of the area would belong to the builder and 40 percent to the land owners. 

          9.       The opposite parties 1 and 2 have admitted the receipt of the amount of Rs.21,00,000/-( Rupees Twenty One Lakhs ) from the complainant.  The apartment of the complainant is eighty percent complete.   Out of the total sale price of Rs.41,86,750/-(Rupees Forty One Lakhs Eighty Six Thousand Seven Hundred and Fifty),  the complainant has paid only Rs.21,00,000/-
(Rupees Twenty One Lakhs).   According to opposite parties 1 and 2 the delay in completion of the project was due to circumstances over which they had no control.  They are on the verge of revival of the project jointly with the Association of Flat Owners.  The complainant has refused to accept the compensation offered by them.  It is open to him to pay the balance sale consideration and co-operate in completing the project.  The builder is facing a cash crunch.  Therefore he pleads that a lenient view may be taken.

          10.     The parties went to trial on the above pleadings.  The complainant filed proof affidavit and marked Exhibits A1 to A6 documents.  An Advocate Commissioner was appointed to record the evidence of the complainant.  Accordingly the complainant was examined as PW1 on 02.04.2022 and he was cross examined on behalf of opposite parties 1 and 2.  No evidence has been adduced by the opposite parties. 

          11.     Heard counsel on both sides.  According to the counsel for the complainant, the amount of Rs.21,00,000/-( Rupees Twenty One Lakhs) paid by him represents his hard earned money.  Though receipt of the amount has been admitted, the opposite parties have admittedly not honoured their commitment in Exhibit A1 agreement to complete construction of the apartment agreed to be purchased and to put the complainant in possession thereof.  Though the agreement stipulated payment of an amount of Rs.10,000/-(Rupees Ten Thousand) per month as compensation if construction was delayed, no such payment also was made.  In short, the opposite parties have not abided by any of the terms in Exhibit A1 agreement.  The trauma and hardships caused to the complainant by the deficiency in service and unfair trade practice of the opposite parties is irreparable.  Therefore, appropriate compensation for the mental agony and trauma caused is also necessary to be granted. 

          12.     According to the opposite parties, the delay in completion of the project was caused not due to any fault on their part but due to intervening force majeure conditions.  Since they had no control over the said circumstances, they may not be blamed for the delay.  There has been default on the part of the complainant also since he had not paid the entire amount as agreed in Exhibit A1. 

          13.     The following points arise for consideration in this case:

1. Whether the opposite parties are guilty of deficiency in service and unfair trade practice as alleged in the complaint?
2. Reliefs and costs?

14.         Both the above points are considered together for convenience.  The execution of Exhibit A1 agreement is admitted by the opposite parties.  They have not disputed receipt of the amount of Rs.21,00,000/-(Rupees Twenty One Lakhs) paid by the complainant.  The documents produced by the complainant have also not been disputed.  Exhibit A2 is the confirmation of statement of accounts issued by the 2^nd opposite party admitting receipt of Rs.21,50,000/-(Rupees Rupees Twenty One Lakhs Fifty Thousand) from the complainant.  The terms of the agreement Exhibit A1 show that, the completed apartment was to have been given possession of to the complainant within a period of 24 months from 01.01.2012.  It is not in dispute that the construction of the apartment is still remaining incomplete.  Though the version of opposite parties 1 and 2 has pleaded that the delay was caused due to force majeure conditions, absolutely no evidence has been adduced in support of the said contention.  In fact, no evidence has been adduced by the opposite parties.  Therefore, this is a case where there is evidence only on one side.  It has thus been established that having received an amount of Rs.21,00,000/-( Rupees Twenty One Lakhs) from the complainant, the opposite parties have neither given possession of the completed apartment nor returned the money paid, despite demands to do so.  Their conduct amounts to deficiency in service and unfair trade practice.  They shall therefore be entitled to recover the amount of Rs.21,00,000/-(Rupees Twenty One Lakhs) paid by them from the opposite parties. 

15.         It is true that the complainant has not paid the balance amount of Rs.21.36 lakhs due as sale consideration.  However, he cannot be found fault with for the said omission.  According to him, the balance amount was not paid since he could not find any progress in the construction.  As per the terms of the agreement, for every month of delay caused, the opposite parties were bound to pay an amount of Rs.10,000/-(Rupees Ten Thousand) per month to the complainant.  No such payment was also admittedly made by the opposite parties.  Though the opposite parties have contended that they are in the process of reviving the project, the complainant only wants return of his money. 

16.         To sum up therefore, the complainant has established that he has actually paid the amount of Rs.21,00,000/-( Rupees Twenty One Lakhs) to the opposite parties, the payment is also admitted by opposite parties 1 and 2.  Since the apartment has not been given possession of to the complainant till date, the demand of the complainant for return of his money is fully justified.  The trauma of losing his money and not being able to acquire his dream house has certainly caused a lot of mental agony and trauma to the complainant.  Taking into account the fact that the complainant had been waiting for his apartment from 2012 onwards, more than a decade, he shall be entitled to an amount of Rs.5,00,000/-(Rupees Five Lakhs) as compensation.  He shall also be entitled to the costs of the litigation, which is fixed as Rs.25,000/-(Rupees Twenty Five Thousand).

    In the result, this complaint is allowed on the following terms:-

1.  The opposite parties 1 to 6 are directed to pay an amount of Rs.21,00,000/-( Rupees Twenty One Lakhs) to the complainant with interest theron @8% per annum from 02.03.2019, the date of filing this complaint, till the date of realisation.
2. The opposite parties are directed to pay an amount of Rs.5,00,000/-
   (Rupees Five Lakhs) as compensation to the complainant for the mental agony and hardships caused to the complainant by their deficiency in service and unfair trade practice.
3. The opposite parties are further directed to pay an amount of Rs.25,000/-(Rupees Twenty Five Thousand) as costs of this litigation to the complainant.
4. All the amounts mentioned above shall carry interest @9% per annum, if not paid within a period of one month from the date of receipt of a copy of this judgement.

Dictated to my Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Court, this the 23^rd day of December, 2022.

SL

C.C.No.22/2019

APPENDIX

1. COMPLAINANT’S WITNESS

2. COMPLAINANT’S DOCUMENTS

3. OPPOSITE PARTY’S WITNESS

4. OPPOSITE PARTY’S DOCUMENTS

                    PRESIDENT