COMPLAINT FILED ON: 09.06.2010<br /> DISPOSED ON: 30.11.2010<br /> <br /> BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)<br /> <br /> 30TH NOVERMBER 2010<br /> <br /> PRESENT:- SRI. B.S. REDDY PRESIDENT<br /> SMT. M. YASHODHAMMA MEMBER <br /> SRI. A. MUNIYAPPA MEMBER<br /> <br /> COMPLAINT NO.1299/2010<br /> <br /> COMPLAINANTS 1. Mr. Kirti Kunal Shah,<br /> S/o Sri Kamal Narayan Shah,<br /> Aged about 31 years,<br /> Flat No.206, <br /> Keerti Royale Apartment, <br /> 3 outer Ring Road,<br /> Banaswadi,<br /> Bangalore - 560 043.<br /> <br /> 2. Mr. Satish Babu Natarajan,<br /> S/o E. Natarajan,<br /> Aged about 33 years,<br /> 36/1, Aralimardha Road,<br /> Bangalore - 560 033.<br /> <br /> 3. Mr. Jayakrishna Limaya,<br /> S/o Kashinath Bedge,<br /> Aged about 26 years,<br /> Flat No.206, <br /> Keerti Royale Apartment, <br /> 3 Outer Ring Road, <br /> Banaswadi,<br /> Bangalore-560 043.<br /> <br /> Advocate: Sri. Nayak & Srikumar<br /> <br /> <br /> V/s.<br /> <br /> OPPOSITE PARTIES 1. Granity Properties Pvt. Ltd., <br /> Having its registered offices<br /> At #43, 3rd Cross, 10th A Main, <br /> Indiranagar 1st Stage,<br /> Bangalore - 560 038. <br /> <br /> 2. Orange Properties,<br /> Orange Tower, #114/1,<br /> Outer Ring Road,<br /> Vijaya Bank Colony,<br /> Dodda Banaswadi,<br /> Bangalore - 560 043.<br /> <br /> 3. Mr. Ashfak Ahmad,<br /> Director, <br /> Granity Properties Pvt Ltd.,<br /> 74, Jahangir Manzil,<br /> Maszid Road, <br /> K.R.Puram,<br /> Bangalore - 560 036.<br /> <br /> Advocate for OP-3: Sri. Balaram<br /> <br /> 4. Mr.Krishnarajpuram Maulana<br /> Aajaz Ahmed, <br /> Director, <br /> Granity Properties Pvt Ltd.,<br /> 74, Jahangir Manzil,<br /> Maszid Road, K.R.Puram,<br /> Bangalore - 560 036.<br /> <br /> 5. Mr. Prabhu,<br /> ‘Vice-President’, <br /> M/s Orange Properties,<br /> Orange Tower, #114/1,<br /> Banaswadi Outer Ring Road,<br /> Bangalore - 560 043.<br /> <br /> 6. Mr. Vijay Tata Ravipathi,<br /> Proprietor, <br /> M/s Orange Properties,<br /> Orange Tower, #114/1,<br /> Banaswadi Outer Ring Road,<br /> Bangalore - 560 043.<br /> <br /> OPs-1, 2 & 4 to 6 Ex-Parte <br /> O R D E R<br /> <br /> SMT. M. YASHODHAMMA, MEMBER<br /> <br /> This is a complaint filed u/s. 12 of the Consumer Protection Act of 1986 by the complainant seeking direction against the Opposite Parties (herein after called as O.P) to pay to each of the complainants 1 and 2 a sum of Rs.2 lakhs and to 3rd complainant a sum of Rs.4 lakh along with interest at 24% p.a. from the date of payment alongwith damages of Rs.4 lakh each and cost of proceedings to all the complainants on the allegations of deficiency in service. <br /> <br /> 2. The brief averments made in the complaint are as follows:<br /> <br /> OP-1 is a company OP-2 is proprietary concern. OPs-1 and 2 engaged in the business of development, Promotions and Marketing, Real Estate including the promotion and development of residential township and sale of sites to consumers OPs-3 and 4 are the directors of the OP-1. OPs-5 and 6 claimed to be proprietors of OP-2. Lured away by advertisement made by the OPs in developing residential township namely ‘European township’ wherein sites were offered to the public; Complainants applied for plots in the said township, OP-2 is a developer and promoter of project. The first complainant made application for allotment of site in the above layout for a 40 X 60 site and made payment of Rs.2 lakhs vide cheque dated 03.07.2008 drawn on HSBC Ltd. OP promised to allot the site bearing No.237 in the proposed township. The second complainant applied for allotment of 30 X 40 site and paid a sum of Rs.2 lakhs vide cheque dated 03.07.2008 drawn on HSBC Ltd., OP promised to allot site bearing No.560 in the proposed township. Third complainant applied for allotment of two sites one being a 40 X 40 site and second 30 X 40 sites and paid totally Rs.4 lakhs being a sum of Rs. 2 lakhs in relation to each site vide cheques dated 03.07.2008 drawn on Citi Bank. OP promised to allot two sites bearing No.318 and 691 in the proposed township. Complainants repeatedly contacted the OPs requesting them to furnish the copies of the title documents in relation to the said properties and to enter in to agreement in relation to the allotted sites. However OPs inspite of collecting the money from complainants failed to furnish them the copies of the title documents and were avoiding to furnish any information. OPs informed complainants that the layout would be developed and site would be ready for delivery by December – 2008. In December – 2008 there was no sign that any sites were ready for delivery and any layout had been developed. Complainants came to know that OP-1 and 2 are not in a position to form any layout or sell any sites and proposed layout was not sanctioned by the appropriate authorities. The lands in question were agricultural lands belonging to various farmers and OPs do not have any right in the said lands and they were also not in possession of the land. Complainants sent letters to OP cancelling their respective contracts with the OPs. On 20.12.2008 OP-2 gave the reply stating OP-1 would refund the amounts paid by the complainants. Even if OP-1 fails to make payment second OP would make the payments. Thereafter there was no any further communication from OPs. Complainants repeatedly followed up with all the OPs seeking refund of amount paid by them. In January 2009 OP-2 informed the complainants that if they returns all the original receipts and documents OP-2 would issue post dated cheques towards refund of amount paid by the complainants. Pursuant to this promise of OP-2 each of the complainants returned all the original receipts available with them to the OP-2 and same was acknowledged by OP-2. In exchange of return all original receipts, OP-2 represented by OP-6 issued post dated cheques to each of the complainants towards the amount paid by each of them. Complainants presented the said cheques for collection all the cheque came to be dishonoured for in sufficient funds. OPs have collected several crores of rupees illegally enriched at the expenses of the public. Complainants lodged FIR OP-3 had filed petitions under sec. 482 of CRPC; in these petitions OPs promised and undertook to refund the amounts to the sites purchasers; till date no payments are made by OPs. Under the circumstances complainants felt deficiency in service on the part of the OPs. Under circumstances they are advised to file this complaint for the necessary reliefs.<br /> <br /> 3. On the registration of the complainant notice were sent to all OPs. The said notices were returned with an endorsements not claimed service held sufficient and OPs-1, 2, 4 to 6 placed ex-parte.<br /> <br /> 4. OP-3 filed his version mainly contending that complainants have no case against OP-3 and all the grievances are against one Mr. Vijay Tata Ravipathi i.e. OP-6. OP-3 is not responsible for any acts that the complainant had with the OP-5; Complainants have admitted in their complaints that by rescinding the agreement they have received post dated cheques from OP-6 called Mr. Vijay Tata Ravipathi; there by severing alleged contract if any with this OP-3. Hence OP-3 shall be discharged on this grounds and is not responsible for the alleged transactions between the complainants and OP-4, OP-3 admits that OP-6 by name Mr. Ravipathi, proprietor of M/s Orange Properties had undertaken to market residential sites proposed to form at Hirendanahalli, Bidrahalli Hobli, Bangalore East Taluk, Bangalore. It is not within the knowledge of OP-3 the alleged transactions were held between the OP-5 and the complainants for which this OP is not liable for any alleged deficiency; Cheques were issued from the said OP-6. By receiving the cheques complainants have rescinded the understanding to buy a plot. The appropriate and proper jurisdiction is to file a Civil Suit before the Civil Court against OP-4; Complainants should realize that certain requirements and sanctions from the revenue departments are not within control of this OP; Complainants are estopped from making any such allegations; OP-3 admits that complainants entered the alleged agreement for sale supposedly executed by this OP-3 has been handed over to complainants by executive of M/s. Orange properties. This OP has not handed over to the executive of M/s. Orange properties to hand over to the complainants. Complainants have not taken any action against M/s. Orange properties for the offence of dishonour of cheque under section 138 of Negotiable. Instruments act and the Act of the complainants gives reasonable doubt that complainants might have received the amounts covered under the cheque from M/s. Orange Properties. M/s. Orange Properties; not just cheated the complainants, several other investors but also cheated this OP for several crores of rupees. The complainants had all the opportunities to mitigate the losses and recover its investments losses is due to their own negligence. This OP has not rendered any service to the complainants as such complainants cannot impute the deficiency of service against this OP. Among other grounds OP-3 prayed for dismissal of the complaint.<br /> <br /> 4. In order to substantiate the complaint averments, complainants filed their respective affidavit evidence and produced copy of brochures, copy of the application form of complainant No.1, 2, 3 copy of the receipts issued by OP. Correspondences by OP-2 dated 20.04.2008, copies of the receipts dated 29.01.2009, copies of the post dated cheque issued to the complainants, copies of endorsement issued by bank, copies of FIR lodged by each of the complainants, copies of order of the Hon’ble High Court dismissing petition filed by OPs. On behalf of OP, OP-1, 2 and 4 to 6 did not participate in the proceedings. Inspite of giving sufficient opportunity OP-3 not filed its affidavit evidence. Hence taken as no evidence form OP-3 side. Complainants filed written arguments. Heard complainant side; taken as heard from OP-3 side.<br /> <br /> 5. In view of the above said facts the points now that arise for our consideration in this complaint are as under:<br /> <br /> Point No.1:- Whether the complainants have proved <br /> the deficiency in service on the part of <br /> the OPs?<br /> <br /> Point No.2:- If so, whether the complainants are <br /> entitled for the relief’s now claimed?<br /> <br /> Point No.3 :- To what Order?<br /> <br /> 6. We have gone through the pleadings of the parties both affidavit and documentary evidence and the arguments advanced. In view of the reasons given by us in the following paragraphs our findings on the above points are:<br /> <br /> <br /> <br /> Point No.1:- In Affirmative <br /> Point No.2:- Affirmative in part <br /> Point No.3:- As per final Order.<br /> <br /> R E A S O N S<br /> <br /> 7. At the out set it is not at dispute that OP-1 is a company incorporated under the Companies Act 1956, OPs-3 and 4 are the Directors of OP-1. OP-2 is proprietary concern OPs-5 and 6 are the Vice President and Proprietor of the said concern respectively. The complainants being lured away with an advertisement and propaganda issued by OPs-1 and 2 with regard to developing ‘European Township’ a residential township wherein sites would be sold to members of public became the members of OP-1 paid amounts for the sites to be allotted. The first complainant was allotted a site No.237 measuring 40 X 60 feet and he paid initial payment of Rs.2,00,000/- through cheque dated 03.07.2008. The second complainant was allotted site No.560 measuring 30 X 40 feet and he has paid Rs.2,00,000/- through cheque dated 03.07.2008. The third complainant applied for two sites and he was allotted site Nos.318 and 619 he has paid total amount of Rs.4,00,000/- through cheques dated 03.07.2008. OP-1 issued the receipts for having collected the amounts. Since there was no any sign of forming any layout, the complainants demanded for refund of the amount paid by cancelling the contracts. OP-2 issued letters dated 20.12.2008 to each of these complainants undertaking to refund the amounts paid to OP-1 in case OP-1 fails to refund the amount OP-2 would make the payments. Since OP-1 failed to refund the amount, though the original receipts were collected assuring to refund the amount, then OP-6 on behalf of OP-2 issued cheques towards refund of the amount, but all the cheques were dishonoured. Thus it becomes clear that OPs neither acquired any property for formation of layout nor formed any layout duly approved by statutory authority. OPs also failed to refund the amount collected from these complainants. The very fact of collecting the amount from the complainants with a false promise of forming a layout and allotting sites is nothing but unfair trade practice on the part of the OPs. Without acquiring any property and forming a layout brochure was issued inviting the applications from the public for allotment of sites with huge deposits. When OPs were unable to form any layout and by acquiring any land for the formation of layout it would have been fair enough on their part in refunding the amounts to the complainants. There is no merit in the contention of OP-3 that the cheques are issued by OP-6, hence the contract entered into between the complainants and OP-1 are rescinded; OP-3 as a Director is not responsible for refunding the amount. In fact OP-1 has collected the amounts from these complainants and issued the receipts. OP-2 on behalf of OP-1 undertaken to refund the amount and issued the cheques which are dishonoured. Further there is no merit in the contention of OP-3 that the complainants have to approach the Civil Court for seeking appropriate reliefs. OPs by collecting the amounts from these complainants assured to allot the sites by forming layout thereby the collected the initial deposits towards cost of the sites and also service charges as such the complainants are Consumers under the Act, they cannot be directed to approach the Civil Court for seeking necessary reliefs. The affidavit evidence of the complainants and the documents produced clearly goes to show that OPs neither formed any layout and allotted sites nor refunded the amounts received from the complainants, as such the complainants proved deficiency in service on the part of the OPs. <br /> 8. Some of the purchasers having paid the advance sale consideration for the allotment of sites in the said township filed complaints against OPs-3 and 6 before the Commissioner, CCB Police, Bangalore and the case was registered against them for the offence punishable U/s 420 IPC. Criminal petitions were filed before the Hon’ble High Court in criminal petition Nos.3866, 3871, 3878, 3881, 3884, 3886, 3896, 3898, 3903 and 3932/09, the Hon’ble High Court dismissed criminal petition No.3866/09 filed by OP-6. The other criminal petitions were disposed of with a direction that if this OP-3 the petitioner pays the amount due to the complainants as per the schedule, the case registered against him stands quashed. In the event payments are not made as undertaken, the police is at liberty to proceed against the accused. Quashing of the FIR is subject to complete payment to the complainants. The copies of the orders passed in the criminal petitions are produced by the complainants at document No.13. In these criminal petitions OP-3 has filed an affidavit as a Managing Director of OP-1 undertaking to discharge to liability due to the complainants. Further he has undertaken to pay the amount in 4 equal installments and the last installment due on 15.10.2009. Thus it becomes clear that this OP-3 has filed an affidavit before the Hon’ble High Court admitting his liability for refunding the amount as a Managing Director of OP-1. Therefore now OP-3 cannot be permitted to contend that it is only OP-6 as a proprietor of OP-2 liable to refund the amount. Under these circumstances we are of the view that the complainants are entitled for the refund of the amounts with interest at 18% p.a. and litigation cost. Accordingly we proceed to pass the following:<br /> <br /> <br /> <br /> O R D E R<br /> <br /> The complaint filed by the complainants allowed in part. OPs are directed to refund an amount of Rs.2,00,000/- each to complainants No.1 and 2 and Rs.4,00,000/- to complainant No.3 with interest at 18% p.a. from 03.07.2008 till the date of realization and pay litigation cost of Rs.1,000/- to each of the complainants.<br /> <br /> This order is to be complied within four weeks from the date of this order. <br /> <br /> Send the copy of this order to both the parties free of cost.<br /> <br /> (Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 30th day of November 2010.) <br /> <br /> <br /> <br /> PRESIDENT<br /> <br /> <br /> MEMBER MEMBER <br /> <br /> Snm:<br /> <br /> <br /> <br />