STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

M/s Daulat Ram Hotel (P) Ltd. 1644, Urban Estate-II, Hisar, through its Managing Director Sh.Ashwani Kumar.                                  

…Complainant

Versus

1.      Haryana Urban Development Authority, through its Chief        Administrator, Sector-17, Chandigarh.

2.    The Estate Officer, HUDA, Gurgaon. 

     …Opposite Parties

          Complaint U/s 17 of Consumer Protection Act,1986.

BEFORE: JUSTICE SHAM SUNDER (Retd.), PRESIDENT.

              MRS. NEENA SANDHU, MEMBER

Argued by:  Sh. Neeraj Pal Sharma, Advocate for the complainant.

Sh.Sikander Bakshi, Advocate for the Opposite Parties.

PER  JUSTICE SHAM SUNDER (Retd.), PRESIDENT.

1.             The facts, in brief, are that two bays plot No.37, in Sector-32, Gurgaon, was allotted to the complainant, by the Estate Officer, Haryana Urban Development Authority, Gurgaon i.e. Opposite Party No.2, on 29.6.95, vide allotment letter, copy whereof is annexure C-2. According to clause-7 of the allotment letter, possession was to be offered, on completion of development work, in the area. The construction of building on the plot, was to be completed within 5 years, from the date of offer of possession. It was stated that since the Opposite Parties,  did not offer possession of the plot, in question, to the complainant, and resumed it, so, it (complainant) filed CWP No.5378 of 2001, in the Hon’ble High Court. The Hon’ble  High Court, vide order dated 31.10.2003,  allowed the Writ Petition, and restored plot, to the complainant. It was further directed by the Hon`ble High Court, that the Opposite Parties, shall offer possession of the plot, in question, to the complainant.  It was further stated that a review application was filed, by the complainant, as no order was passed, on the excess amount charged by the Opposite Parties, and in that review application the Hon’ble High Court, directed the complainant, to make representation to the Haryana Urban Development Authority.  It was further stated that the aforesaid acts of the Opposite Parties, amounted to deficiency, in rendering service, as also indulgence into unfair trade practice.  The Opposites Parties were asked to pay interest, on the amount, deposited by the complainant, from the respective dates of deposit, till possession was delivered;  amount of escalation, in cost of construction; amount of interest, on installments till basic amenities were provided; and compensation for mental agony and physical harassment but to no avail. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), was filed.

2.             The Opposite Parties, put in appearance, and filed written version. It was pleaded that the complaint was not maintainable, as the complainant, did not fall within the definition of a consumer.  It was further pleaded that this Commission, had no pecuniary jurisdiction, to entertain and decide the complaint. It was further pleaded that the jurisdiction of the Commission, was barred, according to Section 50(2) of the Haryana Urban Development Authority Act,1977. It was further pleaded that the dispute, in question, had already been adjudicated and decided, by the Hon’ble High Court, and, as such, the present complaint was barred by the principles of res juddicata. It was further pleaded that the aforesaid two bays plot No.37 in Sector-32, Gurgaon, allotted to the complainant, was fully developed, with all civic amenities like water, road, sewerage, electricity etc. It was stated that the complainant was offered possession of the plot, vide office memo No.55 dated 13.12.2005 Annexure R-1. It was further stated that the possession of  plot, in question, was to be delivered, to the complainant, after the completion of required formalities.  It was denied that there was no road, provided to the aforesaid plot of the complainant.  It was further stated that the plot, in question, had been developed, as per the development plan, and layout plan of the sector, with proper arrangement of street light and storm water drainage.  It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor they indulged into unfair trade practice. The remaining averments, were denied, being wrong.

3.             The Parties led evidence, in support of their case.

4.             After hearing the Counsel for the parties, and, on going through the evidence, and record of the case, this Commission, dismissed the complaint, vide order dated 01.11.2006.

5.             Feeling aggrieved, First Appeal No.767 of 2006, was filed by the appellant/complainant, before the National Consumer Disputes Redressal Commission, New Delhi.

6.             The National Consumer Disputes Redressal Commission, New Delhi, held that two material issues, as under, which  were involved in the complaint, had not been decided by the State Consumer Disputes Redressal Commission:-

                        i.   Whether the delay in delivery of possession had resulted into any kind of financial burden on the appellant, in respect of escalation of the cost of construction or that it was due to the act of the appellant that such additional burden of construction cost was required to be incurred?

                       ii.    Whether the appellant was entitled to recover interest @18% p.a. in respect of the deposit, for which the refund was required to be made?

7.             Accordingly, the order dated 01.11.2006, was set aside, and the matter was remitted to this Commission, for deciding the issues, involved, in the case, afresh, by giving due opportunity to both the sides,  to lead evidence, and hear them on merits. The parties were directed to appear, before this Commission, on 10.10.2011.

8.             After the complaint was received by remand, the Counsel for the complainant, put in appearance, but nobody, put in appearance, on behalf of the Opposite Parties.

9.             Notice was issued to the Opposite Parties, through Registered A.D. Covers, but even after the expiry of 30 days, from the date of issuance thereof, at their correct address, no legally authorized representative, put in appearance, on their behalf.  They were, accordingly, deemed to be duly served as envisaged by the proviso engrafted to Section 28A(3) of the Act. They were, accordingly, proceeded against exparte vide order dated 12.12.2011.

10.           The complainant led exparte evidence, by way of affidavits of Sh. Ashwani Kumar, Managing Director of the complainant, and Sh. Pankaj Jaiswal, alongwith which documents were attached.

11.           On 16.01.2012, the Counsel for the Opposite Parties, put in appearance, and moved an application for setting aside the exparte proceedings order dated 12.12.2011.

12.           Reply to the application, was not filed. However, the Counsel for the complainant, stated that he had received instructions, from his client, that it had no objection, in case, the exparte proceedings order dated 12.12.2011,  was set aside.

13.           However, keeping in view the principle of law, laid down, in  Rajeev Hitendra Pathak and others vs Achyut Kashinath Karekar and another IV (2011) CPJ 35 (SC), a case decided by a three judge Bench of the Apex Court, that since, this Commission, was not vested with the power to review/recall the exparte proceedings order, the concession of the Counsel for the complainant, on the question of law, was not accepted.

14.           Vide separate order dated 21.02.2012, the application for setting aside the exparte proceedings order dated 12.12.2011, was dismissed.

15.           We have heard the Counsel for the parties, and, have gone through the evidence, and record of the case, carefully. 

16.           The Counsel for the complainant,  submitted that the complainant, fell within the definition of a consumer, as it hired the services of Haryana Urban Development Authority, for the allotment of two bays plot No.37 in Sector-32, Gurgaon, for consideration. He further submitted that, as per the terms and conditions of the allotment letter, the possession of the aforesaid plot, was to be handed over, to the complainant, after being fully developed, with all civic amenities like water, road, sewerage, electricity etc. He further submitted that since the basic facilities, aforesaid, had not been provided, the physical possession of the plot, could not be offered to the complainant, immediately, after allotment. He further submitted that, ultimately, the plot was resumed  illegally, by the Opposite Parties, as a result whereof, the complainant had to file CWP No.5378 of 2001, in the Hon’ble High Court, which was allowed and the Opposite Parties, were directed to offer possession of the plot, in question, to the complainant, after providing the aforesaid basic amenities. He further submitted that, ultimately, the possession of the plot was delivered on 13.12.2005, after providing the aforesaid facilities. He further submitted that the Opposite Parties, could not claim amount, towards the price of the plot, until the aforesaid facilities were provided, to the complainant, and physical possession thereof, had been delivered to it. He further submitted that the amount, so deposited, by the complainant, with the Opposite Parties, from time to time, was illegally retained by them, until the physical possession of the plot was delivered, as a result whereof, the complainant became entitled to interest @18% p.a., on the amount, so deposited and later on refunded from the respective dates of deposits. He further submitted that, in the meanwhile, the cost of construction, also escalated, and, as such, the complainant became entitled to compensation. He further submitted that by neither granting interest, on the amount aforesaid, nor granting compensation, on account of escalation, in the cost of construction, the Opposite Parties, were not only deficient, in rendering service, but also indulged into unfair trade practice.

17.           On the other hand, the Counsel for the Opposite Parties, submitted that the complainant, being a Limited Company, carrying on the business of hotels, got allotment of the plot, purely for commercial purpose, with a view to earn profits, and, as such, it did not fall within the definition of a consumer, according to Section 2(1)(d), of the Act. He further submitted that all the basic facilities had been provided, at the time of allotment of the plot, in question. He further submitted that, no doubt, physical possession, of the plot, in question, was handed over to the complainant on 13.12.2005, yet, the price of the same also escalated manifold, in the meanwhile, and, as such, the complainant was not entitled to interest, on the amount, deposited by it, for the purpose of allotment of plot. He further submitted that, if, in the meanwhile, the cost of construction escalated, the price of the plot, also appreciated manifolds, which must be, much more than the escalated cost of construction, as a result whereof, the complainant was not entitled to compensation.  He further submitted that even the affidavit of Pankaj Jaiswal,  who claimed himself to be a qualified Professional, with the qualification of AMIE (Civil), submitted by way of evidence, is not based, on any cogent, convincing, and tangible data, for the purpose of working out, the escalation, in the cost of construction, from the year 1998, when the possession was expected to be delivered, upto 13.12.2005, as the construction was required to be completed by the Opposite Parties, as per the letter of allotment dated 29.06.1995, within 5 years, from the date of offer of possession. He further submitted that even, the complaint was barred by the principles of res juddicata. He further submitted that neither there was any deficiency, in rendering service, on the part the Opposite Parties, nor they indulged into unfair trade practice.

18.           The first question, that falls for consideration, is, as to whether, the complainant, falls within the definition of a consumer or not. For proper decision of this question, the provisions of Section 2(1)(d) and Section 2(1)(o), defining the `consumer` and ‘service’ respectively, are extracted as under:-

“(d) "Consumer" means any person who, -

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised or under any system of deferred payment when such use is made with the approval of such person but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii)[hires or avails of] any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other then the person who [hires or avails of] the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person [but does not include a person who avails of such services for any commercial purpose]; Added by Act 62 of 2002 w.e.f. 15.03.2003.

[Explanation. For the purposes of this sub-clause "commercial purpose" does not include use by a consumer of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood, by means of self-employment;]

Section 2(1)(o) defines service as under:-

(o) "services" means service of any description which is made available to potential 16[users and includes, but not limited to, the provision of] facilities in connection with banking, Financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, 17[housing construction] entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service.”

19.             According to Section 2(1)(d)(i) of the Act, the consumer does not include a person, who obtains such goods for resale or for any commercial purpose. Section 2(1)(d)(ii), which was amended by Act 62 of 2002 w.e.f. 15.03.2003, clearly lays down that the person who hires or avails of the services, for a consideration, for any commercial purpose, shall not qualify, as a consumer. In the instant case the plot, in question, was allotted on the basis of application, moved by the complainant, by the Haryana Urban Development Authority, vide allotment letter Annexure C-2 dated 29.06.1995. The complainant, as is evident, from the heading of the complaint, is M/s Daulat Ram Hotel (P) Ltd., Company. It may be stated here, that the complainant, is running the hotel business, on a large scale, with a view to earn profits. The status of the complainant, being that of a commercial entity, and it had got allotted the plot, in question, for the purpose of construction of hotel, a commercial activity, with an intent, to generate huge profits, and, as such, it did not fall within the definition of a consumer. In the complaint, nowhere, it was stated by the complainant,  that the plot, in question, was allotted in its favour, by the Opposite Party, for running a small business activity, with a view to earn its livelihood, by way of self employment. In Economic Transport Organization Vs.Charan Spinning Mills (P) Ltd., & Anr., I (2010) CPJ 4 (SC), it was held that, after the amendment of Section 2(d) of the Act w.e.f. 15.03.2003, the services of the carriers, if had been availed of, for any commercial purpose, then the person availing of the services, does not fall within the definition of a consumer, and consequently, the consumer complaint will not be maintainable, in such cases. In Birla Technologies Ltd. Vs. Neutral Glass and Allied Industries Ltd. 2011 (1) SCC 525 , a Limited Company availed of the services of the service provider i.e. from another Limited Company, for installation of modules of the software for commercial purpose. Ultimately, the Hon`ble Supreme Court held that the goods having been purchased for commercial purpose, and the services were hired or availed of, for the aforesaid purpose, the complainant Company did not fall within the definition of a consumer, and, as such, the Consumer Complaint was not maintainable. Similar principle of law, was laid down, in Sanjay D.Ghodawat Vs. R.R.B.Energy Ltd., IV (2010) CPJ 178 (NC), a case decided by a Full Bench of the National Consumer Disputes Redressal Commission, New Delhi The principle of law, laid down, in the aforesaid cases, is fully applicable, to the facts of the instant case. It is, therefore, held that the complainant does not fall within the definition of a consumer, and, as such, the Consumer Complaint was not maintainable. The submission of the Counsel for the Opposite Parties, in this regard, being correct, is accepted.

20.             The Counsel for the complainant, however, submitted that the allotment of plot, was made, in favour of the complainant, in the year 1995 i.e. much earlier to the amendment of Section 2(d) of the Act, on 15.03.2003, and, as such, the same was inapplicable to the instant complaint. The submission of the Counsel for the complainant, in this regard, does not appear to be correct. No doubt, the allotment, was made in favour of the complainant, in the year 1995, yet the possession was handed over  to it, on 13.12.2005. The cause of action accrued to the complainant, to file the instant complaint in 2006 i.e. much after the amendment of Section 2(d) on 15.03.2003. Under these circumstances, the amended provisions of Section 2(d) were applicable to the instant complaint. Not only this, in Economic Transport Organization`s case (supra), it was in clear-cut terms held that the amendment would be applicable to the consumer complaints, filed after the same came into force. Similar principle of law, was laid down, in Birla Technologies Ltd.`s case (supra). In both these cases, the goods were purchased, and the services were hired, much before the amendment of Section 2(d) on 15.03.2003, but the complaints were filed, after the amendment came into force. It was, under these circumstances, held in the aforesaid cases, that since the goods were purchased and the services were hired for commercial purpose, with intent to earn profits, though before the amendment came into force, yet, the complaints having been filed, after the amendment, the same were not maintainable. In this view of the matter, the submission of the Counsel for the complainant, being without merit, must fail, and the same stands rejected.

21.             One of the questions, formulated by the National Consumer Disputes Redressal Commission, at the time of remand of the complaint, was, as to whether, the complainant was entitled to recover interest @18% p.a. for delay, in delivery of possession, in respect of the deposits, for which the refund was required to be made. It may be stated here, that in the instant case, no doubt, the plot was allotted to the complainant,  on 29.06.1995, yet, the possession was delivered on 13.12.2005. It is evident,  from Annexure C-5 , affidavit of Anju Choudhary, HCS, HUD (infact HUDA), Gurgaon, filed in pursuance of the order, passed by the Hon`ble High Court, that after recalculating  the amount, the petitioner was refunded Rs.1,72,730/- vide cheque no.624690 dated 16.12.2005,  and the amount of Rs.3,36,738/- was adjusted, on account of delay, in making the payment of installments, towards the cost of plot. The possession of the plot, in question, was given to the complainant on 13.12.2005, at old rates of 1995. There must have been manifold, escalation, in the price of the plot, from the date of allotment, until the possession thereof was delivered to the complainant. The complainant, thus, got benefit of escalation in price,  of the plot, by paying the price of the same, at the old rates, prevailing in 1995. Under these circumstances, it (complainant) was not at all entitled to interest, on the amount, so refunded to it. It was also held in Haryana Urban Development Authority Vs. Darsh Kumar, etc. etc.  III (2004) CPJ 34 (SC), that where possession is given, at old rates, and the party had got benefit of escalation, in price of land, there could not be award of interest on money. In Bangalore Development Authority Vs. Syndicate Bank, 2007(6) Supreme Court 711, it was held as under:-

“13. As already noticed, where the grievance is one of delay in delivery of possession, and the development authority delivered the house during the pendency of the complaint at the agreed price, and such delivery is accepted by the complainant, the question of awarding any interest on the price paid by him from the date of deposit to date of delivery of possession, does not arise. The allottee who had the benefit of appreciation of price of the house, is not entitled to interest on the price paid”

The principle of law, laid down, in the aforesaid cases, decided by the Apex Court, is fully applicable, to the facts of the instant case. Even otherwise, since, it has been held that the complainant does not fall within the definition of a consumer, and the complaint filed by the complainant,  was not maintainable, it was not entitled to any other relief.

22.            The next question, that falls for consideration, is, as to whether, the complainant was entitled to compensation, on account of escalation, in the cost of construction, on account of delay, in the delivery of possession of plot, in question. According to Clause 7 of the allotment letter Annexure C-2, dated 29.06.1995, the possession of the site, was to be offered to the complainant, on completion of development work in the area. According to Clause 8 of the allotment letter, the construction of the building, on the plot, was required to be completed by the allottee, within 5 years, from the date of offer of possession, and no rebate in the price of land, was to be given, even if the construction was completed before 5 years. The combined reading of both these clauses, clearly goes to reveal that the possession was to be given, after the completion of development work, in the area, and that the construction was to be raised/completed by the allottee, within 5 years, from the date of offer of possession. It was not that the possession was to be offered immediately, on the allotment of plot. These conditions were accepted by the complainant, with eyes wide open. The Haryana Urban Development Authority, in our considered opinion, in the normal course, was expected to deliver possession of the plot to the complainant upto 1998.. Had the possession been delivered within a period of 3 years from 1995, only then the complainant could raise construction within further 2 years, thereafter, as per clause 8 of the allotment letter. In the instant case, possession was delivered on 13.12.2005. What was the escalation, in the cost of construction,  from 1998 to 13.12.2005, is required to be considered by this Commission. The complainant has produced the affidavit of Pankaj Jaiswal, who claims himself to be a qualified professional being AMIE (Civil). In his affidavit, it was stated by him, that he went through  the Government rates, pertaining to the period before 1997  to 2006. Alongwith his affidavit, Annexure C-8 dated 02.01.2012, has been submitted by Pankaj Jaiswal, wherein, he has given the difference, in cost of construction of 4 storeyed building, from 1997. Not only this, photo-copy of the letter allegedly received from the Executive Engineer, and the photocopies of abstract of cost attached therewith, relating to 18.07.1996, do not appear to be authentic documents. No affidavit of the Executive Engineer, who allegedly wrote this letter, to one Anil Kumar, Govt. Contractor, Bhiwani, has been placed, on the record,  to prove that these documents are correct, and based on the authentic and tangible data. Not only this, this letter relates to the construction of additional 30 bedded Civil Hospital, at Adampur, in Hisar. In the instant case, 4 storeyed building, which was to be allegedly constructed, by the complainant, was of a hotel. There, therefore, cannot be any comparison, between the cost of construction of additional 30 bedded Civil Hospital and 4 storeyed building of a hotel. Neither, the affidavit of Pankaj Jaiswal with a certificate dated 02.01.2012, submitted by him, nor the documents at annexure C/8 (colly.), at pages 82 and 83, are based on any authentic data and tangible material. As stated above,  since  Annexure C-9/1, and the abstract of cost, attached therewith,  are only photocopies, and the author thereof, has not furnished an affidavit in support thereof, no reliance  thereon, can be placed. The affidavit of Pankaj Jaiswal, alongwith documents, submitted by him, therefore, cannot be taken into consideration, for coming to the conclusion, that there was any escalation, in the cost of construction, from 1998 to 2005. Under these circumstances, no compensation, on account of alleged escalation, in the cost of construction, can be granted, to the complainant. Even otherwise, had this Commission, come to the conclusion, that there was escalation, in the cost of construction, the complainant would not have been entitled to the same, on account of the reason, that it being not a consumer, and the complaint, filed by it, was not maintainable, as discussed above.

23.            Not only this, the matter can be looked at, from another angle also. The plot, in question, is situated at Gurgaon. It was allotted to the complainant, on 29.06.1995. The possession thereof, as stated above, was delivered to it, on 13.12.2005, at the old rates, which were prevailing, in the year 1995. The price of the plot, allotted to the complainant, must have escalated manifolds from 1995 to 2005. As such, escalation may be more than 50 to 55%. The cost of construction, in the meanwhile, must have not escalated to that extent. Under these circumstances, escalation, in the price of plot manifolds, in Gurgaon, where a number of Multinational Companies have set up their Offices, and also Mega Malls have mushroomed, in greater numbers, would be more than adequate to compensate the complainant, for escalation in the cost of construction. On this ground too, the complainant is not entitled to, any compensation, on account of escalation, in the cost of construction. Similar principle of law, was laid down, in Brij Bala Nandwani Vs. Haryana Urban Development Authority and another, First Appeal No. 2772/2006, decided on 08.08.2008, by the State Consumer Disputes Redressal Commission, Haryana, Panchkula. 

24.           No other point, was urged, by the Counsel  for the  parties.

25.           For the reasons recorded above, the complaint, being devoid of merit, must fail, and the same is dismissed, with no order as to costs.   

26.           Certified Copies of this order, be sent to the parties, free of charge.

27.           The file be consigned to Record Room, after completion

Pronounced.

May 16, 2012

Sd/-

[JUSTICE SHAM SUNDER (Retd.)]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Rg