Tamil Nadu

StateCommission

CC/161/2014

K. Balakrishnan & Rekha Balakrishnan - Complainant(s)

Versus

J. RAVI - Opp.Party(s)

SAMPATH KUMAR AND ASSO

20 Oct 2022

ORDER

Date of filing : 29.10.2014

 IN THE TAMILNADU STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI – 600 003.

BEFORE      Hon’ble Thiru. Justice R.SUBBIAH                          PRESIDENT

                     Thiru. R VENKATESAPERUMAL                             MEMBER

 

C.C. No.161/2014

DATED THIS THE 20^TH DAY OF OCTOBER 2022

1. K. Balakrishnan,

2. Mrs. Rekha Balakrishnan,

Both residing at:-

No.A-201, ATRIUM Apartments,

Kalashektra Road,

Thiruvanmiyur,

Chennai – 600 041.                                                                              .. Complainants. 

 

-Versus-

1. Mr. J. Ravi,

S/o. Mr. P. Jayaram,

Old No.1/3. New No.73/3,

‘M’ Block, 3^rd Avenue,

Anna Nagar,

Chennai – 600 102.

 

2. M/s. Jeyaram Civicon Pvt. Ltd.,

Represented by its Managing Director

Mr. J. Ravi,

Old No.1/3. New No.73/3,

‘M’ Block, 3^rd Avenue,

Anna Nagar,

Chennai – 600 102.                                                                       .. Opposite parties.

 

Counsel for the complainants                          : M/s. Sampath Kumar & Associates

 

Counsel for the opposite parties                      : M/s. S. Giritharan

 

This complaint having come up for final hearing before us on 22.09.2022  and on hearing the arguments of both parties and upon perusing the material records submitted by both parties and this Commission made the following:-

ORDER

Thiru. R VENKATESAPERUMAL, MEMBER

 

The present complaint was filed by the complainant against the opposite parties alleging deficiency in service and to direct them to refund a sum of Rs.39,40,000/- with interest at the rate of 24% p.a. with monthly rests from 22.06.2011, to pay a sum of Rs.25,00,000/- towards compensation for mental agony, deficiency in service and financial loss and to pay cost to the complainant.

1.         Brief facts necessitating the filing of complaint:

The complainants submit that the opposite parties have promoted a project of constructing individual Villas and Cottages named ‘Malgudi’ located at Punnapattu Village, Vittalapuram Group, Thirukazhukundram Taluk, Kancheepuram District. The opposite parties also have promised the delivery of a constructed liveable Villa within 6 months from the date of entering into an agreement.  The total cost of Villa was Rs.42,50,000/- (Land Cost of Rs.5,81,280/- + Construction Cost of Rs.36,68,720/-).  On 22.06.2011, an Agreement of Sale was entered into between the 1^st opposite party and the complainants for the sale of the Plot No.56 measuring an extent of 4844 sq. ft. or thereabout at “Malgudi Villa” comprised in S. No.270/4 situated at Pannapattu Village, Vittlapuram Group, Thirukazhukundram Taluk, Kancheepuram District for a sale consideration of Rs.5,81,280/- and the complainants paid an advance of Rs.1,00,000/- to the 1^st opposite party.   Further the complainants submit that the 2^nd opposite party executed a Construction Agreement on 22.06.2011 with the complainants for the construction and landscaping of a Villa in the said Plot No.56 with a built up area of 1100 sq. ft. at a cost of Rs.36,68,720/-.   Under this agreement, the complainants paid an advance of Rs.1,00,000/- towards construction.  The specifications of construction and the payment schedule were detailed under the Schedule ‘C’ and Schedule ‘D’ of the Construction Agreement.  Pursuant to the above agreements, the complainants paid the balance of Rs.4,81,280/- towards sale consideration and the Sale Deed dt.07.07.2011 in their names was registered in SRO, Thirukalikundram as Document No.2760/2011. 

2.         The complainants submit that they took Housing Loan from the Indian Overseas Bank, Texco Srinagar Colony Branch, Saidapet, Chennai – 600 015 who have sanctioned Housing Loan of Rs.30,00,000/- under Subha Graha Scheme to the complainants for purchasing / construction of subject property.  The complainants submit that the opposite parties had assured that the work in progress was in advanced levels and demanded for further payment for quicker delivery of constructed Villa.   The opposite parties also promised the delivery of constructed Villa by December 2011/ January 2012.   The 1^st complainant is a M.D. & C.E.O. in an IT Concern and the 2^nd complainant is a Home Organizer and both of them did not have time to supervise the construction works who believed and trusted the opposite parties.   The complainants submit that Indian Overseas Bank released funds to the tune of Rs.18,25,000/- out of housing loan sanction amount of Rs.30,00,000/-.  Thus, the complainants have paid a total amount of Rs.39,40,000/- out of the project cost + land cost of Rs.42,50,000/-.   The complainants submit that for the housing loan amount of Rs.18,25,000/- by the Indian Overseas Bank, the complainant are paying interest at 10.50% p.a. monthly compounded.  The complainants submit that the EMI payments are agreed to be commenced after taking possession of Villa.   Since the opposite parties failed and neglected to hand over the possession of the Villa to the complainants as per the Construction Agreement, the Bank insisted the complainants to start making the EMI.  Therefore, the complainants were forced to make the payment of EMI from 15.12.2012 @ Rs.30,000/- per month for the home loan availed by them.   The complainants have so far paid a sum of Rs.6,13,552/- towards interest as on 07.10.2014.  The complainants submit that the opposite parties have cheated the complainants by not handing over possession of Villa.   Hence, the complainant has sent repeated emails on various dates to the opposite parties.  But the opposite parties have started avoiding totally any form of communication with the complainants.    The act of the opposite parties caused great mental agony and hardship to the complainants.   Hence, this complaint is filed before this Commission.

3.           Resisting the case of the complainant, the opposite parties has filed a version stating that the complaint is not maintainable either by law or on facts of the case and is liable to be dismissed in limine.    The complainants agreed for payment without any default in payment as mentioned in Schedule ‘C’ of the Agreement.   The complainants were informed that any default in payment would result in diminution of work at the site.   The opposite parties state that the complainants were informed of the progress substantiated with photographs of site at that time.  As stated by the complainants periodic demands were raised along with dues if any were notified to the complainants from time to time to ease the quicker delivery of constructed Villa.   Though the complainants have paid a sum of Rs.39,40,000/- out of the total sum of Rs.42,50,000/- all the  payments were made belatedly.   The opposite parties state that regarding interest for the loan availed by the complainant, payment of EMI etc they are no way related with the same.   The opposite parties state that  the complainants were made known about the status and update of progress through e-mails periodically and attached the photographs regarding various stages of completion as and when the complainants sought for the stage.  The opposite parties state that the complainants had wantonly made defaulted payments and had cleared the payment dues only for the purpose of this case.     The opposite parties state that the Construction Agreement also provides for the Arbitration Clause wherein, the parties thereto agreed to refer any dispute or difference between the parties arising out of or relating to or touching upon the meaning, effect or interpretation or any breach thereof to arbitration in accordance with the Arbitration and Conciliation Act.   While so, this complaint is not maintainable before this Commission.  The opposite parties state that they are ready to handover the constructed villa to the complainants as per the Construction Agreement within a short span of time.  .   Therefore, there is no deficiency in service on the part of the opposite parties and hence, this complaint is liable to be dismissed.

4.         The complainants filed their proof affidavit and submitted documents marked as Ex.A1 to Ex.A24 on their side.  The opposite parties filed their proof affidavit and submitted documents marked as Ex.B1 & Ex.B2 on their side.

5.         Points for Consideration:

1. Whether the complaint is maintainable before the Consumer Commission?
2. Whether there is any deficiency in service and unfair trade practice on the part of the opposite parties as alleged by the complainant?
3. If so, for what relief the complainant is entitled to?

 

6.         Point No.1:

Heard the learned Counsels appearing for both parties.  The complainant has filed his written arguments.  In the written version, the opposite parties had raised an issue with regard to the maintainability of the complaint as the Construction Agreement also provides for the Arbitration Clause wherein, the parties thereto agreed to refer any dispute or difference between the parties arising out of or relating to or touching upon the meaning, effect or interpretation or any breach thereof to arbitration in accordance with the Arbitration and Conciliation Act.  It is contended by the opposite parties that the Consumer Commissions has no jurisdiction to try a case involving lease and that the appropriate forum would be the Civil Court and thus prays for the dismissal of the complaint on the issue of jurisdiction. We are unable to accept the above contention, for the reason that once the agreement dated 22.06.2011 was executed between the parties and signed by the opposite parties for the development of the project to the complainant, the agreement derives the colour of “Development Agreement” and the jural relationship of ‘the Developer’ and ‘the Purchaser’ comes into existence between the parties and the agreed total payment to be considered as ‘consideration’.  Hence, the issue with regard to the non-maintainability of the complaint before the Consumer Commission does not arise. The presence of arbitration clause in the development agreement is not a bar to file a complaint before Consumer Commission as held by various precedents of the Apex Court.  Thus we answer point No.1 in favour of the complainant holding that the complaint is maintainable before the Consumer Commission.

 

7.         Point No.2:-

The contention of the complainants that the opposite parties have promoted a project of constructing individual Villas and Cottages named ‘Malgudi’ located at Punnapattu Village, Vittalapuram Group, Thirukazhukundram Taluk, Kancheepuram District.  The opposite parties also have promised the delivery of a constructed liveable Villa within 6 months from the date of entering into an agreement.  The total cost of Villa being Rs.42,50,000/- (Land Cost of Rs.5,81,280/- + Construction Cost of Rs.36,68,720/-).  On 22.06.2011, Ex.A2, an Agreement of Sale was entered into between the 1^st opposite party and the complainants for the sale of the Plot No.56 measuring an extent of 4844 sq. ft. or thereabout at “Malgudi Villa” comprised in S. No.270/4 situated at Pannapattu Village for a sale consideration of Rs.5,81,280/- and the complainants paid an advance of Rs.1,00,000/- to the 1^st opposite party.   Further the contention of the complainant that as provided under the Agreement of Sale, the 2^nd opposite party executed Ex. A3, Construction Agreement on 22.06.2011 with the complainants for the construction and landscaping of a Villa in the said Plot No.56 with a built up area of 1100 sq. ft. at a cost of Rs.36,68,720/-.  Under this agreement, the complainants paid an advance of Rs.1,00,000/- towards construction as per Ex.A7.  The specifications of construction and the payment schedule were detailed under the Schedule ‘C’ and Schedule ‘D’ of the Construction Agreement.  Pursuant to the above agreements, the complainants paid the balance of Rs.4,81,280/- towards sale consideration as per Ex.A11 and the Sale Deed dt.07.07.2011 in their names was registered in SRO, Thirukalikundram as Document No.2760/2011. 

8.         Further the contention of the complainants that they took Housing Loan from the Indian Overseas Bank, Texco Srinagar Colony Branch, Saidapet, Chennai – 600 015 who have sanctioned Housing Loan of Rs.30,00,000/- under Subha Graha Scheme to the complainants for purchasing / construction of subject property.  The Credit Sanction Advice from the Indian Overseas Bank to the complainants was marked as Ex.A18.   The opposite parties had assured that the work in progress was at the advanced levels and raised periodic  demands from the complainants  for further payment for quicker delivery of constructed Villa.   The opposite parties also promised the delivery of constructed Villa by December 2011/ January 2012.    The complainants submit that Indian Overseas Bank released funds to the tune of Rs.18,25,000/- out of housing loan sanction amount of Rs.30,00,000/-.  Thus, the complainants have paid a total amount of Rs.39,40,000/- out of the project cost + land cost of Rs.42,50,000/-.  The receipts for the payment of Rs.39,40,000/- is marked from Ex.A7 to Ex.A16.  Further, the opposite parties accepted the receipt of the sum of Rs.39,40,000/- from the complainants in their written version.  The complainants submit that the housing loan amount of Rs.18,25,000/- by the Indian Overseas Bank, the complainant are paying interest at 10.50% p.a. monthly compounded.  The complainants submit that the EMI payments are agreed to be commenced after taking possession of Villa.   Since the opposite parties failed and neglected to hand over the possession of the Villa to the complainants as per the Construction Agreement, the Bank insisted the complainants to start making the EMI.  Therefore, the complainants were forced to make the payment of EMI from 15.12.2012 @ Rs.30,000/- per month for availing the home loan account.   The complainants have so far paid a sum of Rs.6,13,552/- towards interest as on 07.10.2014.    The contention of the complainants that the opposite parties have cheated the complainants by not handing over the possession of Villa.    Hence, the complainant has sent repeated emails on various dates as per Ex.A21 to the opposite parties. Album containing 17 photographs of the incomplete construction of the Villa is marked as Ex.A24.  But the opposite parties have started avoiding totally any form of communication with the complainants.    The act of the opposite parties in not handing over the Villa after receipt of amount of Rs.39,40,000/-  clearly amounted to unfair trade practice on part of them.  Thus, we hold that the opposite parties had committed clear deficiency in service and unfair trade practice and we answer point No.2 in favour of the complainant and as against the opposite parties.

12.       Point No.3:-

As we have come to the conclusion that the opposite parties have committed deficiency in service and unfair trade practice and the complainant should be compensated in terms of money.  It is evident from the payment receipts Ex.A7 to Ex.A16, issued by the opposite parties that the opposite parties have received Rs.39,40,000/- from the complainant.   Thus, the complainants are entitled for refund of the said amount with interest at the rate of 9% p.a. from the date of complaint  till realization.  Further, the complainants are also entitled for a compensation of Rs.2,00,000/- for the mental agony and hardship suffered by him.  Cost of Rs.10,000/- is awarded to the complainants. Thus, we answer point No.3 in favour of the complainants.

In the result, this complaint is allowed in part.  The opposite parties 1 & 2 jointly and severally are directed to refund a sum of Rs.39,40,000/- (Rupees Thirty nine lakhs forty thousand only) to the complainant along with interest at the rate of 9% p.a. from the date of filing of this complaint i.e. 29.10.2014 till the date of this order i.e. 20.10.2022, to pay a sum of Rs.2,00,000/- (Rupees two lakhs only) towards compensation for mental agony and hardship caused to the complainant with cost of Rs.10,000/- (Rupees Ten thousand only) to the complainant.

 

The above amounts shall be payable within a period of one month from the date of receipt of the order copy, failing which, it carries interest at the rate of 9% p.a. from the date of award till realisation.

 

R VENKATESAPERUMAL                                                                         R.SUBBIAH                        

             MEMBER                                                                                         PRESIDENT

 

List of documents filed by the complainant:-   

Ex.A1	22.06.2011	Copy of letter from the 2nd opposite party to the complainants
Ex.A2	22.06.2011	Copy of Agreement for Sale between the complainants and 1st opposite party
Ex.A3	22.06.2011	Copy of Construction Agreement between the complainants and 2nd opposite party
Ex.A4	07.07.2011	Copy of Sale Deed executed by the 1st opposite party in favour of the complainants
Ex.A5	07.07.2011	Copy of Memorandum of Deposit of Title Deeds executed by the complainants in favour of Indian Overseas Bank
Ex.A6	-	Copy of Encumbrance Certificate No.5046/2011 showing entry of ownership of the complainants
Ex.A7	09.11.2012	Copy of Patta No.600 in the name of the complainants
Ex.A8	22.06.2011	Copy of receipt No.069 for Rs.2,00,000/- issued by the 2nd opposite party
Ex.A9	29.06.2011	Copy of receipt No.070 for Rs.1,00,000/- issued by the 2nd opposite party
Ex.A10	04.07.2011	Copy of receipt No.071 for Rs.2,00,000/- issued by the 2nd opposite party
Ex.A11	06.07.2011	Copy of receipt No.035 for Rs.5,00,000/- issued by the 2nd opposite party
Ex.A12	07.07.2011	Copy of receipt for Rs.4,81,280/- issued by the 2nd opposite party confirming receipt of amount from Indian Overseas Bank
Ex.A13	12.07.2011	Copy of receipt No.072 for Rs.1,00,000/- issued by the 2nd opposite party
Ex.A14	13.07.2011	Copy of receipt No.073 for Rs.7,00,000/- issued by the 2nd opposite party
Ex.A15	15.07.2011	Copy of receipt No.074 for Rs.1,00,000/- issued by the 2nd opposite party
Ex.A16	15.07.2011	Copy of receipt No.076 for Rs.1,00,000/- issued by the 2nd opposite party
Ex.A17	16.07.2011	Copy of letter from the 2nd opposite party to the complainants confirming receipt of Mortgage Deed from Indian Overseas Bank
Ex.A18	20.07.2011	Copy of receipt No.083 for Rs.4,43,720/- issued by the 2nd opposite party confirming receipt of amount from Indian Overseas Bank
Ex.A19	02.07.2011	Copy of Credit Sanction Advice from Indian Overseas Bank to the complainants
Ex.A20	20.07.2011	Copy of letter from the 2nd opposite party to the complainants
Ex.A21	-	Copy of statement of receipt of payment received from the complainants to the 2nd opposite party duly signed
Ex.A22	20.12.2011 to 06.07.2014	Copy of email correspondences between the complainants and opposite parties
Ex.A23	07.07.2011 to 07.10.2014	Copy of Statement of Home Loan Account issued by Indian Overseas Bank
Ex.A24	20.07.2014	Album containing 17 photographs of the incomplete construction of the Villa

 

List of documents filed by the opposite parties:-

Ex.B1	30.10.2020	Copy of complaint in C.C.P. No.39/2021 before RERA
Ex.B2	28.09.2021	Copy of reply filed by the respondent in C.C.P. No.39/2021 before RERA

 

 

R VENKATESAPERUMAL                                                                         R.SUBBIAH                        

             MEMBER                                                                                         PRESIDENT