1.       The present First Appeal (FA) has been filed by the Appellants against Respondent as detailed above, under section 23 of Consumer Protection Act 1986, against the order dated 04.05.2022 of the State Consumer Disputes Redressal Commission Rajasthan (hereinafter referred to as the ‘State Commission’), in Consumer Complaint (CC) no.  45 of 2019 inter alia praying for setting aside of the order dated 04.05.2022.

2.       The Appellants were Complainants and Respondent was Opposite Party in Complaint No. 45 of 2019 before the State Commission.  Notice was  issued to the Respondent on 13.06.2022.  Appellants filed brief of Arguments/Synopsis on 28.11.2023.  Due to non appearance despite service, respondent was proceeded ex parte.

3.       Brief facts of the case, as emerged from the FA, Order of the State Commission and other case records are that Respondent launched the ‘Ekant Vihar Farm House Scheme’ situated at Sikar Road, Jaipur in 2006, in which facilities like farm house, swimming pool, convention centre were also included.  The complainants had participated in the auction of the plots held on 17.02.2006.  Plot No. 53 measuring 3233 sq.mtr. was allotted to the complainants, against which the complainants made payments as per details given in para 3 of the complaint. 

4.       On 09.05.2006 complainants deposited another Rs.3,79,860/- against lease deed for issue of site plan but even after lapse of 13 years, no site plan of the plot was prepared.  Local people were doing cultivation on the site and crop was found cutting there.  In this way, there was no demarcation of the said plot and no possession of the plot was given to the complainants even after writing many times to the respondent for possession. 

5.       In the year 2017 when complainant sought information from the respondents, they were asked to deposit Rs.7,44,883/-  as lease charges, Rs.1,86,220/- as urban tax and  tax thereon of Rs.1,44,321/- vide letter dated 09.10.2012 but the complainants state that they did not receive the said letter.  When complainants asked the respondents proof of service of the said letter,  respondents admitted that Rs.1,86,220/- have been wrongly added.   In this way, the complainants deposited Rs.9,31,103/- and Rs.3,42,761/- on 20.01.2017.  Complainants went to the respondent on 23.0.6.2017 and respondent told them that possession of plot cannot be given in the absence of electricity and water connection.  The complainant again requested for possession of the said plot but possession was not given.  Even the scheme of the respondent was not registered under Rajasthan Real Estate Regulatory Authority.  The respondent despite allotting the plot to the complainants and taking huge sum of money, neither gave possession or demarcated the plot nor developed other facilities.  Being aggrieved,  the Complainant preferred complaint before the State Commission and State Commission vide order dated 04.05.2022 dismissed the Complaint of the Complainants.  Therefore, the Complainants are before this Commission now in the present FA.

6.       Appellant(s) have challenged the Order dated 04.05.2022 of the State Commission mainly on following grounds:

1. State Commission erred in holding that Complainants are not the consumers and misinterpreted the decision of the Hon’ble Supreme Court in UT Chandigarh Administration and Anr. Vs. Amarjeet Singh ( 2009) 4 SCC 660 and decision of this Commission in Revision Petition No. 3649 of 2014- Delhi Development Authority Vs. Parveen Kumar and Ors. 

2. The prospectus of the respondent makes it clear that all the development were to be made after the auction of the plots and not before that.  However, even 16 years after the scheme was launched, no development had taken place and by ratio decidendi of the said decision, service had to be rendered by the respondent after the auction and, hence the Appellants are consumers. 

3. State Commission committed material irregularity by rejecting the contents of the prospectus of the respondent.  The  prospectus is an official document stating therein what all development the Authority would do and that was to be done after the allotment of the said plot in the scheme.  The respondent did not challenge the document.  The complainants bid for the plot on the basis of promises made therein. 

4. State Commission committed material irregularity by rejecting the document on untenable ground that there is no document of agreement on record showing that such facilities were to be provided.  None was needed as the prospectus reflects the promises made by the Respondent.  The respondent never denied that it had promised to the complainants certain amenities with respect to the plot.

5. The  order of the State Commission suffers from material irregularity in ignoring the evidence that respondent had to lay down the water line, electricity line, sewerage line, roads etc. within the scheme, which had to be done after the allotment of the plot to the complainant.  The order  of the State Commission mentions that these issues were for the Civil Court to examine, which is an erroneous position taken by the State Commission.

7.       Heard learned counsel for the Appellant. On account of absence despite notice, Respondent was proceeded ex-parte.  Contentions/pleas of the parties, on various issues raised in the FA, Written Arguments, and Oral Arguments advanced during the hearing, and records of State Commission are summed up below.

8.       We have carefully gone through the orders of the State Commission and other relevant records.    Complainants have prayed in their Complaint directions to the OP to refund the amount of Rs. 73,58,129/- paid by them to OP in respect of Plot No. 53, Ekant Vihar Farm Home Yojna alogwith interest, compensation and litigation cost.  State Commission, vide impugned order dismissed the Complaint holding that Appellants were not consumers since they had bought the plot in auction on ‘ as is where is’  basis, wherein no service has been rendered to the Complainants.  OP, in their reply to the Complaint filed before the State Commission has contended that Complainants are not consumers since they were allotted the plot in auction on ‘as is where is’  basis.  We have carefully gone through various judgments relied upon by the parties before the State Commission / this Commission.

9.       In Lucknow Development Authority (supra ), Hon’ble Supreme Court held that for entertaining a Complaint, test is nature of duty or function performed, if it is a service, then provider of the service, irrespective of whether the same is a private body or statutory or public authority, would be amenable to the provisions of the Act.  In Amarjit Singh ( supra), Hon’ble Supreme Court held  :

“18. The decisions in LDA and GDA make it clear that where a public development authority having invited applications for allotment of sites in a layout to be formed or for houses to be constructed and delivered, fails to deliver possession by forming the layout of sites or by constructing the houses within the stipulated period, the delay may amount to a deficiency in service by treating the development authority as a service provider and the allottee as the consumer. But where existing sites are put up for sale or lease by public auction by the owner, and the sale/lease is confirmed in favour of the highest bidder, the resultant contract relates to sale or lease of immovable property. There is no hiring or availing of services by the person bidding at the auction. Nor is the seller or lessor, a trader who sells or distributes "goods". The sale price or lease premium paid by the successful bidder of a site, is the consideration for the sale or lease, and not consideration for any service or for provision of any amenity or for sale of any goods.

19. In LDA it was held that where a developer carries on the activity of development of land and invites applications for allotment of sites in a developed layout, it will amount to "service", that when possession of the allotted site is not delivered within the stipulated period, the delay may amount to a deficiency or denial of service, and that any claim in regard to such delay is not in regard to the immovable property but in regard to the deficiency in rendering service of a particular standard, quality or grade. The activity of a developer, that is development of land into layout of sites, inviting applications for allotment by assuring formation of a layout with amenities and delivery of the allotted sites within a stipulated time at a particular price, is completely different from the auction of existing sites either on sale or lease. In a scheme for development and allotment, the allottee has no choice of the site allotted. He has no choice in regard to the price to be paid. The development authority decides which site should be allotted to him. The development authority fixes the uniform price with reference to the size of plots. In most development schemes, the applications are invited and allotments are made long before the actual development of the layout or formation of sites. Further the development scheme casts an obligation on the development authority to provide specified amenities. Alternatively, the developer represents that he would provide certain amenities, in the brochure or advertisement. In a public auction of sites, the position is completely different. A person interested can inspect the sites offered and choose the site which he wants to acquire and participate in the auction only in regard to such site. Before bidding in the auction, he knows or is in a position to ascertain, the condition and situation of the site. He knows about the existence or lack of amenities. The auction is on "as-is-where-is basis". With such knowledge, he participates in the auction and offers a particular bid. There is no compulsion that he should offer a particular price. When the sites auctioned are existing sites, without any assurance/representation relating to amenities, there is no question of deficiency of service or denial of service. Where the bidder has a choice and option in regard to the site and price and when there is no assurance of any facility or amenity, the question of the owner of the site becoming a service provider, does not arise even by applying the tests laid down in LDA or Balbir Singh.

              xxx

21. With reference to a public auction of existing sites (as contrasted from sites to be "formed"), the purchaser/lessee is not a consumer, the owner is not a "trader" or "service provider" and the grievance does not relate to any matter in regard to which a complaint can be filed. Therefore, any grievance by the purchaser/lessee will not give rise to a complaint or consumer dispute and the fora under the Act will not have jurisdiction to entertain or decide any complaint by the auction-purchaser/lessee against the owner holding the auction of sites.”

10.     In Haryana State Agricultural Marketing Board (supra), Hon’ble Supreme Court held “……even in the absence of stipulation in allotment letter of providing basic amenities as condition precedent, Board obliged to provide same to allottees to facilitate utilization and enjoyment of plots … inaction of the board for more than a decade established deficiency in service.”

11.     In their reply filed before the State Commission, the OP have admitted the fact of launch of the scheme called Ekant Vihar Farm House Scheme and allotment of plot no. 53 to the complainants in the auction on 17.02.2006, stating further that Complainants were issued the lease deed and site plan as per rules.  In their reply, the OP has also stated that they  have completed the first phase of tar roads and the balance roads will be constructed depending on the financial situation of the OP.  The 30 feet road in front of the plot no. 53 has been tarred and demarcation  pillar of plot no. 53 has been placed.  On careful consideration of entire facts and circumstances of the case, we are in agreement with the contentions of the Complainants that the OP Authority was a service provider in connection with the scheme in question and the Complainants are consumers under the Act.  Simply because the plot was sold in auction on ‘as is where is’ basis does not mean that it was a simplicitor sale.  In the present case, though the scheme brochure /auction notice mentioned the auction to be on ‘ as is where is basis’, it was a development scheme with OP authority having obligations to provide certain amenities / facilities after the sale in auction. These days public authorities adopt auction as one of the mode of allotment of sites / flats etc as contrast to allotment through draw of lots or first come first serve basis or any such other method based on eligibility of the applicants.  The main consideration for adopting auction as method of allotment is to  bring in more objectivity and transparency in the allotment and fetch a higher price, commensurate with prevailing market price of such sites / units.  Hence, if any public authority undertakes a development scheme for allotment of plots / units, which also envisage provision of certain amenities / facilities by such authority, such authority will be a service provider and the allottee will be a consumer under the Act notwithstanding that such allotment by the authority was through a public auction.  Further, it is the normal practice for such authorities to mention ‘as is where is basis’ with respect to the actual location / size / condition / legal status etc of the site / unit on ground and it is not necessarily with respect to provision of any amenities / facilities which the development scheme may otherwise have envisaged.  Hence, each and every allotment through auction on as is where is basis may not be a sale simplicitor and may involve the provision of services by the authority, and each case has to be seen in its own facts.  In view of the facts and circumstances of the present case as stated above, we are of the considered view that in the present case,  the OP was service provider and Complainants qualified to be consumers under the Act.  The OP in their reply has admitted that some such amenities like tar road were completed in the first phase and balance will be constructed depending on the financial position of the OP.  The present case is covered under the law laid down by Hon’ble Supreme Court in Amarjit Singh ( supra ), relevant paras of which have been cited in the preceding paras.  Hence, we hold that Complainants before the State Commission / Appellants herein are consumers under the provisions of Consumer Protection Act and State Commission went wrong in holding that Complainants are not consumers.  Accordingly, the order of the State Commission cannot be sustained and is hereby set aside.  Accordingly, Appeal is allowed and matter is remanded back to the State Commission for fresh disposal on merits as per law after giving an opportunity of hearing to both sides.  As respondent was proceeded ex parte before this Commission, State Commission may issue notice to both sides to appear before the State Commission for hearing.

12.    The pending IAs in the case, if any, also stand disposed off.