STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(Appeal No.84 of 2010)

Chandigarh Housing Board, Sector 9-D, Chandigarh, through its Secretary.

……Appellant/OP.

V e r s u s

Kamlesh Kumar Dogra s/o Sh. Ajudhir Nath Dogra, H.No.2851/1, Sector 47-C, Chandigarh.

              ....Respondent/Complainant.

BEFORE:         HON’BLE MR. JUSTICE SHAM SUNDER, PRESIDENT.

                        MRS. NEENA SANDHU, MEMBER.

                        S.  JAGROOP  SINGH   MAHAL, MEMBER.

Argued by:  Sh. K.K. Gupta, Advocate for the appellant.

                        Sh. S.K. Bawa, Advocate for the respondent.

PER  JAGROOP  SINGH  MAHAL, MEMBER.

1.                              This appeal, under Section 15 of Consumer Protection Act, 1986 (hereinafter referred to as the Act), has been filed by the appellant/OP against the order dated 18.1.2010 passed by learned District Consumer Disputes Redressal Forum-II, U.T., Chandigarh (hereinafter referred to as District Forum) vide which the complaint filed by the complainant (respondent) was allowed and the appellant/OPs were directed to issue the NOC without demanding any amount of dues and pay Rs.20,000/- as compensation for harassment, mental agony etc. and Rs.5,000/- as costs of litigation etc. to the complainant.

2.                              The facts of the case, in brief, are that the complainant applied for the dwelling unit; was declared successful and was allotted dwelling unit No.2851/1, Sector-47, Chandigarh. At that time, the total value of the dwelling unit was Rs.38,000/- and out of that, a sum of Rs.9,500/- was deposited being 25% of the total cost, as initial deposit, with OPs at the time of application and rest of amount was to be paid in installments of Rs.334/- per month. The OPs allotted account No.4010 to the complainant and the installments were to be paid for 15 years.  The complainant paid his installments regularly, in time, except on some occasions, when he could not deposit the same in time due to some domestic problems. The OPs issued a letter to the complainant whereby, in the year 2006, he was asked to deposit a sum of Rs.38,811/- alongwith Rs.380/-, details of which were to be furnished by OPs. In pursuance of the letter dated 06.07.2006, the complainant deposited a sum of Rs.16,200/- and told the OPs that rest of the amount would be deposited within one month. The OPs again communicated to the complainant that a sum of Rs.22,611/- alongwith a sum of Rs.380/- as revival charges were payable by him. In pursuance of that letter, the complainant deposited the entire amount and then made a request to the OPs for issuance of No Objection Certificate in his favour. The complainant again visited the office of the OPs for getting No Objection Certificate in the month of June, 2007 and he was advised to further deposit a sum of Rs.1,000/- approximately which included Rs.611/- as outstanding balance amount and Rs.380/- as revival charges. Accordingly, the complainant deposited the above said amount with OPs. However, the complainant was traumatized when OPs vide their letter dated 11.07.2007 asked him to deposit another sum of Rs.27,480/- and complete other formalities before 31.07.2007. The complainant vide his letter apprised the OPs that he has already deposited the entire outstanding amount and further asked them that in case something is due, the details of the same be furnished to him, but all in vain. The complainant served a legal notice, but no response was received. Alleging the aforesaid acts of OPs as deficiency in service on their part, the complainant filed the present complaint with the prayer that OPs be directed to issue the No Objection Certificate in his favour and to pay compensation of Rs.1,00,000/- on account of unnecessary delay in issuing NOC and harassment and mental agony caused to him and Rs.15,000/- as litigation expenses.

3.                              The OPs in their written statement raised some preliminary objections regarding the maintainability of the complaint etc. and further pleaded that the complainant himself violated the terms and conditions of the allotment letter. It was averred that earlier the allotment of dwelling unit in question was cancelled by the CEO on account of building violations vide letter No.15391 dated 25.07.2000. On appeal filed by the complainant before worthy CM, CHB for reviving the Dwelling Unit, the same was considered and revived by the CM, CHB subject to payment of revival charges and then the complainant remained defaulter, therefore, he was not entitled to any relief. It was pleaded that the complainant was asked to deposit a sum of Rs.38,347/- vide office letter No.484-86 dated 29.01.2002, but the same was not deposited by him. Thereafter, the complainant was again requested to deposit a sum of Rs.38,811/- and Rs.380/- as revival charges vide office letter No.7196 dated 04.04.2006, but still the amount was not deposited by him. The complainant, instead, deposited a sum of Rs.22,611/- alongwith revival charges of Rs.380/-, but he did not deposit the entire outstanding amount with the OPs. It has been alleged that the details of the amount, allegedly submitted by the complainant, were totally false. It was pleaded that the OPs made repeated requests to the complainant regarding the original/ photocopies of pay-in-slips of deposits, but all in vain. Subsequently, the complainant was asked to deposit Rs.48,131/- on 13.12.2006, but the needful was not done by him and finally after making all adjustments for the amounts deposited by the complainant, he was asked to deposit  Rs.27,460/- alongwith revival charges of Rs.380/- on 31.07.2007, but the same was again not deposited by him.  It was stated that the NDC could be issued to the complainant only after depositing all the outstanding dues, but he did not deposit the entire pending amount despite various letters by the OPs. Pleading no deficiency in service on their part, OPs prayed for dismissal of the complaint.

4.                              The parties led evidence in support of their contentions. 

5.                              After hearing the learned counsel for the parties and perusing the record, the learned District Forum allowed the complaint vide impugned order dated 18.1.2010, as already mentioned in the opening para of the judgment.

6.                              We have heard the arguments of learned counsel for the parties and have perused the record.

7.                              The ld. Counsel for the appellant has argued that the finding recorded by the ld. District Forum to the effect that the OP/appellant was grossly deficient in service, and also indulged in an unfair trade practice, is far from truth.  He referred to the calculation sheet submitted before the ld. District Forum to the effect that a sum of Rs.36,285/- was due from the complainant on 28.2.2002, Rs.2,052.30 as  arrears of ground rent upto 13.5.2002 and Rs.380/- as revival charges.  It was admitted that some amounts were paid by the complainant but, in the meantime, the interest accrued on the arrears and some more amount was required to be paid, which was intimated to the complainant, but he did not pay it.  It is contended that it is the complainant who was a defaulter. The ld. Counsel has produced a calculation sheet (now marked as Annexure OP-4) to support his contention. It may be mentioned that no such calculations were provided to the ld. District Forum and no data was given to it to examine whether the amount of Rs.36,285/-, alleged by the OP/appellant, was actually due from the complainant or it was an inflated figure, stage managed by the officials of the OP/appellant to prove that the complainant was a defaulter.  It may be mentioned that the only controversy between the parties is as to whether the complainant has paid the amount in accordance with allotment letter Annexure C-1 or not. When we go through Annexure OP-4, it reveals glaring violations not only of the allotment letter (Annexure C-1), but of the rules and regulations governing this allotment.  Annexure R-1 rather shows that the officials of the OP/appellant had been totally unfair, did not bother to go through the various clauses of the allotment letter (Annexure C-1), and were whimsical in imposing penalties/interest on the complainant to justify their non issuance of the No Due Certificate.  As per Annexure OP-4, if the delay is more than 03 months, they are entitled to impose monthly interest @ 25% of the installment amount.  When we go through the allotment letter (Annexure C-1), we do not find any such clause under which the OP/appellant can impose interest or penalty at this rate.  The ld. Counsel for the OP/appellant referred to the concluding lines of para 7 of the allotment letter, which reads as follows :-

“7.…………In case of default of more than three consecutive months in respect of any instalment the tenancy may stand terminated and you shall be liable to be evicted from the dwelling Unit by following the procedure prescribed under Rules as framed under Chapter VI of the Haryana Housing Board  Act, 1971, as extended to U.T., Chandigarh.  However, the Chairman, may revive the allotment and tenancy, on such terms and conditions and by imposing such penalty as he considers fit, in appropriate cases, before referring the case to the Competent Authority under Chapter VI of the Act.

8.                              It is not disputed that when the complainant defaulted in making the payment of installments for more than three months, the allotment/Registration was cancelled vide order dated 25.7.2000 (Annexure OP-1).  The allotment/registration was subsequently revived vide order dated 29.1.2002 (Annexure OP-2) and a sum of Rs.380/- was ordered to be recovered as revival charges from the complainant.  The appellant did not impose any such penalty/interest @ 25% on the complainant at the time of reviving the said registration/allotment.  Annexure OP-3 is the letter dated 9.1.2006 vide which also the revival charges of Rs.380/- were intimated to the complainant and he was directed to deposit the same alongwith the other amount due from him.  Clause 7 of the allotment letter (Annexure C-1) provides that if the delay is more than two months, in making the payment of any installment, the Board can impose a penalty of 4% of the amount of installment delayed or Rs.10 whichever is more for the third month of default, provided that it shall not exceed 10% of the amount due every month.  In this manner, at the most, the Board was entitled to 10% of the amount of installment and not 25% as the OP/appellant has imposed on the complainant.

9.                              The ld. Counsel for the appellant has referred to a resolution dated 16.5.1996 passed by the Board vide which it was authorized to impose 25% of the amount as penalty. No copy of this resolution was provided to the ld. District Forum nor has it been produced before this Commission as evidence, though a copy is produced at the stage of arguments.  We, therefore, cannot take notice of the said resolution.  Otherwise also, this resolution proceeded on an analogy that in the allotment letters issued subsequently to the allotment of the complainant, a penalty of 10% was provided therein for delay of payment for more than three months.  It was that penalty of 10% which was sought to be revised upwards to 25%.  However, it is not so in the present case because here in case of default of more than three months, no such penalty of 10% was provided. Rather, the Chairman can cancel the registration/allotment and could revive it on such terms and conditions and by imposing such penalty as he considers fit. The Chairman, exercising the said power under clause 7 of the allotment letter, imposed a penalty of Rs.380/- only, which the complainant has already paid.  This resolution, which is sought to be produced by the OP, therefore, cannot be applied against the complainant.

10.                         There is yet another irregularity being committed by the officials of the OP in respect of proper appropriation of the amount of installments deposited by the complainant.  It is not disputed that the complainant deposited the installments in April, May and June 1986 by due dates.  He did not deposit any installment in July, August and September, 1986 and thereafter deposited the installment in October, 1986, but again defaulted in November 1986 and then deposited the installment by due date in December 1986. When the complainant deposited the installment in October 1986, the OP of their own appropriated this amount towards the installment payable in July 1986 and similarly the installment deposited in December 1986 was appropriated towards the installment due in August 1986.  The OP/appellant could not refer to any provision in the allotment letter or any rule and law under which they were entitled to appropriate the amount to the previous months when actually no payment was made by the complainant against that installment in October or December, 1986. By doing so, the OP/Board have gained sufficient amount because they are showing in default not only the installment of August 1986 and imposing the penalty of 25% against it, but even the installment of October 1986, which was deposited in time, has also been shown to be in default and again the penalty of 25% has been imposed against it.  On the other hand, if the amount has been deposited by due date in a particular month, the complainant was not liable to pay any penalty thereon.  The OP/appellant has, therefore, recovered the penalty not only for the installment which was not paid by the complainant but also for the installment paid by him in time.

11.                         The OP has also imposed interest @ 11.75% per annum as per the policy of the OP/appellant dated 17.1.1994 after the period of 15 years was over and the arrears were not paid by the complainant.  No such policy dated 17.1.1994 has been produced by the OP/appellant either before the ld. District Forum or before this Commission.  It has also not been justified as to how the case of the complainant is covered under the said policy which was not in existence, when this contract Annexure C-1 came into being in 1986.  Needless to mention that the allotment would be governed by the terms of the allotment letter (Annexure C-1) or under the provisions of the Chandigarh Lease-hold of Sites and Building Rules, 1973 as mentioned in sub clause (ii) of clause 10 of the allotment letter under which liquidated damages cannot exceed 10% of the amount due every month.  There is no separate provision for imposition of interest @ 11.75% per annum on the delayed payment.  There is no provision in the allotment letter (Annexure C-1) authorizing the OP to introduce any such penalty of 11.75% interest p.a. on the complainant where he has delayed the payment.  In the present case, there is no such power in OP of imposing interest @ 11.75% on the complainant and, therefore, he would not be liable to pay in excess of 10% of the amount due every month.

12.                         As regards the liability of the complainant to pay interest on the delayed payment of ground rent, we have no  hesitation to hold that in view of Rule (3-A) of Rule 12 of the Rules ibid, the complainant was liable to pay interest @ 24% per annum w.e.f. 22.7.1993.  It is argued by the ld. Counsel for the OP/appellant that earlier the rate of interest was 12% and was revised to 15% w.e.f. 29.11.1990 and then to 24% w.e.f 22.7.1993.  We are, therefore, of the opinion that the imposition of interest on the ground rent cannot be assailed by the complainant.

13.                         In view of the above discussion, we are of the opinion that the direction given by the ld. District Forum to issue the No Due Certificate to the complainant is perfectly good in law because the complainant has already paid a sum of Rs.80,876/- for the plot, the total premium of which was only Rs.38,000/-. The other amount was swelled by the OP/appellant dishonestly by imposing penalty and interest, which they are not competent to impose. The impugned order is, therefore, maintained however with a modification that the OP shall redraft the statement of the amount due from the complainant in the light of the observations mentioned above and refund the excess amount, if any, to the complainant within thirty days from the date of passing of this order failing which this amount will also carry interest @ 18% per annum from the date of filing of the present complaint i.e. 4.4.2008 till realization. The OPs shall also pay Rs.10,000/- to the complainant as litigation charges.

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

Pronounced.

26^th April, 2011.

Sd/-

[JUSTICE SHAM SUNDER]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Sd/-

[JAGROOP SINGH MAHAL]

MEMBER

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