BEFORE THE MANDYA DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, MANDYA<br /> <br /> PRESENT: 1. SIDDEGOWDA, B.Sc., LLB., President,<br /> 2. M.N.MANOHARA, B.A., LLB., Member,<br /> 3. A.P.MAHADEVAMMA, B.Sc., LLB., Member, <br /> <br /> ORDER<br /> <br /> Complaint No.MDF/C.C.No.28/2009<br /> <br /> Order dated this the 30th day of September 2009<br /> <br /> COMPLAINANT/S <br /> M/s Sri Venkateshwara Khadi and <br /> Gramodyoga Sangha (R) by its President <br /> Sri.Venkatesh, Sweet Water Pond, <br /> 3rd Cross, Old M.C.Road, <br /> Mandya City.<br /> <br /> (By Sri.Andanaiah., Advocate)<br /> <br /> -Vs-<br /> <br /> OPPOSITE PARTY/S<br /> 1.Karnataka Industrial Area <br /> Development Board, Regional Office, <br /> Near Vikranth Tyres, <br /> K.R.Sagar Road, Mysore by <br /> its Deputy Development Officer.<br /> 2.M/s Jain Industrial <br /> Cotton Wastage, No.1090, <br /> Vishnuvardhana Road, <br /> M.G.Main Road, Chamarajapuram, <br /> Mysore. <br /> <br /> (By Sri.T.Lokesh., Advocate)<br /> <br /> Date of complaint 20.03.2009<br /> Date of service of notice to<br /> Opposite parties 20.04.2009<br /> Date of order 30.09.2009<br /> Total Period 5 Months 10 Days<br /> Result The complaint is partly allowed, directing the 1st Opposite party to refund the deposit of Rs.25,200/- and Rs.95,494/- minus Rs.5,000/- with compensation of Rs.5,000/- to the Complainant with cost of Rs.1,000/- within six weeks, failing which the 1st Opposite party is liable to pay interest at 9% p.a. till payment. The Complainant shall return lease cum sale agreement, possession certificate and allotment letter to the 1st Opposite party.<br /> <br /> Sri.Siddegowda,<br /> President<br /> <br /> 1. This complaint is filed under section 12 of the Consumer Protection Act, 1986 against the 1st Opposite party claiming Rs.10 lakhs being the cost of construction and Rs.5 lakhs as compensation for mental shock and agony and litigation expenses of Rs.20,000/-, totally Rs.15,20,000/-.<br /> 2. The brief facts of the complaint are thus:-<br /> The Complainant is a registered Association with the object to start industries under the Khadi and Gramodyoga Scheme. The Complainant applied to the 1st Opposite party for allotment of the industrial site for the purpose of manufacture of steel furniture and General Engineering Works and 1st Opposite party allotted industrial plot No.63B at Tubinakere Industrial Area, Mandya totally measuring 1008 Sq. mtr. and the Complainant made payment of Rs.25,200/- and 1st Opposite party executed the lease cum sale agreement dated 18.12.1997 and also delivered possession of the site with possession certificate. The Complainant got prepared the estimate for the purpose of construction and approved plan for construction of factory. The total cost of estimation is Rs.13,38,000/-. Though, the Complainant applied to Khadi and Gramodyoga, District Office, Mandya, the Complainant was not sanctioned the loan and thereby the Complainant borrowed loans from others has invested Rs.10,00,000/- for the purpose of construction of the building, but it was not fully complete. The Complainant informed the same to the 1st Opposite party. Unfortunately on 23.07.2004 he sustained injuries due to assault and he was admitted to NIMHANS, Bangalore and treated for grievous injury to his head and the Complainant under complete rest for more than one year. The Complainant had orally informed the Opposite party regarding the severe head injury and also his inability to proceed with the construction of the building in the plot and sought for time. But, without any notice and intimation, the 1st Opposite party is said to have allotted the plot in favour of the 2nd Opposite party on 04.05.2006 by executing the agreement on 27.07.2006. The 2nd Opposite party has demolished the construction made by the Complainant. The act of the 1st Opposite party in allotting the plots which were in occupation of the Complainant amounts to clear deficiency in service. The Complainant has absolutely no source of livelihood and the industry which was going to commence and income derived is only source of living for the Complainant and his family members. Therefore, the present complaint is filed. <br /> 3. The complaint was registered against 1st Opposite party only and notice was ordered and 1st Opposite party has appeared and filed version. The Opposite party has pleaded that the Complainant is not a Consumer and hence, the complaint is liable to be dismissed. It is denied that the Complainant was not sanctioned the loan from Khadi Gramodyoga Sangha, Mandya and by borrowing the loan, the Complainant has invested a sum of Rs.10 lakhs for construction of the building. The Opposite party in no way is concern to the sanctioning of the loan. Even, if the Complainant has sustained injury in assault case, the association could have continued the construction and started the industry. In spite of providing complete infrastructure, the Complainant failed to utilize the same within the stipulated time and even beyond the extended time for construction of the building and as such there is no deficiency of service on the part of the Opposite party. Even after 4 years when the Complainant failed to construct the industry, on 05.05.2000 when notice was issued to fulfill the terms within 120 days and again by issuing one month on 21.11.2000 Opposite party cancelled the agreement and obtained the possession back on 23.12.2000 and thereafter on 06.01.2001 a notice was caused to the Complainant for return of the documents issued by the Board stating he is entitled to have benefits of the deposits and cost of construction as per the evaluation done by the Engineer of the Board, who estimated at Rs.26,859/- and so the Complainant is entitled to remaining amount after deduction of 25% of the deposit amount, after returning the documents executed by the Board. The other averments are false, the lease cum sale agreement has been cancelled on 23.12.2000 and the complaint is filed after lapse of 8 years and so the complaint is barred by limitation. The recitals in agreement clearly reveals that the Complainant is the lessee and the 1st Opposite party is a lessor and if there is any breach of agreement, aggrieved party has to approach the competent Civil Court and complaint is not maintainable. On these ground, the 1st has sought for dismissal of the complaint.<br /> 4. During trial, the Complainant is examined and has produced the documents Ex.C.1 to C.12. The Opposite party has examined one Official and produced documents Ex.R.1 to R.11.<br /> 5. We have heard both the sides.<br /> 6. The Complainant has also filed written arguments. We have perused the records.<br /> 7. Now the points that arise for our considerations are:-<br /> 1. Whether the Complainant is a Consumer?<br /> 2. Whether the Complaint is not maintainable before the Forum?<br /> 3. Whether the Opposite party has committed deficiency in service in cancelling the allotment of industrial plot and allotting the same to another party?<br /> 4. Whether the Complainant has invested Rs.10 lakhs in the industrial plot for construction purpose?<br /> 5. Whether the Complainant is entitled to the relief sought for?<br /> 6. Whether the Complaint is barred by limitation?<br /> 8. Our findings and reasons are as here under:-<br /> 9. POINTS NO 1 & 2:- The contention of the Opposite party is that the Complainant is not a Consumer and further the dispute between the Complainant and Opposite party is that of a lessee and lessor and the complaint is not maintainable before the Forum and the Complainant has to approach the Civil Court for any dispute. Now, admittedly the Complainant applied for industrial plot to start industries under the Khadi and Gramodyoga Scheme and it is a registered association which is proved by Ex.C.1 registration certificate and the Opposite party has sanctioned plot No.63B measuring 1008 Sq. mtr. on deposit of Rs.25,200/- by the Complainant as per Ex.C.3(a) and possession certificate was issued as per Ex.C.5 dated 08.10.1997. Even though, the words lessor and lessee are mentioned in the agreement, but the terms of the agreement clearly established that on complying with the terms and conditions of the agreement, the Opposite party shall execute the sale deed in form no.5 appended to the regulations. Even Ex.R.3 of 1st Opposite party clearly stated lease cum sale agreement. So, when the lease cum sale agreement is executed by allotting the site on depositing the amount of Rs.25,200/-, the dispute of taking back the plot by the 1st Opposite party clearly comes within the definition of Consumer dispute and not a Civil dispute involving the rights of lessor and lessee. Therefore, the complaint is maintainable before this Forum.<br /> 10. Though, it is contended by the Opposite party, that Complainant is not a Consumer, the grounds on which, this defence is taken is not explained by the Opposite party in the version or in the arguments. The Complainant is a registered association under Karnataka Societies Registration Act and Consumer is a person who avails the service for a consideration. In the Consumer Act, the person includes Association of persons registered under the Societies Registration Act. As per the complaint the aim of the association is to provide jobs providing employment to the people by starting industries and the Complainant Venkatesh Represent the Sangha is depending upon the income from the industries to be started. As observed above, the allotment of site and cancelling the same is a service on consideration and therefore, when the Opposite party by receiving the consideration of Rs.25,200/- allotted site in favour of the Complainant and the dispute of cancellation of the allotment comes within the complaint of deficiency in service. Therefore, the Complainant is a Consumer and hence, we answer accordingly.<br /> 11. POINT NO.3:- The grievance of the Complainant is that without any notice or intimation to the Complainant, the 1st Opposite party has allotted the industrial plot which was in actual possession of the Complainant to 2nd Opposite party namely M/s Jain Industrial Cotton Wastage and it amounts to deficiency in service. But, the contention of the Opposite party is that the Complainant did not start the industry in the time factor provided and after issuing notice to the Complainant, the allotment was cancelled and possession was taken and hence, it has not committed any deficiency in service. The Opposite party has relied upon the notices and postal acknowledgement marked as Ex.R.3 to R.8. Ex.R.3 to R.5 and postal acknowledgement pertains to Balaji Khadi Gramodyoga Sangha and it is not a party in this complaint. With regarding to the Ex.R.6 referring to the Complainant, it is dated 01.12.2000 and acknowledgement Ex.R.6(a), one Anand has received the same and according to the Complainant one Dhanalakshmi was the Secretary. But on Ex.R.6, the 1st Opposite party has made it to appear that this letter contains the signature of the Complainant, which is not the case of Opposite party at all and therefore, no value could be attached Ex.R.6. The Opposite party has produced Ex.R.8 a letter said to be addressed to the Complainant, but there is no evidence whether it was served on the Complainant. The Complainant has admitted the service of Ex.R.11 dated 22.01.2008, wherein the Complainant was informed that the industrial plot allotted to the Complainant has been allotted and agreement was executed on 27.07.2006 in favour of Jain Industrial Cotton Wastage. Further, the Opposite party has not produced any proceedings initiated for cancellation of the allotment made in favour of the Complainant and taking possession of the industrial plot from the Complainant and then sanction of the allotment of plot in favour of another person. Therefore, this fact clearly established without notice to the Complainant and behind back of the Complainant, the 1st Opposite party has cancelled the allotment of industrial plot made in favour of the Complainant without observing principle of natural justice and allotted said site in favour of third party and third party has demolished the construction made by the Complainant admittedly and therefore, the Opposite party has committed deficiency in service and hence, we answer the point no.3 accordingly.<br /> 12. POINTS NO.4 & 5:- According to the Complainant, he has invested Rs.10 lakhs for the construction purpose. The Complainant produced Ex.C.7 abstract estimate for the construction of the factory building in plot No.63A & 63B and estimate is shown as Rs.15 lakhs and he has submitted to the 1st Opposite party on 25.04.2008, but as per Ex.R.2, the project profile submitted by the Complainant admittedly is for Rs.7 lakhs. According to the Opposite party, at the time of taking possession of the industrial plot allotted to the Complainant, the Engineer of the 1st Opposite party estimated the cost of construction and evaluation report is Ex.R.9 in the year 2006 cost of construction is only shown as 29,712/- and Ex.R.10 is the plan of the construction. The Forum appointed a Commissioner i.e., Engineer of the PWD with consent of both sides and the P.W.D. Engineer submitted the report estimating the cost of construction at Rs.95,494/- by deducting depreciation of seven years calculating the expenditure at the rate prevailing during the year 2009-10. Even though, the Complainant has filed objection to this report stating that the Commissioner has not executed the warrant as per the instructions, but the memo of instructions are not forthcoming before the Forum. Therefore, when the Commissioner has calculated at the construction rate prevailing during the year 2009-10, naturally depreciation has to be given. Admittedly, the construction made was in the year 2002 and therefore, cost of construction is to be accepted at Rs.95,494/- and the Complainant has failed to prove by any evidence that he has invested Rs.10 lakhs for the construction.<br /> 13. The Complainant has sought for Rs.10 lakhs as invested for the construction of the building and Rs.5 lakhs for the mental shock and agony. The Opposite party has contended that the Complainant has not deposited the rent as per the agreement and deducting the rent from the date of delivery of possession to the date of taking back the possession by the Opposite party, the balance amount from the cost estimated by the Commissioner may be ordered. It is true that as per the agreement, the Complainant has to pay Rs.1,000/- p.a. as rent for the site from the date of possession. It is admitted by the Complainant that it is not paid any rent as per the agreement. As per Ex.R.11 issued by the Opposite party to the Complainant, the said plot was allotted to M/s Jain Industrial Cotton Wastage and lease agreement is executed on 27.07.2006. As per Ex.C.5 the possession was handed over to the Complainant on 08.10.1997. As per Ex.R.6, the possession of the plot was resumed on 23.12.2002, so the Complainant is liable to pay rent of 5 years only, because the construction was made in the year 2002 as per the Commissioner report and so naturally in 2002 possession was taken. In view of the Commissioner report, the cost of the construction is Rs.95,494/-. Further, admittedly the Complainant has deposited Rs.25,200/- as per the cost of the industrial plot. The Opposite party as per Ex.R.3 dated 22.01.2008 directed the Complainant to return the original documents, original certificates, so as to enable them to refund the amount. So, it refers to the deposit made by the Complainant. Therefore, the Complainant is also entitled to refund of Rs.25,200/- which is deposited for the site by the Complainant. Therefore, the Complainant is entitled the cost of construction at Rs.95,494/- and Rs.25,000/- being the deposit, deducting Rs.5,000/- being the rent payable by the Complainant as per the agreement.<br /> 14. The Complainant has sought for compensation of Rs.5 lakhs in this case. But considering the deposit made by the Complainant, it is reasonable to award compensation of Rs.5,000/- for the deficiency in service by the Opposite party. <br /> 15. POINT NO.6:- The Opposite party has contended that the complaint is barred by limitation pleading that the lease cum sale agreement has been cancelled on 23.12.2000 and after lapse of 8 years the complaint is filed and therefore, the complaint is barred by limitation. According to the Complainant, the cancellation of the lease cum sale agreement is without notice to him and behind back without giving any opportunity. As observed above, the Opposite party has failed to prove the service of notice before cancellation of the agreement and taking possession of the plot. As per Ex.R.11 dated 22.01.2008 on the application given by the Complainant on 31.12.2007, the Opposite party informed the allotment of the industrial plot granted earlier to the Complainant in favour of M/s Jain Industrial Cotton Wastage and execution of the lease agreement on 27.07.2006. Further, according to the Complainant, he sustained grievous head injury due to assault and he was treated in NIMHANS hospital and he was advised rest and further, the Complainant has filed an application under section 24(A) of C.P.Act, to condone the delay. The Opposite party has not filed any objection to this application and considering the facts of the case delay has been condoned and according to the Complainant’s affidavit, he came to know the alleged allotment of the plot by 1st Opposite party in favour of the second party during third week of November 2008 and immediately on 21.11.2008, he got issued legal notice Ex.C.12 on 22.11.2008 and he was not aware of the alleged allotment of plots in favour of 2nd Opposite party till 3rd week of November 2008. There is no cross-examination on this evidence of the Complainant. Therefore, the Complainant has sufficiently explained the sufficient cause for the condonation of delay in filing the complaint and therefore, the complaint is not barred by limitation. <br /> 16. In the result, we proceed to pass the following order;<br /> ORDER<br /> The complaint is partly allowed, directing the 1st Opposite party to refund the deposit of Rs.25,200/- and Rs.95,494/- minus Rs.5,000/- with compensation of Rs.5,000/- to the Complainant with cost of Rs.1,000/- within six weeks, failing which the 1st Opposite party is liable to pay interest at 9% p.a. till payment. The Complainant shall return lease cum sale agreement, possession certificate and allotment letter to the 1st Opposite party.<br /> <br /> (Dictated to the Stenographer, transcribed, corrected and then pronounced in the open Forum this the 30th day of September 2009).<br /> <br /> (PRESIDENT) (MEMBER) (MEMBER)