BEFORE THE DISTRICT FORUM (UNDER CONSUMER PROTECTION ACT, 1986) MEDAK AT SANGAREDDY

         Present :Smt. Meena Ramanathan,B.Com.,Lady Member

         Sri G.Sreenivas Rao, M.Sc.,B.Ed.,LL.B., PGADR (NALSAR)  Male Member

Tuesday the 26^th day of July 2011

C.C. No. 40 of 2010

Between:

Sanjay Vithalrao Bhosale

S/o Vithalrao  Anandrao Bhosale,

aged about 35 years,

Occupation: Assistant Manager,

Arch Pharma Labs Ltd.,

Gundlamachnoor village,

Hatnoora Mandal, Medak district.                                           ……Complainant

And

1)   M.Nagoor Rao S/o .Hazarathaiah,

aged: Major, Occ: Business,

Prop: Sravani Engineering Industries,

R/o Flat No.101, Siri Residency,

Madeenaguda, Serilingampally Municiplity, Hyderabad.

2)   Chief Manager,

State Bank of India,

Sangareddy branch.

3)   Assistant General Manager,

State Bank of India, RBO,

Sharda Complex, Chandanagar,

R.R. District.

4)   Chief General Manager,

State Bank of India,

Local Head Office,

Koti, Hyderabad.

5)   General Manager,

State Bank of India,

Customer Grievance Cell,

Local Head Office, Koti, Hyderabad.

6)   Chairman,

State Bank of India,

Head Office, Mumbai.                                                ….Opposite parties

      This complaint coming up for final hearing before us on 30-06-2011 in the presence of Sri P. Bal Reddy, Advocate for Complainant and that of M/s M.Giridhar, Advocate for the Opposite party No.1, and that of M/s M.Sunil Kumar, Advocate for the Opposite party No.2 and the Opposite parties 3 to 6 remained absent, upon hearing arguments of both sides, on perusing the

record and having stood over for consideration till this day, this Forum delivered the following:

O R D E R

(Per Se Smt. Meena Ramanathan, Lady Member)

1.                 This complaint is filed under section 12 of C.P. Act, 1986 by  complainant alleging that in search of a dwelling house approached OP No.1 for purchase of flat and in that process, he entered into an agreement towards purchase of Flat No.G-11 an ground floor with the built up area of 1030 sq.fts including common area in the residential Apartment built over Plot Nos.86 to 90 in Survey No.802, 806 and 807 along with car parking, transformer, Manjeera water and lift, etc.,  At the time of entering into agreement of sale, OP No.1 said to have obtained his signatures on printed proformas.  That the complainant paid Rs.1,50,000/- as advance sale consideration and approached OP No.2 bank for sanction of Rs.13 lakhs towards housing loan.  OP No.2 sanctioned the loan of Rs.13 lakhs in the name of complainant and released the amount of Rs.5,00,000/- on 30-07-2008; Rs.7,00,000/- on 04-08-2008 and Rs.1,00,000/- on 20-10-2008 though the flat was not completed and handed over to complainant.  Mr.M.Sheshagiri Rao, Field Officer of OP No.2 bank said to have colluded with OP No.1 and released the said amount without verifying the legality and authenticity of the documents.  That the OP No.1 executed the Agreement of sale showing the sale consideration as Rs.5,00,000/- and further shown an amount of Rs.1,50,000/- towards extra items and got it registered as document No.11072/2008 on 11-06-2008 and subsequently executed the sale deed registered as document No.11073/2008 on 30-07-2008 showing the sale consideration of the property at Rs.5,00,000/- and subsequently corrected the figures to Rs.14,90,000/- though the stamp duty is paid for Rs.5,00,000/-.  Mr.M.Sheshagiri Rao, Field Officer of OP No.2 in collusion with OP No.1 have drawn the additional amount mentioned in the sale deed.

                   It is further alleged that the Complainant is paying interest on the entire loan amount of Rs. 13,00,000/-  from July  2008 onwards though the flat is not handed over to him till date of filing the complaint and the construction is not yet completed.  Altogether, the OP No. 1 collected an amount of Rs. 14,50,000/- from the Complainant.  And OP No. 2   said  to have commenced charging the interest on the loan amount though the flat

is not yet completed nor handed over, which caused loss to the tune of Rs.8,00,000/- to the complainant.  Further alleged that as per sale deed, the OP No.1 is supposed to handover the flat with a built up area of 1030 sq.fts., on suspicion, complainant measured and found it to be 900 sq.fts., including common areas.  OP No.1 drew the entire amount without completing the flat and handing it over to the complainant.  Due to the acts of OP No.1, complainant stated to have sustained loss of Rs.2,49,507/ being interest on loan amount and Rs.4,000/- per month towards rent for his dwelling purpose.  Further alleged that the OP No.1 has erected transformer infront of complainant’s flat corridor (balcony), which reduced the flat value by 25%.  As such, complainant filed the present complaint with a prayer to direct opposite party No.1 to pay interest on loan amount for 24 months amounting to Rs.2,49,507/-; to pay rent of Rs.40,000/-; to reimburse Rs.8 lakhs being excess amount received; to pay Rs.1,95,000/- being difference amount of built-up area i.e., 130 square feet; and also to direct the Ops to pay Rs.2,00,000/- for causing mental agony.  Though complainant issued notice to the Ops, no action is taken.

2.                First Opposite party filed its counter denying the allegations of complaint and contending that complaint is not maintainable as the same is not filed against the firm and that the complaint is barred by limitation and further liable to be dismissed for non joinder of necessary parties.  He admitted the approaching of complainant for loan towards purchase of flat in dispute.  He denied obtaining of signatures of complainant on printed proformas and used to fulfill his ill-desires in collusion with OP No.1.  He admitted payment of advance sale consideration.  He further stated that the total sale consideration of the finished flat agreed upon is Rs.18,54,000/- excluding the extra charges of Rs.1,50,000/- towards car parking, electricity, Manjeera water and lift, which comes to Rs.20,04,000/- but not Rs.5,00,000/- as stated by complainant.  He further denied the physical verification of the flat to be 900 sq.fts and stated it to be 1030 sq. feets.  He further stated that both the agreements i.e., sale deed and agreement of sale were executed on 3-7-2008 by mentioning the sale consideration as Rs.5,00,000/- as per registered market value and for the sake of obtaining loan from OP No.2, complainant entered separate development agreement on 22-7-2008 to complete the flat from semi-finished to finished and as per schedule, OP No.1 completed the flat by end of October 2009 and ever since requesting the complainant to take possession of flat by paying the balance amount of Rs.5,54,000/- but complainant did not turn up.  Hence, he issued notice on 8-4-2010.  He is no way concerned with regard to payment of interest on loan amount by complainant.  He is not the competent person to locate the transformer, but instead, it was electricity personnel who earmarked the place and installed the transformer to safeguard the interest of flat owners and their properties from unwanted incidents.

        He further submitted that he is the sole proprietor of M/s Sri Sravani Engineering Industries and he entered into Development Agreement with land owners for construction of residential apartment and after obtaining necessary permissions, started construction work in the name and style “Sri Sai Sravani Nilayam”.  He further stated that complainant entered into an agreement of sale for Rs.6,50,000/- including extra charges i.e., for car parking, lift, electricity and Manjeera water and another agreement for Rs.13,54,000/- and that both the agreements were registered with appropriate authority.  That as per the legal opinion and on eligibility of complainant, OP No.2 sanctioned the loan of Rs.13,00,000/-.  That after physical verification, the bank authorities have released the loan amount in favour of complainant.  He further alleged that complainant failed to pay the monthly instalments even though OP No.1 completed the construction work.  He admitted receiving of Rs.14,50,000/- from complainant against total sale consideration of Rs.20,04,000/- and stated that complainant is still due Rs.5,54,000/-.  Hence, prayed to dismiss the complaint with costs.

3.                Second Opposite party filed its counter denying the claim of the complainant and stated that sale deed was executed for Rs.5,00,000/- for semi-finished flat and complainant entered into agreement of completion of semi-finished flat with OP No.1 for Rs.13,54,000/- and accordingly OP No.2 sanctioned housing loan for Rs.13,00,000/-.  They admitted entering into agreement of sale by complainant with OP No.1 along with car parking, transformer, Manjeera water and lift, etc. but denied OP No.1 obtaining signatures of complainant on printed proformas in consultation with the then field Officer of OP No.2.  That complainant signed all relevant papers in the bank after reading the contents therein.  They admitted that after inspecting the flat and as per the authorization given by complainant, they released the loan amount. That as per the letter of complainant, they released the loan amount in favour of OP No.1.  they further stated that OP No.1 handed over the finished flat to complainant and drew the amount from OP No.2.  They admitted the correction of amount to Rs.14,90,000/- by putting signature of OP No.1.  They denied the set off claim of Rs.8 lakhs of complainant. They further stated that they were unnecessarily dragged into litigation and that there is no cause of action to file the complaint.  They further stated that after availing loan, complainant remitted installments towards repayment of loan.  Hence, there is no deficiency in service on its part.  Accordingly, prayed to dismiss the complaint with exemplary costs and compensatory costs.

4.              Though the Ops 3 to 6 were served with notices, have remained absent for the reasons best known. 

5.              Both the parties let in evidence on their behalf in the form of affidavits reiterating the contents of the complaint and their counters.  The parties also filed written arguments, which is nothing but repetition of the contents of complaint and counters, hence, need not be traversed.

6.              Complainant exhibited 7 documents in “A” series and the Opposite party No.2 exhibited 12 documents in “B” series.  No documents are exhibited by OP No.1.

       Ex.A1 is certified copy of Agreement of Sale dated 11-06-2008 registered as document No.11072/2008 on 30-07-2008.  Ex.A2 is certified copy of sale deed for flat dated 30-07-2008 registered as document No. 11073/2008 on 30-07-2008.  Ex.A3 is notice dated 8-4-2010 got issued by OP No.1 to the complainant.  Ex.A4 is reply-cum-demand notice dated 19-04-2010 issued by complainant to Ops.  Ex.A5 is the original encumbrance certificate pertaining to the property in dispute.  Ex.A6 are the copies of statement of account of loan account of complainant for the period from 29-07-2008 to 27-07-2010 and Ex.A7 are the two photographs of the transformer in question and the brochure stated to have been issued by the OP No.1. 

                   Ex.B1 is True copy of Agreement of sale dated 11-06-2008 (Ex.A1 document).  Ex.B2 is the true copy of sale deed for flat dated 30-07-2008 (Ex.A2 document).  Ex.B3 is true copy of Agreement for completion of semi-finished flat dated 22-07-2008 (un-registered document).  Ex.B4 is the true copy of affidavit of declaration and indemnity.  Ex.B5 is the true copy of affidavit of complainant. Ex.B6 is true copy of memorandum of loan agreement for home loan granted to public.  Ex.B7 is true copy of guarantee agreement.  Ex.B8 is true copy of Arrangement letter-Housing Finance along with receipt for Rs.1,50,000/- and letter of complainant addressed to opposite party No.2 dated 21-08-2008. Ex.B9 is true copy of letter dated 30-07-2008 addressed by complainant to OP No.2.  Ex.B10 is true copy of letter dated 20-10-2008 addressed by complainant to OP No.2 authorizing to deduct the EMI from his salary account from December 2008 onwards.  Ex.B11 are the true copies of statement of account of loan account of complainant for the period from 01-09-2007 to 14-10-2010.  Ex.B12 is the photocopy of Title Investigation report given by Mr.Prabhakar Gupta, Advocate, Sangareddy, on the properties of complainant (duly verified by the Forum with original). 

7.       The points for consideration are

1)       Whether there is any deficiency in service on the part of the opposite parties?

2)       And if so, whether the complainant is entitled for the reliefs as prayed for?

3)       To what relief?

8.               It is not in dispute that the Complainant agreed to purchase the Flat bearing No.G11 on Ground Floor of “Sri Sai Sravani Nilayam” constructed on plot Nos.86, 87, 88, 89 and 90 in Survey No.802, 806 & 807 total admeasuring 1146.22 square yards situated at Beeramguda village, Ameenpur G.P. Patancheru mandal of Medak district from the OP No.1 and advancing the loan amount of Rs.13,00,000/- as against the said plot.  The only dispute is that the plinth area of plot is 930 sq. feets per complainant and as per Ops it is 1030 sq. feets.  The further dispute is that the document was executed for Rs.5,00,000/- and the figures were corrected subsequently, as per complainant but the same is denied by the Ops.  The OP No.1 contends that the complaint in the present form is not maintainable as the same is not filed against the firm and that the same is barred by limitation.  Further, OP No.1 contended that the complainant owes an amount of Rs.4,54,000/- towards balance consideration.

      Both Opposite parties 1 and 2 vehemently contends that the sale deed was executed for Rs.5,00,000/- and the agreement of sale was executed for Rs.14,90,000/-. A perusal of the documents show that the stamp duty and registration charges of Rs.37,500/- was paid on the sale deed by the complainant towards sale consideration of Rs.5,00,000/- and an amount of Rs.6,200/- is paid towards stamp duty and registration charges on the agreement of sale document, which are marked as Ex.B2 and B1 respectively.  Both the documents show that the charges towards car parking, electricity, Manjeera water, lift, etc., are extra.  At page No.2 [towards the end] off Ex.B1 document, the total amount is shown at Rs.1,50,000/- towards Car parking, Transformer, Manjeera water and lift and whereas on the top of page No.3 of Ex.B1 the total is shown as Rs.14,90,000/- (with corrected figures from Rs.13,00,000/-).  It is astonishing as to how this figure is arrived upon for what this amount pertains to.  There is no mention in the document as to the arrival of amount of Rs.14,90,000/-.  Surprisingly, this document is executed in favour of “Sanjay Vittal Rao Bhosale” showing the Occupation as “Housewife” and age as 28 years.  And the OP No.2 is supporting the contention of OP No.1 on this document without verifying the legality of the same.  Mere correction of the document does not confer right the OP No.1 or any other person claiming through it but there is a duty cast on the OP No.1 to show the legality of the figures so arrived at.  It is the reiterating contention of OP No.1 that the total sale consideration of the finished flat agreed upon was Rs.18,54,000/- and Rs.1,50,000/- being the charges extra for Car parking, electricity, Manjeera Water and lift.  As admitted, complainant paid an amount of Rs.14,50,000/- to OP No.1 i.e., Rs.1,50,000/- as token advance and Rs.13,00,000/- paid by OP No.2.  Nothing is explained either by OP No.1 or OP No.2 either in their counters or by exhibiting any document to show that such works are to be carried on by the OP No.1 towards the semi-finished flat for payment of Rs.15,50,000/- excess to that of actual sale consideration of Rs.5,00,000/-. 

        A perusal of Ex.B3 shows incorporation of nothing as regards to carrying of any new work or works in the semi finished flat in dispute to make a finished one for Rs.13,54,000/-.  Nowhere is it mentioned about the condition and status of the semi-finished flat and the works to be undertaken by OP No.1 to term it a finished one.  Even a keen perusal of this document show the corrections at two places i.e., instead of G-10, it was corrected as G11 and instead of 970 sft it was corrected as 1030 sft.  No evidence is placed by the OP No.1 to show that the G-10 flat consists of such measurement.  Whereas the brochure exhibited as A7 show the area of the flat Nos.G10 and G11 as 960 respectively.  OP No.2 failed to explain on what basis he advanced the loan of Rs.13,00,000/- when the actual registration value of the Ex.B1 document is Rs.5,00,000/- and more so, the registration fee and stamp duty is paid on the sum of Rs.5,00,000/-.  Without any valid and bonafide reason, OP No.2 is supporting the version of OP No.1 in respect to Ex.B3 document throws a big doubt in the mind of this Forum.  Ex.B1 to B12 are the documents filed by OP No.2, hence, it need to answer in proper way.  A glance at Ex.B5 document show that the Schedule-II (description of title deeds) are kept blank and the same are attested by T. Vishwanatham, Notary Advocate, Sangareddy on 29-7-2008 and by which time, the documents Ex.B1 to B3 were much within the knowledge of Ops 1 and 2.  And if that is true, what made the OP No.2 to keep this column blank is not explained.

       It is a laughable to mention here that no bank would advance the loan on silly documents without verifying the contents and meaning of the document and without verifying the legality of the documents in question.  It seems to cover up the laches on the part of the Officer in charge, the OP No.2 took such a bald stance which is not sustainable in any view of the matter.  Though both the opposite parties have contended that the flat was handed over to complainant after due physical verification, nothing is placed on record to vouchsafe the same.  Even the OP No.2 failed to explain on what basis it made such a false statement.  The alleged receipt for Rs.1,50,000/- stated to have been executed by OP No.1 is not properly stamped and how the OP No.2 took this into consideration is also not explained.  Even the Form ‘A’ (part of Ex.B8 document) do not bear any postal stamp though it seems to have been addressed by Complainant to OP No.2 bank.  It is also not explained as to whose handwriting it pertains to.  A perusal of Ex.B9 document throws doubt on the very execution of document itself as there is huge gap in between the matter and the signature of complainant.  We are compelled to mention that no bank or financial institution is ready and willing to provide the financial assistance to the borrowers on the very day of execution of the documents.  As per the contention of both the opposite parties, the documents were registered in the Sub-Registrar’s office on 30-07-2008 and the loan documents executed with OP No.2 also shows the same date and in furtherance, the loan amount was also released on the same date.  How these are possible in one single day to a common man is a big question mark.  It is the usual practice of the banks to obtain the signatures of the borrower on printed proformas and fill it later-on, which is a universal truth.  How OP No.2 gave credence to unregistered Ex.B3 document is not explained.  And all these lacunas might have restrained Ops 2 to 6 from remaining absent.

        A perusal of Ex.B12 shows the correction of figures in respect of square feets of the property in question and also in respect to total sale consideration and balance sale consideration.  The total sale consideration is corrected as Rs.18,55,000/- from Rs.15,45,000/- and the balance sale consideration is corrected as Rs.17,99,000/- from Rs.14,90,000/-.  If this is believed to be true, what made Mr.M.Prabhakar Gupta to correct the figures when the documents presented to him were in corrected ones.  And these corrections intensifies the allegation of complainant that the figures in the documents were corrected later on by OP No.1 in collusion with the Field Officer of OP No.2 to suit his ill-desires, appears to be true.

9.               A perusal of the counter of OP No.1 in keen terms show the admissions to the extent of receiving of monies from complainant to the tune of Rs.14,50,000/-.  Nowhere in the counter, it is mentioned by OP No.1 that he did not receive any money from complainant but instead his firm which received it.  Though allegation is made that complaint has to be filed against the firm, the very admissions and content and meaning of the counter show that the OP No.1 in the capacity of sole proprietor of the firm received the monies from complainant and through OP No.2.  Hence, this allegation of OP No.1 do not hold any water and will not oust the right of complainant in suing him, since the OP No.1 is the sole proprietor of the firm in question.

10.               A further perusal of Ex.A3 document show that sale consideration agreed was at Rs.18,54,000/- and for car parking, etc., it was agreed at Rs.1,50,000/- & the total sale consideration comes to Rs.20,04,000/-.  If this is believed to be true, then what the corrected figures of Rs.14,90,000/- in Ex.B1 is not explained by both the Ops 1 and 2.  There is no nexus for these figures.  The OP No.2 also withheld to file the loan application of the complainant to show its bonafide.  A perusal of Ex.B8 document shows that the monthly loan instalment is fixed at Rs.14,391/-.  If this is believed to be true, why did OP No.2 receive only Rs.13,100/- instead of Rs.14,391/- that too on 08-02-2009 and 28-02-2009 is not explained.  Further, why did OP No.2 keep quiet without deducing the loan installments money from the account of complainant from December 2008 onwards and why was it deducted in the month of February 2009 only, is also not explained.  All these events show that the Field Officer of OP No.2 was hand-in-glove with OP No.1 and that necessitated the complainant to file the present complaint.

11.                From the above observations and the material on record, it can safely be inferred that the services of Ops 1 and 2 towards complainant are deficient and as a result of which the complainant faced great ordeals.  On other hand, it is also not fair and reasonable on the part of the Complainant to claim the amount of rent and interest on instalment monies.  For the above reasons, we answer the points 1 and 2 in favour of the complainant and against the Opposite parties.

12.             Point No.3 : In the result, we allow the complaint and direct the opposite party No.1 to rectify the registered sale deed along with corrections in the office of sub registrar concerned (or) to refund the excess amount i.e, Rs. 8,00,000/- received and further to pay compensation of Rs. 50,000/- for the ordeals experienced by the complainant together with costs of Rs. 5,000/- and finally direct opposite party No. 1 to get the area of the flat including common areas assessed by the licensed surveyor and pay the difference of amount, if any. Time for compliance: One month.

         Typed to dictation, corrected and pronounced by us in the open forum  this    26^th  day of July, 2011.

                                   Sd/-                                                    Sd/-

                         LADY MEMBER                                   MALE MEMBER

APPENDIX OF EVIDENCE

For Complainant:                                                 For Opposite parties:

Affidavit of complainant filed                                                           None

as evidence.

WITNESS EXAMINED

For Complainant:                                                 For Opposite parties:

             -Nil-                                                                                           -Nil-

EXHIBITS MARKED

For Complainant:                                                          For Opposite parties:

                                                                                                                                  Sd/-

LADY MEMBER

Copy to:

1)      The Complainant

2)      The Opp.parties

3)      Spare copy                             Copy delivered to the Complainant/

Opp.Parties On ___________

                                                Dis.No.            /2011, dt.