Date of Filing:15.11.2007<br /> Date of Order:12.11.2008<br /> <br /> <br /> <br /> BEFORE THE II ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SESHADRIPURAM BANGALORE-20<br /> <br /> Dated: 12TH DAY OF NOVEMBER 2008<br /> PRESENT<br /> <br /> <br /> <br /> Sri S.S. NAGARALE, B.A, LL.B. (SPL.), President.<br /> Smt. D. LEELAVATHI, M.A.LL.B, Member.<br /> Sri BALAKRISHNA. V. MASALI, B.A, LL.B. (SPL.), Member.<br /> <br /> <br /> <br /> <br /> COMPLAINT NO: 2271 OF 2007<br /> <br /> <br /> T.S. Dhanagopala Krishna<br /> S//o. T.A. Subbaiah Setty<br /> No. 48, Car Street<br /> Halasur, Bangalore 560 008 Complainant<br /> <br /> V/S<br /> <br /> 1. Managing Director<br /> Omkar Estate Pvt. Ltd.<br /> No. 10, 80 feet Road<br /> Bank Colony, Main Road<br /> Srinivasa Nagar<br /> BSK II Stage, Near Bata Show-room<br /> Bangalore 560 050<br /> <br /> 2. Sri. K.R. Suresh Kumar<br /> Joint Managing Director<br /> Residing at Shreyas, No. 43<br /> New NO. 4/22, Old Puttanna Road<br /> Basavanagudi, Bangalore 560 004<br /> <br /> 3. Sri Tallam V. Nagaraj<br /> Joint Managing Director<br /> No. 43/1, 1st Floor<br /> Kanakapura Road, Basavanagudi<br /> Bangalore 560 004<br /> 4. B.K. Subramanyam<br /> Director, Ashwini Silks<br /> 1st Floor, Old Post Office Building<br /> B.V.K. Iyengar Road, Chickpet<br /> Bangalore 560 053<br /> <br /> 5. Sri N.V. Aswath Narayana Setty<br /> Director, No. 106, 34th ‘B’ Cross<br /> 11th Main, 4th T Block<br /> Jayanagar, Bangalore 41<br /> <br /> 6. Sri M.V. Vasudeva Setty<br /> Director, Sathyanarayan Soapnut Works<br /> Opp: Vinod Talkies, Near Mandipet<br /> Tumkur 572 101<br /> <br /> 7. Sri S. Shivakumar<br /> Director, R/at No. 1254<br /> 23rd Cross, 23rd Main Road<br /> BSK II Stage<br /> Bangalore 560 070<br /> <br /> 8. D. Venkatarathnam<br /> Director, Balaji Saw Mill<br /> Chellakere Road<br /> Pavagad 577 522<br /> <br /> 9. K.N. Ramaiah<br /> Director, Laxmi Venkateswar Nilaya<br /> No.34, Chamundeswari Road<br /> Rajagudi Cross Road<br /> Jaraganahalli, J.P. Nagar Post<br /> Bangalore 560 078<br /> <br /> 10. Smt. Prathiba Dilip<br /> Director, No. 379, 24th ‘B’ Cross<br /> BSK II Stage, Bangalore 560 070<br /> <br /> 11. Smt. Nasrathunnisa<br /> Director, No. 21/1<br /> T.C.M. Royan Road Cross<br /> Cheluvadipalya, Bangalore 560 053 Opposite Parties<br /> <br /> ORDER<br /> By the President Sri. S.S. Nagarale<br /> <br /> This is a complaint filed under section 12 of the Consumer Protection Act 1986. <br /> The facts of the case are that complainant as per terms and conditions of the opposite parties paid installment amount of Rs. 73,000/- commencing from 06.05.1997 upto 09.08.2000 along with Rs. 6,000/- towards development charges for Omkar Nagar. Complainant has paid total amount of Rs. 86,000/- to the opposite parties for allotment of site as per the scheme and terms and conditions of allotment. On 30.10.2000 opposite parties issued allotment letter and allotted site No. 601 in Omkar Nagar layout. But, the opposite parties did not come forward to register the said site. Complainant is a petty businessman running a provision store. With great hardship he has paid the amount. Several correspondences were made between complainant and opposite parties. Complainant would have got atleast Rs. 15,00,000/- which is the prevailing market value of the site. Complainant is constrained to approach this forum for direction to the opposite parties to pay compensation and the amount paid by him. The complainant has claimed in all Rs. 18,76,000/- from the opposite parties.<br /> 2. Notice issued to opposite parties. Opposite parties have put in appearance through their respective advocates. Opposite parties No. 2 & 3 filed defence version stating that site No. 601 was allotted subject to terms and conditions. Registration of site is only after payment of full sale consideration as well as additional development charges. Complainant is entitled for site or refund of money in the year 2000 if he was regular and paid the full consideration. The claim of the complainant is imaginary one. There was no mental agony. Therefore, opposite parties 2 & 3 prayed to dismiss the complaint.<br /> 3. Opposite party No. 5 had also filed separate defence version taking same defence as taken by the opposite parties No. 2 & 3.<br /> 4. Opposite party No. 6 has also filed separate defence version stating that the entire affairs of the company was managed by the Joint Managing Director K.R. Suresh Kumar and Talam V Nagaraj i.e. opposite party No. 2 & 3 and they had been incharge of the all the affairs and assets of the company. Opposite party No. 6 was never incharge of the affairs of the Company. He requested to dismiss complaint against him.<br /> 5. Opposite party No. 7 has also filed a separate version stating that Managing Director of the Company is liable. This opposite party is not full time Director of Omkar Estate Pvt. Ltd. and he requested to dismiss the complaint against him.<br /> 6. Opposite party No. 8 has also filed separate defence version stating that the transaction of complainant with Omkar Estate is not within his knowledge. The amount paid by the complainant is not within his knowledge. Whatever the transaction taken place between the complainant and Omkar Estate Pvt. Ltd. is not binding on him. Therefore, opposite party No. 8 also prayed to dismiss the complaint against him.<br /> 7. Opposite party No. 4, 10 & 11 remained absent. They have not filed any defence version.<br /> 8. Affidavit evidences have filed. Arguments are heard. <br /> 9. The point for consideration are:<br /> “1. Whether there was deficiency in service on the part of the opposite party?<br /> 2. Whether the complainant is entitled for refund of amount with interest and compensation?”<br /> REASONS<br /> <br /> 10. The complainant has produced brochure of opposite party No. 1 i.e. Omkar Estate Pvt. Ltd. In this brochure the Board of Directors have been shown. Opposite parties No. 2 & 3 K.R. Suresh Kumar and Tallam V. Nagaraj are the Joint Managing Directors and opposite parties No. 4 to 11 are Directors of M/s. Omkar Estate Pvt. Ltd. The complainant has produced receipts for having paid the amount for the site right from 06.05.1997 to 09.08.2000. The total amount paid by the complainant to the opposite parties is Rs. 86,100/- as per the last receipt dated 09.08.2000. The receipts are marked as document 4 to 52. From all these receipts it is very clear that the complainant has paid total amount of Rs. 86,100/-. The complainant has produced document No. 53 of Omkar Estate Pvt. Ltd. As per this document the membership of the complainant is mentioned as 0884 and No. 601 is the site allotted to the complainant. This document No. 53 is dated October 30, 2000. the complainant has produced a copy of letter dated 08.08.2007 addressed to Managing Director, Omkar Estate Pvt. Ltd and requested for execution of sale deed of the site in his name and to hand over possession of the site. By the document produced by the complainant there is absolutely no doubt that complainant has paid Rs. 86,100/- to the opposite parties. The complainant has proved beyond doubt payment of Rs. 86,100/- to the opposite parties for the site. By going through the defence versions of the opposite parties the payment of amount is not disputed. The opposite parties have admitted that the complainant has paid the amount of Rs. 86,100/-. It is admitted case of the opposite parties that they have not handed over the possession of the site and sale deed was not executed in favour of the complainant. Therefore, on the facts and circumstances of the case it is a clear case of deficiency in service on the part of the opposite parties. The opposite parties have not able to honour the commitment and they have failed to execute the sale deed and hand over possession of the site to the complainant. During the course of argument the learned advocate for the opposite parties submitted that as regards refund of the amount there is no dispute and they submitted that they are not in a position to allot site and hand over possession because of internal dispute between the Directors. The complainant has alternatively claimed refund of the amount paid by him with interest and compensation on account of escalation of prices of site. Judicial note can be taken that value of sites in and around Bangalore has increased 100 fold during recent years. It is very difficult for a common man to get residential site in a reasonable price. The complainant being a petty business man paid the amount with an intention of constructing residential house. But unfortunately, the opposite parties were not in a position to allot and handover the site to the complainant. Therefore, the complainant has rightly claimed interest on the amount and also compensation. The complainant is entitled for refund of amount with interest along with just, fair and reasonable compensation on account of escalation of price of sites. The opposite parties No. 4, 10 and 11 have remained absent though served with notice. They have not put up their defence version. Therefore, whatever the case made by the complainant had gone unchallenged by them. It appears that they have no defence to make, That is why they have not chosen to contest the matter. The opposite parties No. 5, 6, 7, 8 & 9 have filed their separate defence versions and they have submitted that opposite parties No. 2 & 3 are the Managing Directors of the Company, Omkar Estate Pvt. Ltd. and they are responsible to refund the amount or handover the possession of site. This defence or argument cannot be accepted. The complainant has produced list of Board of Directors. Opposite parties No. 2 & 3 are the Joint Managing Directors and other opposite parties are the Directors. Therefore, the complainant has made all Directors as party to the present proceedings. Opposite parties who are directors of the company cannot escape from their liability to refund the amount along with interest and compensation. The decree or order that will be passed is binding against all the opposite parties No. 1 to 11. The opposite parties No. 4 to 11 who were Directors as per the Board of Directors list are equally responsible along with Joint Managing Directors to satisfy the claim of the complainant. The internal dispute between the directors is nothing to do with the claim of the complainant. The complainant is not responsible for the internal dispute or difference of opinion among the Directors. The Directors i.e. opposite parties No. 4 to 11 cannot escape from their liability to discharge the claim of the complainant. Therefore, there is absolutely no merit in the argument advanced by the learned advocates of opposite parties No. 5 to 9. The complainant is entitled in law to recover the amount paid by him along with interest and compensation against opposite parties No. 1 to 11. The decree or order that will be passed is joint and several. Therefore, other Directors cannot escape from their liability to satisfy the claim of the complainant. The complainant having proved and established payment of Rs. 86,100/- as per the documents is entitled for refund of that amount along with interest. The Hon’ble National Commission and Hon’ble State Commission are awarding 18% interest p.a. on the refund amount in several cases. Therefore, I feel in this case also grant of interest at 18% p.a. on the amount paid by the complainant is quite just, fair and reasonable. The last payment made by the complainant is on 09.08.2000. The complainant is entitled for interest on 86,100/- at 18% p.a. from 09.08.2000. The complainant has claimed Rs. 15,00,000/- as compensation on the ground escalation of prices of sites and has also claimed Rs. 1,00,000/- as compensation towards mental agony. I feel the ends of justice will be met in awarding compensation of Rs. 50,000/- apart from the interest awarded on the refund amount. The compensation claimed by the complainant is exorbitant and therefore, the amount claimed by the complainant towards compensation cannot be granted. In the result I proceed to pass the following:<br /> ORDER<br /> <br /> 11. The Complaint is allowed. The opposite parties 1 to 11 are jointly and severally directed to refund Rs. 86,100/- to the complainant along with 18% interest p.a. from 09.08.2000 till payment / realisation. The opposite parties 1 to 11 are directed to pay compensation of Rs. 50,000/- to the complainant.<br /> 12. The complainant is entitled for Rs. 6,000/- towards costs of the present proceedings from the opposite parties.<br /> 13. The opposite parties are directed to comply the order within 30 days from the date of this order.<br /> 14. Send the copy of this Order to the parties free of costs as a statutory requirement. <br /> 15. Pronounced in the Open Forum on this 12TH DAY OF NOVEMBER 2008. <br /> Order accordingly,<br /> <br /> <br /> PRESIDENT<br /> We concur the above findings.<br /> <br /> <br /> MEMBER MEMBER<br /> <br /> CV<br />