1. Challenge in these Revision Petitions filed under Section 21(b) of the Consumer Protection Act, 1986 (for short “the Act”) by M. Nagoor Rao, Proprietor of Sri Sravani Engineering Industries, is to the Orders dated 21.02.2017, passed by the Telangana State Consumer Disputes Redressal Commission (for short “the State Commission”) in First Appeal Nos. 1042, 1043 & 1044 of 2013. By the Impugned Orders, the State Commission had dismissed the Appeals preferred by the Petitioner, by affirming the view taken by the District Consumer Disputes Redressal Forum, Medak (for short “the District Forum”) vide Order dated 17.09.2013 passed in Consumer Complaint Nos. 20, 21 & 22 of 2012. 

 

2. Since the question of law and facts involved in these Revision Petitions are similar except for minor variations in the Flat Numbers and their sale consideration, these Revision Petitions are being disposed off by this common Order. However, for the sake of convenience, the facts as enumerated in CC No. 20 of 2012 filed before the District Forum, have been discussed at length herein. 

 

3. Succinctly put, the facts giving rise to filing of the present Revision Petitions, as culled out from the CC No. 20 / 2012, are that Maruti Parashuram Patil (hereinafter referred to as the Complainant) entered into an Agreement on 30.07.2008 registered as document No.11074/2008 with M. Nagoor Rao (hereinafter referred to as the Opposite party No. 1 Builder) to purchase the Flat bearing No.207 admeasuring 1000 sft of built-up area over plot Nos.86 to 90 in Sy.Nos.802, 806 & 807 admeasuring undivided share of land 25 sq.yards, situated at Sri Sai Sravani Nilayam, Beeramguda, hamlet of Ameenpur village, Patancheru mandal for a consideration of ₹5,00,000/- apart from car parking charges of ₹85,000/-; ₹25,000/- towards installation of transformer; ₹10,000/- towards manjeera water supply and ₹30,000/- towards lift.  The Complainant paid earnest money of ₹2,55,000/-.  The Opposite Party No.1 Builder assured to get the loan sanctioned from State Bank of India (hereinafter referred to as OP No.2) and accordingly executed sale deed on the same day registered as document No.11075/2008 mentioning the delivery of flat though the same is actually not delivered till date.  It was further averred that when the OP No.2 Bank started deducting the loan instalments from the salary account of the Complainant, on verification, it came to light that the OP No.2 had sanctioned the loan of ₹13,00,000/- of which it paid ₹5,00,000/- on 30.07.2008 and ₹7,00,000/- on 04.08.2008 and ₹1,00,000/- on 20.10.2008 without knowledge and consent of the Complainant, in collusion with Opposite Party/Petitioner Builder.  As per the Agreement, the Opposite Party/Petitioner Builder promised to handover the Flat within 24 months but failed to comply with.  No amenities, as agreed, were provided.  On measurement, the built-up area is found to be short to that of agreed one.   

 

4. It was alleged that in the Agreement and the sale deed, the sale consideration is mentioned as ₹5,00,000/- but the bank officials have released the amount of ₹13,00,000/- without any basis, which is a clear case of collusion.  The Petitioner Builder also deviated the construction permission and approved plan.  As such, the Complainant got issued notices to the Opposite Parties and stopped paying the loan instalments.  Alleging deficiency in service on the part of the Opposite Parties, the Complainant filed Consumer Complaint before the District Forum seeking interest on the loan for 39 months amounting to ₹2,90,000/-; to pay rent of ₹1,30,000/- for not handing over the premises; to reimburse the amount of ₹10,55,000/- towards excess amount received by OP No.1 Builder; to pay ₹1,95,000/- towards difference of built-up area of 130 sft.; to pay damages of ₹2,00,000/- and costs of the Complaint.

 

5. Upon notice, the Opposite Party No. 1 / Petitioner Builder and the Opposite Party No. 2 Bank contested the Complaint.  The Petitioner Builder contended that the entire claim of the Complainant is baseless and that the firm of which he is the Proprietor is not made a Party to the case and that the District Forum has no jurisdiction to entertain the Complaint and the same is barred by limitation.  It was also contended that the Complainant agreed to purchase the subject flat for a total consideration of ₹23,45,000/- including car parking, lift, electricity transformer and manjeera water connection and after negotiations, paid an amount of ₹2,55,000/- in cash and expressed his willingness to obtain housing loan from OP No.2 Bank and promised to pay the balance amount after deducting the loan amount from the total sale consideration.  Accordingly, agreement for sale was executed for ₹6,50,000/- and another agreement for completion of balance works was executed on 22.07.2008 for ₹13,54,000/-.  The Complainant obtained loan of ₹13,00,000/- from the OP No.2 Bank by authorizing it to make payments.  As per the Agreement, he had completed the construction and provided all the amenities by receiving an amount of ₹15,55,000/- including advance amount of ₹2,55,000/- as against the total sale consideration of ₹23,45,000/-.  Still the complainant is due an amount of ₹7,90,000/- to the OP No.1 and that even after taking over possession of the flat, the Complainant did not pay the same and filed the present Complaint with false allegations to evade payment and it was prayed that the complaint be dismissed with costs.

 

6. The Opposite Party No. 2 Bank contended that the Complainant purchased the semi-finished flat for a consideration of ₹5,00,000/- from OP No.1 through the sale deed dated 30.07.2008 registered as document No.11075/2008 and subsequently entered into an Agreement with OP No.1 for completion of the left-over works for an amount of ₹13,54,000/-.  It was further contended that the Complainant obtained loan of ₹13,00,000/- from their bank which was paid to him by debiting from his savings bank account from time to time as per the authorization given by the Complainant and after inspection of progress of the construction work and thereafter the Complainant took possession of the flat.  The Bankers were unnecessarily dragged into litigation making false and baseless allegations of cheating, etc., against them in collusion with the OP No.1, hence, prayed to dismiss the complaint with costs. 

 

7. On appraisal of the evidence adduced before it, the District Forum allowed the Complaint holding that there was deficiency in service on the part of the Opposite Parties and allowed the Complaints by observing as under:-

 

“As per the receipts under Ex. A11 the complainant paid ₹55,000/­ on 22.02.2008 and ₹2,00,000/­ on 20.06.2008 and that the Opposite Party No. 2 Bank paid ₹13,00,000/­. Thus the Opposite Party No. 1 has so far received ₹15,55,000/­. Though he has given total sale consideration of ₹23,45,000/­ for the flat in question, there is neither any documentary nor oral evidence to establish it. Therefore we are unable to accept it.

 

d).  Now coming to the aspect of un­finished construction work of the flat with amenities, it is to be noted that the Opposite Party No. 1 has alleged that he had finished said work and intimated the same to the complainant with a request to take possession of the flat by sending letter, Ex. A13. But the complainant disputed it by the reply letter, Ex. A14 on receipt of Ex. A13 with a specific request to the opposite party no. 1 to complete the unfinished work and then hand over possession of the flat. In this regard the report of civil engineer, PW. 2 under Ex. A4 is of material importance. As per this document he made spot inspection and physical verification of the flat on 30.12.2012 in pursuance   of   the   request   letter,   Ex.   A3   from   the  complainant   after complainant’s issue of notices under Ex. A1 to opposite parties. Ex. A2, A6 & A8 are postal receipts and acknowledgements for Ex. A1. The civil engineer has also enclosed photos, Ex.A5 & a CD, Ex. A7 along with his report, Ex. A4. These documents clearly show that the finishing work of the flat and all the amenities were still not completed making it difficult to the complainant to take possession of it. No doubt the inspection was made by the Civil Engineer in the absence of the opposite parties but for that the complainant cannot be blamed. Because he had already issued notices to them about the proposed visit and inspection of civil engineer. In this circumstance we have no hesitation to hold that the defense setup by the opposite parties alleging completion of entire construction work in schedule time has no legs to stand. Thus the opposite party no. 1 has violated the terms and conditions with regard to completion of construction work within 24 months as per the registered agreement, Ex. A9 (Ex.B1). The report of civil engineer also shows that even the actual extent of the flat in question is with a deficit of 137.18 sft. The complainant has also filed evidence affidavit of the said civil engineer as PW. 2 to prove Exs. A4, A5 & A7. But the opposite parties did not choose to cross­examine him. Therefore we hold that the contents of said documents have been duly proved.

 

e) The complainant has propounded that since the opposite party no. 1 did not complete the construction work with all the amenities within stipulated time, he was forced to stay in a rented house on a monthly rent of ₹5,000/­. To establish this fact he has filed evidence affidavit of the landlord as PW.3. The opposite parties did not choose to cross­examine him to rebut and disprove the contents of said affidavit.

 

……

 

g) No doubt the opposite party no. 1 has filed a copy of order dated 15.10.2012 passed by the Hon’ble State Commission in F.A. No. 884/2011 between “M. Nagoor Rao AND Sanjay Vithalrao Bhosale & others”, to contend that in a similar case of purchase of another flat in the same apartment Sri Sai Sravani Nilayam, the claim of complainant there in was rejected. But the facts in the said case are totally different than the facts in the present case and that as such the opposite party no. 1 cannot avail any benefit from it.

 

h).  In view of the aforesaid discussion, we hold that the complainant has successfully established deficiency in service on the part of the opposite parties and as such he is entitled from them a quantum of interest on the loan amount of ₹13,00,000/­ in respect of the proportionate period which shall be   calculated   by   the   bank.   Because   the   Opposite   Party   No.   2 bank   has disbursed the said entire loan amount to opposite party no. 1 even without properly verifying the factum of progress and completion of construction work. The complainant is further entitled from the Opposite Party No. 1 a sum of ₹1,30,000/­  towards  rent  of the  hired  building  by  him and  a  sum of  ₹3,24,770/­ towards the costs of deficit built up area of 130 sq. ft. and cost of un­finished construction work of the flat as calculated by the civil engineer, PW. 2. The opposite parties are liable to pay a reasonable compensation and damages of ₹50,000/­ jointly and severally to the complainant for causing mental agony to him with costs of ₹10,000/­.” 

 

8. Feeling aggrieved, the Opposite Party No. 1/Petitioner herein, Builder and Opposite Party-2 Bank preferred separate Appeals before the State Commission.  After hearing both the Parties and material and evidence produced before it, the State Commission had affirmed the view taken by the District Forum that the there was deficiency in service on the part of the Opposite Parties and dismissed the Appeals by observing as under:-

“15)     As stated supra, the developer agreed to sell the subject flat consisting of RCC frame structure, super structure, main door, other doors, windows, kitchen, shelves, shelves, flooring, toilets, painting, electrical and water supply for a total consideration of ₹5,00,000/- apart from charging ₹1,50,000/- for car parking, transformer, manjeera water and lift under Ex.B1.  In addition to these, the developer had agreed to provide the grills to the balconies as well as to the windows of apartments, which can be evidenced from clause-9(d) of the sale deed, which reads as follows:

 

“………The vendee shall not close the verandahs or lounges or also shall not alter the exterior colour of the building complex.  For this purpose, the flat owners means all persons having rights, title or interest in any part of the building.  The design of the grills provided to the balconies as well as to the windows of apartments shall not be replaced with any other design so as to maintain uniformity in the appearance of the building.”

 

From the above, it can be safely inferred that the developer agreed to provide colour and grills to the flat.  If all these amenities are kept aside, nothing is stated in the agreement for completion of semi-finished flat as to what are the nature of works that would be attended by the Sri Sravani Engineering Industries, item-wise and category wise.  Be that as it may, the fact remains that the bank, without verifying all these aspects had sanctioned the loan and released the money in favour of the developer.  In order to cover-up its laches, the bank would contend that the flat is completed and delivered to the purchaser but failed to produce any piece of paper to that extent.  On the other hand, the purchaser filed the photographs marked as Ex.A5 which would speak any amount of lapses on the part of the developer in completion of the subject flat, resulting in filing the present complaint which is under challenge in this appeal.  To deny the evidence let-in by the purchaser, no material is brought on record by the developer or the bank.   

 

16) As stated supra, the bank too failed in visualizing the mischief played by the developer in getting drafted the agreement for construction of semi-finished flat while sanctioning the loan.  The bank was well aware of the contents thereof.  Any prudent man would understand the reality of the recitals and contents of the agreement thereon.  The bank could have been more vigilant while sanctioning such loans.  Having sanctioned the loan basing on the Agreement for construction of semi-finished flat, now it cannot turn around and contend that the purchaser has not raised any objection either at the time of sanctioning the loan or while deducting the EMIs.  The bank did not place any convincing material to show that the flat had been constructed and made ready for occupation of the purchaser.  Without verifying the progress of the construction and without verifying the completion of construction works, it had released the amount.  Even no piece of paper is filed to show that the flat was delivered and handed-over to the purchaser.  This Commission is not inclined to accept the contentions raised by the bank.

 

17)  No material is brought on record by the developer to show that the subject flat was agreed to be sold for a total sale consideration of ₹23,45,000/-, hence, this Commission do not accept the said plea.  In so far as the completion of the flat in all aspects is concerned, the forum below had dealt in detail and hence there is no need to this Commission to go into those aspects again.  In so far as payment of rent is concerned, the purchaser has filed the affidavit evidence of PW3 which would establish that he obtained house on rent.  The other aspect of deficit of built-up area has been already answered by the forum below.  It is to be stated that the forum below had discussed in detail on all the aspects and rendered its finding which cannot be found fault with.  For the aforesaid reasons, this Commission does not find any infirmities or irregularities in the orders of the forum below and accordingly this Commission answers the point framed for consideration at paragraph No.11, supra, against the developer and bank and in favour of the purchaser.”

 

9. Feeling aggrieved against the Orders dated 21.02.2017 passed by the State Commission, the Petitioner Builder has filed the present Revision Petitions before us.

 

10. Mr. V. Gouri Sankara Rao, learned Counsel for the Petitioner submitted that the District Forum wrongly observed that there was deficit area whereas as per report filed by the Court Commissioner appointed by this Commission there was no deficit in the area; the Complainant has not approached the Hon’ble Forum with clean hands as he had suppressed Agreement for Completion of semi-furnished Flat executed on 22.07.2008.  It was admitted that on 11.06.2008 Agreement for sale was executed between the Parties.  Subsequently, Agreement for Completion of semi-furnished Flat was executed on 22.07.2008, according to which the Petitioner was liable to complete the construction within a period of 15 months.  On 07.04.2010, the Petitioner completed the construction and offered possession of the Flat to the Complainant/Respondent with all amenities but the Complainant did not pay the balance amount rather he got issued legal notice on 21.07.2011 making false allegation. It was submitted that there was neither any deficit in the area nor there was any delay in handing over the possession of the Flat to the Complainant/Respondent.  It was prayed that the Consumer Complaints be dismissed and the Orders passed by the Fora below be set aside. 

11. Per contra, Mr. Joshi Mohan Sharma, learned Counsel  appearing on behalf of the Respondents/Complainants submitted that the possession of the Flats have not been delivered to them as the Petitioner Builder has miserably failed to remove the deficiencies as pointed by them in compliance of Order dated 09.10.2018 passed by this Commission.  Although he supported the Orders passed by the Fora below yet prayed for enhancement of compensation since the Petitioner Builder failed to complete the Construction and hand over the possession of the Flats within stipulated period.    

 

12. We have heard Mr. V. Gouri Sankara Rao, learned Counsel for the Petitioner, Mr. J. Mohan Sharma, learned Counsel appearing on behalf of the Respondents, perused the Orders passed by the Fora below, the Complaint, the Written Statement and all the documents on record.

 

13. Considering the dispute involved in the present Revision Petitions, vide Order dated 06.03.2018, Mr. Prabhakar Singh, Additional Director General, CPWD was appointed as the Court Commissioner to inspect the subject Flats with a direction to submit a report as to who is in physical possession of the said flats and whether the same have been constructed as per the specifications in the Agreement. Ld. Court Commissioner submitted its Report on 01.05.2018.  Relevant paras of the Report are reproduced as under:-

 

“2. As per the certified true copy of the order dated 06.03.2018 of the National Commission in the Revision Petition No. 2309/2017 of Shri M. Nagoor Rao Vs Maruti Parshuram Patil with Revision Petition No. 2310 and 2311 of 2017, I have been appointed as Court Commissioner and asked to inspect Flat Nos. 207, 208 and G-10, constructed on Plot No. 86 to 90, Sy. No. 802, 806 and 807 situated at Sri Sai Sravani Nilayam, Beerampura Hamlet of Ameernpur Village, Patanheru Mandal and as certain whether the same have been constructed as per specifications in the Agreement of Sales dated 11.06.2008, Agreement of completion of semi-finished flats dated 22.07.2008, and also to check who is in actual possession of the said flats.

 

3. I have visited the site on 26.04.2018, where Shri M. Nagoor Rao, the Petitioner and Shri Joshi Mohan Sharma, counsel for the respondent/Complainant were present along with the representatives of the purchasers of these flats. On inspection, Flat No. G-10 was found locked. Nobody present at the site could tell whose lock it was and the flat is under whose physical possession. Flat No. 207 and 208 were fond felt open and vandalized, with some bathroom fittings stolen/missing, some switch boards removed/stolen/missing, some wires of some switchboards cut/stolen/damaged, the cobwebs in rooms etc. It was very difficult to enter into such dirty, stinking, unhygienic and abandoned flats. But still I took all required measurement and checked the materials of construction and their specifications.

 

4. It was found that these flats have been constructed as per the drawings attached in the Agreements of Sale. The dimension of rooms and the overall dimension of the room match with the dimension given in the drawing. Dimension of the balconies, corridors and open spaces were also measured which were found to match with the dimension indicated in the above-mentioned drawings. Structural RCC columns were found to be according to the drawings.

 

5. On inspection, it was found that as per agreement, the house has RCC Framed structure, super structure of 4-1/2’’ bricks walls, main door of M. teak wood with Teak wood shutters, other doors of Non Teak wood frames and shutters with flush doors, windows of Non-teak wood frames and shutters with M. Teak wood, kitchen with green marble platform with built in sink and glazed tiles dado upto 1’5’’ height, vitrified tile flooring, two toilets with Indian WC with ceramic tile flooring with 4.5’ height glazed tiles and sanitary fittings, shelves, Snowcem painting, concealed copper wires, bore-well, overhead tank etc.”

 

14. A bare perusal of the above Report makes it abundantly clear that there was no deficit in the area of the Flats as the flats were constructed as per the drawings attached with the Agreement to Sale and the overall dimension of the room match with the dimensions given in the drawing.  The construction work was completed in the flats.  Therefore, the Fora below erred in awarding cost towards deficit area and the unfinished construction work in the flats and the same direction is liable to be set aside. Rest of the contentions raised by the Petitioner Builder has been rightly dealt with in detail by the District Forum and affirmed by the State Commission.

 

15. From the perusal of the Report it is also clear that till the date of inspection, the Flats were unoccupied.  As per terms of the Agreement between the Parties, the Petitioner Builder was obliged to give the physical possession of the Flats within 24 months from the date of Agreement but the Petitioner Builder has miserably failed to deliver the actual physical possession of the Flats within stipulated period, which is a clear deficiency in service on the part of the Petitioner Builder. As per settled law, if any builder/developer fails to deliver the possession of the Flats within reasonable period, he will be liable to pay delay compensation for the period of delay.  It is the case of the Complainants/Respondents that they have to pay rent @ ₹5,000/- per month towards rented accommodation due to delay in delivery of the possession.  Accordingly, the Petitioner Builder is liable to pay rent @ ₹5000/- per month from the expected date of delivery of the possession of the Flat till the actual date of physical possession of the Flat to the Respondent/Complainant.  In view of the Judgment passed by the Hon’ble Supreme Court in DLF Homes Panchkula Pvt. Ltd Vs. D.S. Dhanda, II (2019) CPJ 117 (SC), the Respondents/Complainants shall not be entitled for any other compensation.  

 

16. For the reasons stated hereinabove, the Impugned Orders dated 21.02.2017 passed by the Fora below are modified to the following extent :- 

In RP No. 2309 of 2017 

a) The Petitioner Builder is directed to pay rent @ ₹5,000/- per month w.e.f. 10.04.2010 till the actual date of handing over the physical possession of the Flat to the Complainant/Respondent within six weeks from today;

 

b) The Petitioner Builder and the Opposite Party No. 2 Bank are directed to jointly and severally pay quantum of interest on the loan amount of ₹13,00,000/- in respect of the proportionate period which shall be calculated by the Bank because the Opposite Party No. 2 Bank has disbursed the said entire loan amount to the Petitioner Builder even without verifying the factum of progress and completion of construction work;

 

c) The Petitioner Builder is directed to pay ₹5,000/- towards cost of litigation to the Respondent/Complainant.

 

d) The Petitioner Builder is directed to comply with the above directions within 6 weeks from today.  If the Petitioner Builder has not given the possession of the Flat with all amenities after removing the deficiencies in the Flat, the Respondent/Complainant shall be at liberty to take appropriate action as per law. 

In Revision Petition No. 2310 of 2017

 

a) The Petitioner Builder is directed to pay rent @ ₹5,000/- per month w.e.f. 10.04.2010 till the actual date of handing over the physical possession of the Flat to the Complainant/Respondent;

 

b) To pay loss of interest on bank loan (on EMIs) for the period from March 2009 to October 2011 (32 months only) to be calculated by opposite party No.2 Bank.

 

c) The Opposite Party No.2 bank is directed to start collecting the pending EMIs from September 2013 onwards with a waiver of interest and penalty during the disputed period from October 2011 to August 2013.

 

d) The Petitioner Builder is directed to pay ₹5,000/- towards cost of litigation to the Respondent/Complainant.

 

e) If the Petitioner Builder has not given the possession of the Flat with all amenities after removing the deficiencies in the Flat, the Respondent/Complainant shall be at liberty to take appropriate action as per law.

 

In Revision Petition No. 2311 of 2017

 

a) The Petitioner Builder is directed to pay rent @ ₹5,000/- per month w.e.f. 10.04.2010 till the actual date of handing over the physical possession of the Flat to the Complainant/Respondent;

 

b) The Petitioner Builder is directed to pay loss of interest on bank loan (on EMIs) for the period March 2009 to October 2011 (32 months only) to be calculated by Opposite Party No.2 bank.

 

c) The Opposite Party No.2 Bank is directed to start collecting the pending EMIs from September 2013 onwards with a waiver of interest and penalty during the disputed i.e. from October 2011 to August 2013. Time for compliance is one month only.

 

d) The Petitioner Builder is directed to pay ₹5,000/- towards cost of litigation to the Respondent/Complainant.

 

e) If the Petitioner Builder has not given the possession of the Flat with all amenities after removing the deficiencies in the Flat, the Respondent/Complainant shall be at liberty to take appropriate action as per law.

 

17. All the Revision Petitions stand disposed off in above terms.