BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION

AT HYDERABAD.

F.A. 42/2009 against C.C.  49/2008, Dist. Forum, Ranga Reddy

Between:

Smt. Dr. K. Uma Rani,

D/o. K. S. Reddy

Age: 36  years, Service,

Rep. by GPA  Holder.

K. Seetharam Reddy,

S/o. Malla Reddy

Age: 70 years, Business

R/o. 12-5-149/11/1/A

Vijayapuri, Tarnaka

Secunderabad.                                            ***                         Appellant/

                                                                                                Complainant

And

M/s. Janaharsha Estates N Constructions

Rep. by its Managing Director

Office at 12-5-149/17,

Opp. Railway Degree College

Taranaka, Secunderabad.                           ***                         Respondent/

                                                                                                O.P. 

Counsel for the Appellant:                          M/s.  B. Rajasekhar Reddy

Counsel for the Resps:                                M/s. N. S.V. Nageswara Rao.

CORAM:

                         HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT     

&

                                        SMT. M. SHREESHA, MEMBER

TUESDAY, THIS THE SECOND DAY OF NOVEMBER TWO THOUSAND TEN

Oral Order: (Per Hon’ble Justice D. Appa Rao, President)

                                                          *****

1)                Appellant is unsuccessful complainant.

2)                The case of the complainant in brief is that the appellant floated a scheme for sale of plots under the name and style of Dream City-II, Garden Unit.    He joined as a member for 15 plots by paying  admission fee of Rs. 100/- each.   He had to pay Rs. 6,000/- each towards special instalment and Rs. 600/- each per month in 50 equal  monthly instalments.     The appellant promised to grow teak plants and fruit plants in each of the plots.  He had paid the following amounts on  various dates.

Though he had expressed his willingness to pay balance of amount in lump sum in order to get  the registered sale deeds, the Managing Director of the respondent company had been arrested in a murder case and the office was closed and there was none to negotiate for payment of remaining instalments.    When he was released on bail, he approached the respondent who insisted for payment of Rs. 36,000/- for each of the plot more than the agreed amount.    However, he was ready to pay balance instalments amount of Rs. 24,900/- for each of the plot which comes to Rs. 3, 73,000/- for 15 plots.   When he did not agree he issued registered notice calling upon to receive balance sale consideration and execute registered sale deeds.    A false reply was given stating that the amount was forfeited as he did not pay the amounts regularly.   This was done with a malafide intention amounting to deficiency in service.  Therefore he filed the complaint to execute registered sale deeds by receiving balance sale consideration besides claiming Rs. 50,000/- towards compensation and Rs. 10,000/- towards legal expenses. 

3)                 The respondent resisted the case.   He alleged that the rights and liabilities of the parties are governed by agreements.   Since the transaction pertains to immovable property the Dist. Forum has no jurisdiction.    No doubt the complainant had joined as a member in the scheme but he  paid Rs. 1, 66,000/- till September, 2004 and stopped payment of future instalments.    Clause 7(a) stipulates mode of payment.    In the event of default in payment of two instalments the agreement stands cancelled.    As per clause-11  in the event of default  in payment of three instalments  the membership stands  cancelled  without any prior notice  and the  amount paid  till then stands forfeited and  he will not be entitled to any right or claims.    By virtue of above term his membership was terminated and the amount was forfeited.    Though the Managing Director was arrested  the office was never closed.  In order to overcome his own deficiencies he filed this complaint.    Even before the  arrest the complainant had committed default.  In view of raise in prices of real estate he resorted to this speculative litigation and therefore prayed for dismissal of the complaint with costs. 

4)                 The complainant in proof of his case filed his affidavit evidence and got Exs. A1 to A7 marked while the appellant filed the affidavit evidence of   its Chairman & Managing Director T. V. Ramana Murthy and filed Exs. B1  & B2.

5)                The Dist. Forum after considering the evidence placed on record opined that  the complainant had committed default  in payment of amounts  and therefore  the respondent was entitled to forfeit the amount.  There was no deficiency in service  on its part and therefore dismissed the complaint with costs  of Rs. 2,000/-. 

6)                Aggrieved by the said order, the complainant  preferred the appeal contending that the Dist. Forum did not appreciate the facts  or law in correct perspective.  It had failed to see that he was paying the instalments regularly as per the scheme and in view of  arrest of the Managing Director he could not pay the remaining instalments.   There was no person to receive the amount.    In fact the respondent had received the  amounts even after lapse of  three consecutive instalments, and therefore it cannot turn round and forfeit the amount.    Even now he is ready to pay the balance  and  therefore prayed that the appeal be allowed.

7)                The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

8)                It is an undisputed fact that the appellant floated a scheme  wherein the complainant had become a member  for purchase of plots of 120 sq.yds each.   It is also not in dispute  the complainant in all paid Rs. 1,66,000/- as  mentioned earlier evidenced  from statement of account Ex. B2 maintained  by  the  very respondent and receipts  Exs. A2 to A4.    The fact remains that the   respondent though promised under clause-5  of  the scheme did not  grow six teak plants and six fruit plants and hand over the same  on completion of 50 instalments.   He had offered the payment options as under :  (a)     52 months  instalment scheme.

Cost of the 120 sq.yd unit in 52 months  instalment scheme is Rs. 36,000/- this includes   the monthly instalment of Rs. 400/- along with special instalments of Rs. 1000/-  in first month, Rs. 1,400/-  each  in 5^th, 10^th, 15^th, 20^th, 25^th, 30^th, 35^th  & 40^th  months and Rs. 3,000/- in 50^th month respectively.  Those who pay  50^th month special  instalment in advance will become eligible to get unit  reservation and those who pay all special instalments in advance  will become  eligible to get sale agreement.    Unit reservation for the members who fails to pay 2 instalments  in succession will stands cancelled.

(b)      Out right payment.         

Cost of the 120 sq.yds  unit for those who pay lump sum amount in joining month will be Rs. 30,000/-.

( c)     Equal monthly instalments : (EMI)

Cost of the 120 sq.yds  unit is Rs. 36,000/-, Rs. 6,000/- special instalment  to be paid in  1^st month, balance can be paid in equal  monthly instalments in 50 months i.e., Rs. 600/- per month  beginning with first month.  Members opting  this system  are eligible for unit reservation.    Unit reservation for the members who  fails to pay 2 instalments in succession will stands cancelled.

          Clause 10 stipulates:

10.               Those who pay monthly instalments and special instalments  regularly  as per clause 7(a) or 7(c)  will be included  in the monthly draw.    Eery month draw will be conducted  on next month’s  2^nd working day in presence of attended members  in our central office.   The winner of draw will be exempted from payment  of future  instalments.    Those who pay unit  reservation  amount will  participate  in special & bumper draws with  attractive prizes.  Winners of bumper and special draws will be given prizes only after completion  of  their regular  and total payment.    The members with cl.7(b)  option will also participate  in monthly, bumper and special draws.   In case of their  winning a  monthly unit draw difference amount will be calculated  as per cl. 7(a)  and such difference  amount (if any)  will be returned  them without  any interest.    The members with Cl.7(d)  option will also participate  in monthly, bumper & special draws.     Members can choose to retain the unit, get it registered  on his name or he can totally surrender his unit to the company  and in return can take  exactly  double of the amount which he paid in the joining month.  Member joining  with this option will become eligible  in all draws.   

In case  of member winning monthly unit draw, company will calculate the eligibility amount up to that  particular month as per scheme counting period,  return the balance amount  without any interest, however in this case buy back option will be applicable only for the amount which company retains  with it.    Member has to pay instalments  as per his  month of joining.  In all matters of draws such  as mode, eligibility, place and time etc.,  company is authorised  to do any type of alterations and modifications.  However the decision of the company will be final and binding  on members in all matters  of draws.    One membership No. is  entitled to participate  in a maximum of 52 successive  monthly draws.   All draw winners  have to pay the government taxes as per the law. 

In clause-11 there was a stipulation  that   “An interest  of 2%  per month  should be  paid  by the member  on the dues if any.  If instalments are  not paid for 3 months in succession management reserves  its right  to cancel membership  without any prior notice.    The amount paid till then, will not be returned under  any circumstances.    After cancellation  of membership, any person will totally becomes  ineligible  for any sort of rights, benefits and facilities under this scheme. 

9)                Coming to the facts the complainant had paid  Rs. 1,66,000/-  and he had to pay balance of Rs. 3,73,000/- by July, 2004.    It is not in dispute that  the very Managing Director of the  company was arrested  in a murder case.    The complainant alleges that  nobody was there  to receive the amount  and the company was in doll drums.    After the respondent got  bail, he approached for payment of balance of amount, however, he did not agree.    The respondent stated in his affidavit “The arrest of Managing  Director  of opposite party took place in the month of July, 2005.  Even prior to registration of criminal case and arrest of Managing Director  of the opposite party the complainant  has committed default in payment of instalments.”  When the complainant has been making payments,   the respondent has been taking without any demur.   From this it is  beyond that  when the parties had waived  the period of payment  and had option, which we have mentioned above, the respondent cannot turn round and say that  the complainant had committed default in  payment of instalments  by due dates.    When he has no compunction  to receive money paid periodically,   in  lump sum, he cannot rely the conditions   in order to deny the benefit.   

10)              It is important to note that  the respondent did not allege as to when he was released  and who in his absence  was looking after the affairs of the company and unhindered   his company has been executing the  registered  sale  deeds  for  those  persons  who  had  paid  the    amounts. There is no proof that any draw was conducted in any of the months.    He could not show the members  who had benefited from the draws.  The complainant having paid the amount and was ready and willing to pay balance there was no reason  for the respondent   not to honour his promise.    If  really there was default,  he could have  collected interest  which was stipulated in the terms and conditions.    He cannot  abdicate   his duty in receiving the amount and executing  the  registered sale deeds.    The respondent except  repeated version  could not show that he had planted the trees,   and due to default of the complainant in payment of the amount, he could not execute sale deeds.    It may be stated herein that  there was no clause of  forfeiture.    What all he stated  was that the amount paid would not be  re-paid in case of default.    There is no specific clause  of forfeiture. 

11)                The complainant could prove that the respondent  unjustifiably  repudiated the contract.     He did nothing  except receiving the amounts  as and when  it suited  him.     Despite the fact that he was in jail  and no amounts could have been paid to him still  he contends that  he could forfeit  the amount  without agreeing to register the plots by taking balance of sale consideration.  He himself admits that  there was hike in prices of immovable properties in and around Hyderabad and the complainant had filed the complaint belatedly  seeking execution of sale deed.    The very same reason would apply to him.    He had been  refusing  to  execute registered sale deeds as he intends to get the benefit by selling them to third parties.     However at this length of time  and  in view of the fact  that it is not known  as to what happened  to those plots, and evidently no trees are planted, we do not intend the respondent to execute registered sale deeds, instead  we  feel that  ordering refund of the amount  with interest would meet the ends of justice. 

12)              In the result the appeal is allowed in part   setting aside the order of the Dist. Forum.  Consequently the complaint is allowed in part  directing the respondent to  refund Rs. 1,66,500/-  within interest  @ 9% p.a., from the date of  filing of complaint  till the date of  realization  together with costs of Rs. 5,000/-.  Time for compliance four weeks. 

1)      _______________________________

PRESIDENT                 

2)      ________________________________

 MEMBER           

   Dt.  02.  11.   2010.

*pnr

“UP LOAD – O.K.”