COMPLAINT FILED ON: 02.03.2010
DISPOSED ON: 15.06.2011
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)
15TH DAY OF JUNE-2011
PRESENT:- SRI. B.S. REDDY PRESIDENT
SMT. M. YASHODHAMMA MEMBER
SRI. A. MUNIYAPPA MEMBER
COMPLAINT No.440/2010
Complainant OPPOSITE PARTY | Sri Atyam Lakshmi Raja Vamshi, No.A-15, Owners Court Layout, Kasavanahalli, Off Sarjapur Road, Near Amrithamayi Engg. College, Bangalore – 560 035. Permanent Resident and Care of Sri A. Vasudev Rao, Rathnam’s Tanuku, W.G. District, Andhra Pradesh – 534 211. Rep: By its Power of Attorney Holder, Sri Atyam Vasudeva Rao. Advocate: Sri. M.S. Ashwin Kumar & Others V/s. M/s Skyline Construction & Housing Ltd., No.11, Hayes Road, Bangalore – 560 025. Rep: by its Director. Advocate: Sri. M.V. Sundararaman & others. |
O R D E R S
SRI. B.S. REDDY, PRESIDENT
The complainant filed this complaint U/s. 12 of the Consumer Protection Act of 1986, seeking direction against the Opposite Party (herein after called as O.P.) to refund an amount of Rs.9,95,500/- with interest at 21% p.a. and to pay compensation of Rs.1,44,000/- for the loss of rent along with litigation costs on the allegations of deficiency in service on the part of the OP.
2. The case of the complainants is to be stated in brief is that:
The complainant based an advertisement and information provided by OP applied for allotment of apartment with the OP and paid sum of Rs.9,95,500/- towards advance payment for booking flat at Skyline Orange County Project, located at Kanakapura Road, Bangalore. The payments were made through cheques drawn on 27.11.2006 and OP has acknowledged the receipt of the amounts under receipt dated 01.12.2006. OP confirmed the allotment of an apartment through a letter of allotment dated 27.01.2007, wherein the complainant was allotted a three bed room apartment on the 12th floor. At the time of allotment it was promised by OP that the commencement of the project would take place during October / November – 2007. However though time elapsed, the project never took off OP went on promising that the project would commence shortly. The date of commencement of the project was being postponed inordinately on one pretext or the other. The fact even as on today, the project is yet to take off as promised by OP and inspite of lapse of time. The complainant requested OP to cancel the booking and to adjust the amount paid towards allotment of another apartment in the same locality of the Skyline Project, but to no avail. OP is not keeping up with its commitment, in taking up of the construction project and completing the same on time, has driven the complainant to irreparable loss and hardship besides undergoing mental agony. If the project had commenced and the flats as promised had been allotted to the complainant, the complainant would have received sum of Rs.12,000/- rent per month. Thus the complainant sustained loss of Rs.1,44,000/- per year, which OP is liable to make good. Legal notice issued to OP calling upon to comply with the contents of the notice. OP has not complied, but an untenable reply has been issued by OP. The complainant is neither in a position to go in for an alternative dwelling or make any other suitable arrangement as the huge amount has been struck, without earning any interest. OP is guilty of negligence and deficiency in service. Hence the complaint.
3. On appearance, OP filed the version contending that the complaint is not maintainable; the same is liable to be dismissed. OP has not rendered any service to the complainant; the complaint does not make out any case for deficiency of service. It is stated that based on brand equity and market credibility of the OP in the real estate development industry, the complainant came through the real estate agent Mr. A.V.R. Chowdary, a common contact between the complainant and OP, with the sole intention of investing in any of the future projects of OP. Acting upon such common intention of investment, the OP decided to scout for property available in the market for development on joint development basis and finalized the property bearing Sy. No.9/1 situated in Uttarahalli Manavarthe Kavalu Village, Bangalore South Taluk, for development of the same into a residential project known as “Skyline Orange Country” for the mutual beneficial interest of land owners and themselves in general and in particular the beneficial investment interest of innumerable investors whose assurance of the investment for the sole criteria for the OP venturing into the said project. The complainant was desirous of investing in OP’s project namely “Skyline Orange Country”. Accordingly the complainant paid sum of Rs.9,95,000/- as investment in the said project. The complainant never intended to be a customer / consumer of the OP. On the insistence of the complainant, OP issued an allotment letter only to acknowledge the investment money so paid by the complainant. The complainant was not intending to purchase any flat and as he had invested the amount in the OP’s project, no brochures, payment schedules were provided to him. The allotment letter provided to the complainant neither mentions as to which flat is being allotment to him nor is there any schedule for building of the flats annexed to the said allotment letter as is normally done in case of bookings / allotments made in projects officially launched by the OP. The project in question is only a pre-launch booking to the complainant as similar to other investors in the group of investors which forms very basis of taking up the said project by OP. The complainant is not a “consumer” within the meaning of Section 2(1)(d) of C.P. Act. The complainant has approached this Forum claiming refund of investment money, the complaint is not maintainable. OP relying on investment of the investors, had infused large amount of money, men, expertise and infrastructure for securing conversion of property from agricultural to non agricultural residential purpose and for conceptualization, design and development of the project. The complainant was happy to await construction of the apartment complex so that he could get valuable returns as and when market was favourable. Having participated in the risk, the complainant is not entitled to withdraw from the project at his will. The transaction being commercial transaction between the complainant and OP, the complaint cannot be entertained by this Forum. OP had never allotted any flat whatsoever to the complainant. It is on the insistence of the complainant, details like the floor and square feet of the apartment was mentioned in the said allotment letter. The averment that the complainant has neither been allotted an apartment nor has the amount along with interest been returned is admitted as true. As the complainant was one of the investors, no apartment was allotted to him and he could not seek refund of the said amount with interest. The complainant has allegedly canceled the booking only on the ground that the market price of land in the said area had decreased owing to recession. The assertion of the complainant that the construction in the project never started is denied as false. The claim of the complainant that he would have received Rs.12,000/- per month an the monthly rental is denied as false. It is admitted that OP did not comply with the demands sought in the legal notice, as the said demands were baseless and unreasonable. The complainant has not suffered any loss or injury and there is no cause of action for filing the complaint. Hence it is prayed to dismiss the complaint with exemplary costs.
4. In order to substantiate the complaint averments, the power of attorney holder of the complainant filed affidavit evidence. The Managing Director of OP filed affidavit evidence in support of defence version. The interrogatories delivered by OP are replied by the complainant.
5. The complainant filed Memo with copies of the Orders passed in complaint Nos.75/2010 to 77/2010 against the same OP in similar complaints filed on the file of 2nd Additional District Consumer Disputes Redressal Forum, Bangalore. The appeals filed against the said orders before the Hon’ble State Consumer Disputes Redressal Commission, Bangalore in appeal No.4122/2010 and 4124/2010 were dismissed confirming the order of the District Forum. The copy of the orders in appeal No.4122 and 4124/2010 is produced along with written arguments of the complainant.
6. Both the parties filed written arguments. Arguments on both sides heard. Points for consideration are:
Point No.1:- Whether the complainant has proved
the deficiency in service on the part of
the OP?
Point No.2:- Whether the complainant is entitled
for the reliefs claimed?
Point No.3:- To what Order?
7. We record our findings on the above points:
Point No.1:- In Affirmative.
Point No.2:- Affirmative in part.
Point No.3:- As per final Order.
R E A S O N S
8. At the outset it is not at dispute that the complainant applied for allotment of apartment with the OP at “Skyline Orange County” Project, at Kanakapura Road, Bangalore and paid sum of Rs.9,95,5000/- through cheques on 01.12.2006. The OP has issued receipts, acknowledging the receipt of the said amount. The OP confirmed the allotment of the apartment through a letter of allotment dt.27.01.2007 wherein the complainant was allotted three bed room apartment on the 12th floor. The complainant claims that at the time of allotment it was promised by the OP that the commencement of the project would take place during October/November-2007. The OP postponed inordinately on one pretext or the other, the commencement of the project till date project is yet to take off as promised by the OP in spite of lapse of time. Therefore, the complainant cancelled the booking of the apartment, sought for refund of the amount paid with interest.
9. There is no merit in the contention of the OP that the complainant never intended to purchase any apartment, he has invested the amount of Rs.9,95,500/- only as an investment in the project. The allotment letter dt.21.07.2007 issued by the OP clearly states that the OP has allotted three BHK apartment on 12th floor in Skyline Project, the flat cost, car park cost is mentioned, it is sated that the project is in the design stage, any change in the design, layout is at the sole discretion of the developer and the same will be adhered to buy the buyer. Further, it is stated that agreement will be entered into on receiving all sanctions applicable, in the event of the transferring the allotment of the apartment prior to the date of registration a transfer fee of Rs.75 per square feet is to be paid. From this allotment letter it is crystal clear that the OP has allotted three bed rooms apartment on 12th floor of the project. If at all the amount was paid as an investment, there was no need of issuing such allotment letter. Merely because no agreement deed has been entered into between the parties stipulating the terms and conditions, payment schedule of the remaining amount stipulating the time for completion of the project, it cannot be said that the complainant paid that amount only as an investment in the project. The principles laid down in I(2010) CPJ 121 Secretary Rourkela Development Authority V/s General Secretary Rourkela Consumers Front holding that:- Merely depositing earnest money for allotment land or house does not make a person consumer, cannot be made applicable to the facts of the case. The amount paid was by way of advance amount and it was not an earnest money for allotment of the apartment. The OP has specifically mentioned the area of the apartment and the floor on which the same is allotted to the complainant. Thus it cannot be said that the complainant is not a consumer and there is no any service of OP availed. The OP on assurance of completing the project and delivering the possession of the apartment has received the advance amount of Rs.9,95,500/- from the complainant. Even we are unable to accept the contention of the OP that the complainant intended to earn profit by selling the same apartment on a higher cost to others, as such it is a commercial transaction. There is no material to hold that the complainant has invested this amount with a view to earn profit by sale of the same apartment to some other on higher cost.
10. Though there is no material with regard to the time fixed for completion of the project and the commencement of the same but from the affidavit evidence of the PA Holder of the complainant, it is clear that the OP has promised the commencement of the project during October/November-2007. It is pertinent to note that till date OP has not commenced the project and no material is placed with regard to the commencement of the project. The amount was paid on 01.12.2006, in spite of lapse of more than 4 years the OP has not commenced the project. The complainant cannot be made to wait indefinitely for completion of the project. Therefore, the complainant was justified in cancelling the booking of the apartment and seeking the refund of the amount paid. It is true that in the interrogatories supplied by the OP, the complainant has admitted that there is no time specified for construction of the project in the letter of allotment but from that itself it cannot be said that the OP can post pone the commencement of the project indefinitely. In the allotment letter no time is specified for construction of the project but the OP should have commenced the project within a reasonable time even if it was not possible to commence the project in the month of October/Novermber-2007. The principles laid down in AIR 2007 SC 2198 Bangalore Development Authority V/s Syndicate Bank wherein it was held that “where no time is stipulated for performance of the contract or where time is not the essence of the contract and the buyer does not issue notice making time the essence by fixing reasonable time for performance, if the buyer instead of rescinding in the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute”. The said principles cannot be made applicable as the complainant has not accepted the belated performance in terms of the contract. On the other hand, the complainant has rescinded the contract on the ground of non-performance and cancelled the booking and sought for refund of the amount paid.
11. Further, the contention of the OP that the OP is entitled to forfeit the earnest amount paid by the complainant as per the principles laid down in AIR 1996 SC 1981 HUDA V/s Kawal Krishna Goile cannot be accepted for the reason that there is no any agreement entered into between the parties stipulating the terms and conditions so as to invoke the default clause regarding balance amount payable. The OP has not at all commenced the project, the question of forfeiting the deposit amount paid by the complainant does not arise for consideration. Under these circumstances, we are of the view that the failure of the OP in commencing the project or refunding amount paid as advance amounts to deficiency in service on the part of the OP.
12. The complainant has claimed an amount of Rs.1,44,000/- per year as a loss suffered on the ground that had the apartment was completed the complainant would have received monthly rent by letting the same for Rs.12,000/-. In our view the project itself is not commenced, and there is no document stipulating the terms and conditions with regard to completion of the project within certain time in default the OP to pay monthly certain sum towards loss of rental income. Under these circumstances, the complainant is not entitled for the said sum Rs.1,44,000/-.
13. Similar complaints filed against same OP in complaint No.75/2010 to 77/2010 are already allowed and the Hon’ble State Commission has confirmed the orders in appeal No.4122/2010 and 4124/2010. In the written arguments of the OP at Para-15 it is stated that the complaint No.26/2009 was filed against the OP on similar facts before this 4th additional District Consumer Disputes Redressal Forum, Bangalore and the same was allowed directing the OP to pay complainant sum of Rs.4,75,000/- with interest at 18% p.a. from the date of legal notice till date of realization. Aggrieved by the said order an appeal NO.1574/2010 was filed before the Hon’ble State Commission. The Hon’ble State Commission dismissed the said appeal, against the said order it is stated that appeal is preferred before the Hon’ble National Consumer Disputes Redressal Commission and the matter has admitted and execution proceedings initiated is stayed. The OP has not produced any material in support of the said contention. However, it becomes clear that similar complaint filed before the 4th Additional District Consumer Forum has been allowed and the Hon’ble State Commission has been confirmed the said order. Taking into consideration of all the facts and circumstances, we are of the view that the complainant is entitled for refund of the amount paid with interest at 12% p.a. from the date of deposit till the date of realization along with litigation cost of Rs.5,000/-. Accordingly we proceed to pass the following:
O R D E R
The complaint filed by the complainants is allowed in part. OP is directed to refund an amount of Rs.9,95,500/- with interest at 12% p.a. from 01.12.2006 till the date of realization and pay litigation cost of Rs.5,000/- to the complainants.
This order is to be complied within four weeks from the date of this order.
Send the copy of this order to both the parties free of cost.
(Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 15th day of June- 2011.)
MEMBER MEMBER PRESIDENT
Cs:
COMPLAINT FILED ON: 02.03.2010
DISPOSED ON: 15.06.2011
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)
15TH DAY OF JUNE-2011
PRESENT:- SRI. B.S. REDDY PRESIDENT
SMT. M. YASHODHAMMA MEMBER
SRI. A. MUNIYAPPA MEMBER
COMPLAINT No.440/2010
Complainant OPPOSITE PARTY | Sri Atyam Lakshmi Raja Vamshi, No.A-15, Owners Court Layout, Kasavanahalli, Off Sarjapur Road, Near Amrithamayi Engg. College, Bangalore – 560 035. Permanent Resident and Care of Sri A. Vasudev Rao, Rathnam’s Tanuku, W.G. District, Andhra Pradesh – 534 211. Rep: By its Power of Attorney Holder, Sri Atyam Vasudeva Rao. Advocate: Sri. M.S. Ashwin Kumar & Others V/s. M/s Skyline Construction & Housing Ltd., No.11, Hayes Road, Bangalore – 560 025. Rep: by its Director. Advocate: Sri. M.V. Sundararaman & others. |
O R D E R S
SRI. B.S. REDDY, PRESIDENT
The complainant filed this complaint U/s. 12 of the Consumer Protection Act of 1986, seeking direction against the Opposite Party (herein after called as O.P.) to refund an amount of Rs.9,95,500/- with interest at 21% p.a. and to pay compensation of Rs.1,44,000/- for the loss of rent along with litigation costs on the allegations of deficiency in service on the part of the OP.
2. The case of the complainants is to be stated in brief is that:
The complainant based an advertisement and information provided by OP applied for allotment of apartment with the OP and paid sum of Rs.9,95,500/- towards advance payment for booking flat at Skyline Orange County Project, located at Kanakapura Road, Bangalore. The payments were made through cheques drawn on 27.11.2006 and OP has acknowledged the receipt of the amounts under receipt dated 01.12.2006. OP confirmed the allotment of an apartment through a letter of allotment dated 27.01.2007, wherein the complainant was allotted a three bed room apartment on the 12th floor. At the time of allotment it was promised by OP that the commencement of the project would take place during October / November – 2007. However though time elapsed, the project never took off OP went on promising that the project would commence shortly. The date of commencement of the project was being postponed inordinately on one pretext or the other. The fact even as on today, the project is yet to take off as promised by OP and inspite of lapse of time. The complainant requested OP to cancel the booking and to adjust the amount paid towards allotment of another apartment in the same locality of the Skyline Project, but to no avail. OP is not keeping up with its commitment, in taking up of the construction project and completing the same on time, has driven the complainant to irreparable loss and hardship besides undergoing mental agony. If the project had commenced and the flats as promised had been allotted to the complainant, the complainant would have received sum of Rs.12,000/- rent per month. Thus the complainant sustained loss of Rs.1,44,000/- per year, which OP is liable to make good. Legal notice issued to OP calling upon to comply with the contents of the notice. OP has not complied, but an untenable reply has been issued by OP. The complainant is neither in a position to go in for an alternative dwelling or make any other suitable arrangement as the huge amount has been struck, without earning any interest. OP is guilty of negligence and deficiency in service. Hence the complaint.
3. On appearance, OP filed the version contending that the complaint is not maintainable; the same is liable to be dismissed. OP has not rendered any service to the complainant; the complaint does not make out any case for deficiency of service. It is stated that based on brand equity and market credibility of the OP in the real estate development industry, the complainant came through the real estate agent Mr. A.V.R. Chowdary, a common contact between the complainant and OP, with the sole intention of investing in any of the future projects of OP. Acting upon such common intention of investment, the OP decided to scout for property available in the market for development on joint development basis and finalized the property bearing Sy. No.9/1 situated in Uttarahalli Manavarthe Kavalu Village, Bangalore South Taluk, for development of the same into a residential project known as “Skyline Orange Country” for the mutual beneficial interest of land owners and themselves in general and in particular the beneficial investment interest of innumerable investors whose assurance of the investment for the sole criteria for the OP venturing into the said project. The complainant was desirous of investing in OP’s project namely “Skyline Orange Country”. Accordingly the complainant paid sum of Rs.9,95,000/- as investment in the said project. The complainant never intended to be a customer / consumer of the OP. On the insistence of the complainant, OP issued an allotment letter only to acknowledge the investment money so paid by the complainant. The complainant was not intending to purchase any flat and as he had invested the amount in the OP’s project, no brochures, payment schedules were provided to him. The allotment letter provided to the complainant neither mentions as to which flat is being allotment to him nor is there any schedule for building of the flats annexed to the said allotment letter as is normally done in case of bookings / allotments made in projects officially launched by the OP. The project in question is only a pre-launch booking to the complainant as similar to other investors in the group of investors which forms very basis of taking up the said project by OP. The complainant is not a “consumer” within the meaning of Section 2(1)(d) of C.P. Act. The complainant has approached this Forum claiming refund of investment money, the complaint is not maintainable. OP relying on investment of the investors, had infused large amount of money, men, expertise and infrastructure for securing conversion of property from agricultural to non agricultural residential purpose and for conceptualization, design and development of the project. The complainant was happy to await construction of the apartment complex so that he could get valuable returns as and when market was favourable. Having participated in the risk, the complainant is not entitled to withdraw from the project at his will. The transaction being commercial transaction between the complainant and OP, the complaint cannot be entertained by this Forum. OP had never allotted any flat whatsoever to the complainant. It is on the insistence of the complainant, details like the floor and square feet of the apartment was mentioned in the said allotment letter. The averment that the complainant has neither been allotted an apartment nor has the amount along with interest been returned is admitted as true. As the complainant was one of the investors, no apartment was allotted to him and he could not seek refund of the said amount with interest. The complainant has allegedly canceled the booking only on the ground that the market price of land in the said area had decreased owing to recession. The assertion of the complainant that the construction in the project never started is denied as false. The claim of the complainant that he would have received Rs.12,000/- per month an the monthly rental is denied as false. It is admitted that OP did not comply with the demands sought in the legal notice, as the said demands were baseless and unreasonable. The complainant has not suffered any loss or injury and there is no cause of action for filing the complaint. Hence it is prayed to dismiss the complaint with exemplary costs.
4. In order to substantiate the complaint averments, the power of attorney holder of the complainant filed affidavit evidence. The Managing Director of OP filed affidavit evidence in support of defence version. The interrogatories delivered by OP are replied by the complainant.
5. The complainant filed Memo with copies of the Orders passed in complaint Nos.75/2010 to 77/2010 against the same OP in similar complaints filed on the file of 2nd Additional District Consumer Disputes Redressal Forum, Bangalore. The appeals filed against the said orders before the Hon’ble State Consumer Disputes Redressal Commission, Bangalore in appeal No.4122/2010 and 4124/2010 were dismissed confirming the order of the District Forum. The copy of the orders in appeal No.4122 and 4124/2010 is produced along with written arguments of the complainant.
6. Both the parties filed written arguments. Arguments on both sides heard. Points for consideration are:
Point No.1:- Whether the complainant has proved
the deficiency in service on the part of
the OP?
Point No.2:- Whether the complainant is entitled
for the reliefs claimed?
Point No.3:- To what Order?
7. We record our findings on the above points:
Point No.1:- In Affirmative.
Point No.2:- Affirmative in part.
Point No.3:- As per final Order.
R E A S O N S
8. At the outset it is not at dispute that the complainant applied for allotment of apartment with the OP at “Skyline Orange County” Project, at Kanakapura Road, Bangalore and paid sum of Rs.9,95,5000/- through cheques on 01.12.2006. The OP has issued receipts, acknowledging the receipt of the said amount. The OP confirmed the allotment of the apartment through a letter of allotment dt.27.01.2007 wherein the complainant was allotted three bed room apartment on the 12th floor. The complainant claims that at the time of allotment it was promised by the OP that the commencement of the project would take place during October/November-2007. The OP postponed inordinately on one pretext or the other, the commencement of the project till date project is yet to take off as promised by the OP in spite of lapse of time. Therefore, the complainant cancelled the booking of the apartment, sought for refund of the amount paid with interest.
9. There is no merit in the contention of the OP that the complainant never intended to purchase any apartment, he has invested the amount of Rs.9,95,500/- only as an investment in the project. The allotment letter dt.21.07.2007 issued by the OP clearly states that the OP has allotted three BHK apartment on 12th floor in Skyline Project, the flat cost, car park cost is mentioned, it is sated that the project is in the design stage, any change in the design, layout is at the sole discretion of the developer and the same will be adhered to buy the buyer. Further, it is stated that agreement will be entered into on receiving all sanctions applicable, in the event of the transferring the allotment of the apartment prior to the date of registration a transfer fee of Rs.75 per square feet is to be paid. From this allotment letter it is crystal clear that the OP has allotted three bed rooms apartment on 12th floor of the project. If at all the amount was paid as an investment, there was no need of issuing such allotment letter. Merely because no agreement deed has been entered into between the parties stipulating the terms and conditions, payment schedule of the remaining amount stipulating the time for completion of the project, it cannot be said that the complainant paid that amount only as an investment in the project. The principles laid down in I(2010) CPJ 121 Secretary Rourkela Development Authority V/s General Secretary Rourkela Consumers Front holding that:- Merely depositing earnest money for allotment land or house does not make a person consumer, cannot be made applicable to the facts of the case. The amount paid was by way of advance amount and it was not an earnest money for allotment of the apartment. The OP has specifically mentioned the area of the apartment and the floor on which the same is allotted to the complainant. Thus it cannot be said that the complainant is not a consumer and there is no any service of OP availed. The OP on assurance of completing the project and delivering the possession of the apartment has received the advance amount of Rs.9,95,500/- from the complainant. Even we are unable to accept the contention of the OP that the complainant intended to earn profit by selling the same apartment on a higher cost to others, as such it is a commercial transaction. There is no material to hold that the complainant has invested this amount with a view to earn profit by sale of the same apartment to some other on higher cost.
10. Though there is no material with regard to the time fixed for completion of the project and the commencement of the same but from the affidavit evidence of the PA Holder of the complainant, it is clear that the OP has promised the commencement of the project during October/November-2007. It is pertinent to note that till date OP has not commenced the project and no material is placed with regard to the commencement of the project. The amount was paid on 01.12.2006, in spite of lapse of more than 4 years the OP has not commenced the project. The complainant cannot be made to wait indefinitely for completion of the project. Therefore, the complainant was justified in cancelling the booking of the apartment and seeking the refund of the amount paid. It is true that in the interrogatories supplied by the OP, the complainant has admitted that there is no time specified for construction of the project in the letter of allotment but from that itself it cannot be said that the OP can post pone the commencement of the project indefinitely. In the allotment letter no time is specified for construction of the project but the OP should have commenced the project within a reasonable time even if it was not possible to commence the project in the month of October/Novermber-2007. The principles laid down in AIR 2007 SC 2198 Bangalore Development Authority V/s Syndicate Bank wherein it was held that “where no time is stipulated for performance of the contract or where time is not the essence of the contract and the buyer does not issue notice making time the essence by fixing reasonable time for performance, if the buyer instead of rescinding in the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute”. The said principles cannot be made applicable as the complainant has not accepted the belated performance in terms of the contract. On the other hand, the complainant has rescinded the contract on the ground of non-performance and cancelled the booking and sought for refund of the amount paid.
11. Further, the contention of the OP that the OP is entitled to forfeit the earnest amount paid by the complainant as per the principles laid down in AIR 1996 SC 1981 HUDA V/s Kawal Krishna Goile cannot be accepted for the reason that there is no any agreement entered into between the parties stipulating the terms and conditions so as to invoke the default clause regarding balance amount payable. The OP has not at all commenced the project, the question of forfeiting the deposit amount paid by the complainant does not arise for consideration. Under these circumstances, we are of the view that the failure of the OP in commencing the project or refunding amount paid as advance amounts to deficiency in service on the part of the OP.
12. The complainant has claimed an amount of Rs.1,44,000/- per year as a loss suffered on the ground that had the apartment was completed the complainant would have received monthly rent by letting the same for Rs.12,000/-. In our view the project itself is not commenced, and there is no document stipulating the terms and conditions with regard to completion of the project within certain time in default the OP to pay monthly certain sum towards loss of rental income. Under these circumstances, the complainant is not entitled for the said sum Rs.1,44,000/-.
13. Similar complaints filed against same OP in complaint No.75/2010 to 77/2010 are already allowed and the Hon’ble State Commission has confirmed the orders in appeal No.4122/2010 and 4124/2010. In the written arguments of the OP at Para-15 it is stated that the complaint No.26/2009 was filed against the OP on similar facts before this 4th additional District Consumer Disputes Redressal Forum, Bangalore and the same was allowed directing the OP to pay complainant sum of Rs.4,75,000/- with interest at 18% p.a. from the date of legal notice till date of realization. Aggrieved by the said order an appeal NO.1574/2010 was filed before the Hon’ble State Commission. The Hon’ble State Commission dismissed the said appeal, against the said order it is stated that appeal is preferred before the Hon’ble National Consumer Disputes Redressal Commission and the matter has admitted and execution proceedings initiated is stayed. The OP has not produced any material in support of the said contention. However, it becomes clear that similar complaint filed before the 4th Additional District Consumer Forum has been allowed and the Hon’ble State Commission has been confirmed the said order. Taking into consideration of all the facts and circumstances, we are of the view that the complainant is entitled for refund of the amount paid with interest at 12% p.a. from the date of deposit till the date of realization along with litigation cost of Rs.5,000/-. Accordingly we proceed to pass the following:
O R D E R
The complaint filed by the complainants is allowed in part. OP is directed to refund an amount of Rs.9,95,500/- with interest at 12% p.a. from 01.12.2006 till the date of realization and pay litigation cost of Rs.5,000/- to the complainants.
This order is to be complied within four weeks from the date of this order.
Send the copy of this order to both the parties free of cost.
(Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 15th day of June- 2011.)
MEMBER MEMBER PRESIDENT
Cs:
COMPLAINT FILED ON: 02.03.2010
DISPOSED ON: 15.06.2011
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)
15TH DAY OF JUNE-2011
PRESENT:- SRI. B.S. REDDY PRESIDENT
SMT. M. YASHODHAMMA MEMBER
SRI. A. MUNIYAPPA MEMBER
COMPLAINT No.440/2010
Complainant OPPOSITE PARTY | Sri Atyam Lakshmi Raja Vamshi, No.A-15, Owners Court Layout, Kasavanahalli, Off Sarjapur Road, Near Amrithamayi Engg. College, Bangalore – 560 035. Permanent Resident and Care of Sri A. Vasudev Rao, Rathnam’s Tanuku, W.G. District, Andhra Pradesh – 534 211. Rep: By its Power of Attorney Holder, Sri Atyam Vasudeva Rao. Advocate: Sri. M.S. Ashwin Kumar & Others V/s. M/s Skyline Construction & Housing Ltd., No.11, Hayes Road, Bangalore – 560 025. Rep: by its Director. Advocate: Sri. M.V. Sundararaman & others. |
O R D E R S
SRI. B.S. REDDY, PRESIDENT
The complainant filed this complaint U/s. 12 of the Consumer Protection Act of 1986, seeking direction against the Opposite Party (herein after called as O.P.) to refund an amount of Rs.9,95,500/- with interest at 21% p.a. and to pay compensation of Rs.1,44,000/- for the loss of rent along with litigation costs on the allegations of deficiency in service on the part of the OP.
2. The case of the complainants is to be stated in brief is that:
The complainant based an advertisement and information provided by OP applied for allotment of apartment with the OP and paid sum of Rs.9,95,500/- towards advance payment for booking flat at Skyline Orange County Project, located at Kanakapura Road, Bangalore. The payments were made through cheques drawn on 27.11.2006 and OP has acknowledged the receipt of the amounts under receipt dated 01.12.2006. OP confirmed the allotment of an apartment through a letter of allotment dated 27.01.2007, wherein the complainant was allotted a three bed room apartment on the 12th floor. At the time of allotment it was promised by OP that the commencement of the project would take place during October / November – 2007. However though time elapsed, the project never took off OP went on promising that the project would commence shortly. The date of commencement of the project was being postponed inordinately on one pretext or the other. The fact even as on today, the project is yet to take off as promised by OP and inspite of lapse of time. The complainant requested OP to cancel the booking and to adjust the amount paid towards allotment of another apartment in the same locality of the Skyline Project, but to no avail. OP is not keeping up with its commitment, in taking up of the construction project and completing the same on time, has driven the complainant to irreparable loss and hardship besides undergoing mental agony. If the project had commenced and the flats as promised had been allotted to the complainant, the complainant would have received sum of Rs.12,000/- rent per month. Thus the complainant sustained loss of Rs.1,44,000/- per year, which OP is liable to make good. Legal notice issued to OP calling upon to comply with the contents of the notice. OP has not complied, but an untenable reply has been issued by OP. The complainant is neither in a position to go in for an alternative dwelling or make any other suitable arrangement as the huge amount has been struck, without earning any interest. OP is guilty of negligence and deficiency in service. Hence the complaint.
3. On appearance, OP filed the version contending that the complaint is not maintainable; the same is liable to be dismissed. OP has not rendered any service to the complainant; the complaint does not make out any case for deficiency of service. It is stated that based on brand equity and market credibility of the OP in the real estate development industry, the complainant came through the real estate agent Mr. A.V.R. Chowdary, a common contact between the complainant and OP, with the sole intention of investing in any of the future projects of OP. Acting upon such common intention of investment, the OP decided to scout for property available in the market for development on joint development basis and finalized the property bearing Sy. No.9/1 situated in Uttarahalli Manavarthe Kavalu Village, Bangalore South Taluk, for development of the same into a residential project known as “Skyline Orange Country” for the mutual beneficial interest of land owners and themselves in general and in particular the beneficial investment interest of innumerable investors whose assurance of the investment for the sole criteria for the OP venturing into the said project. The complainant was desirous of investing in OP’s project namely “Skyline Orange Country”. Accordingly the complainant paid sum of Rs.9,95,000/- as investment in the said project. The complainant never intended to be a customer / consumer of the OP. On the insistence of the complainant, OP issued an allotment letter only to acknowledge the investment money so paid by the complainant. The complainant was not intending to purchase any flat and as he had invested the amount in the OP’s project, no brochures, payment schedules were provided to him. The allotment letter provided to the complainant neither mentions as to which flat is being allotment to him nor is there any schedule for building of the flats annexed to the said allotment letter as is normally done in case of bookings / allotments made in projects officially launched by the OP. The project in question is only a pre-launch booking to the complainant as similar to other investors in the group of investors which forms very basis of taking up the said project by OP. The complainant is not a “consumer” within the meaning of Section 2(1)(d) of C.P. Act. The complainant has approached this Forum claiming refund of investment money, the complaint is not maintainable. OP relying on investment of the investors, had infused large amount of money, men, expertise and infrastructure for securing conversion of property from agricultural to non agricultural residential purpose and for conceptualization, design and development of the project. The complainant was happy to await construction of the apartment complex so that he could get valuable returns as and when market was favourable. Having participated in the risk, the complainant is not entitled to withdraw from the project at his will. The transaction being commercial transaction between the complainant and OP, the complaint cannot be entertained by this Forum. OP had never allotted any flat whatsoever to the complainant. It is on the insistence of the complainant, details like the floor and square feet of the apartment was mentioned in the said allotment letter. The averment that the complainant has neither been allotted an apartment nor has the amount along with interest been returned is admitted as true. As the complainant was one of the investors, no apartment was allotted to him and he could not seek refund of the said amount with interest. The complainant has allegedly canceled the booking only on the ground that the market price of land in the said area had decreased owing to recession. The assertion of the complainant that the construction in the project never started is denied as false. The claim of the complainant that he would have received Rs.12,000/- per month an the monthly rental is denied as false. It is admitted that OP did not comply with the demands sought in the legal notice, as the said demands were baseless and unreasonable. The complainant has not suffered any loss or injury and there is no cause of action for filing the complaint. Hence it is prayed to dismiss the complaint with exemplary costs.
4. In order to substantiate the complaint averments, the power of attorney holder of the complainant filed affidavit evidence. The Managing Director of OP filed affidavit evidence in support of defence version. The interrogatories delivered by OP are replied by the complainant.
5. The complainant filed Memo with copies of the Orders passed in complaint Nos.75/2010 to 77/2010 against the same OP in similar complaints filed on the file of 2nd Additional District Consumer Disputes Redressal Forum, Bangalore. The appeals filed against the said orders before the Hon’ble State Consumer Disputes Redressal Commission, Bangalore in appeal No.4122/2010 and 4124/2010 were dismissed confirming the order of the District Forum. The copy of the orders in appeal No.4122 and 4124/2010 is produced along with written arguments of the complainant.
6. Both the parties filed written arguments. Arguments on both sides heard. Points for consideration are:
Point No.1:- Whether the complainant has proved
the deficiency in service on the part of
the OP?
Point No.2:- Whether the complainant is entitled
for the reliefs claimed?
Point No.3:- To what Order?
7. We record our findings on the above points:
Point No.1:- In Affirmative.
Point No.2:- Affirmative in part.
Point No.3:- As per final Order.
R E A S O N S
8. At the outset it is not at dispute that the complainant applied for allotment of apartment with the OP at “Skyline Orange County” Project, at Kanakapura Road, Bangalore and paid sum of Rs.9,95,5000/- through cheques on 01.12.2006. The OP has issued receipts, acknowledging the receipt of the said amount. The OP confirmed the allotment of the apartment through a letter of allotment dt.27.01.2007 wherein the complainant was allotted three bed room apartment on the 12th floor. The complainant claims that at the time of allotment it was promised by the OP that the commencement of the project would take place during October/November-2007. The OP postponed inordinately on one pretext or the other, the commencement of the project till date project is yet to take off as promised by the OP in spite of lapse of time. Therefore, the complainant cancelled the booking of the apartment, sought for refund of the amount paid with interest.
9. There is no merit in the contention of the OP that the complainant never intended to purchase any apartment, he has invested the amount of Rs.9,95,500/- only as an investment in the project. The allotment letter dt.21.07.2007 issued by the OP clearly states that the OP has allotted three BHK apartment on 12th floor in Skyline Project, the flat cost, car park cost is mentioned, it is sated that the project is in the design stage, any change in the design, layout is at the sole discretion of the developer and the same will be adhered to buy the buyer. Further, it is stated that agreement will be entered into on receiving all sanctions applicable, in the event of the transferring the allotment of the apartment prior to the date of registration a transfer fee of Rs.75 per square feet is to be paid. From this allotment letter it is crystal clear that the OP has allotted three bed rooms apartment on 12th floor of the project. If at all the amount was paid as an investment, there was no need of issuing such allotment letter. Merely because no agreement deed has been entered into between the parties stipulating the terms and conditions, payment schedule of the remaining amount stipulating the time for completion of the project, it cannot be said that the complainant paid that amount only as an investment in the project. The principles laid down in I(2010) CPJ 121 Secretary Rourkela Development Authority V/s General Secretary Rourkela Consumers Front holding that:- Merely depositing earnest money for allotment land or house does not make a person consumer, cannot be made applicable to the facts of the case. The amount paid was by way of advance amount and it was not an earnest money for allotment of the apartment. The OP has specifically mentioned the area of the apartment and the floor on which the same is allotted to the complainant. Thus it cannot be said that the complainant is not a consumer and there is no any service of OP availed. The OP on assurance of completing the project and delivering the possession of the apartment has received the advance amount of Rs.9,95,500/- from the complainant. Even we are unable to accept the contention of the OP that the complainant intended to earn profit by selling the same apartment on a higher cost to others, as such it is a commercial transaction. There is no material to hold that the complainant has invested this amount with a view to earn profit by sale of the same apartment to some other on higher cost.
10. Though there is no material with regard to the time fixed for completion of the project and the commencement of the same but from the affidavit evidence of the PA Holder of the complainant, it is clear that the OP has promised the commencement of the project during October/November-2007. It is pertinent to note that till date OP has not commenced the project and no material is placed with regard to the commencement of the project. The amount was paid on 01.12.2006, in spite of lapse of more than 4 years the OP has not commenced the project. The complainant cannot be made to wait indefinitely for completion of the project. Therefore, the complainant was justified in cancelling the booking of the apartment and seeking the refund of the amount paid. It is true that in the interrogatories supplied by the OP, the complainant has admitted that there is no time specified for construction of the project in the letter of allotment but from that itself it cannot be said that the OP can post pone the commencement of the project indefinitely. In the allotment letter no time is specified for construction of the project but the OP should have commenced the project within a reasonable time even if it was not possible to commence the project in the month of October/Novermber-2007. The principles laid down in AIR 2007 SC 2198 Bangalore Development Authority V/s Syndicate Bank wherein it was held that “where no time is stipulated for performance of the contract or where time is not the essence of the contract and the buyer does not issue notice making time the essence by fixing reasonable time for performance, if the buyer instead of rescinding in the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute”. The said principles cannot be made applicable as the complainant has not accepted the belated performance in terms of the contract. On the other hand, the complainant has rescinded the contract on the ground of non-performance and cancelled the booking and sought for refund of the amount paid.
11. Further, the contention of the OP that the OP is entitled to forfeit the earnest amount paid by the complainant as per the principles laid down in AIR 1996 SC 1981 HUDA V/s Kawal Krishna Goile cannot be accepted for the reason that there is no any agreement entered into between the parties stipulating the terms and conditions so as to invoke the default clause regarding balance amount payable. The OP has not at all commenced the project, the question of forfeiting the deposit amount paid by the complainant does not arise for consideration. Under these circumstances, we are of the view that the failure of the OP in commencing the project or refunding amount paid as advance amounts to deficiency in service on the part of the OP.
12. The complainant has claimed an amount of Rs.1,44,000/- per year as a loss suffered on the ground that had the apartment was completed the complainant would have received monthly rent by letting the same for Rs.12,000/-. In our view the project itself is not commenced, and there is no document stipulating the terms and conditions with regard to completion of the project within certain time in default the OP to pay monthly certain sum towards loss of rental income. Under these circumstances, the complainant is not entitled for the said sum Rs.1,44,000/-.
13. Similar complaints filed against same OP in complaint No.75/2010 to 77/2010 are already allowed and the Hon’ble State Commission has confirmed the orders in appeal No.4122/2010 and 4124/2010. In the written arguments of the OP at Para-15 it is stated that the complaint No.26/2009 was filed against the OP on similar facts before this 4th additional District Consumer Disputes Redressal Forum, Bangalore and the same was allowed directing the OP to pay complainant sum of Rs.4,75,000/- with interest at 18% p.a. from the date of legal notice till date of realization. Aggrieved by the said order an appeal NO.1574/2010 was filed before the Hon’ble State Commission. The Hon’ble State Commission dismissed the said appeal, against the said order it is stated that appeal is preferred before the Hon’ble National Consumer Disputes Redressal Commission and the matter has admitted and execution proceedings initiated is stayed. The OP has not produced any material in support of the said contention. However, it becomes clear that similar complaint filed before the 4th Additional District Consumer Forum has been allowed and the Hon’ble State Commission has been confirmed the said order. Taking into consideration of all the facts and circumstances, we are of the view that the complainant is entitled for refund of the amount paid with interest at 12% p.a. from the date of deposit till the date of realization along with litigation cost of Rs.5,000/-. Accordingly we proceed to pass the following:
O R D E R
The complaint filed by the complainants is allowed in part. OP is directed to refund an amount of Rs.9,95,500/- with interest at 12% p.a. from 01.12.2006 till the date of realization and pay litigation cost of Rs.5,000/- to the complainants.
This order is to be complied within four weeks from the date of this order.
Send the copy of this order to both the parties free of cost.
(Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 15th day of June- 2011.)
MEMBER MEMBER PRESIDENT
Cs:
COMPLAINT FILED ON: 02.03.2010
DISPOSED ON: 15.06.2011
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)
15TH DAY OF JUNE-2011
PRESENT:- SRI. B.S. REDDY PRESIDENT
SMT. M. YASHODHAMMA MEMBER
SRI. A. MUNIYAPPA MEMBER
COMPLAINT No.440/2010
Complainant OPPOSITE PARTY | Sri Atyam Lakshmi Raja Vamshi, No.A-15, Owners Court Layout, Kasavanahalli, Off Sarjapur Road, Near Amrithamayi Engg. College, Bangalore – 560 035. Permanent Resident and Care of Sri A. Vasudev Rao, Rathnam’s Tanuku, W.G. District, Andhra Pradesh – 534 211. Rep: By its Power of Attorney Holder, Sri Atyam Vasudeva Rao. Advocate: Sri. M.S. Ashwin Kumar & Others V/s. M/s Skyline Construction & Housing Ltd., No.11, Hayes Road, Bangalore – 560 025. Rep: by its Director. Advocate: Sri. M.V. Sundararaman & others. |
O R D E R S
SRI. B.S. REDDY, PRESIDENT
The complainant filed this complaint U/s. 12 of the Consumer Protection Act of 1986, seeking direction against the Opposite Party (herein after called as O.P.) to refund an amount of Rs.9,95,500/- with interest at 21% p.a. and to pay compensation of Rs.1,44,000/- for the loss of rent along with litigation costs on the allegations of deficiency in service on the part of the OP.
2. The case of the complainants is to be stated in brief is that:
The complainant based an advertisement and information provided by OP applied for allotment of apartment with the OP and paid sum of Rs.9,95,500/- towards advance payment for booking flat at Skyline Orange County Project, located at Kanakapura Road, Bangalore. The payments were made through cheques drawn on 27.11.2006 and OP has acknowledged the receipt of the amounts under receipt dated 01.12.2006. OP confirmed the allotment of an apartment through a letter of allotment dated 27.01.2007, wherein the complainant was allotted a three bed room apartment on the 12th floor. At the time of allotment it was promised by OP that the commencement of the project would take place during October / November – 2007. However though time elapsed, the project never took off OP went on promising that the project would commence shortly. The date of commencement of the project was being postponed inordinately on one pretext or the other. The fact even as on today, the project is yet to take off as promised by OP and inspite of lapse of time. The complainant requested OP to cancel the booking and to adjust the amount paid towards allotment of another apartment in the same locality of the Skyline Project, but to no avail. OP is not keeping up with its commitment, in taking up of the construction project and completing the same on time, has driven the complainant to irreparable loss and hardship besides undergoing mental agony. If the project had commenced and the flats as promised had been allotted to the complainant, the complainant would have received sum of Rs.12,000/- rent per month. Thus the complainant sustained loss of Rs.1,44,000/- per year, which OP is liable to make good. Legal notice issued to OP calling upon to comply with the contents of the notice. OP has not complied, but an untenable reply has been issued by OP. The complainant is neither in a position to go in for an alternative dwelling or make any other suitable arrangement as the huge amount has been struck, without earning any interest. OP is guilty of negligence and deficiency in service. Hence the complaint.
3. On appearance, OP filed the version contending that the complaint is not maintainable; the same is liable to be dismissed. OP has not rendered any service to the complainant; the complaint does not make out any case for deficiency of service. It is stated that based on brand equity and market credibility of the OP in the real estate development industry, the complainant came through the real estate agent Mr. A.V.R. Chowdary, a common contact between the complainant and OP, with the sole intention of investing in any of the future projects of OP. Acting upon such common intention of investment, the OP decided to scout for property available in the market for development on joint development basis and finalized the property bearing Sy. No.9/1 situated in Uttarahalli Manavarthe Kavalu Village, Bangalore South Taluk, for development of the same into a residential project known as “Skyline Orange Country” for the mutual beneficial interest of land owners and themselves in general and in particular the beneficial investment interest of innumerable investors whose assurance of the investment for the sole criteria for the OP venturing into the said project. The complainant was desirous of investing in OP’s project namely “Skyline Orange Country”. Accordingly the complainant paid sum of Rs.9,95,000/- as investment in the said project. The complainant never intended to be a customer / consumer of the OP. On the insistence of the complainant, OP issued an allotment letter only to acknowledge the investment money so paid by the complainant. The complainant was not intending to purchase any flat and as he had invested the amount in the OP’s project, no brochures, payment schedules were provided to him. The allotment letter provided to the complainant neither mentions as to which flat is being allotment to him nor is there any schedule for building of the flats annexed to the said allotment letter as is normally done in case of bookings / allotments made in projects officially launched by the OP. The project in question is only a pre-launch booking to the complainant as similar to other investors in the group of investors which forms very basis of taking up the said project by OP. The complainant is not a “consumer” within the meaning of Section 2(1)(d) of C.P. Act. The complainant has approached this Forum claiming refund of investment money, the complaint is not maintainable. OP relying on investment of the investors, had infused large amount of money, men, expertise and infrastructure for securing conversion of property from agricultural to non agricultural residential purpose and for conceptualization, design and development of the project. The complainant was happy to await construction of the apartment complex so that he could get valuable returns as and when market was favourable. Having participated in the risk, the complainant is not entitled to withdraw from the project at his will. The transaction being commercial transaction between the complainant and OP, the complaint cannot be entertained by this Forum. OP had never allotted any flat whatsoever to the complainant. It is on the insistence of the complainant, details like the floor and square feet of the apartment was mentioned in the said allotment letter. The averment that the complainant has neither been allotted an apartment nor has the amount along with interest been returned is admitted as true. As the complainant was one of the investors, no apartment was allotted to him and he could not seek refund of the said amount with interest. The complainant has allegedly canceled the booking only on the ground that the market price of land in the said area had decreased owing to recession. The assertion of the complainant that the construction in the project never started is denied as false. The claim of the complainant that he would have received Rs.12,000/- per month an the monthly rental is denied as false. It is admitted that OP did not comply with the demands sought in the legal notice, as the said demands were baseless and unreasonable. The complainant has not suffered any loss or injury and there is no cause of action for filing the complaint. Hence it is prayed to dismiss the complaint with exemplary costs.
4. In order to substantiate the complaint averments, the power of attorney holder of the complainant filed affidavit evidence. The Managing Director of OP filed affidavit evidence in support of defence version. The interrogatories delivered by OP are replied by the complainant.
5. The complainant filed Memo with copies of the Orders passed in complaint Nos.75/2010 to 77/2010 against the same OP in similar complaints filed on the file of 2nd Additional District Consumer Disputes Redressal Forum, Bangalore. The appeals filed against the said orders before the Hon’ble State Consumer Disputes Redressal Commission, Bangalore in appeal No.4122/2010 and 4124/2010 were dismissed confirming the order of the District Forum. The copy of the orders in appeal No.4122 and 4124/2010 is produced along with written arguments of the complainant.
6. Both the parties filed written arguments. Arguments on both sides heard. Points for consideration are:
Point No.1:- Whether the complainant has proved
the deficiency in service on the part of
the OP?
Point No.2:- Whether the complainant is entitled
for the reliefs claimed?
Point No.3:- To what Order?
7. We record our findings on the above points:
Point No.1:- In Affirmative.
Point No.2:- Affirmative in part.
Point No.3:- As per final Order.
R E A S O N S
8. At the outset it is not at dispute that the complainant applied for allotment of apartment with the OP at “Skyline Orange County” Project, at Kanakapura Road, Bangalore and paid sum of Rs.9,95,5000/- through cheques on 01.12.2006. The OP has issued receipts, acknowledging the receipt of the said amount. The OP confirmed the allotment of the apartment through a letter of allotment dt.27.01.2007 wherein the complainant was allotted three bed room apartment on the 12th floor. The complainant claims that at the time of allotment it was promised by the OP that the commencement of the project would take place during October/November-2007. The OP postponed inordinately on one pretext or the other, the commencement of the project till date project is yet to take off as promised by the OP in spite of lapse of time. Therefore, the complainant cancelled the booking of the apartment, sought for refund of the amount paid with interest.
9. There is no merit in the contention of the OP that the complainant never intended to purchase any apartment, he has invested the amount of Rs.9,95,500/- only as an investment in the project. The allotment letter dt.21.07.2007 issued by the OP clearly states that the OP has allotted three BHK apartment on 12th floor in Skyline Project, the flat cost, car park cost is mentioned, it is sated that the project is in the design stage, any change in the design, layout is at the sole discretion of the developer and the same will be adhered to buy the buyer. Further, it is stated that agreement will be entered into on receiving all sanctions applicable, in the event of the transferring the allotment of the apartment prior to the date of registration a transfer fee of Rs.75 per square feet is to be paid. From this allotment letter it is crystal clear that the OP has allotted three bed rooms apartment on 12th floor of the project. If at all the amount was paid as an investment, there was no need of issuing such allotment letter. Merely because no agreement deed has been entered into between the parties stipulating the terms and conditions, payment schedule of the remaining amount stipulating the time for completion of the project, it cannot be said that the complainant paid that amount only as an investment in the project. The principles laid down in I(2010) CPJ 121 Secretary Rourkela Development Authority V/s General Secretary Rourkela Consumers Front holding that:- Merely depositing earnest money for allotment land or house does not make a person consumer, cannot be made applicable to the facts of the case. The amount paid was by way of advance amount and it was not an earnest money for allotment of the apartment. The OP has specifically mentioned the area of the apartment and the floor on which the same is allotted to the complainant. Thus it cannot be said that the complainant is not a consumer and there is no any service of OP availed. The OP on assurance of completing the project and delivering the possession of the apartment has received the advance amount of Rs.9,95,500/- from the complainant. Even we are unable to accept the contention of the OP that the complainant intended to earn profit by selling the same apartment on a higher cost to others, as such it is a commercial transaction. There is no material to hold that the complainant has invested this amount with a view to earn profit by sale of the same apartment to some other on higher cost.
10. Though there is no material with regard to the time fixed for completion of the project and the commencement of the same but from the affidavit evidence of the PA Holder of the complainant, it is clear that the OP has promised the commencement of the project during October/November-2007. It is pertinent to note that till date OP has not commenced the project and no material is placed with regard to the commencement of the project. The amount was paid on 01.12.2006, in spite of lapse of more than 4 years the OP has not commenced the project. The complainant cannot be made to wait indefinitely for completion of the project. Therefore, the complainant was justified in cancelling the booking of the apartment and seeking the refund of the amount paid. It is true that in the interrogatories supplied by the OP, the complainant has admitted that there is no time specified for construction of the project in the letter of allotment but from that itself it cannot be said that the OP can post pone the commencement of the project indefinitely. In the allotment letter no time is specified for construction of the project but the OP should have commenced the project within a reasonable time even if it was not possible to commence the project in the month of October/Novermber-2007. The principles laid down in AIR 2007 SC 2198 Bangalore Development Authority V/s Syndicate Bank wherein it was held that “where no time is stipulated for performance of the contract or where time is not the essence of the contract and the buyer does not issue notice making time the essence by fixing reasonable time for performance, if the buyer instead of rescinding in the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute”. The said principles cannot be made applicable as the complainant has not accepted the belated performance in terms of the contract. On the other hand, the complainant has rescinded the contract on the ground of non-performance and cancelled the booking and sought for refund of the amount paid.
11. Further, the contention of the OP that the OP is entitled to forfeit the earnest amount paid by the complainant as per the principles laid down in AIR 1996 SC 1981 HUDA V/s Kawal Krishna Goile cannot be accepted for the reason that there is no any agreement entered into between the parties stipulating the terms and conditions so as to invoke the default clause regarding balance amount payable. The OP has not at all commenced the project, the question of forfeiting the deposit amount paid by the complainant does not arise for consideration. Under these circumstances, we are of the view that the failure of the OP in commencing the project or refunding amount paid as advance amounts to deficiency in service on the part of the OP.
12. The complainant has claimed an amount of Rs.1,44,000/- per year as a loss suffered on the ground that had the apartment was completed the complainant would have received monthly rent by letting the same for Rs.12,000/-. In our view the project itself is not commenced, and there is no document stipulating the terms and conditions with regard to completion of the project within certain time in default the OP to pay monthly certain sum towards loss of rental income. Under these circumstances, the complainant is not entitled for the said sum Rs.1,44,000/-.
13. Similar complaints filed against same OP in complaint No.75/2010 to 77/2010 are already allowed and the Hon’ble State Commission has confirmed the orders in appeal No.4122/2010 and 4124/2010. In the written arguments of the OP at Para-15 it is stated that the complaint No.26/2009 was filed against the OP on similar facts before this 4th additional District Consumer Disputes Redressal Forum, Bangalore and the same was allowed directing the OP to pay complainant sum of Rs.4,75,000/- with interest at 18% p.a. from the date of legal notice till date of realization. Aggrieved by the said order an appeal NO.1574/2010 was filed before the Hon’ble State Commission. The Hon’ble State Commission dismissed the said appeal, against the said order it is stated that appeal is preferred before the Hon’ble National Consumer Disputes Redressal Commission and the matter has admitted and execution proceedings initiated is stayed. The OP has not produced any material in support of the said contention. However, it becomes clear that similar complaint filed before the 4th Additional District Consumer Forum has been allowed and the Hon’ble State Commission has been confirmed the said order. Taking into consideration of all the facts and circumstances, we are of the view that the complainant is entitled for refund of the amount paid with interest at 12% p.a. from the date of deposit till the date of realization along with litigation cost of Rs.5,000/-. Accordingly we proceed to pass the following:
O R D E R
The complaint filed by the complainants is allowed in part. OP is directed to refund an amount of Rs.9,95,500/- with interest at 12% p.a. from 01.12.2006 till the date of realization and pay litigation cost of Rs.5,000/- to the complainants.
This order is to be complied within four weeks from the date of this order.
Send the copy of this order to both the parties free of cost.
(Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 15th day of June- 2011.)
MEMBER MEMBER PRESIDENT
Cs:
COMPLAINT FILED ON: 02.03.2010
DISPOSED ON: 15.06.2011
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)
15TH DAY OF JUNE-2011
PRESENT:- SRI. B.S. REDDY PRESIDENT
SMT. M. YASHODHAMMA MEMBER
SRI. A. MUNIYAPPA MEMBER
COMPLAINT No.440/2010
Complainant OPPOSITE PARTY | Sri Atyam Lakshmi Raja Vamshi, No.A-15, Owners Court Layout, Kasavanahalli, Off Sarjapur Road, Near Amrithamayi Engg. College, Bangalore – 560 035. Permanent Resident and Care of Sri A. Vasudev Rao, Rathnam’s Tanuku, W.G. District, Andhra Pradesh – 534 211. Rep: By its Power of Attorney Holder, Sri Atyam Vasudeva Rao. Advocate: Sri. M.S. Ashwin Kumar & Others V/s. M/s Skyline Construction & Housing Ltd., No.11, Hayes Road, Bangalore – 560 025. Rep: by its Director. Advocate: Sri. M.V. Sundararaman & others. |
O R D E R S
SRI. B.S. REDDY, PRESIDENT
The complainant filed this complaint U/s. 12 of the Consumer Protection Act of 1986, seeking direction against the Opposite Party (herein after called as O.P.) to refund an amount of Rs.9,95,500/- with interest at 21% p.a. and to pay compensation of Rs.1,44,000/- for the loss of rent along with litigation costs on the allegations of deficiency in service on the part of the OP.
2. The case of the complainants is to be stated in brief is that:
The complainant based an advertisement and information provided by OP applied for allotment of apartment with the OP and paid sum of Rs.9,95,500/- towards advance payment for booking flat at Skyline Orange County Project, located at Kanakapura Road, Bangalore. The payments were made through cheques drawn on 27.11.2006 and OP has acknowledged the receipt of the amounts under receipt dated 01.12.2006. OP confirmed the allotment of an apartment through a letter of allotment dated 27.01.2007, wherein the complainant was allotted a three bed room apartment on the 12th floor. At the time of allotment it was promised by OP that the commencement of the project would take place during October / November – 2007. However though time elapsed, the project never took off OP went on promising that the project would commence shortly. The date of commencement of the project was being postponed inordinately on one pretext or the other. The fact even as on today, the project is yet to take off as promised by OP and inspite of lapse of time. The complainant requested OP to cancel the booking and to adjust the amount paid towards allotment of another apartment in the same locality of the Skyline Project, but to no avail. OP is not keeping up with its commitment, in taking up of the construction project and completing the same on time, has driven the complainant to irreparable loss and hardship besides undergoing mental agony. If the project had commenced and the flats as promised had been allotted to the complainant, the complainant would have received sum of Rs.12,000/- rent per month. Thus the complainant sustained loss of Rs.1,44,000/- per year, which OP is liable to make good. Legal notice issued to OP calling upon to comply with the contents of the notice. OP has not complied, but an untenable reply has been issued by OP. The complainant is neither in a position to go in for an alternative dwelling or make any other suitable arrangement as the huge amount has been struck, without earning any interest. OP is guilty of negligence and deficiency in service. Hence the complaint.
3. On appearance, OP filed the version contending that the complaint is not maintainable; the same is liable to be dismissed. OP has not rendered any service to the complainant; the complaint does not make out any case for deficiency of service. It is stated that based on brand equity and market credibility of the OP in the real estate development industry, the complainant came through the real estate agent Mr. A.V.R. Chowdary, a common contact between the complainant and OP, with the sole intention of investing in any of the future projects of OP. Acting upon such common intention of investment, the OP decided to scout for property available in the market for development on joint development basis and finalized the property bearing Sy. No.9/1 situated in Uttarahalli Manavarthe Kavalu Village, Bangalore South Taluk, for development of the same into a residential project known as “Skyline Orange Country” for the mutual beneficial interest of land owners and themselves in general and in particular the beneficial investment interest of innumerable investors whose assurance of the investment for the sole criteria for the OP venturing into the said project. The complainant was desirous of investing in OP’s project namely “Skyline Orange Country”. Accordingly the complainant paid sum of Rs.9,95,000/- as investment in the said project. The complainant never intended to be a customer / consumer of the OP. On the insistence of the complainant, OP issued an allotment letter only to acknowledge the investment money so paid by the complainant. The complainant was not intending to purchase any flat and as he had invested the amount in the OP’s project, no brochures, payment schedules were provided to him. The allotment letter provided to the complainant neither mentions as to which flat is being allotment to him nor is there any schedule for building of the flats annexed to the said allotment letter as is normally done in case of bookings / allotments made in projects officially launched by the OP. The project in question is only a pre-launch booking to the complainant as similar to other investors in the group of investors which forms very basis of taking up the said project by OP. The complainant is not a “consumer” within the meaning of Section 2(1)(d) of C.P. Act. The complainant has approached this Forum claiming refund of investment money, the complaint is not maintainable. OP relying on investment of the investors, had infused large amount of money, men, expertise and infrastructure for securing conversion of property from agricultural to non agricultural residential purpose and for conceptualization, design and development of the project. The complainant was happy to await construction of the apartment complex so that he could get valuable returns as and when market was favourable. Having participated in the risk, the complainant is not entitled to withdraw from the project at his will. The transaction being commercial transaction between the complainant and OP, the complaint cannot be entertained by this Forum. OP had never allotted any flat whatsoever to the complainant. It is on the insistence of the complainant, details like the floor and square feet of the apartment was mentioned in the said allotment letter. The averment that the complainant has neither been allotted an apartment nor has the amount along with interest been returned is admitted as true. As the complainant was one of the investors, no apartment was allotted to him and he could not seek refund of the said amount with interest. The complainant has allegedly canceled the booking only on the ground that the market price of land in the said area had decreased owing to recession. The assertion of the complainant that the construction in the project never started is denied as false. The claim of the complainant that he would have received Rs.12,000/- per month an the monthly rental is denied as false. It is admitted that OP did not comply with the demands sought in the legal notice, as the said demands were baseless and unreasonable. The complainant has not suffered any loss or injury and there is no cause of action for filing the complaint. Hence it is prayed to dismiss the complaint with exemplary costs.
4. In order to substantiate the complaint averments, the power of attorney holder of the complainant filed affidavit evidence. The Managing Director of OP filed affidavit evidence in support of defence version. The interrogatories delivered by OP are replied by the complainant.
5. The complainant filed Memo with copies of the Orders passed in complaint Nos.75/2010 to 77/2010 against the same OP in similar complaints filed on the file of 2nd Additional District Consumer Disputes Redressal Forum, Bangalore. The appeals filed against the said orders before the Hon’ble State Consumer Disputes Redressal Commission, Bangalore in appeal No.4122/2010 and 4124/2010 were dismissed confirming the order of the District Forum. The copy of the orders in appeal No.4122 and 4124/2010 is produced along with written arguments of the complainant.
6. Both the parties filed written arguments. Arguments on both sides heard. Points for consideration are:
Point No.1:- Whether the complainant has proved
the deficiency in service on the part of
the OP?
Point No.2:- Whether the complainant is entitled
for the reliefs claimed?
Point No.3:- To what Order?
7. We record our findings on the above points:
Point No.1:- In Affirmative.
Point No.2:- Affirmative in part.
Point No.3:- As per final Order.
R E A S O N S
8. At the outset it is not at dispute that the complainant applied for allotment of apartment with the OP at “Skyline Orange County” Project, at Kanakapura Road, Bangalore and paid sum of Rs.9,95,5000/- through cheques on 01.12.2006. The OP has issued receipts, acknowledging the receipt of the said amount. The OP confirmed the allotment of the apartment through a letter of allotment dt.27.01.2007 wherein the complainant was allotted three bed room apartment on the 12th floor. The complainant claims that at the time of allotment it was promised by the OP that the commencement of the project would take place during October/November-2007. The OP postponed inordinately on one pretext or the other, the commencement of the project till date project is yet to take off as promised by the OP in spite of lapse of time. Therefore, the complainant cancelled the booking of the apartment, sought for refund of the amount paid with interest.
9. There is no merit in the contention of the OP that the complainant never intended to purchase any apartment, he has invested the amount of Rs.9,95,500/- only as an investment in the project. The allotment letter dt.21.07.2007 issued by the OP clearly states that the OP has allotted three BHK apartment on 12th floor in Skyline Project, the flat cost, car park cost is mentioned, it is sated that the project is in the design stage, any change in the design, layout is at the sole discretion of the developer and the same will be adhered to buy the buyer. Further, it is stated that agreement will be entered into on receiving all sanctions applicable, in the event of the transferring the allotment of the apartment prior to the date of registration a transfer fee of Rs.75 per square feet is to be paid. From this allotment letter it is crystal clear that the OP has allotted three bed rooms apartment on 12th floor of the project. If at all the amount was paid as an investment, there was no need of issuing such allotment letter. Merely because no agreement deed has been entered into between the parties stipulating the terms and conditions, payment schedule of the remaining amount stipulating the time for completion of the project, it cannot be said that the complainant paid that amount only as an investment in the project. The principles laid down in I(2010) CPJ 121 Secretary Rourkela Development Authority V/s General Secretary Rourkela Consumers Front holding that:- Merely depositing earnest money for allotment land or house does not make a person consumer, cannot be made applicable to the facts of the case. The amount paid was by way of advance amount and it was not an earnest money for allotment of the apartment. The OP has specifically mentioned the area of the apartment and the floor on which the same is allotted to the complainant. Thus it cannot be said that the complainant is not a consumer and there is no any service of OP availed. The OP on assurance of completing the project and delivering the possession of the apartment has received the advance amount of Rs.9,95,500/- from the complainant. Even we are unable to accept the contention of the OP that the complainant intended to earn profit by selling the same apartment on a higher cost to others, as such it is a commercial transaction. There is no material to hold that the complainant has invested this amount with a view to earn profit by sale of the same apartment to some other on higher cost.
10. Though there is no material with regard to the time fixed for completion of the project and the commencement of the same but from the affidavit evidence of the PA Holder of the complainant, it is clear that the OP has promised the commencement of the project during October/November-2007. It is pertinent to note that till date OP has not commenced the project and no material is placed with regard to the commencement of the project. The amount was paid on 01.12.2006, in spite of lapse of more than 4 years the OP has not commenced the project. The complainant cannot be made to wait indefinitely for completion of the project. Therefore, the complainant was justified in cancelling the booking of the apartment and seeking the refund of the amount paid. It is true that in the interrogatories supplied by the OP, the complainant has admitted that there is no time specified for construction of the project in the letter of allotment but from that itself it cannot be said that the OP can post pone the commencement of the project indefinitely. In the allotment letter no time is specified for construction of the project but the OP should have commenced the project within a reasonable time even if it was not possible to commence the project in the month of October/Novermber-2007. The principles laid down in AIR 2007 SC 2198 Bangalore Development Authority V/s Syndicate Bank wherein it was held that “where no time is stipulated for performance of the contract or where time is not the essence of the contract and the buyer does not issue notice making time the essence by fixing reasonable time for performance, if the buyer instead of rescinding in the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute”. The said principles cannot be made applicable as the complainant has not accepted the belated performance in terms of the contract. On the other hand, the complainant has rescinded the contract on the ground of non-performance and cancelled the booking and sought for refund of the amount paid.
11. Further, the contention of the OP that the OP is entitled to forfeit the earnest amount paid by the complainant as per the principles laid down in AIR 1996 SC 1981 HUDA V/s Kawal Krishna Goile cannot be accepted for the reason that there is no any agreement entered into between the parties stipulating the terms and conditions so as to invoke the default clause regarding balance amount payable. The OP has not at all commenced the project, the question of forfeiting the deposit amount paid by the complainant does not arise for consideration. Under these circumstances, we are of the view that the failure of the OP in commencing the project or refunding amount paid as advance amounts to deficiency in service on the part of the OP.
12. The complainant has claimed an amount of Rs.1,44,000/- per year as a loss suffered on the ground that had the apartment was completed the complainant would have received monthly rent by letting the same for Rs.12,000/-. In our view the project itself is not commenced, and there is no document stipulating the terms and conditions with regard to completion of the project within certain time in default the OP to pay monthly certain sum towards loss of rental income. Under these circumstances, the complainant is not entitled for the said sum Rs.1,44,000/-.
13. Similar complaints filed against same OP in complaint No.75/2010 to 77/2010 are already allowed and the Hon’ble State Commission has confirmed the orders in appeal No.4122/2010 and 4124/2010. In the written arguments of the OP at Para-15 it is stated that the complaint No.26/2009 was filed against the OP on similar facts before this 4th additional District Consumer Disputes Redressal Forum, Bangalore and the same was allowed directing the OP to pay complainant sum of Rs.4,75,000/- with interest at 18% p.a. from the date of legal notice till date of realization. Aggrieved by the said order an appeal NO.1574/2010 was filed before the Hon’ble State Commission. The Hon’ble State Commission dismissed the said appeal, against the said order it is stated that appeal is preferred before the Hon’ble National Consumer Disputes Redressal Commission and the matter has admitted and execution proceedings initiated is stayed. The OP has not produced any material in support of the said contention. However, it becomes clear that similar complaint filed before the 4th Additional District Consumer Forum has been allowed and the Hon’ble State Commission has been confirmed the said order. Taking into consideration of all the facts and circumstances, we are of the view that the complainant is entitled for refund of the amount paid with interest at 12% p.a. from the date of deposit till the date of realization along with litigation cost of Rs.5,000/-. Accordingly we proceed to pass the following:
O R D E R
The complaint filed by the complainants is allowed in part. OP is directed to refund an amount of Rs.9,95,500/- with interest at 12% p.a. from 01.12.2006 till the date of realization and pay litigation cost of Rs.5,000/- to the complainants.
This order is to be complied within four weeks from the date of this order.
Send the copy of this order to both the parties free of cost.
(Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 15th day of June- 2011.)
MEMBER MEMBER PRESIDENT
Cs:
