COMPLAINT FILED: 01.06.2011

                                      DISPOSED ON: 10.11.2011.

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE (URBAN)

10^th  DAY OF NOVEMBER 2011

  PRESENT :-  SRI. B.S. REDDY            PRESIDENT

                     SMT. M. YASHODHAMMA   MEMBER                   

                     SRI.M.MUNIYAPPA               MEMBER  

COMPLAINT NO. 927/2011

O R D E R

SMT. M. YASHODHAMMA, MEMBER

This is a complaint filed u/s. 12 of the Consumer Protection Act of 1986 by the complainant seeking direction against the Opposite Party 1 & 2 (herein after called as O.P) to execute the sale deed in respect of allotted site bearing No.10127 and to hand over the possession of the same or in alternative O.P.1 to refund Rs.76,472 with interest at 18% p.a. and compensation of Rs.2 lakhs and costs  on the allegations of deficiency in service on the part of the OPs.

2.     The brief averments made in the complaint are as follows:

        Attracted by the scheme offered by O.Ps. Complainant became the member of O.P.1 House Building Co-op. Society and OP2 welfare society. OP1 is engaged in forming of residential layout and sites.  OP accepted the membership of the complainant on 11/01/1985 and allotted Roll No. 10127 to the complainant.  Complainant paid Rs.76,472/- on different dates to O.Ps.  Complainant paid Rs.250/- on 11/1/1985 as service charges, Rs.10,000/- on 11/01/1985 .  Rs.250/- and Rs.10,000/- on 13/5/1985 to O.P.2.  On 18/4/1986 Rs.10,472/- to O.P.1.  Rs.10,000/- on 15/01/1986 and Rs.250/- on 21/5/1987 to O.P.2.  Rs.15,000/- to OP1 and Rs.250/- on 28/7/1988 to OP2, Rs.2,000 to OP2 on 15.03.1994 and Rs.18,000/- to O.P.1 on 4/4/1994.  O.P.1 issued provisional allotment letter dated 19/4/1986 to the complainant allotting a site measuring 4000 Sq.ft. situated at Bannergatta housing project consisting a Devara Chikkanahalli, Kodi Chikkanahalli, Honga Sandra, and Arakere Villages.  Vide its letter dated 1/6/1994.  O.P.  assured the complainant to hand over the possession of the site within 3 months.  Complainant through his letter dated 20/12/2010 enquired OP regarding status of the layout scheme.  OP in its reply dated 2/2/2011 repeated the same assurance that they are in the process of acquiring land through Government. They are not liable to pay interest.  Complainant vide his letter dated 16/2/2011 requested OP to refund the amount with interest at 18% p.a. O.P.2 in its reply dated 23/2/2011 directed the complainant to approach O.P.1 for refund. The complainant requested OP1 to refund the amount. OP1 in its reply dt.15.03.2011agreed to refund only the amount paid but not the interest. Since 26 years OP failed to register the site or to refund the amount in spite of repeated requests. Hence complainant felt deficiency in service against Op. Under the circumstances, he is advised to file this complaint against OP for the necessary reliefs.

3. On appearance OP1 filed the version mainly contending that OP1 could not purchase the lands under the prevailing laws. OP has to approach the state government to initiate land acquisition proceedings which involves gazette notification U/s. 4(1) of the Act to hold enquiries of the land owners U/s. 5-A of the Act and to issue final notification U/s. 6(1) of the act and thereafter to pass award granting compensation to the land owners u/s. 9 and 10 of the act. One being consent of land owners and another being the general award. After the procedure the state government will hand over possession of the land to society within 3 to 4 years.  The entire cost including payment to land owner and conversion charges and another expenses incurred should be paid by the society to the government.  The land acquired by the government in favour of the society was challenged by the land owners before the High Court. Unfortunately acquisition proceedings were set aside and notification were quashed.  The Appeal preferred by OP before Hon’ble Supreme Court confirmed the order of the high court.  Further directed the government to return the lands to land owners. OP has to get back the money from the government. Government   will   deduct   22%   of   the   amount towards Administrative heads. Hence OP is not in a position to pay the interest to its members. In AIR 2010 SC 486 it was held that developmental authorities need not pay interest on the deposit amount for the delay or failure of the projects due to the order of the courts; OP1 admits receipt of RS.69,000/- from the complainant. The claim is barred by time. Among other grounds OP prayed for a direction to the complainant to receive the sital deposit amount and prayed for dismissal of the complaint.

4. OP2 filed the version admitting the complaint averments, OP2 contended that it was formed for the benefit of the staff of the Syndicate Bank. It was the predecessor of OP2. It was ceased to exist in 1988 and same was changed to that of OP2. OP2 is not a housing society but a welfare society and social service organization. OP2 remitted the amount to OP1 amount collected towards donations shall form part of corpus of the society and cannot be refunded. Op2 prayed for dismissal of the complaint.

5. In order to substantiate the complaint averments, complainant filed his affidavit evidence and produced notice of OP. Receipts issued by OP 1 & 2, correspondences and reply letter. OP1 failed to file its affidavit evidence in support of its defence version in spite of giving sufficient opportunity. On behalf of Op2 U.S.A.Nayak, Secretary filed his affidavit evidence in support of its defence version. OPs not produced any documents. Complainant filed his written arguments.

6. Heard arguments from complainant side and taken as heard from OPs side.

7. In view of the above said facts the points now that arise for our consideration in this complaint are as under:

               Point No.1:-  Whether the complainant

   proved the deficiency in service

    on the part of the OPs?

Point No.2:-   If so, whether the complainant is

                     entitled for the reliefs now claimed?

      Point No.3:-  To what Order?

8. We have gone through the pleadings of the parties both oral and documentary evidence and the arguments advanced. In view of the reasons given by us in the following paragraphs our findings on:

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

9. At the out set it is not in dispute that the complainant became the member of the OPs society 1 & 2. On the basis of the propaganda made by the OP1 who claims to be the house building Co-Operative society with a hope of getting a site. OP1 assured to allot a site measuring 4000 sq ft. situated at  Bannergatta Housing Project consisting of Devara Chickkanahalli, Kodi-Chikkanahalli, Hongasandra and Arasikere villages. Complainant paid Rs.76,472/- to OP1 and 2 towards sital value on different dates starting from 11.01.1985 to 04.04.1994. To substantiate this fact complainant has produced the copy of the letter issued by Op and receipts issued by OPs 1 & 2, provisional allotment letter dt.19.04.1986 allotting a site measuring 4000 Sq.ft at the above mentioned project OP1 admits receipt of amount of Rs.69,000/- towards sital value. It is contended by OP2 that it being a welfare society amount received towards donation cannot be refunded which form part of the corpus of the society and whatever amount received by OP2 is being remitted to OP1. Complainant had produced receipts to substantiate the payments of Rs.76,472/- to OPs. OPs failed to register the site or to refund the amount as assured. Hence complainant approached this Forum for the necessary relief.

10. As against the case of the complainant the defence of the OP1 that due to legal hurdles it is unable to complete the project and whatever the amount they have received from the members is paid to the developers and deposited towards compensation payable to landlords with the government etc. But OP has failed to substantiate the said defence by producing documents. The land acquired for the purpose of formation of layout is repossessed by the land owners in view of the quashing of the land acquisition proceedings.  So the sum and substance of the defence set out by OP is that it is unable to complete the project due to the quashing of the land acquisition proceedings.  It is unable to refund the sital value to the complainant because of the said amounts are used for paying compensation to the land owners by depositing the same with the government and for paying development expenses.

11.On the close scrutiny of the defence set out by OP1 it can be made out that OP collected the amount towards sital value from the complainant with a promise that it would complete the project and register the site but project could not be completed on account of the acquisition being quashed. When OP was aware of the fact that it is unable to complete the project, it could have been fair on its part to refund the sital value collected to the complainant. No such steps are taken. Hence we find deficiency in service on the part of the OP in not refunding the sital value to the complainant. Having retained the amount for more than 16 years OP1 accrued wrongful gain to itself and thereby caused wrongful loss to the complainant.

12.We are unable to accept the defence of the OP that the complaint is barred by limitation. When once OP accepted the deposit towards sital value with a promise to allot a site to the complainant, till OPs allot and register the sale deed recurring cause of action will accrue to the complainants.

13.In support of his arguments counsel appearing for OP has  relied on Order reported in AIR 2010 Supreme Court 486 in Civil Appeal No. 433, 4335 and 4336/2004 of Punjab Urban Planning and development Authority and Another V/s. Daya Singh.

        In the above matter the Hon’ble Supreme Court has observed that possession could not be delivered in time to respondents in respect of the plots on account of the order passed by the High Court of Punjab and Haryana directing maintenance of status quo regarding possession. Hence it was found that delay was on account of the order passed by the High Court.  So the question of payment of interest for such delayed possession given to the respective respondents may not arise at all and directed the National Commission to take up the issue then decide the same on facts before passing the final order.

14. In the present proceedings acquisition proceedings were quashed by the Hon’ble High Court of Karnataka in W.P. No.17429 to 17493/1986 and the said order was confirmed by the Supreme Court in the Special Leave petition filed by OP. Thereafter even after lapse of many years of the order of the Supreme Court OP has failed to refund the amount to the complainants.  Hence the principles laid down in the above case cannot be made applicable to the present proceedings

15.   The relief claimed by the complainant is for registration of sale deed in respect of allotted site bearing No.10127 and physical possession. Op1 has failed to form the layout. In the absence of any materials that the layout is formed, conversion order and sanction plan has been obtained by statutory authorities, Vacant site is available free from encumbrances as on today at the disposal of OP1, we cannot consider the relief claimed by complainant. Hence complainant is entitled for the alternate relief of refund of amount paid along with interest at the rate of 18% p.a. and litigation cost of Rs.2,000/-.

16.   Complainant has not claimed any relief against Op2.Hence complaint against OP2 is liable to be dismissed.

In view of the order passed by the Hon’ble Karnataka State Consumer Disputes Redressal Commission in Appeal No.5041/2010 dt.19.08.2011 in similar circumstances against OP modified the order passed by the first Additional District Consumer Forum in CC.No.2201/2010 dt.16.11.2010 directing OP to refund the amount paid towards sital value together with interest at the rate of 18% p.a. from the date of respective payments till realization. Hence based on the said order we are of the considered view that complainant is entitled for refund of amount paid along with interest at the rate of 18% p.a. as compensation from the date of respective payment till realization and cost of Rs.2,000/-. Accordingly we proceed to pass the following:

ORDER

          The complaint is allowed in part.  OP1 is directed to refund Rs.76,472/- along with interest at the rate of 18% p.a from the date of respective payment till realization and pay litigation cost of Rs.2,000/- to the complainant.

               Complaint against OP2 dismissed.

This order is to be complied within four weeks from the date of its communication.

Send the copy of this order both the parties free of cost.

(Dictated to the Stenographer and typed in the computer and transcribed by her verified and corrected, and then pronounced in the Open Court by us on this the 10^th day of November 2011.)

MEMBER                         MEMBER                  PRESIDENT                   

CS.