JUSTICE V.K. JAIN, PRESIDING MEMBER (ORAL)

          Land measuring 2785 sq. mtr. bearing final plot no. 242, in Memnagar, T.P. Scheme no. 29 of Ahmedabad was owned by joint family of Sh. Mani Lal Maganlal Patel and Sh. Kali Das (hereinafter referred to as “the owners”).  On coming into force of Urban Land Ceiling and Regulation Act, 1976, they were permitted to set up a housing society for the members of the economically weaker section of the society, under Section 21 of the said Act.  The construction plan was submitted to Ahmedabad Municipal Corporation on 21.12.1995, for construction of houses on the aforesaid land and non-agricultural use of the said land was permitted by District Collector, Ahmedabad vide his order dated 05.11.1996.  Thereafter, the owners entered into an agreement dated 19.12.1994 with a Society named Toran Cooperative Housing Society Ltd. (OP-6) (herein after referred to as “the Society”), for the sale of the aforesaid land.  This was followed by a supplementary agreement dated 17.03.1995.  The possession of the land, subject matter of the agreement to sell and the supplementary agreement was handed over to the society.  That was followed by a tripartite agreement between the society, owners and the appellants (hereinafter referred to as “the builder”).  Under the said agreement, the construction was to be carried out by the builders and they were to be paid by the society for the said construction.

2.      After the construction had been carried out by the builders, they entered into separate agreements with the members of the society, in respect of the individual flats constructed by them.  As many as four blocks of flats were constructed by the appellants.

3.      There was an earthquake in Ahmedabad on 26.01.2001, which caused huge damage to several properties including flats which the appellants had constructed.  Alleging that the construction made by the appellants was of inferior quality and defective, 70 occupants of Blocks-A, B, C and D filed four separate complaints before the State Commission.  It was also alleged in the complaint that though in terms of Section 11 of Gujarat Ownership Flat Act, the appellants were required to establish a cooperative society and given ownership right in the land to the complainants, the sale deeds in favour of the complainants were not executed.  The complainants also sought to recover the maintenance deposit which they had paid to the appellants and the money which the government had provided to the victims of the earthquake as compensation for the damage caused to their properties, by the earthquake.

4.      The complaint was resisted by the appellants, inter alia, on the ground that they had only constructed the building as per the agreement with the society and the owners.  This was also the case of the appellants that the complainants having purchased the flats from the Society, they were not responsible towards them.  They also denied that the construction was of inferior quality.  It was also stated that in the earthquake, which struck on 26.01.2001, flats of some Schemes had altogether fallen down and got destroyed, whereas flats in question did not get broken nor was their life reduced due to any defective construction.  It was also claimed by them that possession of the flats had been handed over to the complainant on 22.09.1999, and there was no complaint regarding construction, till the time earthquake struck Ahmedabad.  This was also the case of the appellants that after damage to the flats was caused by the earthquake, they had carried out repairs under the guidelines of structural Engineer, Mr. Rajendra G. Desai and completed the repair work as per the National Building Code.  Another plea taken by the appellants was that the complaint was barred by limitation since the possession had been delivered on 22.09.1999, whereas the complaints came to be filed in 2002.

5.      The State Commission, vide impugned order dated 17.01.2014, directed the appellants to pay Rs. 10,000/- each to every member of all the four blocks alongwith interest on that amount at the rate of 6% per annum from the date of the complaint till the realization towards compensation for poor construction.  They were also directed to execute sale deed in favour of the complainants and pay Rs. 2,000/- to each of them towards compensation for the mental agony and harassment.  No order adverse to the society was passed by the State Commission.  Being aggrieved from the order of the State Commission, the appellants are before this Commission by way of these appeals.

6.      Though the notice of the appeal stands served upon the complainants, there is no appearance on behalf of all the respondents.

7.      As far as the plea of limitation is concerned, I find no merit in the same.  The period of limitation, as far as the damages to the flats are concerned would commence only from the date on which the occupants of the flats noticed the damage to their respective flats, within a reasonable period computed from the date possession was handed over to them, unless the damage was visible at the time possession was taken.  Since, the earthquake struck Ahmedabad on 26.01.2001, the flat owners had no reason to suspect the quality of the construction before that date.  The complaints having been filed in the year 2002, therefore were clearly within the prescribed period of limitation.

8.      As regards the quality of the construction, the State Commission having noticed that damage was caused to the plinth of the flats in a big way, was of the view that the said damage could not have been caused, had the quality of the construction not been poor and inferior.  It was also noticed by the State Commission that the defect caused was not under the construction of the bricks.  It was for these reasons that the State Commission awarded Rs. 10,000/- each as construction to all the flat owners.  The contention of the learned counsel for the appellants is that though the onus was upon the complainants to establish that the construction was of inferior quality, no technical evidence was produced by them to prove any defect in the construction of the flats.

9.      Ordinarily, if the defects are noticed, in the flats within a period of two years from the date on which possession is handed over to the flat owners, it would be for the builder to explain why and in what circumstances the flats came to develop those defects.  In the absence of any satisfactory explanation from the builder, the Consumer Forum would be justified in drawing an inference that it was the poor quality of the construction and/or the building material used therein which had led to the building developing defects such as cracks in walls, floor, foundation etc.  But, when an intervening factor such as a massive earthquake has taken place and the defects are noticed only after such a massive earthquake, the onus would be on the complainants to prove that it was the poor quality of the construction and/or the building material used therein which had led or at least contributed to the building developing defects during the earthquake.  In other words, in such a situation, it would be for the complainant to establish by producing technical evidence such as the opinion of a structural engineer, that had the construction not been defective and the building material of the appropriate quality and used in appropriate quantity, the earthquake could not have caused the damage which were later noticed by them.  The complainants, in such a situation can also establish deficiency on the part of the builder by showing that the construction had not been undertaken as per the prescribed Building Code.  For instance, if on account of the proposed building being situated in a seismic zone, the building bye-laws mandate the builder to adopt certain protective measures against a possible earthquake and it is shown that the builder had not adopted those protective measures, the negligence on the part of the builder shall stand proved because in such a case it can be safely said that had the builder taken all the prescribed anti-earthquake measures, the building would have withstood the impact of the earthquake and would not have got damaged, to the extent it had actually got damaged.

          In the case before this Commission, there is no evidence of the flat owners having noticed any defect in the flats between the date on which they took possession of their respective flats and on which date the earthquake struck Ahmedabad.  The time gap between the dates on which the possession was taken and the date on which the earthquake struck Ahmedabad are quite substantial being more than one year.  Moreover, it is not in dispute that the building in question was not the only building which developed cracks and other damages on account of the earthquake, there being many such buildings in Ahmedabad alone.  That precisely was the reason for the State Government giving aid to the victims of the earthquake whose property was damaged during the aforesaid mis-hap.  In the absence of any technical opinion, such as the report of a structural engineer, the State Commission, in my opinion was not justified in concluding that the damages to the plinth could not have occurred on account of earthquake, had there been no deficiency in carrying out construction of the flats.  The order of the State Commission does not give any indication as to on what basis the aforesaid conclusion was drawn by it despite there being no technical opinion in support of such a conclusion.

10.    It is true that a person undertaking building activity in a seismic zone such as Ahmedabad is expected to take reasonable care to protect the building against damage from earthquake, but it is for the complainants to prove what were the reasonable protection which the builder, undertaking construction activity in a seismic zone was required to adopt at the relevant time.  Only, thereafter, the builder could have been asked to satisfy the Consumer Forum that it had actually undertaken the aforesaid reasonable protection measures against possible damage from earthquake.  In fact, the learned counsel for the appellants maintains that the area where the building in question is situated was not notified as a part of seismic zone before the earthquake struck Gujarat on 26.01.2001.  Be that as it may, in the absence of technical evidence and the requirements of building bye-laws with respect to the construction in the aforesaid locality, it would not be correct to hold that there was deficiency or shortcoming in the construction carried out by the appellants.

11.    As far as the execution of the sale deed in favour of the flat owners is concerned, the only contention of the learned counsel for the appellant is that since the land underneath the building is owned by the society and not by the appellants, they are not in a position to execute such a deed in favour of the buyers.  However, a perusal of the bilateral agreement executed by the appellants with the flat buyers would show that under the said agreement a number of rights in the flats in question were retained by the appellants.  For instance, (a) without consent of the appellants, the flat buyers were prohibited from selling or transferring their right to anyone, (b) in the event of the flat buyers committing default in payment in terms of the bilateral agreement to the appellants, they could transfer or allot the unit in question to any other person.  The bilateral agreement also provided that if the said buyer did not come forward to take the possession after paying the outstanding amount to the appellant, the appellants could transfer the unit in question to some other person and thereafter the flat buyer would be left with no right in the said unit.  The agreement also provided that the unit, which were not allotted to any person would be treated as owned by the appellants and neither the flat buyer nor the society would have any right in such units.

In these circumstances, I am of the considered view that the sale deed in favour of the flat buyers needs to be executed, by way of a tripartite document wherein the society would be the vendor, the appellants would be the confirming party and the flat buyer would be the vendee.

Though the State Commission had directed that the cost of execution of the sale deed will be borne by the appellants, the aforesaid direction can not be justified since it is for buyer and not for the seller to bear the cost of the execution of the title deed, such as stamp duty, registration charges, typing charges etc.  To that extent, the order of the State Commission needs to be modified.

12.    As far as the compensation awarded by the State Commission is concerned, considering the fact that there have been abnormal delay in execution of the sale deed in favour of the buyers, I find no justification for setting aside the aforesaid direction which is accordingly confirmed.

13.    For the reasons mentioned hereinabove, the appeals are disposed of with the following directions:-

1.      The appellant will not be required to pay any compensation to the complainants for the alleged defects in construction of the flats;

2.      A tripartite sale deed in favour of the flat buyer will be executed with respect to their proportionate share in the land on which the building in question has been constructed.  In the aforesaid tripartite deed, the Toran Cooperative Housing Society Ltd. shall be the vendor, flat buyer shall be the vendee and the appellants shall be the confirming party.  The entire cost of execution of the sale deed including the stamp duty, the registration charges and the typing charges etc. shall be borne by the concerned flat buyer.

3.      The appellants shall send notices to the individual flat buyers within 8 weeks, intimating them of the amount of stamp duty and the registration charges payable by them.  The format of the sale deed shall also be annexed to the notice.  The flat buyers will then get the sale deed prepared on the requisite stamp papers and submit the same to the society, which will execute the deed and hand over to the appellants, who will execute the same as confirming party and handover the same to the vendee.  The sale deed shall be presented before the concerned Registrar/Sub-Registrar for the purpose of registration on a date which shall be mutually fixed between the vendor, vendee and the confirming party.

4.      The appellants shall also pay the compensation of Rs. 2,000/- to all the flat buyers in terms of the order of the State Commission.

14.     The statutory deposit made by the appellant no. 4 with this Commission shall be refunded to him alongwith interest which has accrued on the said amount, after verifying that the said deposit was made by appellant no. 4 only, after the appellants have complied with this order in toto and filed an affidavit to this effect.