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

DATED 9^th DAY OF MARCH 2022

ORDER

SRI.K.S.BILAGI, PRESIDENT

1. The complaint has been filed under Section 12 of C.P.Act, 1986 (herein under referred as an Act) for the following reliefs against the OP:-

(a) Declare that the OP No.1 has not completed the construction work of the B Schedule property within the stipulated time agreed under the agreement of sale as well as agreement of construction dated 15.12.2015 even after receiving payments from the appellant and respondent No.2 i.e. Bank which is nothing but deficiency of service on the part of OP Nos.1 and 2.

(b) Declare that the registered agreement of sale dated 15.12.2015 and agreement of construction dated 15.12.2015 are no value in the eye of law and same will become cancel as automatically terminate.

(c) Declare that the OP No.1 is exclusively liable to repay the loan amount sanctioned by the OP No.2 in favour of OP No.2.

(d) Declare that the OP No.1 is liable to repay the amount for a sum of Rs.18,61,294/- paid to him including the amount of Rs.5,20,294/- paid towards loan to OP No.2 along with interest in favour of appellant herein.

(e) To grant such other reliefs. 

2. The case set up by the complainant in brief is as under:-

The complainant having entered into an agreement of sale with OP No.1 in respect of Flat No.429 for consideration of Rs.19,58,800/- dated 15.12.2015, paid Rs.3,00,000/- as advance. Even though, OP No.1 assured that sale transaction will be completed within 90 days, but OPs failed to comply the terms of agreement.

3. The complainant also contends that he has entered into agreement for construction dated 15.12.2015 with OP No.1 for cost of construction of Rs.32,46,200/-.  As per the terms of the agreement, the construction of the flat will be completed within 24 months and grace period of three months from the date of agreement i.e. on or before 15.09.2017.  The complainant has also paid Rs.10,41,000/- under the agreement of sale on four different dates i.e. 04.02.2015, 13.12.2015, 19.12.2015 and 24.12.2015.

4. The complainant also contends that the tripartite agreement between him, OP Nos.1 and 2 came to be executed on 24.06.2016 for loan of Rs.52,05,000/-.  The complainant made payment of Rs.5,20,294/- towards construction to OP No.1.  The complainant in all paid Rs.18,61,294/-.  The total value under agreement of sale and construction agreement is Rs.52,04,500/-.  The OP No.1 failed to comply the terms of agreement of sale and construction agreement.  The OP No.1 is liable to repay Rs.18,61,294/- including Rs.5,20,294/- to the OP No.2.  The OP No.1 failed to comply the terms of both the agreements.  The OP No.1 caused deficiency of service. Hence, this complaint.

5. Despite receipt of notice by paper publication, OP No.1 failed to appear before this Commission.  OP No.2 also failed to appear, despite receipt of notice.  Therefore, both the OPs have been placed exparte.

6. The complainant filed his affidavit evidence and relies on 14 documents.  Heard the arguments of advocate for the complainant.  Perused the records.

7. The following points arise for our consideration

1. Whether District Consumer Forum had pecuniary jurisdiction to entertain the complaint on the date of filing the complaint i.e. 03.12.2018?
2. Whether the complainant proves deficiency of service on the part of OPs?
3. Whether the complainant is entitled to relief mentioned in the complaint?
4. What order?

8. Our answers to the above points are as under:

       Point No.1:  In the negative.

      Point Nos.2 and 3: Do not survive for consideration

      Point No.4: As per final orders

REASONS

9. Point No.1:  Even though, OPs neither appeared nor filed version challenging contention and claim of the complaint. But, it is the duty of us to ascertain, whether on the date of filing this complaint, this Forum had pecuniary jurisdiction to entertain the complaint or not.
10. The complainant has filed his affidavit evidence and relies on 14 documents in support of his case.  The allegations made in the complaint, affidavit evidence of complainant and documentary evidence clearly indicate that on 15.12.2015, the complainant and OP No.1 entered into an agreement of sale in respect of flat No.4219 for sale consideration of Rs.19,58,500/-.  It is also proved from the case set up by the complainant that he entered into agreement of construction with OP No.1 on 15.12.2015 for cost of construction of Rs.32,46,000/-.  Even though, the OP No.1 agreed to complete the construction on or before 15.09.2017.  But, OP No.1 neither executed the sale deed nor completed the construction work within stipulated period.
11. It is also established that the complainant and OP No.1 have entered into tripartite agreement and complainant agreed to take loan of Rs.52,05,000/- from OP No.2 banker.  It is also proved from the evidence of the complainant that the complainant has paid Rs.3,00,000/- and Rs.10,41,000/- i.e. Rs.13,41,000/- to OP No.1.  It is also proved from the case set up by the complainant that OP No.2 banker released the portion of loan and complainant has paid Rs.5,20,294/- to the OP No.1.  Thereby, OP No.1 has received Rs.18,61,294/- in respect of construction agreement.  Even though, complainant seeks to declare that the agreement of sale and construction agreement suffer from deficiency of service.  It is relevant to note that the OP No.12 is not party to the agreement of sale as well as agreement of construction.  Apart from this, the complainant claims a relief of Rs.18,61,294/- that OP No.1 is liable to pay this amount to OP No.2.  According to the allegations made in the complaint, affidavit evidence and documents produced by the complainant, the value of the service under agreement of sale Rs.19,58,000/- and value of the service under agreement for construction Rs.32,46,200/-.  Thereby, the total value of service under both the agreement is Rs.52,05,000/-.
12. This complaint came to be filed on 03.12.2018 under the provision of C.P.Act, 1986.  The question arises, whether on the date of filing this complaint, this District Forum had pecuniary jurisdiction to entertain the complaint.  It is relevant to refer Section 11(1) of C.P.Act, 1986 which read thus:-   

11(1): Jurisdiction of the District Forum: (1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed (does not exceed rupees five lakhs).  

13. According to the above provision for the purpose of pecuniary jurisdiction of this District Consumer Forum, the value for the purpose of pecuniary jurisdiction shall be determined on the value of goods or services and amount claimed. In the present case the value of service Rs.52,05,000/- (under agreement of sale and agreement of construction) and claim of relief is Rs.18,61,294/-.  If these items are taken into consideration, the total value for the purpose of pecuniary jurisdiction would be Rs.70,66,294/-.  It means, on the date of filing the complaint, this Forum had no pecuniary jurisdiction to entertain the complaint.  This Forum had pecuniary jurisdiction to entertain the complaint when the value of components and value of service and claim does not exceed Rs.20,00,000/-. The complaint suffers from want of pecuniary jurisdiction on the date of filing the complaint.
14. This reasoning of us is supported by the decision of Hon’ble National Consumer Commission reported in the following decisions:-

1. 2018 (2) CPR 111 in the matter between Gurmukh Singh Vs. Greater Mohali Area Development Authority and another. The Honb’le National Commission referring the earlier judgement of Larger Bench in Ambrish Kumar Shukla and others Vs. Ferrous Infrastructure Pvt. Ltd.,, wherein it was held in para 6 which read thus:-

Para 6:- A three-member bench of this Commission in their order on 07.10.2016, stated as under on the issue referred above:-

It is the value of the goods or services as the case may be, and not the value or cost of removing the deficiency in the service which is to be considered for the purpose of determining the pecuniary jurisdiction.

2. III (2018) CPJ 370 (NC) in the matter between Renu Singh Vs. Experion Development Pvt. Ltd., where in it is held that “Consumer Protection Act, 1986 Sections 29(1)(g), 21(a)(ii) – Pecuniary jurisdiction – booking of residential unit – builder-buyer agreement – Terms and conditions not agreed upon, Refund of deposited amount sought, alleged deficiency in service – State Commission dismissed complaint – Hence, appeal value of unit itself is Rs.1,28,84,474/- - Pecuniary jurisdiction in complaint is not before the State Commission but it is before the National Commission – No perversity in well reasoned order passed by State Commission.

15. The C.P.Act, 2019 has come into force w.e.f. 20.07.2020 under which the pecuniary jurisdiction of District Commission is enhanced to Rs.1 crore i.e. consideration paid.  The question arises, whether this complaint can be continued under the provisions of Consumer Protection Act, 2019.
16. We are of the considered opinion that the complaint filed under the provision of C.P.Act, 1986 cannot be continued under the new Act taking into payment and consideration the purpose of pecuniary jurisdiction mentioned in C.P.Act 2019.  The C.P.Act, 2019 has no retrospective effect.  This complaint cannot be continued under the new C.P.Act, 2019.   
17. This reasoning of us is supported by the following decisions of the Hon’ble Supreme Court of India and Hon’ble National Commission:-

1. 2021 (2) CPR 398 in the matter of Neena Aneja Vs. Jain Prakash Associates Ltd., dated 16^th March, 2021.  It  is relevant to refer to para 71 of the judgement which read thus:-

71. For the above reasons, we have come to the conclusion that proceedings instituted before the commencement of the Act of 2019 on 20 July 2020 would continue before the fora corresponding to those under the Act of 1986 (the National Commission, State Commissions and District Commissions) and not be transferred in terms of the pecuniary jurisdiction set for the fora established under the Act of 2019.  While allowing the appeals, we issue the following directions:

(i) The impugned judgement and order of the NCDRC dated 30 July 2020 and the review order dated 5 October 2020, directing a previously instituted consumer case under the Act of 1986 to be filled before the appropriate forum in terms of the pecuniary limits set under the Act of 2019, shall stand set aside;

(ii) As a consequence of (i) above, the national Commission shall continue hearing the consumer case instituted by the appellants;

(iii) All proceedings instituted before 20 July 2020 under the Act of 1986 shall continue to be heard by the fora corresponding to those designated under the Act of 1986 as explained above and not be transferred in terms of the new pecuniary limits established under the Act of 2019 and

iv) The respondent shall bear the costs of the appellant quantified at Rupees two lakhs which shall be payable within four weeks.

2. Case No.833/2020 in the matter between M/s Pyaridevi Chabiraj Steels Pvt. Ltd., Vs. National Insurance Company Ltd., and three others dated 28.08.2020 at para 10 read thus:-

Para 10:- From a reading of the aforesaid provisions it is amply clear that for determining the pecuniary jurisdiction of the District Commission, State Commission or National Commission the value of the goods or services paid as consideration alone has to be taken and not the value of the goods or services purchased/taken.  Therefore, we are of the view that the provision of Section 58 (1)(a)(i) of the Act of 2019 are very clear and does not call for any two interpretations.

18. On the date of filing the complaint, this District Consumer Forum had no pecuniary jurisdiction to entertain the complaint.  Accordingly, the complaint cannot be continued under C.P.Act, 2019.
19. Point Nos.2 and 3:- When the complaint was not maintainable on the date of filing the complaint and when the complaint cannot be continued under the new C.P.Act, 2019, these two points which touch the merits of the case, do not survive for consideration.     
20. Point No.4:- Having regard to the discussion made in the presiding paragraph on point No.1, the complaint requires to be returned to the complainant for presentation before the Hon’ble State Commission, Bengaluru.   Hence, we proceed to pass the following 

  O R D E R

1. The complaint was not maintainable for want of pecuniary jurisdiction on the date of filing the complaint and complaint cannot be continued under new C.P.Act, 2019.
2. Return the complaint to the complainant for presentation before the Hon’ble State Commission, Bengaluru.
3. Furnish the copy of this order to both parties as per law.   

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 9^th March, 2022)

Documents produced by the Complainant which are as follows:-