AVM J. RAJENDRA, AVSM, VSM (RETD.), MEMBER

1.      This Order shall decide both the Appeals arising from the impugned Judgment/Order dated 03.06.2016 passed by the learned State Consumer Disputes Redressal Commission, Rajasthan (hereinafter referred to as the “State Commission”) in Consumer Complaint No. 94/2014, wherein the State Commission partly allowed the complaint.

2.      For Convenience the parties are being referred to as mentioned in the Complaint before the State Commission. Smt. Rameshwari Devi is identified as the Complainant. While Rajasthan Housing Board (for short the RHB) is referred to as the OP-1, Commissioner, Rajasthan Housing Board, Jaipur as OP-2, and the Dy. Commissioner, Rajasthan Housing Board, Jaipur, Circle-I, as OP-3.

3.      Brief facts of the case are that the Complainant had responded to an advertisement by the Opposite Parties (the RHB) and applied for an auction purchase of a residential plot (No. 33) in Zone 90, Pratap Nagar, proposing a purchase price of Rs. 33,100/- per square meter. The Complainant paid an initial deposit of Rs. 50,000/- on 13.02.2013 and was declared as the successful bidder. Subsequently, she deposited
Rs. 8,51,000/- on 18.02.2013. An allotment letter was issued on 28.05.2013, stating the total price of the plot as
Rs. 63,15,116/-. After adjusting the amount already deposited, the balance amount to be paid was Rs. 54,14,116/-, which the Complainant deposited within the specified 30-day period through demand drafts and the Opposite Parties issued the receipts on 27.06.2013.

4.       However, it was alleged that the Opposite Parties (RHB) issued a demand letter dated 30.07.2013 to the Complainant to deposit 1% of the entire amount, claiming delay in payment. The Complainant requested for cancellation of this demand and sought possession letter of the property. The Complainant further alleged that the OPs illegally demanded Rs.1,78,740/- for "miscellaneous" charges without providing any explanation, even though the plot was vacant with no construction.

5.      Additionally, the OPs charged 5% as lease money based on the reserve price of the plot, while only 2.5% of the reserve price should have been charged. Moreover, the lease money is payable only after possession of the plot is given to her. Being Aggrieved by the above acts of the OPs the Complainant filed a Consumer Complaint No. 94 of 2014, before the Rajasthan State Commission with following prayer:-

1) It may be directed to the respondents to issue the possession letter of the plot no. 90/33, Pratap Nagar, Sanganer, Jaipur and further to give possession of the aforesaid plot to the complainant with immediate effect.

2) It may be directed to the respondents that the complainant be compensate @24% per annum on the total received amount (Rs. 63,15,116/-) i.e. Rs. 18,94,533/- (In words Rs. Eighteen Lacs I Ninety Four Thousand Five Hundred Thirty Three only).

3) It may be directed to the respondents to return the amount i.e. Rs.1,78,740/- (In words Rs. One Lac Seventy Eight Thousand Seven Hundred Forty only) to the complainant which has been taken in the name of misc. expenses.

4) It may be directed to the respondents to return the amount i.e. Rs.1,77,876/- (In words Rs. One Lac Seventy Seven Thousand Eight Hundred Seventy Six 1 only) to the complainant which has been taken in the name of lease money as advance. It may further be directed to the respondents to calculate the lease money @2.5% instead of 5% on the reserve price.

5) The complainant entitled to receive the compensation for an amount of Rs 20,00,000/ (In words Rupees Twenty Lacs due to deficiency in service.

6) Is entitled to receive the cost of the litigation expenses and advocates fee to the tune of Rs. 1,00,000/-(In words Rupees One Lac),

7) An enquiry must be initiated against the responsible person who committed default and is liable for harassment of the complainant. It may be ordered that the money which has been asked in terms of compensation should be recovered from such defaulting officer.

8) Any other relief oi order or direction the Hon’ble commission deems just and proper.

Therefore, the complainant is entitled to receive in total Rs.43,51,149/- (In words Rs. Forty Three Lacs Fifty One Thousand One Hundred Forty Nine only) along with 24% interest from the date of filing of the present complaint till the date of filing disposal of this complaint.

6.      In response to the Complaint, the RHB (OPs) submitted that the dispute in question is not a consumer dispute under the Consumer Protection Act, 1986 (the Act) as the Complainant purchased the plot in an auction sale. The Complainant's delay in depositing certain demand drafts and her failure to comply with the auction's terms and conditions were pointed out. The plot was given to the complainant at the bid rate and the miscellaneous charges were demanded based on the terms of auction. After looking into her objections, the RHB recalculated the lease money and issued a revised letter (Annexure R/1). They asserted that there was no deficiency in service, and the Complainant is not entitled to damages or interest. Since the Complainant was already given possession of the plot, the RHB has rejected the complaint.

7.  The State Commission, vide Order dated 03.06.2016 allowed the Complaint with the following directions to OPs:-

(a) The opposite parties (the RHB) shall refund to the complainant the miscellaneous charges of Rs.1,78,740/- (Rupees One Lac Seventy Eight Thousand Seven Hundred Forty only) with 12% interest p.a. from the date of filing of the complaint.

(b) The opposite parties shall not levy or demand from the complainant any lease money in compliance of Allotment Letter dated 28.05.2013 (Ann.5) or Revised allotment letter dated 24.12.2014 (Ann. R/1). The opposite parties shall recalculate the lease money at the rate of 2.5%, treating the reserve price of the plot to be Rs. 8,784/- (Rupees Eight Thousand Seven Hundred and Eighty Four only) per sq. mts and the reassessed lease money shall be demanded from the complainant only from 15.01.2015, the date on which possession was handed over to the complainant. The amount paid by the complainant against the lease money, shall be refunded or adjusted against the re-assessed lease money.

(c) The opposite parties (the RHB) shall pay to the complainant Rs.5,00,000/- (Rupees Five Lacs only) as compensation against mental agony, with 09% interest p.a. on the aforesaid amount from the date of filing of the complaint,

(d) The opposite parties (the RHB) shall also pay Rs.25,000/- (Rupees Twenty Five Thousand only) to the complainant as cost of proceedings for the present complaint,

(e) The demand note dated 30.07.2013 of the OPs (Ann.9) whereby an amount of 1% of the cost of the plot, is demanded is hereby quashed and set aside, and no such amount shall be demanded form the complainant.

(f) The opposite parties (the RHB) shall be at liberty to recover the aforesaid amount of compensation and other amount imposed against them, from the delinquent officers of the RHB, who are responsible for their misconduct which resulted in allowing this complaint.

          The compliance of the order shall be made within one month from today.”

8.    Aggrieved by the Order of learned State Commission, both the parties i.e., the Complainant and the Opposite Parties have filed the present cross Appeals before this Commission with the following respective prayers:

FA/810/2016 filed by Complainant:

(i) Modify the impugned judgment and final order dated 03.06.2016 passed by learned State Consumer Disputes Redressal Commission Rajasthan, Jaipur in Consumer Complaint No.94/2014 and direct the respondents to pay interest @ 20% per annum on the amount of Rs.63,14,116/- from the. date of deposit i.e., 26.06.2013 to the date of delivery of possession of plot to the appellant i.e., 15.01.2015;

(ii) To direct the respondents to return the amount of Rs.1,78,740/- realized from appellant/ complainant in the name of Misc. Charges, with 20% interest thereon from the date of receiving this amount from complainant.;

(iii) To direct the respondents to return to the appellant the lease money illegally recovered from her, along, with 20% interest thereon from the date of receipt.;

(iv) To direct the respondents to realize the lease money from the appellant at the rate of 2.5% of the reserve price Rs.8487/- per Sq. Meter from the date of handing over possession of the plot i.e., 15.01.2015.

(v) To direct the respondents to further pay a sum of Rs.15,00,000/-, in addition to Rs.5,00,000/- already awarded to the appellant by learned State Commission, on account of harassment, loss of enjoyment of fruits of the property, escalation in construction price etc.;

(vi) To direct the learned State Commission to launch prosecution against Shri N.R. Meena S/o Shri Shyonath Meena, Officer-in-charge. Estate Manager Circle I, Pratap Nagar Jaipur, for giving false evidence on Affidavit before State Commission regarding date of receipt of amount by Rajasthan Housing Board from the complainant/ appellant;

(vii) To direct the respondent no.1 Rajasthan Housing Board to recover all the damages caused to it in this matter, from the concerned employees, after fixing their responsibility in the matter so that exchequer is not burdened for the mischief of individuals;

(viii) Cost of this appeal may kindly be awarded in favour of the appellant;

ix) Any other relief thought fit by this Hon’ble Commission which is just and proper in the facts and circumstances of the case may kindly be granted in favour of the appellant.

9.      In the FA/1106/2016, the Appellants prayed for setting aside of the Impugned Order of the State Commission.

10.    In Appeal No. 810 of 2016, the Complainant mainly raised the following grounds:-

a)  The State Commission failed to consider that the Complainant had deposited the entire cost of the plot on 26.06.2013, but possession was handed over only on 15.01.2015. During this period, the entire amount remained with the OPs for over 1½ years and they utilized the money for their own benefits. As a result, she is entitled to interest on the money with the OPs from the date of deposit to the date of handing over possession @ 20% per annum.

b) Towards depositing the cost of the allotted plot, she had to borrow money from LIC Housing Finance Ltd. and other persons, including relatives. Therefore, she needs be compensated with higher interest for the duration the Respondents held their money.

c). The Respondents' have followed the practice of charging heavy interest at 15% per annum on amounts due from consumers and imposing a penalty of 5% for any failure in deposit of the due amount in time.

11.  In Appeal No. 1106 of 2016, the Opposite Parties have mainly raised the following grounds:-

a)      The State Commission granted excessive amount of Rs. 5 lakhs with 9% interest from the date of filing the complaint. There was no malice, and the OPs merely served notices for an amount they believed to be due.

b) The State Commission erred in quashing the miscellaneous charges of Rs. 1,78,740/- and directing its refund with 12% interest. These are for development, such as roads, sewer lines, water pipes, power etc which are separate from pure construction activities of the OPs.

c)       The State Commission failed to consider that admittedly the amount was deposited on 27.06.2013, justifying 1% charge towards such belated payment.

d) The lease money was correctly calculated and cannot be based on the reserve price, as stated in the order. The demanded amount of Rs. 88,936/- was accurate.

e)      The amount was to be deposited at Collection Centre 09, Sector-05 Pratap Nagar Jaipur. However, she deposited the amount at another place. Thus, it was considered as deposited beyond the specified time, warranting the levy of an extra 1% amount.

12.    The Learned Counsel for the Complainant argued that the State Commission's award of Rs. 5 lakhs as compensation to the Complainant/appellant. However, the State Commission failed to award appropriate interest, despite the fact that the Appellant had borrowed money on loan with interest from LIC Housing Finance Ltd and other relatives. The Counsel also highlighted that the Rajasthan Housing Board (RHB) itself charged a total of 20% interest (15% p.a. + 5% penalty) on delayed payments of lease money installments and other amounts. She argued that on a reciprocal basis, the appellant should be awarded interest at the same rate to maintain fairness between the parties. Additionally, the RHB utilized the amount deposited by the complainant/appellant for its own benefit for a significant period of one year and six months. In the interest of justice and equity, the Counsel requested that the Appellant should be granted interest @ 18% PA to compensate for the utilization of her money and for fair resolution in the case.

13.    She further argued that the State Commission ignored the fact that the Housing Commissioner, RHB vide Letter No. 3123 dated 25.11.2014 addressed to Deputy Secretary Lokayukt admitted that the balance amount if Rs. 12,47,000/- has been deposited in time. However, the officer-in-charge of the case Shri N.R. Meena still contested the matter and submitted a false Affidavit before the State Commission to that the complainant has not deposited the balance amount in time.

14. The Learned Counsel for the Appellant/ Complainant has relied on the following judgments: -

a)      George Thomas & Ors V/s Ghaziabad Development authority & Ors 1(1999) CPJ 18(N.C.), Para No. 7.

b) Lucknow Development Authority V/s M.K. Gupta (1994) Supreme Court case 243 in para 11.

15.    As regards the issue whether the Appellant is a ‘Consumer’ with respect to the property acquired by her from the OPs (RHB), the learned counsel for the Appellant addressed the difference in S.L.P. (C) No.14172/2013, Sanjay Kumar Joshi Vs. Municipal Board, Laxmangarh & Anr. dated 26.09.2014 wherein the Hon’ble Supreme Court had held that an auction purchaser acquiring a property in auction for commercial purpose does not constitute a ‘Consumer’. Whereas, the property acquired by the Appellant in auction on “as is where is basis” for residential purpose under the conditions stated in the Affidavit dated 26.07.2021. it was a sealed cover auction wherein an individual participating has mandate to state the “Offer” while there are certain restrictions in accepting or rejecting that offer. She further argued that when a Statutory Authority develops land and allots sites or constructs houses for the public benefit, it is as much service as by a builder or contractor. The one is contractual service and other statutory service. When a person avails of service which is not for commercial purpose, he/she cannot be excluded from the definition as defined in Section 2 (i) (d) of the Consumer Protection Act. The Appellant/ Complainant is not aggrieved by any disadvantage of the residential plot purchased by her or that amenities are not provided. In the present case, her main grievance is as regards delay in handing over the possession of the plot despite receiving the entire cost of the plot well back on 26.06.2013 by the OPs.

16.    The Learned Counsel for the Opposite Parties argued that the Appellant being an auction purchaser of the property, she is not a ‘Consumer’ within meaning of the Consumer Protection Act, 1986. In terms of Para 5 of the Allotment Letter dated 28.05.2013 it was upon her to install electric and water connection at her own cost. Thus, there was no promise of any sort of development or improvement of the said land. He argued that, the Hon'ble Supreme Court was faced with a similar issue in UT Chandigarh Administration v. Amarjeet Singh (2009) 4 SCC 660. The Apex Court held that in a public auction there is no hiring or availing of services by the bidder and hence in such a case no complaint can lie before the consumer forum. Excerpts from the aforesaid judgment are reproduced as follows:

"18.....But where existing sites are put up for sale or lease by public auction by the owner, and the sale/lease is confirmed in favour of the highest bidder, the resultant contract relates to sale or lease of immovable property. There is no hiring or availing of services by the person bidding at the auction. Nor is the seller or lessor, a trader who sells or distributes 'goods’. The sale price or lease premium paid by the successful bidder of a site, is the consideration for the sale or lease, and not consideration for any service or for provision of any amenity or for sale of any goods.

21. With reference to a public auction of existing sites (as contrasted from sites to be ‘formed’), the purchaser/lessee is not a consumer, the owner is not a 'trader' or 'service provider' and the grievance does not relate to any matter in regard which a complaint can be filed. Therefore, any grievance by the purchaser/lessee will not give rise to a complaint or consumer dispute and the fora under the Act will not have jurisdiction to entertain or decide any complaint by the auction purchaser/lessee against the owner holding the auction of sites."

17.    This decision was reaffirmed in a recent decision of the Hon'ble Supreme Court in Estate Officer v. Charanjit Kaur (2021) SCC Online SC 686. Further, the Apex Court went onto state that even if the term "service" is given the widest interpretation, the consumer fora would not have jurisdiction to entertain complaints on ground of deficiency of service pertaining to transfer of immovable property. Accordingly, any grievance pertaining to a plot purchased in public auction, even if justified, cannot be treated as a consumer complaint. Relevant paragraph is reproduced below:

"24. Since the respondents are already in possession of the sites as lessee on 99 years basis, it cannot be said that the appellant was deficient in providing any service, which even if used in a liberal sense would not include transfer of title in an immovable property Thus, the consumer fora under the Act would not have jurisdiction to entertain the consumer complaints on the ground of deficiency in service related to transfer of title of the immovable property"

18.    As per learned counsel for the Respondent, a person who purchases a plot in a public auction is not a consumer within meaning of Section 2(1)(d) of the Consumer Protection Act, 1986 and is thereby precluded from claiming deficiency of service on any ground whatsoever. He further argued that the Complainant deposited Rs.41,67,116/- before 1.00 PM with a person who was not authorised to collect the same. It was to be deposited at counter No. 9 of cash collecting center, Pratap Nagar, Jaipur as stated in the Allotment Letter dated 28.05.2013. Despite the same, the Respondents considered it as being paid as it was deposited within the stipulated time. The remainder of the amount was deposited via two demand drafts of Rs 12,38,000/- and Rs 9000/- respectively after 1.00 PM. This is clear breach of Para 2 of the Allotment Letter. The Allotment Letter provided a detailed procedure to be followed in deposit of the said amount. The time of collection in the Letter was between 9.00 AM and 1.00 PM, but the drafts were produced much after the stipulated time. The Complainant has conveniently submitted the drafts to the counter responsible for receiving inward mail, instead of Counter No. 9 of cash collecting center, which was specifically tasked with the duty of receiving payments from allottees. Thus, the demand for 1% of total cost of the plot is justified.

19.    The miscellaneous charges of Rs.1,78,740/- i.e. 3% of total cost of the plot was under condition 9 of the tender conditions and applicable rules/regulations. Moreover, these are taken for the purposes of development work and other activities that the Respondent undertakes.

20.    We have examined the pleadings made by both the parties, material placed on record and the arguments advanced by the learned counsels for the Appellant as well as the Respondents.

21.    There was a delay of 52 days in filing the Appeal No. 1106 of 2016 by the Opposite Parties. For the reasons stated in IA/8489/2016, the delay is condoned.

22.    As regards the issue whether the Complainant is a Consumer, it is an admitted position that the Complainant purchased the said land property from the OPs in an auction. However, firstly, the plot offered by the OPs and purchased by the Appellant is a residential property. Further, while the process under which the subject property was purchased by the Appellant from the OPs was stated to be an auction, it is an admitted position that it was in fact a sealed tender process wherein the Appellant had applied for a plot by quoting a rate in a closed envelope. The Opposite Parties (RHB) considered her quote as the highest and thus allotted the plot. She neither knew the rates quoted by the others nor had opportunity to first quote a base price and thereafter enhance the same during course of other quotes by others. Thus, evidently, the process adopted by the OPs is merely a sealed tender quotation method of determining highest bidder and allot the residential plot. Therefore, the said citations of the Hon’ble Supreme Court referred as regards public auction purchase of commercial property are inapplicable to the present case.

23. The claim of the Appellant for interest @ 20% on Rs.63,14,116/- paid by her to the OPs (RHB) for the duration from 26.06.2013 to 15.01.2015 is considered untenable as the delay was due to certain processes and differences in appreciation of facts by the parties and further the same has already been adequately addressed by the learned State Commission as part of the compensation granted. 

24.    The Claimant sought enhancement of interest on Misc. Charges from 12% granted by the learned State Commission to 20%. While examining the question as to what constitutes reasonable delay compensation, Hon’ble Supreme Court in the case of Experion Developers Pvt. Ltd. Vs. Sushma Ashok Shiroor, in Civil Appeal No.6044 of 2019, decided on 7.4.2022, held as under:

“We are of the opinion that for the interest payable on the amount deposited to be restitutionary and also compensatory, interest has to be paid from the date of the deposit of the amounts. The Commission in the Order impugned has granted interest from the date of last deposit. We find that this does not amount to restitution. Following the decision in DLF Homes Panchkula Pvt. Ltd. Vs. DS Dhanda and in modification of the direction issued by the Commission, we direct that the interest on the refund shall be payable from the dates of deposit. Therefore, the Appeal filed by purchaser deserves to be partly allowed. The interest shall be payable from the dates of such deposits.

25.    Thus, as per the principles laid down by the Hon’ble Supreme Court, interest @ 9% per annum as compensation for delay would meet the ends of justice. However, the Claimant sought increase from 12% to 20%. The same is rejected. Considering the facts of the case and the inherent absence of coordination amongst different authorities at the RHB resulting in excess payments being recovered from the Claimant, we are of the considered view that the interest @ 12% granted on the miscellaneous charges by the learned Commission needs no interference.

26.    The claim of the Complainant for payment of lease money is untenable and thus rejected. Further, the Appellant is to pay the statutory dues and taxes as per law to the OPs.

27.    The claim for enhancement of compensation from Rs. 5 Lakhs to Rs. 20 Lakhs on account of harassment, mental agony and loss of enjoyment of fruits of property, escalation in construction price etc. is rejected as the Appellant has already been adequately compensated by the State Commission as well as the escalation of property in value. The prayer seeking for prosecution of certain officers and for recovery of damages is also rejected. The Respondents are to comply with the Order of the learned State commission in this regard.

28.    For the reasons deliberated above, the prayer of the Respondents seeking setting aside of the learned State Commission Order dated 03.06.2016 is rejected. 

ORDER

29.    In view of the foregoing deliberations, both the FA 810 of 2016 and FA 1106 of 2016 are dismissed.

30.    There shall be no orders as to costs.

31.    All the pending Applications, if any, are disposed of accordingly.