BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION
AT HYDERABAD.
C.C. 1/2007
Between:
Dr. N.R.K. Biotech Pvt. Ltd.
Rep. by its Managing Director
Dr. N.R.K. Raju, S/o. N.A.N. Raju
Age: 58 years, R/o. 502,
Suraksha Souvenir
White Fields, Hi-tech City
Kothaguda, Hyderabad-32. *** Complainant
And
1) Shapoorji Pallonji Biotech Park Pvt. Ltd.
Rep. by its Director & Chief Executive
S. Dhawan, S/o. Late Madan Mohan Dawan
Age: 55 years, R/o. A-13, Ground Floor
R. K. Niwas, Street # 3
Indian Airlines Colony, Begumpet
Hyderabad- 500 003.
2) K. S. Shashidhar
Head & Finance & Company Secretary
M/s. Shapoorji Pallonji Biotech Park Pvt. Ltd.
R/o. A-13, Ground Floor
R. K. Niwas, Street # 3
Indian Airlines Colony, Begumpet
Hyderabad- 500 003. *** Opposite Parties
Counsel for the Complainant: M/s. T. Jagadish
Counsel for the OPs: M/s. M. S. Srinivasa Iyengar
CORAM:
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
SMT. M. SHREESHA, MEMBER
&
SRI K. SATYANAND, MEMBER
WEDNESDAY, THE SEVENTEENTH DAY OF FEBRUARY TWO THOUSAND TEN
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
***
1) The complainant, a private limited company, filed the complaint seeking to set-aside the debit notice dt. 17.11.2006 and further provide amenities besides a compensation of Rs. 25 lakhs towards deficiency of service, Rs. 5 lakhs towards mental agony and Rs. 5,000/- towards costs.
2) The case of the complainant in brief is that it is a private limited company engaged in carrying on business of manufacturing, selling and dealing in pharmaceuticals and to conduct, study, research, analyze the systems of bio-technological products, to manufacture and develop all kinds and varieties of bio-compounds and to buy, sell and deal in bio-technic, bio-technical, and bio-chemical raw materials and ingredients used in the above activity. The Government of Andhra Pradesh has transferred Ac. 144.34 guntas of land in S.No. 230 to 243 of Turkapally village in Shameerpet mandal of Ranga Reddy Dist., for development of phase-I Biotechnology Park to opposite party Shapoorji Pallonji Biotech Park Pvt. Ltd.. Since it is also involved in the same kind of business it has applied for allotment of a plot of land in the above said area to construct a building and to carry out the business of products of bio-technology. Accordingly 11471 sq.yds of land in plot No. 11 was allotted to it. Having received a consideration of Rs. 40,76,000/- possession was delivered on 12.1.2005. Later a sale deed was executed by the opposite party in its favour on 15.4.2005. However, the opposite party did not develop the area nor provided the required amenities to enable it to commence any sort of production. While so it had issued a debit notice Dt. 13.12.2006 to pay Rs. 2.25 per sq.yd viz., Rs. 25,810/- per month towards operation and maintenance charges from July, 2006 to November, 2006 in all Rs. 1,29,050/-. Without providing amenities such as sewerage treatment plant, library, incubation centre etc. it could not demand the above said amount. It caused mental agony and hardship. Therefore it sought a declaration to set-aside the debit notice dt. 17.11.2006 and further provide amenities besides a compensation of Rs. 25 lakhs towards deficiency of service, Rs. 5 lakhs towards mental agony and Rs. 5,000/- towards costs.
3) The opposite parties resisted the case. It alleged that admittedly the complainant is a company carrying on business of manufacturing, buying, selling and dealing in pharmaceuticals a commercial organization. The activity of the complainant is wholly commercial and the purpose for which the plot was purchased is to carry out the above said activity and therefore the State Commission has no jurisdiction. When it pleaded that it had failed to provide the service to enable the complainant to start production and thereby causing financial loss it would show that it was not a consumer within the meaning of Section 2(d)(ii) of the Consumer Protection Act. A meeting of all the allottees in the park was called on 29.11.2006 and in the said meeting the Managing Director of the complainant and Sri K. S. Shashidhar, Head (Finance) of opposite party No. 1 along with Sri S. Dhawan, Chief Executive were present. It was resolved that an amount of Rs. 2.35 per sq.yd per month towards maintenance charges had to be paid by all the units in the Biotech park in order to provide common amenities and other facilities like roads, electrical installations and equipment in the pump house etc. except for usage of sewerage where the charges would be levied based on the actual usage. This was agreed by the very complainant, and the same was incorporated as Clause 4(m) in its sale deed Dt. 15.4.2005. The complainant having accepted is under an obligation to bear the maintenance charges. The debit note was issued recoursing to the above proceedings. The incubation centre is being jointly developed by Department of Biotechnology, Government of India and Govt. of A.P. with Indian Institute of Chemical Technology (IICT) as implementing agency and it cannot be linked to the payment of the maintenance charges. The complainant has failed to prove that it is ready to start production. It did not even apply for clearances from Pollution Control Board and local Gramapanchayat for their proposed unit which is basic for commencing construction of factory building. It has only constructed a guest house. It is a private limited company, the question of mental agony or hardship will not arise. Their acts do not constitute any loss to the complainant. The very invocation of the case before the State Commission is bad under law and prayed for dismissal of the complaint with exemplary costs.
4) The complainant in proof of its case filed the affidavit evidence of its Managing Director and got Exs. A1 to A17 marked. Refuting its evidence opposite party No. 1 filed the affidavit evidence of Sri K. S. Shashidhar, Head Finance & Company Secretary and also affidavit evidence of Sri P. Gopal Krishnan, Head-Biotech Park and got Exs. B1 to B8 marked.
5) The points that arise for consideration are :
i) Whether the complaint is not maintainable under the Consumer
Protection Act as the predominant activity being commercial in
nature?
ii) Whether the complainant is entitled to the declaration sought for?
iii) Whether the complainant is entitled to any compensation? If so, to what amount?
iv) To what relief?
6) It is an undisputed fact that the complainant is a private limited company engaged in carrying on business of manufacturing, selling and dealing in pharmaceuticals and to conduct, study, research, analyze the systems of bio-technological products, to manufacture and develop all kinds and varieties of bio-compounds and to buy, sell and deal in bio-technic, bio-technical, and bio-chemical raw materials and ingredients used in the above activity. The opposite parties had allotted the land to construct the building and to carry out the business in biotech products as per the objects of the company. In the very sale deed executed by the opposite party in favour of complainant Ex. A1 Dt. 15.4.2005, the purpose for which the sale was made a mention “for setting up of an industry for the manufacture/research of Biotech products and/or activities associated with or a service industry to the Biotech sector”
In fact in the very sale deed it was made clear mentioning that the complainant had to commence the constructions works on the allotted plot within a period of 12 months and complete it within 30 months which the complainant did not do so. Clause- 4(m) of the sale deed reads as follows :
“to bear the maintenance charges for the common amenities and facilities like roads, drainage, sewerage, street lighting, security etc at such rates as may be fixed by the party of the first part from time to time within 7 days of notice of demand”
Having accepted to pay the maintenance charges, when a debit notice Dt. 13.12.2006 Ex. B2 was given for payment of Rs. 1,29,050/- towards operation and maintenance charges as agreed upon the complainant had filed this case alleging deficiency in service on the part of opposite parties stating that it did not provide the amenities such as sewerage treatment plant, library, incubation centre etc. and other required amenities. The complainant represented by its Managing Director not only agreed to pay the said amount without any pre-condition but also a signatory to the minutes of the meeting Dt. 29.11.2006 (Ex. B1). Therefore the complainant is estopped from raking up the issue stating that some amenities were not provided forgetting the fact that it did not fulfill its part of contract by starting any construction as mentioned in the sale deed. Ex. B4 photographs would show that it did not obtain approval from the Grama Panchayat or clearance from Pollution Control Board evidenced from Ex. B3. For the notice Ex. B4 Dt. 8.4.2009 given by the complainant, the opposite party gave reply under Ex. B7 Dt. 9.5.2009.
7) Learned counsel for the opposite parties contended that to get over the construction of building wherein it had to carry on the business, a cheap remedy available under the Consumer Protection Act in filing a complaint before the Consumer Fora was resorted to. When the complainant did not adhere to the terms of the agreement by constructing the building, the opposite parties issued a notice for which it sought extension of time and having got extension up till 2.4.2009 by addressing a letter Dt. 8.4.2009 (Ex. B4) it sought for further extension of 18 months on the ground that the bank loan was not cleared. When the opposite parties protested for construction of guest house without constructing of the buildings and drawing electrical energy it gave reply under Ex.B6 Dt. 24.4.2009 alleging that “Hereby you are requested not make any irresponsible statement like guest house, arm-twisting and black mailing. We gain nothing by those false allegations made by you. All correspondence aroused due to abnormal delay in giving ratification for the second building under false pretext and threatening that you will take away our property without any valid reason. Pursuant to Ex. B1 minutes of meeting Dt. 29.11.2006 when the complainant was directed to pay Rs. 1,29,050/- towards operation and maintenance charges it had filed the complaint. After filing of the complaint, it gave reply under Ex. B7 Dt. 23.5.2009 threatening to initiate contempt of court proceedings against the opposite parties. The fact remains that the amount payable towards operation and maintenance charges was not paid, on the other hand it filed the complaint.
8) Learned counsel for the opposite parties relying a decision of Supreme Court in Laxmi Engineering Works Vs. P.S.G. Industrial Institute reported in AIR 1995 SC 1428 contended that the complainant is a private limited company and it cannot be said that it used exclusively for purpose of earning livelihood by means of self-employment. The complainant could not have averred such fact nor could have any meaning if such contention is taken. In the very complaint, the complainant pleaded that the entire activity was to carry on business of manufacturing, selling and dealing in pharmaceuticals and biotechnology products which we have already adverted to. The cost of the project is about Rs. 24.95 crores evidenced under Ex. B8. The complainant cannot be considered as a person as defined u/s 2(1)(m) of the Consumer Protection Act, since the transaction was for commercial purpose. The dispute pertaining to the amount payable towards operation and maintenance charges, which the complainant had agreed to pay. To get over the payment it alleges that some amenities were not provided. Evidently this service which it intended to avail is for commercial purpose. Even assuming that it is for ‘Service’ it would not attract the provisions u/s 2(1)(o) of the Consumer Protection Act. Absolutely there is no deficiency of service on the part of opposite parties. The said fact was not even pleaded in the complaint. The complainant alleges deficiency of service on the ground it did not provide amenities such as sewerage treatment plant, library, incubation centre etc. which we have already adverted to. The Supreme Court in Ravneet Singh Bagga Vs. KLM Royal Dutch Airlines reported in (2000) 1 SCC 66 held that:
“In view of the definition of “service” and “deficiency” in Sections 2(1)(o) and 2 (1)(g) of the Consumer Protection Act, 1986 , the deficiency in service cannot be alleged without attributing fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be performed by a person in pursuance of a contract or otherwise in relation to any service. The burden of proving the deficiency in service is upon the person who alleges it. The complainant has, on facts, been found to have not established any willful fault, imperfection, shortcoming or inadequacy in the service of the respondent. The deficiency in service has to be distinguished from the tortuous acts of the respondent. In the absence of deficiency in service the aggrieved person may have a remedy under the common law to file a suit for damages but cannot insist for grant of relief under the Act for the alleged acts of commission and omission attributable to the respondent which otherwise do not amount to deficiency in service. In case of bona fide disputes no wilful fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance in the service can be informed. If on facts it is found that the person or authority rendering service had taken all precautions and considered all relevant facts and circumstances in the course of the transaction and that their action or the final decision was in good faith, it cannot be said that there had been any deficiency in service. If the action of the respondent is found to be in good faith, there is no deficiency of service entitling the aggrieved person to claim relief under the Act. The rendering of deficient service has to be considered and decided in each case according to the fact of that case for which no hard and fast rule can be laid down. Inefficiency, lack of due care, absence of bona fide, rashness, haste or omission and the like may be the factors to ascertain the deficiency in rendering the service.”
Coming to the facts when the complainant itself agreed to pay the said amount, and when the services sought for was for commercial purpose, at no stretch of imagination the complaint could be held maintainable under the Consumer Protection Act. Even otherwise, we do not see any deficiency in service on the part of opposite parties in order to deny the claim made by the opposite parties for recovery of maintenance charges. Therefore this point is held against the complainant.
9) In the light of discussion mentioned above, no relief need be granted to the complainant. We do not see any merits in the complaint.
10) In the result the complaint is dismissed with costs computed at Rs. 5,000/-. Time for compliance four weeks.
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
3) ________________________________
MEMBER
APPENDIX OF EVIDENCE
WITNESSES EXAMINED FOR
COMPLAINANT: OPPOSITE PARTIES
None None
Exhibits marked for complainant:
Ex.A-1 Copy of Deed of Sale executed by Shapoorji Pallonji Biotech Park Pvt Ltd., and Dr.N.R.K.Biotech Pvt Ltd., dt.15.4.2005.
ExA-2 Provisional Registration as Small Scale Industry issued by Department of Industries, Government of A.P.
Ex.A-3 Letter addressed by Chief Executive, Shapporji Pallonji Biotech Park Pvt Ltd., to Dr.N.R.K.Raju dt.1.11.2006.
Ex.A-4 Debit Note issued by Head-Finance & Company Secretary, Shapporji Pallonji Biotech Park Pvt Ltd. to Dr.N.R.K.Bio-tech Pvt Ltd., Dt.14.12.2006
Ex.A5 Letter addressed by Dr.N.R.K.Biot ech Pvt Ltd., to P.Gopal Krishnan, Head Biotech Park dt.16.6.2009.
Ex.A-6 Letter addressed by Shapoorji Pallonji Bio tech Park Pvt Ltd., to Dr.N.R.K. Biotech Pvt Ltd dt.20.4.2009.
Ex.A-7 Letter addressed by Shapoorji Pallonji Bio tech Park Pvt Ltd., to Dr.N.R.K. Biotech Pvt Ltd dt.2.4.2009.
Ex. A-8 Letter addressed by Dr.N.R.K.Biotech Pvt Ltd., to P.Gopal Krishnan, Head Biotech Park dt.30.3.2009.
Ex.A-9 Letter addressed by Dr.N.R.K.Biotech Pvt Ltd., to Chairman & Managing Director, APIIC Ltd., dt.30.3.2009.
Ex.A-10 Letter addressed by State Bank of Hyderabad, Funfoundry, Hyderabad to Dr.N.R.K.Biotech Pvt Ltd., dt.26.3.2009.
Ex.A-11 Letter addressed by Dr.N.R.K.Biotech Pvt Ltd., , to P.Gopal Krishnan, Head, Biotech dt.10.2.2009.
Ex.A-12 Letter addressed by Dr.N.R.K.Biotech Pvt Ltd., , to P.Gopal Krishnan, Head, Biotech dt.24.2.2009
.
Ex.A-13 Letter addressed by Shapoorji Pallonji Bio tech Park Pvt Ltd., to Dr.N.R.K. Biotech Pvt Ltd dt.22.1.2009.
Ex.A14 Letter addressed by Dr.N.R.K Biotech Pvt Ltd., to The Chief Executive, Shapporji Pallonji Biotech Park Pvt Ltd., dt.13.12.2008.
Ex.A15 Colour Xerox of VISA-CARD of Nadimpally Naga Pooja.
Ex.A16 Hard copies of Power Point Presentation of Shapporji Pallonji Bio tech Park Pvt. Ltd., along with CD (compact disk).
Ex.A-17 Brochure.
Documents marked for Opposite Parties:
Ex.B-1 Copy of the Minutes of meeting dt.29.11.2006.
Ex B-2 Debit Note dt.13.12.2006.
Ex.B-3 Letter from Dr.N.R.K.Bio-Tech Pvt Ltd., to the Adm. Officer,
S.P.Biotech, Begumpet, Secunderbad.
Ex.B-4 Photographs of the building on allotted plot.
Ex.B-5 Letter dt.8.4.2009 addressed by Dr.N.R.K.Raju to Mr.P.Gopal Krishnan.
Ex.B-6 Letter t.24.4.2009 addressed by Dr.N.R.K.Raju to Mr.P.Gopal Krishnan.
Ex.B-7 Letter dt.9.5.2009 addressed by Mr.VVN Reddy of Shapoorji Pallonji Biotech Park (P) Ltd., to Dr.N.R.K.Raju of Dr.N.R.K.Biotech Pvt.Ltd.,
Ex.B-8 E-mail dt.7.8.2009 addressed to Mr.P.Gopal Krishnan.
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
3) ________________________________
MEMBER
Dt. 17. 2. 2010.
“UP LOAD – O.K.”
