Delay of 30 days is condoned.

          This Revision petition has been filed by Haryana Urban Development Authority (‘HUDA’ for short) against the order dated 2.1.2006 passed by State Consumer Disputes Redressal Commission (hereinafter referred to as the ‘State Commission’) in appeal No.1223 of 2002, vide which appeal of HUDA assailing District Forum’s order has been disposed of with more favourable dispensation to the complainant than what was allowed by the District Forum.

Facts of the case ------

          Complainant before the District Forum Shri B.M. Malhotra was initially allotted plot No.1439-P in Sector 23-24A, Gurgaon on 27.3.1985 for Rs.44,528/-.  On 21.11.1990, he was allotted plot bearing No.4224P in lieu of Plot No.1439P due to change in the lay out plan.  This plot number too was revised to plot No.1625P, Sector-10-A, Gurgaon.  However, due to pendency of litigation, HUDA vide their letter dated 29.7.1997 finally offered plot No.1638 in Sector 45 @ Rs.2350/- per sq.yd. which was accepted by the complainant.  When even this plot was not delivered in time, a complaint was filed by Shri B.M. Malhotra before the District Forum praying for direction to the opposite party (HUDA) to deliver the plot and charge only the original total cost of Rs.44,528/- and also refund all the additional payments made by him during the intervening period with interest, compensation etc.  The District Forum vide its order dated 26.11.2001 after hearing the parties and going through evidence on record allowed the complaint and directed the petitioner/opposite party (HUDA) to charge the same old rate for the alternate plot at which the original plot was allotted to the complainant - further to pay interest on the deposits made by the complainant against his original plot at the rate as per HUDA policy after two years from the date of deposits till the date possession.  The petitioners/opposite party was also directed to deliver the possession of the alternative plot to the respondent-complainant and ordered the refund of excess amount paid by him.

          Aggrieved with the order of the District Forum, the petitioners (opposite parties) preferred Appeal before the State Commission.  The State Commission, in its order dated 2.1.2006 held that the demand of extra price of land made  by petitioners/opposite party (HUDA) was wholly unjustified.  The State Commission, while maintaining  the order of the District Forum with regard to delivery of possession of the plot at the original price and refund of excess amount paid by the complainant, however, ordered payment of interest @ 12% p.a. after two years from the date of allotment till delivery of the plot as against the interest as per HUDA policy as directed by the District Forum.  We are informed that as per HUDA policy interest range at around 8%.

          It is against this order of the State Commission that petitioners/opposite parties (HUDA) have filed this revision petition.

          It may stated at this stage itself, that during the pendency of the revision petition at the instance of this Commission, the alternate Plot No.1638, Sector 45, Gurgaon was handed over by the petitioners and possession thereof taken over by the complainant on 24.8.2007 leaving the parties to raise their contentions only with regard to whether original price is to be charged for the alternate plot and whether the respondent/complainant was entitled to any compensation for the delay in delivering possession.

          Learned counsel for the petitioner has contended that the petitioner, in keeping with their policy to provide alternate plot whenever the land acquired or plot allotted became a subject matter of prolonged litigation offered plot No.1638 in Sector 45, Gurgaon to the complainant.  Whenever there was problem, as in this case first due to change in the lay out plan and subsequently due to litigations, the petitioner offered alternate plot to an allottee.  This should be viewed as a commitment of the petitioner    to render effective public service rather than drawing adverse inference as has been done by the fora below.

          Next, drawing our attention to exhibit P2 at page-16 of  the paper book, learned counsel has contended that this letter of offer of alternate site clearly stated that due to pendency of litigation, plot No.1638 in Sector 45 at the rate of Rs.2350/- per sq.yd. was being offered for allotment and the complainant vide his letter dated 18.8.1997 Annex.P (page 17) gave his consent to accept the offer.  The counsel contends that in view thereof it was not open for the allottee respondent to question the rate later.  Besides, the complainant has already deposited the amount calculated at the rate stated in the letter of offer of alternate plot without any protest.  Learned counsel further contends that the State Commission further failed to consider that the petitioner had offered the possession of the plot vide its letter dated 7.3.2001, but the complainant did not respond with ulterior motive to blame the petitioner.  The State Commission has clearly erred in not considering these vital aspects of the case and wrongly held that the respondent/complainant was entitled to the plot at original price.  The learned counsel thereafter has referred to the judgment of the Apex Court in the case of Bangalore Development Authority Vs. Syndicate Bank in Civil Appeal No.5462 of 2002 decided on 17.5.2007 and has contended that as per this latest judgment of the Hon’ble Supreme Court, the respondent/complainant is not entitled to any relief as the petitioner had not stipulated any time period for the delivery of possession of the plot in their letter of allotment and further more when the petitioners have allowed interest on the prior payments at the rate ranging  from 10 to 15%. 

Counsel for the respondent complainant on the other hand has contended that the petitioner/opposite party had repeatedly changed the allotment and raised unjustified additional demands from time to time and finally offered possession of the alternate plot after 15 years when he had already approached the District Forum.  The prolonged and inordinate delay is clearly deficiency in service. Learned counsel contends that in a number of similar cases, the National Commission has awarded 18% rate of interest and the State Commission was fully justified in awarding interest @ 12% to compensate the respondent complainant to cover the cost of escalation in prices and cost of construction.

          On the point of the petitioners being entitled to pay only the original price as against the market price levied on the respondent/complainant, he has cited the judgment of the Supreme Court in HUDA Vs. Raj Laxmi reported in IV (2004) CPJ 135C where in while disposing of an appeal against the order of the National Commission, the Supreme Court said ;

“3.     in our view, there is no infirmity in the reasoning of the National Commission in directing that the alternate plot be given at the same price at which original plot was allotted.”

          The counsel contends that the order of the District Forum as well as the State Commission are inconformity with this law laid down by the Apex Court and, therefore, need no interference.

          We have carefully heard both the learned counsel for the parties and perused the records.

          While the petitioner has admitted that there has been repeated changes and offer of alternate plots to the respondent,  these were occasioned because of situations arising first on account of change in the lay out plan and subsequently due to litigations which take years to get resolved.  The delay was for reasons beyond their control and un-intentional.  The petitioner, however has offered alternate plot every time a contingency arose keeping in view the interest of the respondent.

          In a mammoth organization like that of the petitioner who acquire hundred of hectares of land, develop them and offer as plots ; often houses and flats in thousands to the general public ; it would be unfair to blame every instance of delay on them.  It is common knowledge that  litigations take years often more than a decade to get resolved.   If in such a scenario the respondent-complainant was offered alternate plot which he accepted in writing and voluntarily deposited the amount at the prevalent rate of the sector of the alternate site without any manner of protest or representation, it cannot be said that the petitioner was deficient in service.

          We have perused Annex.P2 (Page 16). This letter dated 29.7.1997 is the offer letter of alternate plot No.1638 in Sector 45, Gurgaon.  It clearly states that the cost of the plot is to be calculated @ Rs.2350/- sq.yd.  It also fairly stipulates that the allottee would be entitled to  interest @ 10% p.a. upto Nov. 1991 and 15% thereafter on the deposits already made.  The concluding para of the letter reads as under :

“You are, therefore, requested to convey your acceptance within 30 days from the receipt of this letter failing which this offer shall stand withdrawn and it shall be presumed that you are willing to retain the earlier allotment/plot.  Your right to approach the court of law for an alternative plot shall be barred and the possession of earlier allotted plot shall be offered to you as and when it become free from encumbrances.”

          Clearly, therefore the respondent/complainant had the option, either to wait for the litigation to be over in order to get possession of the original plot at original price or choose the option of accepting the alternate plot at the price offered by the petitioner.  The respondent complainant having consented to opt for the later option, in our view,  he cannot claim the alternate plot at the price of the original plot.  It is also to be noted that even the original plot No.1439P allotted vide Annex.P. (page 13) clearly stated that the price quoted was tentative and clause 9 thereof stipulated that  :

“The above price is tentative to the extent that any enhancement in the cost of land awarded by the competent Authority under the Land Acquisition Act shall also be payable proportionately as determined by the authority.  The additional price determined shall be paid within thirty days of its demand.”

          The District Forum as well as the State Commission thus clearly fell into an error of judgment in holding that the complainant was entitled to the alternate plot at the price of original plot.

          On the point of law on the subject learned counsel for the respondent has cited a number of judgments and relied particular on the judgment in the case of HUDA Vs. Raj Laxmi (Supra) and has argued that by virtue of these series of rulings, it is by now the settled law that alternate plot allotted due to delay on part of the authority will be charged only at the original price. 

          No doubt, the judgments cited by the learned counsel delivered by the Apex Court in the particular facts and circumstances the cases concerned held the field’s but the latest ruling of the Hon’ble Supreme Court cited by the learned counsel for the petitioner delivered through judgment dated 17.5.2007 in the case titled Bangalore Development Authority Vs. Syndicate Bank will hold the field hence.  This judgment lays down the principles to be followed in deciding matters particularly concerning delay in delivery/possession of allotted plots/flats/houses and payment of compensation and other reliefs.  The principles laid down by the Hon’ble Supreme Court read as under :-

“The principles

10. Where a Development Authority forms layouts and allots plots/flats (or houses) by inviting applications, the following general principles regulate the granting of relief to a consumer (applicant for allotment) who complains of delay in delivery or non-delivery and seeks redressal under the Consumer Protection Act., 1986 (‘Act’ for short) – {vide : Lucknow Development Authority V. M.K. Gupta MANU/SC/0178/1994, Ghaziabad Development Authority V.Balbir Singh MANU/SC/0282/2004, and Haryana Development Authority V.Darsh Kumar MANU/SC/0634/2004, as also Ghaziabad Development Authority V. Union of India MANU/SC/0414/2000} :

(a)       Where the development authority having received the full price, does not deliver possession of the allotted plot/flat/house within the time stipulated or within the reasonable interest thereon from the date of refund.  In addition, the allottee may also be entitled to compensation, as may be decided with reference to the facts of each case.

(b)      Where no time is stipulated for performance of the contract (that is for delivery), or where time is not the essence of the contract and the buyer does not issue a notice making time the essence by fixing a reasonable time for performance, if the buyer, instead of rescinding the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts.  However, if some statute steps in and creates and statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute.

(c)       Where an alternative site is offered or delivered (at the agreed price) in view of its inability to deliver the earlier allotted plot/flat/house, or where the delay in delivering possession of the allotted plot/flat/house (page 2725) is for justifiable reasons, ordinarily the allottee will not be entitled to any interest or compensation.  This is because the buyer has the benefit of appreciation in value.

(d)       Though the relationship between Development Authority and an applicant for allotment is that of a seller and buyer, and therefore, governed by law of contracts, (which does not recognize mental agony and suffering as a head of damages for breach), compensation can be awarded to the consumer under the head of mental agony and suffering, by applying the principle of Administrative Law, where the seller being a statutory authority acts negligently, arbitrarily or capriciously.

(e)       Where an alternative plot/flat/house is allotted and delivered, not at the original agreed price, but by charging current market rate which is much higher, the allottee will be entitled to interest at a reasonable rate on the amount paid towards the earlier allotment, from the date of deposit to date of delivery of the alternative plot/flat/house.  In addition, he may be entitled to compensation also, determined with reference to the facts of the case, if there are no justifiable reasons for non-delivery of the first allotted plot/flat/house.

(f)         Where the plot/flat/house has been allotted at a tentative or provisional price, subject to final determination of price on completion of the project (that is acquisition proceedings and development activities), the Development Authority will be entitled to revise or increase the price.  But where the allotment is at a fixed price, and a higher price or extra payments are illegally or unjustifiably demanded and collected, the allottee will be entitled to refund of such excess with such interest, as may be determined with reference to the facts of the case.

(g)       Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment without and mental agony, in addition to appropriate direction for execution and delivery of title deed.

(h)       Where the allotment relates to a flat/house and construction is incomplete or not in accordance with the agreed specifications, when it is delivered, the allottee will be entitled to compensation equivalent to the cost of completing the building or rectifying the defects. 

(i)          The quantum of compensation to be awarded, if it is to be awarded, will depend on the facts of each case, nature of harassment, the period of harassment and the nature of arbitrary or capricious or negligent action of the authority which led to such harassment.

(j)          While deciding whether the allottee is entitled to any relief and in moulding the relief, the following among other relevant factors should be considered : (i) whether the layout is developed on ‘no profit no loss’ basis, or with commercial or profit motive ; (ii) whether there is any assurance or commitment in regard to date of delivery of possession ; (iii) whether there were any justifiable reasons for the delay or failure to deliver possession ; (iv) whether the complainant has alleged and proved that there has been any negligence, shortcoming or inadequacy on the part of the developing authority or its officials in the performance of the functions or obligations in regard to delivery ; and (v) whether the allottee has been subjected has been subjected to avoidable harassment and mental agony.”

It is to be noted that the case in hand would fall in the category of principles  enunciated in category (b) and (e) above.  A perusal of the original letter of allotment no where states any time frame within which the plot was to be delivered nor did the respondent-complainant issue any notice fixing any outer limit for the possession to be delivered.  On the contrary, he has accepted the offer of alternate plot.  Therefore, as per the principle enumerated at  (b) above question of any breach or payment of damages does not arise.  Further more, since the respondent/complainant has been allotted and delivered the alternate plot by charging prevailing rate of the sector in which the alternate plot has been allotted, he was entitled to interest at reasonable rate on the amount paid towards earlier allotment from the date of deposits to date of delivery of the alternate plot.  In this respect, it will be useful to extract para 2 of the petitioner’s offer of alternate site letter dated 29.3.2007 which states :

“In order to meet the commitment, it has been decided to offer you an alternative plot No.1638 measuring 8 marla/kanal in the Sector 45 @ 2350/-. The Haryana Urban Development Authority has also decided that interest on the deposited amount @ 10% p.a. upto Nov., 1991 and 15% p.a. from Dec., 1991 till date of this offer shall be created/adjusted against payment of this intended allotment.  In case the allotment so calculated exceeds the price of this office, the excess amount, if any, shall be refunded to you."

          Thus, there is an inbuilt provision to compensate the respondent complainant with regard to previous deposits and the rate of interest at 15% p.a. in our view is adequate.  However, the period for which the interest would be paid has been limited to the date of offer i.e. upto 29.7.1997.  This period in our view should extend to the date of delivery of possession ; especially in the back ground of the respondent/complainant having been charged at the prevailing rate of the alternate plot.  This would be in consonance with the principle laid down by the Hon’ble Supreme Court enumerated at (e) above.  In keeping with the principle, the respondent/complainant cannot claim the alternate plot at the price of the original one as even the original price was tentative, no time frame for delivery of possession of the plot had been promised ; thus time was not the essence of the agreement.  Further, the complainant had not only agreed to accept the offer of the alternate plot but had deposited the amount at the rate indicated on behalf of the petitioners.  Under the circumstances and  discussions sated above, while the respondent/complainant would not be entitled to the alternate plot at original price, the petitioners will have to pay interest on his deposits at the rate of 15% p.a. till the date of delivery of possession of alternate plot.   This revision petition is disposed of in these terms.