F.A.No. 922 OF 2006 AGAINST C.D.No.765 OF 2005
 DISTRICT FORUM-I HYDERABAD

Between:
1.      The Executive Engineer (Housing),
          Central Division, APHB, 2^nd Floor,
          Gagan Vihar,M.J.Road, Hyderabad

2.      The Vice-Chairman/Housing Commissioner,
          2^nd Floor, Gagan Vihar, M.J.Road, Hyderabad

3.      A.P. Housing Board,
          Rep. by its Managing Director,
          Gruhakalpa Building, Nampally,
          Hyderabad.                                                Appellants/opposite parties

A N D

Smt P.Jyothi W/o P.Venkata Swamy
Flat No.407, Prithvi Apartments-II,
Chikkadpally, Hyderabad                                  Respondent/complainant

Counsel for the appellants                       Sri D.Ranganath Kumar
Counsel for the respondent                     Smt M.Umadevi

QUORUM:            SRI K.SATYANAND, PRESIDING MEMBER
                                                        &

                              SRI R.LAKSHMINARSIMHA RAO, MEMBER

      WEDNESDAY THE TWENTY FOURTH  DAY OF JUNE

                                         TWO THOUSAND NINE

          Oral Order ( As per Sri R.Lakshminarsimha Rao, Member)

***

          The respondent filed complaint under section 12 of the C.P.Act before the District Forum seeking refund of Rs.98,000/- with interest @ 24% per annum and Rs.5,000/- as damages as also Rs.5,000/- towards expenses.  It was alleged that on 7.5.2003 the respondent paid an amount of Rs.10,000/- towards registration charges to the opposite parties.  On 30.07.2003 the respondent paid a sum of Rs.88,000/- towards first instalment of the cost of the house allotted to her and she was required to pay the balance amount in five instalments.  The first appellant through their letter dated 20.11.2003 reminded the respondent that she had not paid the instalment amount of Rs.1,47,000/- as per the schedule by 30.10.2003 and they further informed the respondent that they would receive the second instalment amount with interest @ 10% per annum till 15.12.2003 failing which they would cancel the allotment and further the amount already paid.  On 6.1.2004, the first  appellant requested the respondent to pay the arrear instalment by 31.01.2004 and she was informed that if she fails to pay the amount in stipulated time, allotment of the house would be cancelled by allotting the house to a substitute.  The respondent could not pay the amount due on account of financial constraints.  The respondent addressed letter dated 29.6.2004 requesting the appellants to refund the amount as she has to meet the marriage expenses of her daughter.

2.      On 7.8.2004 the second appellant requested the respondent to pay Rs.10,000/- by the end of September, 2004 for piped cooking gas supply, Rs.40,000/- for covered car parking space and Rs.15,000/- for uncovered parking.   The letter made it clear that the respondent’s name is in the live list of allottees and the amount paid by her is not forfeited.  The respondent had got issued legal notice dated 22.1.2005 through her advocate to the second appellant.  The second appellant neither did refund the amount nor did give any reply. There was no condition as to forfeiture of the amount either in the allotment order or in the application-cum-brochure.  The appellants allotted the flat to the other applicant in the waiting list by collecting registration fee of Rs.10,000/- from him and thereby the appellants got double benefit.

          The first appellant filed objections statement before the District Forum. It was contended that the respondent failed to pay the second installment amount even after request made by the appellants for several times and consequently the appellants were compelled to cancel the allotment and forfeit the amount paid by the respondent.

          Having regard to the pleadings, the District Forum framed the following points:

1.     Whether there is deficiency in service on the part of the opposite parties?

2.    Whether the complainant is entitled for the refund of the amounts paid in the circumstances of the case?

The respondent filed his affidavit and got marked Exs.A1 to A1.  On behalf of the appellants Exs.B1 and B2 have been marked. 

The District Forum by its order dated 20.4.2006 answered points no.1 and 2 in the affirmative and held that the respondent is entitled to the refund o R.98,000/- and costs of Rs.2,000/-.  The appellants were held jointly and severally liable to pay the amount. 

Being aggrieved by the above order of the District forum, the appellants have preferred the appeal. 

We have heard the learned counsel appearing for the appellants and the learned counsel for the respondents.  The learned counsel for the appellants submitted that the amount paid by the respondent is liable to be forfeited, on account of her failure to pay the amount due in stipulated time, in terms of the regulation which was approved by the Government vide G.O.Ms.No.62 (Hg) (HB-II) Dept. dated 3.12.2004 providing for cancellation of allotment by forfeiting 10% of the notified cost or the total amount paid by the allottee whichever is lower.  He submitted that the District forum has no jurisdiction to overrule or ignore G.O.Ms.No.62 (Hg) (HB-II) Deptt. Dated 3.12.2004. 

The learned counsel appearing for the respondent submitted that the District Forum has passed a reasoned order and there is no ground to interfere with its findings.  She has submitted that the appellants in their discretion and in absence of any tems and conditions in regard to forfeiture of the amount either in allotment letter or brochure cannot be permitted to forfeit the amount.

Having regard to the contention of the parties, the points that arise for determination in this appeal are:

1)    Whether the appellants are entitled to forfeit any amount paid by the respondent?

2)    Whether the District Forum was justified in awarding refund of the entire amount to the respondent?

3)    Whether the order passed by the District forum calls for interference in the appeal?

POINT NO.1:       The respondent entered into an agreement with the appellants for purchase of flat and paid an amount of Rs.10,000/- on 7.5.2003 towards registration charges and Rs.88,000/- on 30.7.2003 towards the first instalment of the cost of the flat allotted to her.  Agreement stated to have been executed in between the parties has not been filed before the District forum.  Ex.A2, letter No.2365/2001 dated 14.6.2003 issued by the appellant no.1 to the respondent requesting her to make payment of the instalments as per the schedule given in the application-cum-brochure.  The application-cum-brochure was not filed either by the appellants or by the respondent.  In Ex.A2 it was stated that the number of isntalments are six and respective due dates and the amount payable was also mentioned and it was informed to the respondent that the appellants would levy interest at 10% per annum on delayed payment of isntalments.  The appellants informed the respondent through Ex.A3 that they will accept the payment of second instalment upto 15.12.2003 subject to payment of interest @ 10% per annum and they had also informed her that the work ws under progress as per the schedule.  A reminder under Ex.A4 was issued extending the time for payment of second installment till 31.1.2004 and the respondent was informed that in case of her failure to pay the amount by the stipulated date, allotment would stand cancelled and the flat would be allotted to a substitute.  Another letter Ex.A5 addressed to the respondent on 15.6.2004 that she had not informed her decision to make payment or withdrawal of her application and it was informed to the respondent that allotment would be cancelled and registration fees along with 10% amount paid by the respondent would be forfeited to the housing board w.e.f.,  30.6.2004.  In reply to Ex.A5, the respondent had issued letter Ex.A6 informing the appellants that she was not in a position to pay the balance instalments and requested them to refund the amount.  Ex.A6 was followed by legal notice Ex.A7 bringing to the notice of the appellants that there was no condition of forfeiting 10% amount either in the allotment order or in the letter dated 15.6.2004. 

The respondent failed to pay the second instalment.  Hence she became a defaulter and requested for refund of the amount paid by her towards registration charges and the first instalment of the cost of the house.  The appellants have contended that they are entitled to forfeit 10% of the notified costs or total amount paid by the respondent whichever is lower and they had relied upon regulation issued by them after the agreement was brought into existence, stating that it was approved by the Government vide G.O.Ms.No.63 (Hg) ( HB-II) Deptt. 3.12.2004.  It was agreed by both the parties that in the agreement a condition was incorporated making the appellants entitled to forfeit 5% of the notified cost from the total amount paid by the respondent which ever is lower.  The terms and conditions prevailing at the time of execution of agreement would have operation in the field till the contract is performed except that any change in the terms and conditions of the agreement be made with the consent of the parties to the agreement.  As the appellants admitted the condition in the agreement in relation to the forfeiture of 5% of the notified cost would have application in the circumstances of the case, we are inclined to allow the appeal and modify the impugned order to the extent of award of refund of the amount of Rs.98,000/- and hold the appellants entitled to forfeiture of 5% of the notified cost.  The respondent is entitled to Rs.41,500/- i.e., notified cost of Rs.9,70,000/- - Rs.48,500/- ( 5% of the notified cost).

In the result, the appeal is partly allowed.  The appellants directed to pay the amount of Rs.41,500/- and costs of 2,000/- to the respondent.  Time for compliance four weeks.

                                                                   PRESIDING MEMBER

                                                                             MEMBER

                                                                        Dt. 24.06.2009