DISPOSED ON: 31.03.2011

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

31^ST MARCH 2011

  PRESENT:-  SRI. B.S. REDDY                             PRESIDENT

                     SMT. M. YASHODHAMMA               MEMBER

                     SRI. A. MUNIYAPPA                         MEMBER         

COMPLAINT Nos.1375, 1376, 1378, 1380, 1384

                             1389, 1397, 1610 to 1617, 1619

     to 1622, 1624, 2266 to 2270,

     2272 to 2277 & 2279/2010

COMMON ORDER

SRI. B.S.REDDY, PRESIDENT

These are the complaints filed U/s. 12 of the Consumer Protection Act of 1986, by the respective complainants seeking direction against Opposite Party (herein after called as O.P) to refund the advance amounts paid with interest at 18% p.a. and to pay the arrears of rentals and expenses incurred in visiting the office of the OP and for compensation on the allegations of deficiency in service on the part of the OP. 

As the OP in all these complaints is common, the questions involved, relief claimed being the same, in order to avoid the repetition of facts and multiplicity of reasonings, these complaints stand disposed of by this common order.

The brief averments, as could be seen from the contents of these complaints, are as under:

2.      The complainants being lured away with the advertisement and propaganda issued by the OP regarding a schemes towards the construction of residential apartments to be constructed in the schemes called as “Orange Premium” and “Orange Township” at Sannamanikera Village, Devanahalli Town, Bangalore Rural District; booked flats with initial advance amounts paid to the OP. OP executed agreement to sell in favour of each of these complainants with an undertaking to complete construction within 18 months from the date of approval of the plan from the competent authorities and deliver the possession of the flats within 24 months from the date of approval of the plan. Further OP assured to pay certain amount every month towards monthly rentals till the completion of the project through ECS to the accounts of the complainants. OP failed to complete the project, the complainants demanded for refund of the advance amount paid. OP agreed to refund the amounts and issued cheques towards the rental premiums and refund of the advance amount. The cheques issued were dishonoured by the bank for “Insufficient Funds”. Later OP remained absconding. The complainants lodged police complaints and a case was registered against the OP for the offences punishable U/s 406 and 420 IPC. OP approached the Hon’ble High Court and filed Criminal Petition No.3866/2009, during the pendency of the said petition, OP made some part payments to the complainants. Ultimately the said Criminal Petition was dismissed. OP failed to comply the terms and conditions of the agreement deed and has not rendered proper service. The complainants invested the amounts anticipating that they would get the amount monthly to suit their day to day financial needs. Due to the abandonment of the scheme, the complainants are left in lurch. OP neither delivered the flat nor refunded the amount. The complainants are entitled for the interest at the rate of 18% p.a. OP has benefit of the same which benefit is deprived to the complainants. The details of the flats booked by each of these complainants, amount paid and the amount refunded, the total amount claimed is noted in the below chart for convenience sake:

3.      On appearance, OP filed the version. The defence set out by OP in all these complaints is almost same and identical. It is admitted that OP invited the intending purchasers to invest by purchasing the residential flats and these complainants paid initial advance and OP entered into an agreement to sell the apartments. Further it is admitted that OP agreed to complete the construction activities and deliver possession within 24 months from the date of approval of the plan. It is denied that the complainants approached the OP and requested to adhere to the terms of the agreement and to pay the monthly rentals and further it is denied that OP failed to complete the project as agreed. It is contended that the complainants on the basis of the reports in the media that there was a failure in the project marketed by the OP without even intimating OP filed criminal complaints. However OP requested and informed the complainants that the project / scheme floated by him in Devanahalli has got nothing to do with the project which has failed in K.R. Puram and that he was only marketing agent and that it is one M/s Granity Developers who had failed to deliver the sites. Further he informed the complainants that he would complete the project and handover the possession of the flats within the agreed period. The complainants did not believe the OP and insisted the refund all the money. In this regard OP was forced to cancel the agreement with the landlords and could not complete the project. The entire accounts and all documents were seized by the police; OP was unable to arrange for repayment. During the pendency of criminal petition before the Hon’ble High Court, OP made payments to the tune of Rs.1.84 Crores as per the directions of the Hon’ble High Court. The criminal petition was dismissed. OP entered into an agreement of sale with the landlords intending to construct residential flats and for the said purpose formulated a scheme to the intending purchasers. OP has invested more than 10 Crores for the purpose of development of the project.

          OP entered into an agreement with M/s Granity Properties Pvt. Ltd., on 29.06.2008 under which, OP was required to sell sites promoted and developed by the said M/s Granity Properties Pvt. Ltd., by way of marketing to its customers. OP was required to market the sites. M/s Granity Properties Pvt. Ltd., agreed to develop the project at the earliest possible time and handover the sites to the customers brought in by this OP. Acting on the agreement entered into between them, he invested huge money for promoting the sales of the sites / flats by way of advertising in several news papers. The prospective customers were required to pay the consideration amount in favour of M/s Granity Properties Pvt. Ltd., subsequent to promotion of the project by the OP; several customers approached OP and booked sites by paying advance in favour of M/s Granity Properties Pvt. Ltd., Subsequently the said M/s Granity Properties Pvt. Ltd., started giving excuses that it require more time to complete and develop the sites. The customers started to question the OP regarding the status of the development of the sites, since the same was marketed by the OP. OP requested M/s Granity Properties Pvt. Ltd., to repay the amount collected to the customers. However the said M/s Granity Properties requested OP to issue cheques for the amount collected and that they shall pay the same to the OP. Believing words of the M/s Granity Properties Pvt. Ltd., OP issued cheques to the customers for various amounts. M/s Granity Properties Pvt. Ltd., without making any payments to the OP absconded. The cheques issued by OP were returned unpaid as the money was required to be paid by M/s Granity Properties Pvt. Ltd., Aggrieved by the returning of the cheques the customers lodged various complaints against the OP and the Central Crime Branch seized the office of OP.

Panicked by the reports of the media about the aforementioned facts, the complainants came to the OP and started demanding to refund the entire money. OP requested the complainants that he shall complete the project within the agreed time and that he has nothing to do with the project floated by the said M/s Granity Properties Pvt. Ltd., OP requested the complainants that he would require time to repay the money expressing the facts that he already suffered losses. Criminal complaints were filed against the OP, OP preferred criminal petition U/s 482 of Cr. P.C. and sought for quashing of the criminal complaints filed against him. During the pendency of the criminal petition OP had made payments to the tune of Rs.1.84 crores as per the directions of the Hon’ble High Court. The Hon’ble High Court dismissed the criminal petition. Being aggrieved by the said order of dismissal, OP preferred SLP No.2611/2010 before the Hon’ble Supreme Court. The Hon’ble Supreme Court after considering the case on merits was pleased to stay the operation of the order, by directing the OP to pay entire liability. OP sought for some time to deposit the money and the Hon’ble Supreme Court was pleased to grant time to deposit the entire money. The OP has cleared the entire liability by depositing the entire amount as per the directions of the Hon’ble Supreme Court. The Hon’ble Supreme Court has now directed the Hon’ble High Court to disburse the entire money so deposited and the matter is before the Hon’ble High Court pending consideration. The complainants themselves did not allow the OP to complete the project and insisted for refund of money based on the false media reports and as such the complainants are not entitled for any compensation as claimed by them. OP has honestly deposited entire liability before the Hon’ble Supreme Court and he has no intention to cheat the complainants. OP is not liable to pay the claim amount and he has already deposited entire liability. Hence it is prayed to dismiss the complaints.               

4.      In order to substantiate the complaint averments, each of the complainants filed affidavit evidence in support of their respective claims made in the complaints. OP filed affidavit evidence in support of the defence version and produced documents.

5.      Arguments on both sides heard. Points for consideration are:

       Point No.1:- Whether the complainants proved the          

                          deficiency in service on the part of

                            the OP?

Point No.2:- Whether the complainants are entitled

                   for the reliefs now claimed?

       Point No.3:- To what Order?

6.      We record out findings on the above points:

Point No.1:- In Affirmative.

Point No.2:- Affirmative in part.

Point No.3:- As per final Order.

R E A S O N S

7.      At the outset it is not in dispute that the complainants in response to an advertisement and propaganda issued by the OP regarding the schemes called as “Orange Premium” and “Orange Township” wherein residential apartments were proposed to be constructed at Sannamanikera Village, Devanahalli Town, Bangalore Rural District, booked each of them flats by paying initial advance amounts to the OP. The remaining amount was to be paid in installments on completion of different floors as mentioned in the sale agreement executed by OP. While executing the agreement to sell in favour of each of these complainants, OP had undertaken to complete the construction within 18 months and deliver possession of the flats within 24 months from the date of approval of the plan by the competent authorities.

Further OP has executed indenture of agreement in favour of each of these complainants assuring to pay certain amount every month towards rentals from the date of execution of the sale agreement till the completion of the project. OP was unable to commence the project work, the complainants demanded for refund of the advance paid. OP while agreeing to refund the amounts issued cheques in favour of the complainants towards the rental premiums and refund of advance amount, but the said cheques were dishonoured on the ground “Insufficient Funds”. The complainants lodged police complaints against the OP and a case was registered for the offences punishable U/s 406 and 420 IPC against the OP. Being aggrieved by the said registration of the case OP approached the Hon’ble High Court in criminal petition No.3866/09. During the pendency of the said criminal petition OP refunded part of the amounts to the complainants. The said criminal petition was dismissed. Since OP failed to refund the amounts, the complainants filed these complaints seeking for refund with interest at 18% p.a. along with compensation and arrears of rental amount, expenses incurred. OP approached Hon’ble Supreme Court in SLP No.2611/10 challenging the order of dismissal of the criminal petition No.3866/09. As per the direction of the Hon’ble Supreme Court OP has deposited an amount of Rs.2,00,00,000/- on 07.05.2010 and Rs.3.16 crores on 22.07.2010 as per documents No.2 and 3. It is stated that the sum of Rs.1.84 crores was paid by the OP in criminal petition No.3866/09 as per the direction of the Hon’ble Hihg Court. OP claims that out of Rs.7,00,00,000/- an amount of Rs.1.84 crores was paid while the criminal petition No.3866/09 was pending before the Hon’ble High Court and an amount of Rs.5.16 crores was deposited before the Supreme Court. Thus the entire amount received from the parties is already deposited, the Hon’ble Supreme Court has directed the Hon’ble High Court to disburse the entire amount deposited and now the matter is before the Hon’ble High Court for consideration. Thus it is stated that OP is not liable to pay any amount, as he has already deposited the entire liability.

8.      It may be noted OP has not purchased any land for the proposed project and no documents are produced in support of the contention that the agreements entered into between the land owners and OP for the purchase of the lands was cancelled as a result he has been put to a loss to an extent of Rs.10,00,00,000/- which he had invested. Therefore it is not possible to accept that the complainants based on the reports of the media about the failure of the project floated M/s Granity Properties pvt. Ltd., insisted the OP to refund the amounts inspite of OP assuring to complete the project as per the time schedule. OP without acquiring any property for completion of the project made these complainants to part with huge amounts towards advance sale consideration. Though OP executed indenture of agreements to pay monthly rentals till the project is completed, but OP has not paid any amount towards rental arrears. It appears that only to make the complainants to pay the advance sale consideration, OP has assured to pay monthly rentals. When OP was not able to commence the project work as he has not purchased any lands required for the project, it would have been fair enough on his part to refund the entire amount received from the complainants. Therefore the act of OP in not completing the project or refunding the amount to the complaints amounts to deficiency in service on the part of the OP.

9.      The complainants after deducting the amount refunded during the pendency of the criminal petition No.3866/09 are claiming refund of the balance principle amount with interest at 18% p.a., expenses incurred for visiting the office of the OP, CCB Office, Police Stations; towards compensation and damages for not complying the terms and conditions and also monthly rental arrears. The OP has not filed the list of total number of investors and the total amount received from the investors. Even it is not possible to accept that the amount due to the complainants in these complaints includes the amount already deposited before Hon’ble Supreme Court. Therefore merely because an amount of Rs.5.16 crores is in deposit and the Hon’ble High Court is considering disbursement of the said amount amongst the investors as submitted by the learned counsel of the OP; it cannot be said that these complaints are to be dismissed taking into consideration of the amount already deposited.

Interest claimed at the rate of 18% p.a. is just and reasonable. The complainants have been deprived of the returns from the said amounts; OP had benefit of the said amount. We have to take into consideration escalation of costs of the flats, mental agony and physical harassment by the act of the OP in not refunding the amount and commencing the project. Arrears of rental amount as agreed under the agreement deeds is not paid by the OP. Since the project has not commenced, it is not just and reasonable to order for payment of arrears of rent. The complainants have incurred expenses to visit the office of the OP and they also approached the police in lodging the complaints. Instead of awarding compensation for mental agony and sufferings, expenses incurred to visit the office of OP and arrears of rental amounts, it would meet ends of justice by awarding interest at 18% p.a. on the amounts paid by these complainants.

10.    In complaint No.1375/10 an amount of Rs.2,40,000/- has been refunded; after deducting that amount, the balance amount is of Rs.85,787/-, but complainant has claimed Rs.87,751/- hence an amount of Rs.2,000/- is claimed excess. The complainant is entitled for the balance principle amount of Rs.85,787/-.

In complaint No.1389/10 though in the complaint it is shown that only Rs.40,000/- is refunded out of Rs.2,98,400/-, but OP has stated that an amount of Rs.50,000/- has been refunded. The complainant has claimed the balance principle amount of Rs.2,48,400/- after deducting amount of Rs.50,000/- refunded. Therefore the complainant is entitled for the balance principle amount of Rs.2,48,400/-.

In complaint No.1378/10 though the complainant has admitted the refund of Rs.40,000/-, but he has not given deduction for the same while claiming the balance principle amount. After deducting that amount of Rs.40,000/- the balance principle amount is Rs.3,62,525/-. The complainant is entitled for the said sum.

In complaint No.1616/2010 in the complainant it is admitted that an amount of Rs.15,000/- has been refunded, but the same has not been given deduction in the principle amount. Hence after deducting that amount of Rs.15,000/- the balance amount that remains Rs.1,85,000/-; complainant is entitled for the said sum.

Under these circumstances we are of the view that complainants are entitled for refund of the principle amount with interest at 18% p.a. from the date of respective payments, till the date of realization with litigation cost of Rs.2,000/- to each of the case. Accordingly we proceed to pass the following:     

O R D E R

The complaints filed by the complainants are allowed in part.

1. In complaint No.1375/2010 OP is directed to refund an amount of Rs.85,787/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

2. In complaint No.1376/2010 OP is directed to refund an amount of Rs.3,62,525/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

3. In complaint No.1378/2010 OP is directed to refund an amount of Rs.3,62,525/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

4. In complaint No.1380/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

5. In complaint No.1384/2010 OP is directed to refund an amount of Rs.88,881/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

6. In complaint No.1389/2010 OP is directed to refund an amount of Rs.2,48,400/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

7. In complaint No.1397/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

8. In complaint No.1610/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

9. In complaint No.1611/2010 OP is directed to refund an amount of Rs.3,35,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

10. In complaint No.1612/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

11. In complaint No.1613/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

12. In complaint No.1614/2010 OP is directed to refund an amount of Rs.3,65,538/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

13. In complaint No.1615/2010 OP is directed to refund an amount of Rs.1,00,000/- with interest at 18% p.a. from the date of respective payments, till the date of realization and pay litigation cost of Rs.2,000/- to the complainant.

14. In complaint No.1616/2010 OP is directed to refund an amount of Rs.1,85,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

15. In complaint No.1617/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

16. In complaint No.1619/2010 OP is directed to refund an amount of Rs.2,88,424/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

17. In complaint No.1620/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

18. In complaint No.1621/2010 OP is directed to refund an amount of Rs.75,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

19. In complaint No.1622/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

20. In complaint No.1624/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

21. In complaint No.2266/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

22. In complaint No.2267/2010 OP is directed to refund an amount of Rs.2,87,219/- with interest at 18% p.a. on the principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

23. In complaint No.2268/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

24. In complaint No.2269/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

25. In complaint No.2270/2010 OP is directed to refund an amount of Rs.1,00,000/- with interest at 18% p.a. from the date of respective payments, till the date of realization and pay litigation cost of Rs.2,000/- to the complainant.

26. In complaint No.2272/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

27. In complaint No.2273/2010 OP is directed to refund an amount of Rs.1,60,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

28. In complaint No.2274/2010 OP is directed to refund an amount of Rs.2,69,042/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

29. In complaint No.2275/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

30. In complaint No.2276/2010 OP is directed to refund an amount of Rs.1,00,000/- with interest at 18% p.a. from the date of respective payments, till the date of realization and pay litigation cost of Rs.2,000/- to the complainant.

31. In complaint No.2277/2010 OP is directed to refund an amount of Rs.2,00,000/- with interest at 18% p.a. from the date of respective payments, till the date of realization and pay litigation cost of Rs.2,000/- to the complainant.

32. In complaint No.2279/2010 OP is directed to refund an amount of Rs.1,50,000/- with interest at 18% p.a. on the entire principle amount from the date of respective payments up to the date of refund of the part of the amount refunded and till realization on the balance principle amount with litigation cost of Rs.2,000/- to the complainants.

OP to comply the order within four weeks from the date of this order.

This original order shall be kept in the file of the complaint No.1375/2010 and a copy of it shall be placed in other respective files.

Send the copy of this order to both the parties free of cost.

(Dictated to the Stenographer and typed in the computer and transcribed by him, verified and corrected, and then pronounced in the Open Court by us on this the 31^st day of March – 2011.)

PRESIDENT

MEMBER                                                      MEMBER 

  Snm: