1. P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION : AT HYDERABAD

C.D. 50 /2005

Between:

                                                                                                           Complainants

And

SRI LAXMI ENCLAVES, MAHABUBNAGAR represented by its partners:

1. V. Shiva Reddy, S/o Chinna Reddy

    Age 54 years, Occ: Business

    R/o Flat No. 108, Balaji Enclave

    Tirumalanagar, Moulali,

    Hyderabad  - 40.

2.  B. V. Raghava Reddy

     s/o Pandu Ranga Reddy, age 47 years, Occ: Business

      R/o plot no.37, CH 67096, Bellary Chowrasta,

      Ganesh Nagaram, Kurnool

3.  G. Prakash Rao,

     S/o Yellaba Rao, age 50 years,

     Occ: Business, H.no.9-60,

      Kaverammapet village

     Jadcherla Mandal,

     Mahabubnagar district.                      .. Opposite parties.

CD 51/2005

Between:

1.  Areena Begum, D/o Md. Mohmood Miya, age 12 years, Student,

     Village and Mandal Bijinpally, Mahabubnagar District.

2.  Sreevani, D/o D. Jagath Reddy, age 15 years, Occ: Student, Poultry

     Form,  Veldanda post & Mandal, Mahabubnagar District.

3.  Avinash Kuamr, s/o B. Venkateshwara Rao, s/o Shantha Rao, age 10   

    years, Occ: Student, R/o Karukonda village , Bijinapally Mandal,

    Mahabubnagar District.

4. Sri Guru Raghavendra, C/o B. Sathya Narayana Singh, age 12,

    R/o Buddaram,  Gopal plet Mandal, Mahabubnagar District.

5.  Samba Shivudu, S/o Basappa, age : 40 years, Occc: Business,

       R/o Polkepad, Mandal Gopalpet, Mahabubnagar District.

6.  M. Suneetha, W/o M. balakristaiah, age : 30 years, Occ; House wife,

     R/o ¾ Parimila House I , Chaitanyapuri, Dilsukhnagar Hyderabad.

7.  L. Narsimha Rao, s/o Pedda Kistaiah, age : 50 yrs, Occ: Farmer,

     r/o Pasupula, Koderu Mandal, Mahabubnagar District.

8.  S. Narsimha Rao, s/o Suraiah, age 52 yrs, Occ: Agriculture, R/o post.

      Pasupula, Mandal Koderu, Mahabubnagar District.

9.  S. Kishan, S/o Balakistaiah, age 50 yrs, Occ: Driver, R/o Buddaram

      village, Gopalpet Mandal, Mahabubnagar District.

10.  Venkatramulu, s/o Ramulu, age 35 lyrs, Occ: Business, R/o Velgonda

        village, mandal Bijinapally, Mahabubnagar District.

11.  Thirupahi Reddy, s/o Narayan Reddy, age 40 yrs, Occ: Employee,

       R/o Domalapenta post, Amrabad Mandal, Mahabubnagar District.

12.  P. Shiva kumar, S/o Chandra Mouli, age 16, Occ: Student,

       R/o Gowreddypally, Telkapply Mandal, Mahabubnagar District.

13.  P. Lavanya, D/o Chandra Mouli, age 18, Occ: Student,

       R/o Gowreddypally, Telkapally mandal, Mahabubnagar District.

14.  Ramulamma , W/oRamulu, age 40 yrs, Occ: House wife,

      R/o   Velgonda village, Mandal lBijinapally, Mahabubnagar District.

15.  B. Ram Mohan, S/o B. Sudhakar, age 35 years, Occ: Agriculture, R/o

       Wadela post, Midjil mandal, Mahabubnagar District.

16.  Abdul Azeem, s/o Abdul Quadeer, age 25 years, Occ: Student,

        R/o Buddaram village, Gopalpet mandal, Mahabubnagar District.

17.  E. Omkar, S/o Keshavulu, age 45 years, Occ: Reporter, Andhra

       Jyothi, R/o Rajeev Chowk, pst and Mandal Wanaparthy,

        Mahabubnagar District.

18.  L. Saritha, W/o L. Suresh, age 25 years, Occ: House wife, R/o C/o Sai

       Bore wells, Raja Rameshwar Rao complex, Opp; Wanaparthy pst and

       Mandal, Mahabubnagar District.

19.  D. Shesagiri Rao, S/o d. Narasimha Rao, age 45 years, Occ;

       Agriculture, R/o Chityala village, mandal Wanaparthy, Mahabubnagar

       District.

20.  Gandam Janaki , D/o Sreenivasulu, S/o Eshawaraiah, age 14 yrs,

       occ: Student, R/o Wadela, Mandal Midjil, Mahabubnagar District.

21.  Gandam Archana, D/o Sreenivasulu, s/o Eshwaraiah, age 12, Occ:

       Student, R/o Wadela, mandal Midjil, Mahabubnagar District.

22.  B. Sai KLumar minor rep. his father b. Ramulu, S/o Chennaiah, age

       45 years, occ; employee, R/o Chukarkal village, Balnagar mandal,

       Mahabubnagar District.

23.  Sameena minor represented by her father M.A. Gaffar, S/o M.A.

        Quyyum, age 39 years, Occ; Business, R/o H.no.1-8-97/15/E, T.D.

        Gutta, Mahabubnagar.

24.  Shaheena begum, W/o Md. Naseer, age 24 years, occ: House wife,

       R/o Amistapur village, Bhoothpur Mandal , Mahabubnagar District.

25.  Samiya Begum minor represented by her father Sri Shaik Masood Ali,

       Occ: Conductor, APSRTC, Shadnagar Depot.

26.  Sri Shaik Massod Ali, Occ: Conductro, APSRTC, Shad Nagar Depot.

27.  V. Bhoopal, S/o Sayanna, age 30 years, Occ: Agriculture,

      Mudireddypally village post Rajapoor, mandal Balanagar,

       Mahabubnagar District.

28.  D. Balraj, S/o D. Venkat Ramulu, age 38  years, Occ: Govt Employee

      H.No.7-29, Gandhi chowk, Wanaparthy, Mahabubnagar District.

                                                                                                           Complainants

And

SRI LAXMI ENCLAVES, MAHABUBNAGAR represented by its partners:

1. V. Shiva Reddy, S/o Chinna Reddy

    Age 54 years, Occ: Business

    R/o Flat No. 108, Balaji Enclave

    Tirumalanagar, Moulali,

    Hyderabad  - 40.

2.  B. V. Raghava Reddy

     s/o Pandu Ranga Reddy, age 47 years, Occ: Business

      R/o plot no.37, CH 67096, Bellary Chowrasta,

      Ganesh Nagaram, Kurnool

3.  G. Prakash Rao,

     S/o Yellaba Rao, age 50 years,

     Occ: Business, H.no.9-60,

      Kaverammapet village

     Jadcherla Mandal,

     Mahabubnagar district.                      .. Opposite parties.

Counsel for the Complainants           : Mr. C. Rajeev Kumar        

Counsel for the   Opposite parties            :   OP I served.

                                                                Mr. M. Saifulla Baig  for OP 2

                                                                Mr. V. Gourisankar Rao for OP 3

CORAM    :   HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT

                                                            And

SMT. M. SHREESHA,LADY MEMBER

                 MONDAY, THE  THIRTIETH DAY OF  MARCH,

                                    TWO THOUSAND NINE.                                      

Common Oral order :( as per Smt. M. Shreesha, Hon’ble Member )

*           *           *

            Since both CDs 50/2005 and 51/2005  are dealing with common facts with common opposite parties  and therefore both these matters are being disposed of by this Common Order.

            The brief facts as set out in the complaint are : The opposite parties  started a real estate venture in survey no.444 and 445 of Kaverampet Village of Jadcherla Mandal, Mahabubnagar District  in Ac. 25.60 guntas and named the venture as “ Sai Nagar” and the market value at relevant time is Rs.20 lakhs per acre and the opposite parties prepared a layout for 494 plots in the scheme and enrolled members.  The third opposite partysi the  one of the  pattedars of scheme and is also a partner of venture and is authorized and having power to register the scheme plots.  The cost of  plot of 175 Sq. yards is of Rs.25,650/- i.e.,Rs.147/- per Sq. yard.  The duration of the scheme is 59 months from December, 1996 to October, 2001.  Every enrolled member has to pay Rs.350/- per month  and additional  amount of Rs.1000/- for every 12 months.  The corner plot will be allotted to the needy member on payment of Rs.10/-  per each Sq. yard in addition to Rs.25,650/-.  The opposite parties offered the plots adjacent to  N.H.7 @ Rs.300/- per Sq. yard.  There will be a lucky draw in every month.  The winner of the draw will be allotted plot and he need not pay future instalments.  If any member has paid the entire amount, the opposite parties will register the plot even during the scheme period.  The opposite parties authorized agents  to enroll the member to the scheme and to collect the monthly instalments.  The opposite parties also arranged cash counters at their office for collecting instalment amounts.  The complainants attracted by the advertisement joined the scheme, were allotted membership numbers having collected amounts by the opposite parties.  The total amount paid by the complainants and the plot numbers which have been allotted to them are shown below

The opposite parties due to disputes among them stopped the scheme midway  without any information to the members. They informed the complainants that they would register the plots only after completion of the scheme even if they paid the entire instalments. Vexed with the attitude of the opposite parties, the complainants got issued common legal notice on 2.10.2003 and 26.10.2003.  The first opposite party replied on 4.11.2003 assuring the complainants to settle the disputes  within one month and the third opposite party  sent reply on 23.10.003 denying his liability. Legal notices were not served on the second opposite party.   In spite of several requests,  plots were not registered in favour of the complainants.  Vexed with their attitude,  they approached this Commission seeking registration of specific plots together with compensation of Rs.10 lakhs , i.e., Rs.25,000/- to each individual and costs.

          Notices for opposite parties 1 and 2 were  published in VAARTHA news paper at Hyderabad and Kurnool Edition.

          Notices were served on the first opposite party but did not appear or file his counter.

          The second opposite party filed counter affidavit stating that Mr. Shiva Reddy purchased land in an extent of Ac.25.60 guntas of land in sy. No. 444 and 445 of Kavarampet Village  of Jadcherla Mandal, Mahaboobnagar District on 9.9.1996 for total consideration  of Rs.46,08,000/- , i.e, @ Rs.1,80,000/- per acre and an agreement of sale for consideration was executed  between the third opposite party and Sri V.Shiva Reddy.  Thereafter, the third opposite party executed GPA in favour of the second opposite partyand one B. Satyanarayana Singh and therefore the second opposite party sold the plots to some of the complainants.  Subsequently, the third opposite party without knowledge and  notice   of the second opposite party and B. Satyanarayana Singh cancelled the GPA and therefore  they are not in a position  to register the plots. The partners of Sri Laxmi Enclaves, Mahaboobnagar paid substantial sale consideration to the third opposite party and requested the third opposite party to extend time for payment of balance sale consideration. 

The second opposite party submits that he  along with Sri Shiva Reddy  and others entered into an agreement  and carried on Real Estate Business and  opposite party no. 3 and his family members entered into an agreement  for sale of Ac. 25.60 guntas of land by the first opposite party to the third opposite party.  Therefore, the third opposite party  is estopped from stating  that he does not have any privity of contract  with the complainants.  The third opposite  party also executed registered GPA in favour of himself and another person by name B. Satyanarayana Singh and that they sold the plots through their venture named “ Sai Nagar” and Sri Laxmi Encalves, Mahabubnagar.  The third opposite party and his family members received 60 to 70% sale consideration.  This sale consideration was paid to the  third opposite party only out of the instalments  collected  from the complainants. Even the complainants  paid the sale consideration in installments based on the agreements of sale  and the  GPA executed  by the third opposite party.  Therefore  rights accrued to the complainant in the property of the third opposite party  cannot be frustrated with the cancellation of agreement of sale and GPA by the third opposite party and submits that there is no deficiency of service on his behalf  and that he is not liable to any of the claims of the complainants  and the sale of plots to the complainants was on the strength of Agreement of sale and GPA executed by the third opposite party in favour of himself and the first opposite party and another person.  Hence, he claims dismissal of the complainant against him and costs.

The third opposite party filed counter  affidavit stating that  the present complainants filed individual complaints before the District Forum, Mahabubnagar and the District Forum has already dismissed 9 similar complaints against him and other opposite parties  based on the merits of the case holding that he is not a partner   of the said firm nor did he received any amount  much less he  executed agreements. The  complainants having suspected that their case will also meet the same fate have withdrawn 40 cases and filed this present complaint before this Commission.  

          The third opposite party contends that he and his brother  are pattedars of Ac. 25.60 guntas of land in sy. No.444 and 445 in Kaverammapet village, Jadcherla mandal, Mahaboobnagar District.  He submits that he is not a partner of  Sri Laxmi Enclaves, opposite party no.1, Sri V. Shiva Reddy, Sri B. V. Raghava Reddy and some others  are the partners of M/s. Sri Lakshmi Enclaves.  On 09.09.1996, Sri V.Shiva Reddy purchased the land in Sy. No. 444 and 445 in an extent of Ac. 25.60 guntas of Kaverammapet Village for a total sale consideration of Rs.46,08,000/- i.e., @ Rs.1,08,000/-  per acre.  He paid Rs.6 lakhs and agreed to pay in seven installments of half yearly each Rs.6 lakhs. He paid Rs.17,66,000/- upt o 25.3.2000. On 25.3.2000 Sri V. Shiva Reddy required time for payment of remaining sale consideration amount and interest.  As such, on 25.03.2000 a Settlement Agreement time was executed granted up to 09.03.2001 for payment of the said amount.  Even after, 09.03.2001 Sri Shiva Reddy has not paid the agreed amount.  Sri B. Shiva Reddy and their partners again approached elders for settling the matter and on 19.5.2002 a Memorandum of Understanding/agreement of sale was executed  between them and as per clause 4(b)  of the said MOU, Sri V. Shiva Reddy  will sell the plots and will get the sale deeds registered by the third opposite party and his brother in piece meal not less than 10 plots each time and pay Rs.11,000/- per plot and pay  entire sale consideration of Rs.36,98,650/-  which includes additional amount and interest.  The first opposite party and their  partners started sale of plots under the name “ Sri Sai Nagar” and enrolled members in the said enterprises.  The third opposite party submits that he has not received the entire amount and  for the amount which he has received as per the instructions of Sri V. Shiva Reddy, registered the plots.  He submits  that Sri V. Shiva Reddy failed to pay sale consideration as per MOU on 19.5.002.  He closed his firm M/s. Sri Lakshmi Enclaves and is absconding.  And he got issued  a legal notice through his counsel dated 28.5.2005 informing that the MOU  dated 19,5,002 stands cancelled and the amount paid by him stands forfeited.  Subsequently Sri V. Shiva Reddy filed O.S. No.25/2006 on the file of the I Additional District Judge Court, Mahabubnagar  against OP. 3 and his three brothers for specific performance and the suit is still pending. For the legal notice dated  02.10.2003 go issued by the complainants, he got issued a suitable reply notice dated 23.10.2003 stating that he has not started  the venture and that He has not received any amount from the complainants and that  he is liable to register the plots to them and that all the receipts  filed by the complainants were issued by Sri Lakshmi Encalves and that he has  not entered  into any agreement of sale  with the complainants .  For the breach of the terms and conditions  by Sri Lakshmi Enclaves,  the complainants have to approach competent civil court  for the redressal of their grievances.

The first opposite party did not choose to file any counter.

The brief point that falls for consideration is whether  there is deficiency in service  on behalf of the opposite parties  and if the complainants are entitled to relief sought for in the complaint.

The complainants filed affidavit evidence and also rejoinder reiterating the facts in the complaint and also stating that in the counter of opposite party no. 3  he  submitted that he is not a partner,  he is not liable for transaction. The complainants submit that in the appeal filed by the third opposite party, .i.e, FA nos. 355, 360, 361, 362, 364, 367, 368, 369 and 370 of 2004 he himself admitted the liability and got registered the plots  to the scheme members and in some of the cases he refunded the collected amount together with interest.  The said appeals were disposed by this Commission vide its order dated  5.1.006. The complainants submit that the contentions that there is no privity of contract and civil suit is pending etc are unsustainable because  the rights of  the agreement holders  that were transferred to the complainants for a valuable consideration cannot be destroyed and the rights accrued to the complainants with payment of installments on the strength of agreement of sale  with the owners of lands cannot be denied merely because agreement of sale with the owners was  cancelled due to the default of the agreement holder.

The complainants in support of their case in CD  50/2005 filed Ex. A1 to A6 and B1 to B14 and in CD 51/2005 Ex A1 to A8 and      Ex B1 to B14. 

Ex A1 is the copy of pamphlet/scheme conditions.  Ex A2 is the copy of legal notice dated 2.10.2003  issued to opposite parties. Ex A3  is the copy of legal notice dated  26.10.2003 issued to opposite parties 1 to 3.   Ex A4 is he reply dated 23.10.2003 by OP.2 and Ex A5 is the reply to the legal notice by the first opposite party,.Ex A6 is the Bunch of receipts.  The complainants filed all the original receipts which are not disputed by the opposite parties. 

The opposite parties 2 and 3 filed affidavit evidence and Ex B1 to B14 are marked on their behalf.  Ex B1  is the order copy in FA 1941 to 1943 of 2005  on the file of this Commission. Ex B2 is th  order copy  dated 23.6.2005 in CD 95/2004 to 140/2004 on the file of the District Forum, Mahabubnagar.  Ex B3 is the order copy dated 29.8.005  in CD 10/2005 to 14/2005 on the file of the District Forum, Mahabubnagar.  Ex B4 is the agreement of sale dated 19.5.002. Ex B5 is the sale agreement dated 20.7.1996.  Ex B6 is the paper advertisement dated 285.2005.  Ex B7 is th pahani Sy. Nos. 444 , 445/a, 445/aa, 445/c. Ex B8 is the cheque dated 21.4.1997.  Ex B9 is the cheque dated 10.4.1997.  Ex B10 is the cancellation of the GPA dated 22.6.2000.  Ex B11 is the legal notice  dated 19.11.2005. Ex B12 is the list of register Plot numbers of  Sri Laxmi Enclaves. 

The brief point that falls for consideration is whether there is any deficiency of service on behalf of the opposite parties and if the complainants are entitled  for the reliefs sought for in the complaints.

          We observe from the record that the payments of the amounts made by the complainants with respect to purchase of land in sy. Nos. 444 and 445 in Jadcherla Mandal, Mahabubnagar District are not in dispute. The details of the complainants, the amounts paid by them and the plot numbers allotted to them are as follows :