AGNELO ANTHONY D'SOUZA vs MAHESH G.MEHTA (H.U.F.)

BY Agreement dated 7th May, 1998 the complainant undertook to purchase from the respondent a flat bearing number Af3, situated on the first floor of the building known as "Prashanti Estates", Aldona, admeasuring 87.48 sq. mtrs. of super built up area approximately, alongwith parking space of an area of around 12 sq. mtrs. An amount of Rs. 5,00,000/- was paid by the complainant to the respondent as advance in terms of the said Agreement. Possession of the flat was supposed to be given to the complainant on or before 30th September, 1998, on which date he was bound to pay to the respondent the final balance amount of Rs. 2,00,000/-. It is the complainant''s case that the respondent did not complete the construction of the suit premises and failed to deliver its possession within the stipulated time or even thereafter up till now. BY registered A.D. letter/Notice, dated 4.1.1999, the complainant called upon the respondent to deliver possession of the suit premises within 15 days. The respondent acknowledged and replied to this letter on 19th January, 1999 admitting the delay in completing the construction and offered to deliver possession to the complainant between 1.4.1999 and 30.4.1999. The complainant, however, on verifying the stage of the construction and confirming that no work was effected after the reply dated 19.1.1999, sent a Notice dated 31.3.1999 calling upon the respondent to deliver possession of the flat on or before 30th April, 1999, failing which the complainant would institute proceedings against him. Since the terms of this Notice was not complied the complainant filed this complaint praying that the respondent be ordered to deliver forthwith possession of the premises, complete in all respects, in terms of the Agreement dated 7.5.1998 with interest @ 18% per annum on the advanced amount of Rs. 5,00,000/-, right from 1.5.1999 till the date of payment, in the alternative directing the respondent to refund to the complainant the amount of Rs. 5,00,000/- with interest @ 18% per annum from the date of receipt of the said amount from the complainant till the date of final re-payment. Additional prayer was made for payment of a compensation of Rs. 5,000/- to the complainant towards mental torture suffered by him.

THE complaint was not contested by the respondent who, inspite of having been served, failed to put in his version on the appointed date. However, since he remained present on the day the complainant filed his affidavit in evidence, he was allowed to produce his evidence also which is a part of the record. In his affidavit he has admitted that the execution of the Agreement dated 7.5.1998 and the payment of amount of Rs. 5,00,000/- in terms of the Agreement. He also accepted that possession was required to be given on or before 30th September, 1998 but the reason advanced for not completing the construction was the recession affecting the industry. THE respondent has also admitted the receipt of the complainant''s letter dated 4.1.1999, which was replied on 19.1.1999 admitting the delay in completing the construction which he offered to deliver between 1.4.1999 to 30.4.1999. He also stated that he even undertook in the said letter to pay the rents which the complainant was presently paying from October, 1998 till the possession of the flat is given to them. His case was that the construction of the building is complete except for the internal and external finishings and plumbing connection which could not be completed because of recession in the Real Estate business. He further pleaded that he had genuine financial difficulties because the building had altogether twelve flats meant for sale out of which the complainant was the only purchaser while the remaining eleven flats remain to be sold. He stated that he had invested all his substantial savings in the Project and he had no intentions to either delay the construction or defraud the complainant. He was prepared to deliver possession of the flat as soon as his financial position comes back to normal. He, however, denied his liability to pay any interest on the amount of Rs. 5,00,000/- nor to pay compensation of Rs. 5,000/- towards mental torture suffered by him. He was prepared to refund the amount of Rs. 5,00,000/- to the complainant as soon as he could be able to do so. He was also prepared to pay rent of the premises in which the complainant was residing from October, 1998 till possession of the suit flat was given to him. In case of failure to pay the rentals, he agreed that the total amount payable by him should be deducted from the balance amount of consideration of flat due by the complainant at the time of handing over possession of the flat. He lastly expressed his inability to annexe any documents alongwith the affidavit in evidence on account of the fact of office having been sealed and Bank Accounts closed. We have gone through the records and considered the submissions of both the complainant''s learned Counsel and the opposite party in person as well. The fact of the execution of the Agreement dated 7.5.1998, the payment by the complainant of the advance money of Rs. 5,00,000/- to the opposite party and his obligation to deliver possession of the flat to him on or before 30th September, 1998 have not been disputed by the opposite party at all. Similarly, the opposite party has not also denied that there has been delay in the completion of the flat and that even his subsequent promise to hand over its possession, complete in all respects, by 30.4.1999, has not been honoured. The opposite party has also admitted the receipt of the complainant''s Notice dated 4.1.1991 and also did not deny, in his reply dated 19.1.1999, that again admitted that the delay in completing the flat, even on the extended date, was due to recession in the Real Estate business. He also undertook to compensate the complainant for the rents which they were actually paying in the leased flat taken by him for occupation pending the completion of the suit flat and delivery of its possession. The only justification the opposite party had sought to advance for the continuous failure to fulfil the terms of the Agreement and to comply with his promises is recession in the Real Estate business which, obviously, is no ground at all for dishonouring the actual commitments assumed by him before the complainant. Admittedly, the opposite party has received from the complainant the amount of Rs. 5,00,000/- towards advance instalment and only the balance amount of Rs. 2,00,000/- remained to be paid at the time of delivery of possession of the flat. The submission of the opposite party that he is prepared to complete and deliver possession of the premises to the complainant only when his financial position comes to normal and he becomes free from the complications in which he was involved in respect of his office which has been sealed and his Bank Accounts which have been frozen indicates that the opposite party has not only failed to comply with the terms of the Agreement but also is not in a position to do so in a near future. This fact amounts typically to a situation of deficiency in service which makes him liable to compensate and render him bound to bear with the consequences of the non compliance of the Agreement Clauses consequent upon non-completion of the suit flat. In such case both the alternative prayers are to be considered when the opposite party is not able to satisfy us to the contrary and/or make a case as to why any of these prayers should not be granted in toto. We, therefore, allow the complaint and direct the respondent to either deliver the possession of the suit flat, complete in all respects in terms of the Agreement, dated 7.5.1998 and to pay interest @ 18% per annum on the advanced amount of Rs. 5,00,000/-, right from 1.5.1999 till the date of payment, within 30 days or, in the alternative, to refund to the complainant the advanced amount within 30 days with interest @ 18% per annum from the date of the receipt of the said amount from the complainant till the date of its final payment. He is also directed to indemnify the complainant with a further sum of Rs. 5,000/- towards mental torture suffered by him within 30 days failing which the said amount will carry interest @ 18% per annum till its actual payment. Order accordingly. Complaint allowed.