AJAY ENTERPRISES LTD. vs VINOD KUMAR BHARGAVA

THIS is an appeal filed by Opposite Party No. 1 against the order dated 31st March, 1993 passed in complaint case No. C-117/92 by the State Consumer Disputes Redressal Commission, Delhi. The said complaint was filed by the present Respondent No. 1 against the present appellant and M/s. Swadeshi Estates Pvt. Ltd., Respondent No. 2 herein (Opposite Party No. 2 in the complaint). By the impugned order the present appellant has been directed to pay to the complainant an amount of Rs. 2,58,025/- with interest at the rate of 18% per annum from the date of filing the complaint till payment. It has further been ordered that the payment be made within period of three months from the date of the order.

THE present appellant proposed to promote and construct residential apartments in Charmwood Village Scheme. Respondent No. 2 is acting as its agent for booking flats constructed by it. The complainant booked a flat in Charmwood Village Apartments on 28th June, 1989. The complainant was allotted flat No. 207 in E-1 block, the total cost of which was about Rs. 6,46,250/-. Upto 15th October, 1990 the complainant paid in all Rs. 2,27,000/- in four instalments. It is further the case of the complainant that the building was to be completed and possession of the flats was to be given to the purchasers in April, 1991. In 1991 the complainant visited the site and found that no construction had been started. Thereupon the complainant requested the appellant to give him two bed room Villa in Erose Garden Villa III and the money already paid by him along with interest at the rate of 20% per annum be adjusted towards the price of the Villa. As he did not hear anything from the appellant, he requested both the opposite parties to refund the amount of Rs. 2.27 lacs with interest at the rate of 24% per annum. The appellant refunded Rs. 70,000/- to the complainant on 30th July, 1991 but did not refund the balance amount. Thereupon, the complainant filed the complaint for issuing a direction to the opposite parties to pay to him Rs. 1,57,000/- with interest at the rate of 2% p.m., Rs. 25,000/- as cost of travelling from Shimla to Delhi and back and Shillong to Delhi and back and Rs. 5,000/- as lodging charges and Rs. 1,50,000/- as damages.

THE appellant contested the complaint and pleaded that the Commission has no jurisdiction to entertain the complaint. It was also pleaded that the appellant agreed to refund an amount of Rs. 2,27,000/- without interest and out of that, Rs. 70,000/- was refunded to the complainant. However, the balance amount was not refunded as the complainant started claiming interest on the deposit.

RELYING upon the order of this Commission in U.P. Avas Evam Vikas Parishad v. Garima Shukla I(1991) CPJ 1 = (1993)1 CTJ 463 (CP) wherein it was held that builders are rendering service to the society by providing the people flats/houses and developed plots for consideration, the State Commission held that it had jurisdiction to entertain the complaint. As the dispute between the parties remained about interest only, the Commission held that the appellant had utilised the amount deposited by the complainant with them and therefore, the complainant was entitled to claim interest on the amount paid by him. The Commission granted interest at the rate of 18% p.a. from the dates of deposit of the amounts till the date of repayment. Accordingly, the Commission calculated interest at the above rate from the respective date of deposit till 30th July, 1991 and after deducting Rs. 70,000/- refunded by the appellant to the complainant the Commission arrived at the figure of Rs. 2,29,662/-. On that amount the interest was calculated at the above rate from 30th July, 1991 to the date of filing of the complaint and arrived at the figure of Rs. 2,58,025/- which the appellant was directed to refund to the complainant as noticed above. The complainant was not allowed any compensation for travelling expenses and mental tension etc. as the State Commission was of the opinion that the complainant was amply compensated by allowing him interest at a fairly high rate. Opposite Party No. 2 (Respondent No. 2 herein) was held not liable to pay anything to the complainant as he is said to have disclosed the name of the principal at the time the agreement was entered into with the complainant. Feeling aggrieved of that order the appellant has filed this appeal.

THE preliminary objection was not pressed on behalf of the appellant. Presumably, in view of the fact that the view taken by this Commission expressed in Garima Shukla''s case has been upheld by the Supreme Court vide its order in Lucknow Development Authority v. M. K. Gupta, Civil Appeal No. 6237/90 decided on November 5, 1993 reported at (1993)1 CTJ 929 (Supreme Court)(CP).

IT was urged on behalf of the appellant that allotment of flat made in favour of the appellant was only provisional one and according to the terms and conditions of allotment it was liable to be changed at the sole and absolute discretion of the appellant and the complainant had no right to object. Even if we accept the contention of the appellant, it will not help it. The appellant has given up the construction of the Block in question altogether. It is not the case of the appellant that the complainant was offered any other flat/space similar to the one booked by him in any other Block. It appears from letter dated 29th January, 1991 (page 29 of the paper book) written by the complainant to the appellant recording the discussions he had with the appellant. The complainant was told that he could be allotted three bed room flat in C-1 Block measuring 1,450 sq.ft. in lieu of his original booking. It may be mentioned here that the complainant had booked a two room flat measuring about 1,250 sq.ft. The complainant refused that offer on the ground that he felt it did not suit his requirements and was also beyond his budget. If a person has booked a two room flat and was asked to take a three room flat costing higher price, it cannot be said that the appellant rightly exercised the discretion to allot another flat to the complainant. The above letter further shows that the complainant was also offered a two room villa flat on 2nd floor with basement at the old rate. With respect to that offer the complainant wrote : "In this respect I would request you that since the decision of not constructing the flats in E-1 Block has been taken by you inspite of my booking and payments of all instalments, which has upset my all plans without any fault of mine. As such I would request you to allot me a second floor of villa with basement at the concessional rate giving consideration to the fact that my money has been lying with you for one year and a half. Further, I was supposed to take possession of the flat in early 1991, the new villa flat will be ready in 2 years time, it means I came to the original level of booking. My 2.27 lakhs rupees are already with the company for over 1 1/2 years, which should be adjusted along with 2% (Company Interest) with my amount for the villa." However, this proposal was perhaps not accepted by the appellant and, therefore, the complainant asked for the refund of his amount with interest. The appellant refunded only Rs. 70,000/-.

THE contention of the appellant is that the complainant is not entitled to any interest in view of Clause 49 of the agreement. That Clause reads as follows : "That if as a result of any legislation, order or rule the Company is unable to complete the aforesaid building/or to deliver possession of the apartment thereof to the allottee, the only responsibility and liability of the Company will be to pay over to the allottee the total amount as may be received by the Company at that time and in the manner as may be decided by the Company and save as aforesaid the apartment owner(s) shall have no right to claim against the Company under or in relation to this agreement or otherwise howsoever."

IN our opinion, that Clause has no application to the present case. The appellant has not proved on the file the circumstances under which the construction of the Block in question was dropped. The State Commission has rightly held that the money has been utilised by the appellant and the complainant has been deprived of its use and hence he is entitled to interest for the loss and tension caused to him on account of non-allotment of a flat to him at the price at which he had booked with the appellant. Therefore, in the circumstances, we uphold the direction of the State Commission awarding interest to the complainant. In view of the above discussion, we do not find any force in the present appeal and dismiss the same. The appellant will pay a sum of Rs. 1,000/- by way of costs to the complainant.