AMIT PRABHAT vs DELHI DEVELOPMENT AUTHORITY

A common order is being passed in all the above four cases as issues involved in them are the same and they revolve around the same cause of action.

THE summary of the facts of the cases is narrated below : R.T.P.E. 81/98 C.A. 110/98 In January, 1995 the respondent viz., the Delhi Development Authority brought out a scheme known as "Expandable Housing Scheme, 1995" where built-up houses were offered to prospective applicants. The complainant/ applicant Shri Amit Prabhat applied for a house and paid a sum of Rs. 15,000/- on 26.2.1995. The respondent issued a letter which was received on 27.5.1995 informing the complainant/ applicant that he had been allotted a house in Dwarka. On seeing certain reports in newspapers that the houses offered by the respondent under the scheme were of poor quality the complainant/ applicant vide letter dated 19.6.1995 sent under registered post requested the respondent to cancel the allotment and to refund the deposit of Rs. 15,000/-The respondent refunded on 25.1.1996 a sum of Rs. 10,000/- after deducting a sum of Rs. 5,000/- from the initial amount and did not pay any interest.

The complainant/applicant originally challenged the legality of Clause 14 of the terms and conditions of the scheme which governed "surrender/cancellation cases". Subsequently the complainant amended his complaint by filing an application under Regulation 65 of the Monopolies and Restrictive Trade Practices Act, 1991 which was accepted by the Commission. The complaint thus came to challenge the legality of Clauses 12 and 13 also.

CLAUSE 12 of the terms and conditions provided that a computer based draw would be conducted to allot houses and unsuccessful applicants would be refuded the initial deposits within six months from the last date of closing of the scheme. In case of any delay in refund, 7% interest per annum beyond the said period of six months would be made. Clause 13 of the terms and conditions provided that after allotment in case the allottee delayed payment of instalments beyond due dates, interest at 12% per annum for the first month and 18% per annum for the next two months would be levied. This clause also provided that in the event of default on the part of the allottees the allotment of the house would be automatically cancelled and the respondent reserved the right to restore the allotment after charging 12% interest for the period of default.

CLAUSE 14 of the terms and conditions provided that no application for withdrawal would be considered before allotment of a specific house. Rs. 5,000/- would be forfeited out of initial deposit if the request for surrender/ cancellation was made within 30 days of the issue of allotment letter and Rs. 10,000/- would be forfeited if the request was made after 30 days but within 60 days of the issue of the allotment letter. In all other cases the entire amount of initial deposit would be forfeited. The complainant/applicant in the above cases charged that the provisions of Clauses 12, 13 and 14 amounted to restrictive practices falling with the definition of 2(o) of the Monopolies and Restrictive Trade Practices Act, 1969 (for brief the Act). He has also claimed in the compensation application refund of Rs. 5,000/- of the initial deposit forfeited by the respondent alongwith 24% interest per annum. R.T.P.E. 74/97 C.A. 139/97 The complainant/applicant Ms. Urvashi Prabhat had also applied for a house under the same scheme referred to in the above case and paid an amount of Rs. 15,000/- on 1.3.1995. Noticing press reports relating to poor quality of construction the complainant/applicant applied on 26.7.1995 for refund of the initial deposit of Rs. 15,000/- by sending a letter to the respondent by registered post. The respondent informed the applicant/complainant about allotment of a house through a letter which was received on 28.8.1995. The applicant/complainant wrote to the respondent on 18.9.1995 by registered post asking for refund of the amount and drew the attention of the respondent to her earlier letter dated 26.7.1995. This letter was received back by the applicant/complainant with the remarks of the postal department that the respondent refused to take delivery. The applicant/complainant again wrote to the respondent on 6.1.1996 by registered post asking for refund. The respondent replied on 31.7.1996 refusing to refund any amount on the ground that the cancellation request was received beyond 60 days of the allotment of the house.

THE complainant/applicant has charged the respondent with indulging in restrictive trade practices with reference to the provisions of Clause 14 of the terms and conditions of the scheme. She has also claimed compensation from the respondent by way of refund of initial deposit plus interest at 24% per annum.

SINCE the respondent failed to file replies in RTPE 81/98 and CA 110/98 issues were framed on 29th April, 1998 and the complainant/ applicant and the respondent were directed to file affidavit and counter affidavit to facilitate adjudication in the matter. The complainant/ applicant filed the affidavit of evidence on 8.6.1998 reiterating the facts mentioned by him in the original complaint and amended complaint as well as the compensation application. The respondent did not file the counter affidavit of evidence. In respect of RTPE 74/97 the respondent was set ex-parte for failure to file a reply and make an appearance before the Commission vide order of the Commission dated 14.8.1998. Subsequently, on 16th December, 1997 in respect of RTPE 74/97 and CA 139/97 the Commission gave an opportunity to the respondent to participate in the proceedings by filing evidence in the form of counter affidavit. The affidavit of evidence in these cases was filed by the complainant/applicant on 23.7.1998.

In the affidavit of evidence the applicant has reiterated the statements made in the original compensation application. The applicant has affirmed that she had written to the respondent on 26.5.1995 through registered letter asking for refund of the initial deposit of Rs. 15,000/- vide postal receipt No. 2116. Subsequent reminder dated 18.9.1995 which was sent by registered post was returned by the postal department stating that DDA had refused to take delivery. The applicant again sent a registered letter on 16.1.1996.

THE respondent though did not file a reply to the NOE as well as notice of compensation application filed a counter affidavit of evidence in which there has been no pointed denial of the receipt of letters from the complainant/applicant. THE respondent has, however, stated that it received a letter dated 31.7.1996 from the applicant for cancellation of the house which was beyond 60 days from the date of issue of demand-cum-allotment letter. No proof of issue of demand-cum-allotment letter has been furnished nor a copy of the letter dated 31.7.1996 filed. Since the respondent was set ex-parte in respect of all the above cases, no issues were framed. The respondent, however, participated in the final arguments through a Counsel. We gave a hearing to Shri Amit Prabhat, Advocate for the complainants/applicants in these cases and Ms. Sushmita Lal, Advocate for the respondent. We have carefully gone through the records of the case, evaluated the evidences adduced and given due regard to the arguments advanced by the Counsels.

IN RTPE 81/98 allegations were made that the terms and conditions contained in Clauses 12, 13 and 14 constitute restrictive trade practices falling within the definition of 2(o) of the Act. While allegations which fit into the description of practices contained in (a) to (l) of 33(1) of Section the Act are deemed to be restrictive trade practices by definition, other restrictive trade practice falling within the definition 2(o) of the Act have to be proved. The complainants in these cases have not led any evidence to prove the existence of manipulation of prices or conditions of delivery or imposition of unjustified cost or restrictions on the consumers to substantiate the charge that the provisions of Clauses 12,13 and 14 of the relevant terms and conditions constitute restrictive trade practices. The Advocate for the complainants argued that the order of the Commission in the case involving Technology Parks Limited in RTPE 116/90 reported in 1996(4) CTJ 109 (MRTPC) dated 7.3.1996 held that clause similar to the allegations in these cases were held to be restrictive trade practices. Another case against Greater NOIDA in CA278/94 reported in 1997(5) CTJ 378 (MRTP) 27.12.1996 was also cited. We are of the view that the issues involved in these cases are not similar to those examined in the cases whose judgments have been cited. In the case against Greater NOIDA the clause prescribing the entire forfeiture of the registration amount when an allottee withdrew from the scheme was declared to be a restrictive trade practice in the context of absence of any specific provisions in the terms and conditions to that effect. It was noticed that the terms and conditions did not envisage situations of withdrawal from the scheme after 30 days of the date of allotment. In the case against Technology Parks Limited the penalty of 20% per annum levied by the respondent on payment of defaulted amounts was considered usurious in the context of absence of any provision to fasten liabilities on the respondent for its failure to honour its obligations. In other words, the conclusion arrived at was in the peculiar circumstances of the case and cannot be made applicable in all cases where 20% penal interest is levied. We have carefully gone through the allegations levelled against the respondent in RTPE 81 /98. Under Clause 12 of the agreement interest at 7% was paid beyond first six months. Clause 13 of the terms and conditions provide that on defaulted amounts interest at 12% per annum for the first month and 18% per annum for the next two months would be levied. Only where the allotment is cancelled the respondent reserves the right to restore the allotment after charging 24% interest for the period of default. We are of the view that these terms and conditions do not constitute any restrictive trade practice especially when the complainant has made only bald allegations without any proof.

AS regards Clause 14 of the terms and conditions are concerned, an amount of Rs. 5,000/- was forfeited in case application for withdrawal was received within 30 days and Rs. 10,000/- was forfeited if such application is received after 30 days but within 60 days of receipt of allotment letter. The forfeiture of the whole amount, brother cases, related only to the initial deposit of Rs. 15,000/-. These terms and conditions were contained in the Brochure of the scheme and the applicants had agreed to abide by the terms and conditions. Under the circumstances, we do not consider that the contents of Clause 14 constitute any restrictive trade practice.

SINCE in CA 110/98 it is an admitted position that the applicant applied for cancellation of allotment and refund of the initial deposition 19.6.1995 and the respondent refunded an amount of Rs. 10,000/- without interest in terms of the agreement the applicant is not entitled for any compensation. In RTPE 74/97 the complainant has levelled allegations only with regard to Clause 14 of the agreement. In CA 139/97 the applicant has stated on affidavit that she applied for refund of initial deposit on 26.7.1995. As already discussed by us the respondent had not filed any reply in this case nor has he pointedly denied the receipt of this letter even in the counter affidavit filed. The case of the respondent is that a letter dated 31.7.1996 was received by the applicant beyond the period of 60 days from the date of allotment and as such the entire initial deposit was forfeited. 22.No reply to the notice of the compensation application was filed by the respondent nor was any proof given at the time of hearing to show that a demand-cum-allotment letter was issued to the applicant. Under the circumstances, in view of the affidavit filed by the applicant, we have no alternative but to come to the conclusion that the applicant applied for the refund of the initial deposit before she was intimated of the allotment made to her. As per the conditions contained in the Clause 14 of the terms and conditions this demand for refund of the initial deposit should be construed as one which was made within 30 days of receipt of allotment letter. We are of the view that the action of the respondent in not following the terms and conditions contained in the Clause 14 of the agreement and its refusal to refund any amount to the applicant on the ground that the entire initial deposit is forfeited amounts to a restrictive trade practice. The applicant in the CA has suffered loss and damage due to this and is entitled for compensation. The respondent is entitled to refund of a sum of Rs. 10,000/- after deduction of Rs. 5,000/- in accordance with the Clause 14. Since this amount was not refunded to the applicant who was deprived of the use of this money, she is entitled for compensation. The respondent should pay interest at 18% per annum for the period of delay in repayment. Since the applicant had applied for cancellation on 26.7.1995 a period of three months from that date can be taken as a reasonable period for making the refund. 23. To sum up we order that the NOE issued in RTPE 81/98 is ordered to be discharged and the compensation application CA 110/95 is dismissed. In regard to RTPE 74/97 we hold that the respondent has indulged in restrictive trade practice in this case inasmuch as it had not acted in accordance with the terms and conditions contained in Clause 14 of the agreement and its action in not refunding the amount amounted to manipulations of conditions of delivery. We, therefore, order that in C A139/97, the respondent shall refund the applicant Ms. Urvashi Prabhat a sum of Rs. 10,000/- as discussed earlier with interest at 18% calculated from 1st November, 1995 till the date of payment. We also further direct the respondent to give effect to the above order within a period of eight weeks from today and file an affidavit of compliance within four weeks thereafter. There is no order as to costs in any of the above cases. Ordered accordingly.