AZEEM TOWER OWNERS/RESIDENTS WELFARE ASSOCIATION vs AZEEM CONSTRUCTIONS

THE original complaint was filed by M/s. Azeem Towers Owners/Residents Welfare Association, registered under Andhra Pradesh (Telangana Areas) Public Societies Registration Act, 1350 Fasli with Registration No. 133 of 1990 accorded by the Registrar of Societies, Hyderabad, rep. by its Secretary against opposite parties. Opposite party No. 1 is the construction company, whereas opposite party No. 2 is the Managing Partner of the first opposite party. Opposite party No. 3 is a partner of opposite party No. 1 and 4th opposite party was impleaded on 8.8.1996 as per orders in I.A. No. 431/1996. It is stated in the complaint that opposite party No. 1 after getting sanction from M.C.H., entered into individual agreements with members of the complainant Association in 1981-82 for construction of 32 flats. THEre are two blocks in the Complex with twenty-eight 2-bed room and four 3-bed room flats with construction costs of Rs. 1,45,000/- and Rs. 1,75,000/- respectively. Though, the construction started in 1980 itself it was not completed till 1985-86 and the flat owners occupied their respective flats with the understanding that the remaining work would be completed by the opposite parties 1 to 3. However, in spite of a number of representations nothing happened and ultimately on 19.2.1991 they issued a legal notice and filed the complaint on 26.2.1992. In the complaint they pointed out a number of deficiencies and requested the Commission to direct the opposite parties to register the flats in the names of the respective flat owners, to supply municipal drinking water, electrification of common places, over head tank for storage of ground water and a sump for municipal water, completion of sanitary works, to raise man-holes up to road level and cover them properly, to complete stair-cases and landing areas, to asphalt the parking area, to clean the premises and remove the debris, to reimburse Rs. 68,411.20 to flat owners paid by them to APSEB, for restoration of electric connection, to provide link documents, approved plan and specifications issued by M.C.H., to obtain and provide occupancy certificates and installation of 3 lifts etc. It would not be out of place to mention here that the opposite party No. 2 also resides in the same complex and attended some of these meetings and was also signatory to the same.

IN the counter affidavit filed on 11.3.1996 by opposite party No. 2 it was alleged that the complainant was not a validly constituted Association and hence the Secretary, who represented the Association was not the competent person to file the complaint. It is further stated that 1st opposite party was dissolved with effect from 31.3.1995 vide Dissolution Deed dated 22.4.1995 and as per the dissolution M/s. Space Construction Pvt. Ltd., i.e. 4th opposite party has taken over the assets and liabilities of the said firm and since all the papers have been handed over, the names of opposite parties 1 to 3 may be deleted. It is further stated that the flats were handed over after opposite party No. 1 completed the structural work, flooring, fixing of doors, windows and ventilators and completion of sanitary works of individual flats. Though the flat owners had not paid the full amount, on their request they were allowed to occupy the flats with the understanding that the remaining work would be completed on their paying the balance amount due from them. Thus, they occupied the flats, in as it is and where it is condition. By not paying the balance amount the flat owners committed breach of agreement and till the date of filing the complaint, the amounts were due. They did not even pay the charges towards electricity which they used from the common meter and Rs. 1,10,000/- had to be paid by opposite party No. 1 for restoration of electricity connection. IN the meantime the then Managing Partner, Mr. Aqeel Ahmed died in 1983 and taking advantage of the same the flat owners started harassing the opposite parties including opposite party No. 2 who took over charge as Managing Partner. Though the complainants were aware of the fact about the dissolution and taking over the assets and liabilities by 4th opposite party, they did not implead 4th opposite party as a party. It is further alleged that the flat owners after occupying their respective flats did not pay towards common amenities etc., and therefore, except the Secretary no one else is having any complaint. It is further stated that all the agreement holders should approach 4th opposite party and get the account settled by making payments as per the agreement entered with opposite party No. 1 and get the sale deeds executed and registered and if they have any further grievances, they should agitate the same against 4th opposite party only. The 4th opposite party in his counter affidavit dated 2.9.1996 reiterated most of the things stated by opposite party No. 2 and adopted his counter. He alleged that the said self styled Secretary, Mr. Basheer Ahmed, though claims to stay in flat No. 203 but in fact the flat is in the name of Smt. Ashraf Madani, as per the agreement and notices issued to her were evaded and thus avoided paying the balance amount. The 4th opposite party requested the Commission to direct all the agreement holders to approach him and pay the balance so that all the facilities as per the agreement would be provided.

In the reply affidavit filed on behalf of the complainant Association, rep. by its Secretary, it was reiterated that opposite party No. 2 attended the meetings of the Welfare Association and signed the Resolutions dated 26.1.1990, 30.8.1989 as owner of flat No. 304. He was also one of the Executive Member of the said Association. He denied that the Association was aware about the dissolution of opposite party No. 1 and that all the assets and liabilities were taken over by opposite party No. 4. Opposite party No. 1 was a partnership firm and as per the provisions of Indian Partnership Act all the partners are jointly and severally responsible and they cannot shift the responsibility to anybody since they had entered into agreements with opposite party No. 1 and its partners could not shift their responsibility. He further alleged that all the members of the Association paid their respective considerations to opposite party No. 1 and it never issued any notice to complainants to pay the outstanding amount. In fact opposite party No. 1 issued No Due Certificates to several members of the complainant Association. In this context, he mentions that even to his wife Mrs. Ashraf Madani, in whose name the flat is, was issued receipts bearing Nos. 383 and 384 dated 4.8.1986 for Rs. 40,000/- and Rs. 1,00,000/- respectively towards full payment and on 14.3.1988 and opposite party No. 2 as Managing Partner even gave a ''No Due Certificate''.

ON behalf of the complainants Exs. A1 to A93 were filed. ON behalf of the opposite parties three third party affidavits were filed stating that there was no association, which was denied by the complainants in the reply affidavit stating that one of the persons was not in India and hence could not have signed the affidavit and other two were close relatives of opposite party No. 2. Opposite parties also filed Agreement of Mrs. Ashraf Madani dated 4.8.1986 (Ex. B1). After giving a number of adjournments, opposite parties did not choose to appear and they were set ex-parte on 17.11.1998. It was noted on 16.4.1999 that affidavit evidence on behalf of the complainant was filed as evidence affidavit along with Exs. A1 to A93. Though 5 months time was given on 17.11.1998 still no evidence was filed by the complainant in this case of 1992, the opposite parties were not present and versions/counters were filed by opposite parties 2 and 4 but opposite parties 1 and 3 did not file version/counters nor any memo adopting the versions/counters of opposite parties 2 and 4 and, therefore, it is noted : "that Counsel shall state whether there is anything subsisting in the matter. It was posted to 2.8.1998 finally". Again on 9.11.1998 it is noted as follows : "Counsel for the complainant present. Counsel for the opposite parties is not present today also. They did not file any affidavit evidence in support of their case. In the circumstances opposite parties are set ex-parte. Post on 16.2.2000 for arguments". Ultimately on 28.2.2001 it is noted as follows : "Inspite of our order dated 13.2.2001 and also similar earlier orders the opposite parties or their Counsel are not present today also. We are convinced that the opposite parties are not interested to go on with the matter as they have not even filed affidavit evidence so far. Under the circumstances we are constrained to close the evidence of the opposite parties. The affidavit evidence of the complaint will be treated as evidence on behalf of the complainant Association. Since the opposite parties have failed to cross-examine the Secretary of the complainant Association and that the matter will be proceeded with the available evidence on record. Post on 8.3.2001 for arguments of both parties."

It was subsequently posted to 13.3.2001 and 16.3.2001 and since the opposite parties or their Counsel did not appear, we heard the Counsel for the complainant on 16.3.2001 and 23.3.2001 and reserved for judgment.

NOW the points to be considered are whether there is any deficiency on the part of opposite party Nos. 1 to 4 as mentioned in the complaint and if so, to what extent ? We have to also consider whether opposite party No. 4, which was impleaded as 4th opposite party on 8.8.1996 stepped into the shoes of opposite party No. 1 after its dissolution is liable to rectify the deficiencies pointed out by the complainant Association or since the privity of contract is between the complainant and opposite party No 1 and its partners namely opposite parties 2 and 3 after the dissolution of opposite party No. 1, opposite parties 2 and 3 are only responsible. Going through the documents, we find that there is no dispute that first opposite party as a partnership firm obtained permission from Municipal Corporation of Hyderabad for construction of Azeem Towers with 32 flats and entered into separate agreements with the prospective buyers during 1981-82 and that the Azeem Towers consisted of 28 two-bed room flats and 4 three-bed rooms flats and the construction cost was fixed at Rs. 1,45,000/- and Rs. 1,75,000/- approximately respectively. Accordingly the construction was stated and most of the members of the complainant Association occupied their respective flats in semi-finished condition. The dispute is whether the complainant Association is a legal association and whether the opposite parties are obliged to register the flats even though the flat owners have not paid full amounts according to opposite parties. While the flat owners claim that they have paid full amounts and hence opposite parties have to complete the unfinished work and remove the defects in the construction and register the flats and hand over all the necessary documents including approved plan. As the agreement is almost two decades old and the flats were occupied some 15 years back, at this juncture, we can look into only the major deficiencies since many other defects might have occurred during this period. We find from the exhibits that 9 persons have filed the complaint and argument of the opposite parties is that the Association is not legal and that only a few persons have filed the complaint, hence they are not representatives of all the flats owners and the complaint is not accepted. We are however of the opinion that the Azeem Towers Residents Welfare Association is a registered one and even a single flat owner has a right to complain in case of any deficiency. So far as the cost of the flat is concerned, the flat owners have produced certificates (Exs. A9, A43, A48, A61, A62 and A70) and we find that they have paid the full consideration for the flats. They have also filed their respective agreements (Exs. A10, A24, A27, A33, A36, A45, A49, A63, A67 and A77). Opposite parties have also filed Ex. B1, the agreement. While the agreements filed by the flat owners contain only page numbers 1 to 3 and 8, the agreement filed by the opposite parties contains all the 8 pages and it appears to be actual agreement signed by all the parties, since the flat owners have filed only xerox copies. After the complaint was filed in 1992, opposite party No. 1 was dissolved with effect from 31.3.1995 vide Dissolution Deed dated 22.4.1995 and M/s. Space Constructions Private Limited took over all the assets and liabilities of opposite party No. 1 and all the files and papers were handed over to opposite party No. 4. To this effect opposite party No. 4 issued notice on 1.4.1996 to all the agreement holders to come and settle the matter and pay the balance amount payable towards agreement as well as towards maintenance so that opposite party No. 4 could proceed further and provide all amenities and facilities and also manage the Complex. According to opposite parties since they were not made party to the Association, the complainant Association is not legal. Therefore, it is admitted that all the facilities and amenities have not been provided by opposite parties and still some work is pending. We find from the agreement, Ex. B1, that the complainants have to bear some expenditures apart from the cost of the flat such as ''Proportionate non-agricultural assessment tax or any other tax that may be levied''. According to Clause 13 the complainants in addition to the consideration agreed upon shall pay deposits required for water, T.V., antenna, electrical energy connections and other amenities and the opposite party No. 1 shall provide complete power arrangement from the premises to the flat owners upto the meter only. Any further service connection charges, meter deposit, VLC that may be incurred by the first opposite party shall be collected from the flat owners on actual basis and flat owners shall not dispute any such expenditure and shall pay the same before taking over the possession of the premises. Since the members of the complainant Association have already paid for their respective flats long back, we are of the opinion that they must have paid all the amounts due to the opposite parties. In case some of the complainants have not paid the full amount, the opposite parties cannot deprive others of the common facilities and other amenities particularly to those who have already paid the full amount. The complainants have filed a number of receipts showing payments made by them on various dates. The opposite parties however have not given any notice to the complainants where specific amount due has been mentioned. In the notice given by opposite party No. 4 Ex. No. 84 on 7.6.2000 it only asked them to come with all the papers and settle their account which is very vague and does not prove that all the flat owners have to pay any balance amount. The opposite parties also did not choose to cross-examine the Secretary of the Association, though he filed his affidavit in lieu of examination-in-chief, except making appearance through Advocates they did not take any further interest in the matter. In view of the above facts and discussion, we are of the opinion that opposite parties should register the flats in the names of the flat owners who are complainants here on payment of the registration charges. The opposite parties are further directed to provide link documents to all the flat owners and approved plans and specifications issued by MCH and HUDA along with occupancy certificates to individual flat owners and they are also directed to remove any debris if it is still lying in the premises.

AS per Clause 2 of the agreement, flat owners "shall purchase the premises including the service areas and common facilities to be constructed by the first party as delineated in the proposed plan annexed hereto with the finishing as detailed in the annexure" to the agreement for total consideration of Rs. 1,45,000/- and Rs. 1,75,000/- which has been paid by the complainants. However, we do not find any "annexed plan" or ''annexure'' has been filed by either parties. In the absence of ''annexure'' it is difficult to say whether lift was included in the consideration paid by the complainants.

THE opposite parties are, therefore, directed to raise the manholes to the road level and cover them and complete the stair-case and provide roof over the stair-case to stop the flowing of rain water down the stair-case. THEy are also directed to provide over head tank of suitable capacity for storage of ground water and municipal water, if not done already. Since opposite parties 2 and 3 were Managing Partner and Partner respectively of opposite party No. 1 which was dissolved during the pendency of the case, therefore, they cannot now deny their liability. Moreover, privity of contract is between opposite party No. 1 and opposite party No. 4 and not between complainants and opposite party No. 4, therefore, opposite parties 2 and 3 cannot be absolved of their responsibility. Therefore, all the opposite parties are directed to complete the works as mentioned above. Time for compliance 8 weeks. Parties shall bear their own costs. The complainants and opposite parties are free to approach appropriate Civil Court, if they are so advised for other complaints/grievances. Complaint disposed of.