BROADWAY TOWER INDIA PVT. LTD. vs SHARAT CHAWLA

THESE are cross-appeals against the order of the State Commission in Case No. 572 of 1993 dated 30th October, 1997.

SHRI Sharat Chawla (hereinafter be referred as SHRI Chawla) was the complainant before the State Commission. He booked flat No. 6 on the ground floor and basement floor in block I with a total area of 2200 sq. ft. with the Broadway Tower (India) Pvt. Ltd. (hereinafter be referred as the builder) in a Multistoreyed Commercial Building on 8.6.1981 by making a payment of Rs. 90,000. As the builder failed to start the construction activities, the complainant issued legal notice to him. Though the builder issued certificates acknowledging receipt of Rs. 90,000 on 14.6.1989 and 26.9.1992, he did not confirm the date on which the construction could be started. Hence, the complainant filed a complaint before the State Commission claiming refund of Rs. 7,44,000 interest pendente lite and future interest @ 18% with quarterly rests with costs. The case was contested by the builder on the plea that it was barred by limitation, stating that certificates on deposits of Rs. 90,000 issued were obtained by the complainant surrepetitiously from his employee. Further the construction activities could not be started as the seller of the land refused to perform his part of the contract. The complainant filed a rejoinder stating that the signatory of the certificate was an accountant who was authorized to issue the same and that there is a continuous cause of action and there is no question that the claim is barred by limitation.

Relying upon a judgment of the National Commission in Dr. Ramesh Chandra Rukmi Lal and Another v. Lata Construction, 1996 (1) CPR 7, and also the judgment of the Apex Court in D.S. Thimmappa v. Siddhara Makka, JT 1996 (4) SC 324, and certain other cases and analyzing them in great detail the State Commission ordered as follows: The complaint is allowed and the O.P. is directed to refund the amount of Rs. 90,000 along with 18% interest per annum from 1.1.1985 till date of refund, allowing about 3 years for the construction to have been made. The O.P. shall also pay Rs. 5,000 on account of costs. This order shall be complied with within four weeks of the receipt of a copy, in default it will be open to the complainant to invoke jurisdiction of the Commission under Section 27.

IT is this order which is in appeal. Learned Counsel for the builder submitted that the case is hopelessly barred by limitation even then, the State Commission had admitted this case and passed an adverse order against the builder. Further as there was no specific agreement between the parties, there was no breach of contract on the part of the builder. Lastly, the complainant is not a genuine consumer as he is an investor. The learned Counsel for Shri Chawla submitted that there was continuous cause of action and accordingly the complaint was filed before the State Commission within the time limit prescribed. Further, he contended that he is dissatisfied with the last para of the order wherein he has been allowed interest @ 18% per annum from 1.1.1985 till the date of refund allowing 3 years for the construction to have been made. He urged that he is entitled to interest from the date of deposit as the flat was not built and handed over.

IT is clear from the records of the case that the amount of Rs. 90,000 was deposited by the complainant with the builder on 8.6.1981 for which he had obtained valid receipt. He has paid several visits to the site as well as to the office of the builder to find to his utter dismay that the construction work had not at all started. A responsible officer of the rank of an accountant who is authorized to issue receipts has issued the certificates on 14.6.1989 and 26.9.1992, so there is continuity in the cause of action and the complaint was filed by the complainant on 27.9.1993 i.e., within two years of the last valid communication between him and the builder. To avoid repetition we would not like to quote the judgments relied upon by the State Commission to arrive at a conclusion that the case was not barred by limitation. The contention of the learned Counsel for the builder that there was no specific agreement between the parties cannot be accepted in view of the fact that it was not the deposit simplicitor of Rs. 90,000 as can be seen from the receipt No. 65 dated 9.6.1981 which is reproduced below: Received with thanks from Shri Sharat Chawla the sum of Rupees ninety thousand only in cash/cheque/Draft No. 204336 of 8.6.1981 of on Indian Overseas Bank, Golf Link as advance towards booking of space 2200 sq. ft. Flat No. 6 on Ground floor + Basement floor, Block No. 1 of the building proposed to be constructed on 3B, Masjid Moth. 90,000 for BROADWAY TOWERS (INDIA) PVT. LTD. Sd/- Director

The above receipt has an essence of the contract. The last contention of the learned Counsel for the builder is that the complainant is an investor has no relevance.

ACCORDINGLY the appeal filed by M/s. Broadway Tower (India) Pvt. Ltd. in F.A. No. 40 of 1998 is dismissed. The contention of the learned Counsel for Shri Chawla in Appeal No. 44 of 1998 that interest has to be paid from the date of the deposit is a valid one as the State Commission has erroneously ordered the payment of interest from 1.1.1985 allowing about 3 years for the construction to have been made. As no construction work at all had begun, the question of allowing time for the construction to have been made is purely hypothetical. Therefore, we modify the last para of the order of the State Commission to read as ''builder is directed to refund to Shri Chalwa the amount of Rs. 90,000 along with 18% interest per annum from the date of the deposit i.e., 9.6.1981 till the date of payment''. This payment shall be made within four weeks from the date of this order. The builder shall also pay Rs. 5,000 as costs as ordered by the State Commission.

IN view of above, appeal filed by Broadway Towers Pvt. Ltd. (F.A. No. 40/98) stands dismissed and Appeal No. 44/98 filed by the complainant stands allowed in above terms. First Appeal No. 40/98 dismissed. First Appeal No. 44/98 allowed.