B.V.V. RAMESH KUMAR & ANR. vs M. LAKSHMANA RAO

The present revision petition has been filed against the judgment dated 27.01.2010 of the Andhra Pradesh State Consumer Disputes Redressal Commission, Hyderabad (''the State Commission'') in Appeal no. 1383 of 2007.

The facts of the case as per the respondent/ complainant are that the petitioner induced the respondent to join in a scheme for purchase of 200 sq yards of site in which 40 manziam plants would be planted and developed as trees in six years. The respondent being attracted by the scheme entered into an agreement with the petitioners on 02.11.2000 and as per the agreement the respondent agreed to purchase plot no. 44 with manziam trees. At the time of transaction, the respondent paid an amount of Rs.5100/- towards first monthly instalment as an advance and the balance of consideration was to be paid within the stipulated time of 60 months. The petitioners agreed to develop 40 manziam plants in 200 sq yards of land undertaking to bear, labour, water, fertilizer expenses over a period of six years. The respondent purchased 200 sq yards of land from Bemasetty Suryakantham by a registered sale deed on 06.11.2000 by paying balance sale consideration to her.

The respondent further stated that even after six years as per the agreement there was no growth of manziam plants as promised by the petitioner. The petitioner did not take care of the development of the plants by rendering timely nourishment to the plants. Hence, the respondent got issued a legal notice dated 22.11.2006 to the petitioner and as there was no reply from them the respondent filed a complaint before the District Forum.

As the petitioners did not appear and contest the case, the District Consumer Disputes Redressal Commission, Vizianagaram (''the District Forum'') set them ex parte.

The District Forum dismissed the complaint vide their order dated 30.07.2007, which reads as under: " Complainant purchased 200 sq yards of site for Rs.14,100/- as per sale deed dated 06.11.2000 from a third party. Complainant obtained agreement of sale dated 02.11.2000 from the opposite parties for the same property purchased under Ex A 7. In that sale agreement the complainant obtained a promise from the opposite parties to develop forty manziam trees in the land purchased by the complainant. There is no whisper of any consideration to the opposite parties for the service to be rendered by them. Complainant cannot enforce the agreement against the opposite parties because the service was devoid of consideration. Because the service was devoid of consideration, the complainant is not a consumer as per Section 2 (1) (d) of the Consumer Protection Act. We, therefore, hold that there is not deficiency of service on the part of the opposite parties. Hence, we answer the point accordingly.

In the result, this complaint is dismissed. No cost. Advocate fee is fixed at Rs.1,000/-".

Aggrieved by the order of the District Forum, the respondent filed an appeal before the State Commission. The State Commission while allowing the appeal observed as under: " The respondent no. 2 is the managing partner of the respondent no. 1. The appellant purchased 200 sq yards of land on request of the respondents from its owner Smt Beemisetty Suryakantham through registered sale deed dated 06.11.2000. Prior to the execution of the sale deed, the appellant had entered into an agreement of sale on 02.11.2000 with the respondent no. 1 wherein it is mentioned that the respondent no. 2 entered into an agreement to purchase five acres of land in Sy no. 371/2, 371/ 7 and 371/ 23 at Sarika Village of Vizianagaram Mandal and District and in view of the power conferred by the agreement of sale the first respondent divided the five acres of land into 80 agricultural plots with each plot measuring 200 sq yards. The respondent no.1 agreed to develop 40 manziam plants in 200 sq yards in each of 200 sq yards plot over a period of six years and further it was agreed that the respondent no. 1 would bear the labour, water, fertilizer expenses incurred in developing the 40 manziam plants. The agreement was stated to be in accordance with the scheme rules framed by the respondent no.1. Thus, it is clear that respondent no. 2 being the managing partner of respondent no. 1 firm sold 200 sq yards plot to the appellant under agreement of sale, the plot being part of five acres of land that the respondent no.2 had purchased under agreement of sale for and on behalf of respondent no.1.

The appellant being the pass book holder in the scheme "sai eswar" particulars whereof have been mentioned in the brochure issued by the respondent no.1. The respondent no.1 offered to sell the plot to the appellant at the rate of Rs.125/- per sq yards of which an amount of Rs.5,000/- towards advance was paid by the appellant to the respondent no.1 with the agreement that the balance consideration has to be paid within a period of 60 months therefrom and in case of delay in payment of EMI an interest @ 2% per month would be levied on the EMI. The agreement of sale embodies the terms to the effect that the respondent no.1 had undertaken to develop the land and 40 manziam plants in each of 200 sq yards plot subject to payment of the EMIs and registration and betterment charges by the appellant herein.

The appellant has got issued notice dated 22.11.2006 bringing it to the notice of the respondent that the appellant had obtained the registered sale deed from the original owner of the plot as requested by the respondents as also that the appellant paid the entire balance consideration whereof the respondent had given him discount. It was pointed out in the notice that the respondents failed to develop manziam plants in accordance with the terms of the agreement of sale which had reference to the terms of the brochure to the effect that the plants would be grown 75 ft in six years and at the end of the six years the income from the 40 trees would be an amount of Rs.1,20,000/-. The appellant by means of the notice brought to the knowledge of the respondents that they have violated the terms and conditions of the agreement of sale deed 02.11.2000 where under they promised to develop 40 manziam trees in terms of the brochure issued by them in relation to the Sai Eswar Scheme introduced by them in this regard. It appears that the respondents have not given any reply. The respondents have not chosen to contest the claim of the appellant before the District Forum. The respondents have not been represented even before the Commission and after giving sufficient time and after hearing counsel for the appellant. The appeal was reserved for orders.

The agreement of sale is on the basis for the claim of the appellant. Usually the agreement of sale pales into insignificance once the sale deed is executed in pursuance of the terms and conditions laid in thereof. In the present case the position is entirely different and the importance of agreement of sale has not been brushed aside by any factor even after the sale deed was executed for the reasons that the agreement of sale was entered into between the appellant and the respondents whereas the sale deed was got executed by the appellant as per the request made by the respondents from the original owner of the plot. The respondents entered into agreement of sale by receiving an amount of Rs.5,000/- from the appellant with the cost of the plot being fixed taking into consideration of not only its development as also the development of 40 manziam plants in the plot thereof. Therefore, it cannot be said that the agreement of sale is only a simple agreement without being supported by any consideration. The consideration so mentioned in the agreement of sale includes in its ambit the cost of the plot as also the development of the plants therein. It is pertinent to mention that the respondents have issued three receipts dated 01.04.2000, 01.11.2000 and 06.11.2000 for an amount of Rs.1,000/-, Rs.5,100/- and Rs.12,500/- respectively. Hence, viewed from any angle the appellant cannot be said to have not paid any amount to the respondents in connection with the purchase of the plot as also development of the manziam trees therein. The District Forum, erred in holding that the appellant is not a consumer as also that the agreement of sale was devoid of any consideration in regard to the development of 40 manziam plants in the plot that was purchased under agreement of sale from the appellants which was subsequently culminated in execution of the sale deed by the original owner of the plot. The appellant has claimed a sum of Rs.1,20,000/- towards the estimated profit as promised by the respondents and an amount of Rs.1,00,000/- towards compensation for mental agony. The respondents had issued the brochure promising an estimated amount of Rs.1,20,000/- on 40 manziam plants at the end of six years reckoned from the date of issue of the brochure. The 40 manziam plants have also got a mention in the agreement of sale in regard to the period of their raising which was stipulated as six years. Taking into consideration of the date of execution of the sale deed which was executed on 06.11.2000, it is already more than 8 years much beyond the stipulated period of six years whereof the appellant is entitled to the benefit conferred on him by virtue of the promise in the brochure made by the respondents. Therefore, we hold the appellant is entitled to a sum of Rs.1,20,000/-, i.e., the sum assured in the brochure issued by the respondents. We award interest @ 9% per annum on the amount of Rs.1,20,000/- for the loss and hardship suffered by the appellant after the stipulated period of six years in regard to the failure of the respondents to exercise proper care in developing the manziam plants in the plot that sold to the appellant. The respondents, in the circumstances are at liberty to cut down or sell away the manziam plants in the said plot.

In the result the appeal is allowed by setting aside the order passed by the District Forum. Consequently the complaint is allowed directing the respondents no.1 and 2 to pay an amount of Rs.1,20,000/- with interest @ 9% per annum from the date of filing of the complaint till payment and Rs.2000/- towards costs".

Hence the present revision petition.

Learned counsel for the petitioner / opposite party has contended that the State Commission''s order is erroneous both on facts and in law and should be set aside. The State Commission erroneously held that the respondent was a consumer. In fact, the consumer had paid no consideration for hiring the services of the petitioner.

The respondent who was present in person, however, argued in favour of the order of the State Commission and contended that they had rightly appreciated the matter and that the scheme of the petitioner was a scam and he had been sold a worthless plot of land to which there was no access. He was lured by an advertisement and representation by the petitioner to invest in the scheme. However, the petitioner, thereafter failed to develop the plants as promised by them under the sale agreement and they did not take care of the plants, as a result even after six years plants as promised had not grown to the height of 7 ft as promised in the brochure and hence, he has lost the promised income of Rs.1,20,000/-.

We have gone through the record. As per the translation of the brochure available on record 40 manzium plant can be planted in 200 sq mts. The plants grow to maturity in six years. The plants grow to a size of 75 ft yielding about 10 inch ft wood. The market value of 40 plants would be Rs.1,20,000/-. This wood is used in doors, practical boards, chairs dining table, sofa set and mainly in paper industry. No permission is required from the Government of Andhra Pradersh for planting and cutting. So availing of this scheme, one can enjoy the profit and pulp would be purchased by the petitioner.

In the sale agreement dated 02.11.2000 condition no. 1, 2 and 6 reads as under: "The first party is fixed at the rate of Rs.125/- per sq.yd out of consideration for sale, an amount of Rs.5,000/- as an advance. The balance of consideration shall be paid the second party the first party''s office, or recovery assistant of the first party and obtain receipt from the first party the absence of the receipt the first party shall not hold responsibilities for such payment.

The balance consideration should be paid within the stipulated time of sixty months. As per EMI (Equal Monthly Instalments) paid to the first party in case of delay in payment of second party. The first party charge interest of 2% per month levied on the EMI.

The first party develop 40 Manziam plants in 200 such square yards for six years including labour, water, and fertilizers expenses born by the first party only."

From this it is clear that the scheme offered in the brochure by the petitioner as also the sale agreement was a composite package which offered 200 sq yds of land as also 40 manziam plants which would mature after six years, during which period the petitioner would develop the plants by bearing the expenses on labour, water, fertilizers etc., Admittedly per the agreement, the respondent paid discounted price of Rs.18,600/- against the price of Rs.25,000/-. However, even after the passage of six years the manzium plants as promised were not available on his plot of land. Hence, the respondent alleged unfair trade practice and deficiency of service.

In view of the above, we agree with the conclusion of the State Commission that "hence, viewed from any angle, the appellant cannot be said to have not paid any amount to the respondents in connection with the purchase of the plot as also development of manziam trees therein. The District Forum erred in holding that the appellant is not a consumer as also that the agreement of sale was devoid of any consideration in regard to the development of 40 manziam plants in plots that was purchased under the agreement of sale from the appellants which was subsequently culminated in execution of the sale deed by the original owner of the plot".

The Hon''ble Supreme Court in Mrs Rubi (Chandra) Dutta vs M/s United India Insurance Co. Ltd., 2011 (3) Scale 654 has observed: "Also, it is to be noted that the revisional powers of the National Commission are derived from Section 21 (b) of the Act, under which the said power can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order, and only then, may the same be set aside. In our considered opinion there was no jurisdictional error or miscarriage of justice, which could have warranted the National Commission to have taken a different view than what was taken by the two Forums. The decision of the National Commission rests not on the basis of some legal principle that was ignored by the Courts below, but on a different (and in our opinion, an erroneous) interpretation of the same set of facts. This is not the manner in which revisional powers should be invoked. In this view of the matter, we are of the considered opinion that the jurisdiction conferred on the National Commission under Section 21 (b) of the Act has been transgressed. It was not a case where such a view could have been taken by setting aside the concurrent findings of two fora."

Thus, we find that no jurisdictional or legal error has been shown to us in the impugned order to call for interference in the exercise of powers under Section 21 (b) of Act. The order of the State Commission does not call for any interference nor does it suffer from any infirmity or erroneous exercise of jurisdiction or material irregularity. Thus, the present revision petition is hereby, dismissed and we re-affirm the orders of the State Commission allowing the complaint.