CHARANJIT SINGH BAKHSHI vs PUNJAB URBAN DEVELOPMENT AUTHORITY & ORS

By this order, we propose to dispose of the above noted revision petitions arising out of the order of the State Commission Punjab dated 16.02.2009 in First Appeal No. 158 of 2006 & First Appeal No. 275 of 2006.

Briefly stated facts relevant for the disposal of the revision petitions are that pursuant to a development scheme floated by respondents opposite parties, one Smt. Mann Kaur Sabharwal was allotted plot no.3077, Sector 69, Mohali measuring 500 sq. yards vide allotment letter dated 07.10.1996. Smt. Mann Kaur in terms of the allotment letter deposited a sum of Rs.2,25,000/- towards 25% of total consideration amount of Rs.9,00,000/-. The balance Rs.6,75,000/- alongwith interest @ 10% was payable by her in six yearly instalments. The petitioner Charanjit Singh Bakshi purchased said plot from Mann Kaur in year 1997 and applied to the respondents for transfer of said plot in his name. The request for transfer was accepted by the respondents and the petitioner complainant was issued re-allotment letter in his favour vide letter dated 16.03.1998. Despite of re-allotment, the respondents failed to deliver possession of the allotted plot to the petitioner complainant. The complainant, however, was informed vide letter dated 12.07.1999 issued by respondent no.2 that delivery of said plot was not feasible and an option was invited from the complainant for an alternative plot. Pursuant to the said option, the complainant was allotted alternative plot no.3150, Sector 69, Mohali.

It is the case of the petitioner complainant that plot no. 3150, Sector 69, Mohali was low lying and unfit for construction of house. The complainant, therefore, made an application dated 04.07.2000 to the opposite parties requesting for allotment of some alternative plot. The father of the complainant personally met the Chief Administrator of the opposite party and gave application dated 09.10.2000 for allotment of alternative plot. The aforesaid application was followed by another application dated 06.12.2000. The Chief Engineer of the opposite parties visited the spot and vide his letter dated 27.12.2000 confirmed that alternative plot was located in a pond more than 8 ft. deep. Despite that, no action was taken on the request of the complainant for alternative plot.

When the efforts of the complainant for getting an alternative plot failed, a legal notice dated 01.04.2002 was issued to the opposite parties. After a very long time, complainant came to know that opposite parties have allotted him plot no.1167, Sector 69, Mohali in lieu of plot no.3150, Sector 69, Mohali. The father of the complainant thus met the Estate Officer of the opposite parties in May 2003 and requested for issue of allotment letter. The allotment letter, however, was issued on 09.06.2003 after repeated visits of the father of the complainant to the office of the opposite parties.

It is further the case of the complainant that ultimately the opposite parties vide letter dated 22.01.2004 called upon the complainant to take delivery of possession of plot no. 1167, Sector 69, Mohali on any working day, pursuant to which possession of plot was taken by the complainant on 12.02.2004. According to the complainant, the opposite parties by delaying the possession of the plot to the complainant has committed deficiency in service. Thus, the complainant raised a consumer dispute by approaching the concerned District Forum praying for compensation to the tune of Rs.19,00,000/-.

The opposite parties in their written statement admitted that plot no. 3077, Sector 69 was initially allotted to Mann Kaur Sabharwal, which allotment was subsequently transferred in the name of the petitioner complainant after he purchased the plot from Mann Kaur Sabharwal. It was admitted that total price of the plot was Rs.9,00,000/- against which a sum of Rs.2,25,000/- was deposited by Mann Kaur and balance was to be paid in six yearly instalments alongwith interest @ 10%. The opposite parties had also admitted that complainant had paid all the instalments as per the time schedule given in the allotment letter.

It was further pleaded by the opposite parties that possession of plot no. 3077 Sector 69 could not be delivered to the complainant because the plot fell within the disputed area which was subject matter of litigation between Friends Cooperative Society and the Opposite Parties pending in Punjab and Haryana High Court. This fact was brought to the notice of the complainant and his consent was sought for considering his name in the draw of lots for the alternative plots. On receipt of the consent of the complainant, his name was included in the draw of lots and pursuant to the result of draw of lots, plot no. 3150 Sector 69 Mohali was allotted to the complainant vide allotment letter dated 03.11.1999 on the same terms and conditions as contained in re-allotment letter dated 16.03.1998.

It was further pleaded that plot no. 3150, Sector 60, Mohali was not suitable for construction as it was a low lying plot. Therefore, in a fresh draw of lots for non feasible plots in Sector 69 and Sector 70, Mohali held on 12.07.2002, plot No. 1167, Sector 69 Mohali was allotted to the complainant in lieu of plot no. 3130, Sector 69, Mohali. The complainant had taken possession of the plot without any objection on 12.02.2004. It was pleaded that the complainant after having taking possession of the alternative plot without raising any objection has no right to raise any objection regarding late delivery of possession particularly when the earlier plots were not feasible plots. Thus, in effect the opposite parties denied having committed any deficiency in service.

On consideration of the pleadings of the parties and the evidence produced on record, the District Forum partly accepted the complaint vide its impugned order dated 22.12.2005 and granted following reliefs to the petitioner: "Thus, while partly allowing the complaint, we make an order ordering the respondents to refund the aforesaid the aforesaid amount of Rs.2,35,250/- to the complainant recovered from him by way of interest alongwith interest on the same @ 12% p.a. from the dates of deposit of various amounts relating to that amount till refund, further ordering the respondents to pay interest on the price of plot amounting to Rs.9 lacs @ 12% p.a. from the date of deposit of various amounts under that head till the delivery of possession of the alternative plot to the complainant on 12.2.2004 vide certificate Ex. R.2 on the file. Besides that the respondents are also ordered to pay another sum of Rs.3000/- by way of costs of the proceedings. The respondents are granted six weeks time to comply with the orders of the Forum from the date of receipt of a copy of the order."

Being aggrieved of the order of the District Forum, the Opposite Parties filed an appeal no. 275 of 2006 praying for setting aside of the impugned order of the District Forum. The complainant also filed appeal no. 158 of 2006 seeking enhancement of compensation as also the interest awarded by the District Forum.

The State Commission after hearing the parties allowed the appeal preferred by the opposite parties and dismissed the complaint. As a consequence, the appeal preferred by the petitioner complainant for enhancement of compensation was also dismissed. Being aggrieved of the order of the State Commission, the petitioner has filed the instant revision petitions.

Petitioner has assailed the impugned order on the ground that the State Commission has committed a grave error in failing to appreciate that the respondent authority committed a deficiency in service by allotting plot No.3077 to Smt. Mann Kaur Sabharwal, the predecessor in interest of the petitioner knowing fully well that the title of the plot was not clear as it was under litigation before Punjab & Haryana High Court. It is further contended that the State Commission failed to appreciate that the respondent compounded the deficiency in service by allotting alternate plot No.3150 which was water logged and not fit for construction. It was also argued that the State Commission has wrongly concluded that the delay of 8 years in allotment of plot to the petitioner/complainant did not amount to deficiency in service because the time was not the essence of the contract of allotment between the parties. It was also argued that the State Commission has passed the impugned order ignoring the law laid down by the Supreme Court in the matter or Ghaziabad Development Authority vs. Balbir Singh, 2004 5 JT 16 and that the State Commission has passed the impugned order on incorrect appreciation of the judgment of the Apex Court in the matter of Bangalore Development Authority vs. Syndicate Bank, 2007 2 CPJ 17

Learned counsel for the respondent on the contrary has argued in support of the impugned order.

We have considered the rival contentions and perused the record.

Undisputedly, the petitioner is a subsequent allotee, who purchased the right of original allotee Mann Kaur Sabharwal pertaining to plot no. 3077, Sector 69, Mohali. It is also not in dispute that because of litigation initiated by Friends Cooperative Society in respect of the land on which plot no. 3077, Sector 69, Mohali was located, the petitioner complainant was given an option to get his name considered in a draw of lots for alternative plot and on receipt of consent of the complainant, his name was included in the said draw. Pursuant to the result of draw of lots, plot no. 3150 Sector 69 was allotted to the petitioner. It is the case of the petitioner that aforesaid plot no. 3150 was located in a low lying pond. The petitioner, therefore, protested against said allotment and ultimately he was allotted alternative plot no. 1167, Sector 69, Mohali. It is also established on record that petitioner complainant after having taken possession of the alternative plot number 1167, Sector 69, Mohali on 12.02.2004 filed consumer complaint in the District Forum Ropar on 29.05.2004.

Learned State Commission taking note of the aforesaid history of the case , relying upon the judgment of the Supreme Court in the matter of Bangalore Development Authority allowed the appeal preferred by the opposite party respondent and dismissed the complaint.

Hon''ble Supreme Court in the above said matter after considering whole gamut of law including the judgment in Ghaziabad Development Authority on the subject, laid down following principles of law: 10. Where a Development Authority forms layouts and allots plots/flats (or houses) by inviting applications, the following general principles regulate the granting of relief to a consumer (applicant for allotment) who complains of delay in delivery or non-delivery and seeks redressal under the Consumer Protection Act, 1986 (''Act'' for short) - [vide : Lucknow Development Authority vs. M. K. Gupta, 1994 1 SCC 243, Ghaziabad Development Authority vs. Balbir Singh, 2004 5 SCC 65, and Haryana Development Authority vs. Darsh Kumar, 2005 9 SCC 449, as also Ghaziabad Development Authority vs. Union of India, 2000 6 SCC 113]:

(a) Where the development authority having received the full price, does not deliver possession of the allotted plot/flat/house within the time stipulated or within a reasonable time, or where the allotment is cancelled or possession is refused without any justifiable cause, the allottee is entitled for refund of the amount paid, with reasonable interest thereon from the date of payment to date of refund. In addition, the allottee may also be entitled to compensation, as may be decided with reference to the facts of each case.

(b) Where no time is stipulated for performance of the contract (that is for delivery), or where time is not the essence of the contract and the buyer does not issue a notice making time the essence by fixing a reasonable time for performance, if the buyer, instead of rescinding the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute.

(c) Where an alternative site is offered or delivered (at the agreed price) in view of its inability to deliver the earlier allotted plot/flat/house, or where the delay in delivering possession of the allotted plot/flat/house is for justifiable reasons, ordinarily the allottee will not be entitled to any interest or compensation. This is because the buyer has the benefit of appreciation in value.

(d) Though the relationship between Development Authority and an applicant for allotment is that of a seller and buyer, and therefore governed by law of contracts, (which does not recognise mental agony and suffering as a head of damages for breach), compensation can be awarded to the consumer under the head of mental agony and suffering, by applying the principle of Administrative Law, where the seller being a statutory authority acts negligently, arbitrarily or capriciously.

(e) Where an alternative plot/flat/house is allotted and delivered, not at the original agreed price, but by charging current market rate which is much higher, the allottee will be entitled to interest at a reasonable rate on the amount paid towards the earlier allotment, from the date of deposit to date of delivery of the alternative plot/flat/house. In addition, he may be entitled to compensation also, determined with reference to the facts of the case, if there are no justifiable reasons for non-delivery of the first allotted plot/flat/house.

(f) Where the plot/flat/house has been allotted at a tentative or provisional price, subject to final determination of price on completion of the project (that is acquisition proceedings and development activities), the Development Authority will be entitled to revise or increase the price. But where the allotment is at a fixed price, and a higher price or extra payments are illegally or unjustifiably demanded and collected, the allottee will be entitled to refund of such excess with such interest, as may be determined with reference to the facts of the case.

(g) Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment and mental agony, in addition to appropriate direction for execution and delivery of title deed.

(h) Where the allotment relates to a flat/house and construction is incomplete or not in accordance with the agreed specifications, when it is delivered, the allottee will be entitled to compensation equivalent to the cost of completing the building or rectifying the defects.

(i) The quantum of compensation to be awarded, if it is to be awarded, will depend on the facts of each case, nature of harassment, the period of harassment and the nature of arbitrary or capricious or negligent action of the authority which led to such harassment.

(j) While deciding whether the allottee is entitled to any relief and in moulding the relief, the following among other relevant factors should be considered : (i) whether the layout is developed on ''no profit no loss'' basis, or with commercial or profit motive; (ii) whether there is any assurance or commitment in regard to date of delivery of possession; (iii) whether there were any justifiable reasons for the delay or failure to deliver possession; (iv) whether the complainant has alleged and proved that there has been any negligence, shortcoming or inadequacy on the part of the developing authority or its officials in the performance of the functions or obligations in regard to delivery; and (v) whether the allottee has been subjected to avoidable harassment and mental agony.

In the instant case, it is clear that respondent authority in view of its inability to deliver earlier allotted plot to the petitioner and the delay caused for justifiable reasons allotted alternative plot to the petitioner which was accepted by him. The alternative plot was allotted on the same price on which original plot was agreed to be allotted. Therefore, in view of clause (c ), (d) and ( e) of the principles laid down by the Hon''ble Supreme Court in the matter of Bangalore Development Authority , we do not find fault with the impugned orders passed by the State Commission which may call for interference in exercise of revisional jurisdiction. Revision Petitions are, therefore, dismissed.