GABRIEL FERNANDES vs JOSE JOAO DOMINGOS GODINHO

THE complainants have filed this complaint against the opposite party [O.P.] alleging deficiency of service for non-delivery of possession of one flat and one shop and have claimed compensation of Rs. 16,80,000/- or alternatively to be put in possession of the said flat and shop.

THE complaint in short is that the complainant had engaged the services of the opposite party for development of their property bearing Plot No. 1 admeasuring 650 sq. m. of the property known as "Hospitalcho Molo" in village Se Old Goa, Ilhas. THE parties executed an agreement dated 13.3.1994. As per the said agreement, the opposite party, in consideration of the development and sale of the remaining premises in the building to be constructed on the said property, was to deliver to the complainants duly constructed with occupancy certificate and sale deed within 18 months the following premises : (a) one shop admeasuring 16 sq.m. on the ground floor, and one flat admeasuring 88 sq.m. on the first floor, both in a building called "City Avenue Complex" at Boca de Vaca, Panaji; and (b) one shop admeasuring 18 sq.m. on the ground floor of the building called "Vailankanni Apartments" proposed to be constructed in the plot belonging to the complainants. Soon after the execution of the agreement, the opposite party informed the complainants that he would not be constructing the "City Avenue Complex"

personally but that the same would be done by one Khan Realtors Pvt. Ltd. and requested the complainants to execute an agreement with the said Khan Realtors wherein the opposite party would be the confirming party. THE opposite party represented to the complainant that the commitment to deliver the premises in "City Avenue" would be honoured by him through the said Khan Realtors. Accordingly, the complainants executed an agreement dated 10.8.1995 with the said Khan Realtors with the opposite party as the confirming party. THE opposite party commenced development of the said plot of the complainants in December, 1994 after obtaining construction licence on 16.12.1994. THE opposite party was unable to deliver possession of the said premises within the stipulated time. In part performance of the agreement, the opposite party delivered possession of the shop in "Vailankanni Apartments" on 27.12.1997. THE opposite party assured the complainants that the flat and shop in "City Avenue" would be delivered shortly. As the possession was not delivered till October, 1998, the complainants insisted with the opposite party to atleast pay compensation of Rs. 50,000/- in addition to the amount of Rs. 20,000/- paid earlier. Accordingly, the opposite party, on 7.10.1998, delivered 3 cheques for total amount of Rs. 50,000/-. When the first cheque was presented, the same was returned unpaid for insufficiency of funds. THE opposite party, on being confronted by the complainants, pleaded not to present the other two cheques for encashment as he was unable to arrange funds on account of financial difficulties. THE opposite party took back the three cheques and instead issued 10 undated cheques of Rs. 5,000/- each. Of these, two cheques amounting of Rs. 10,000/- were encashed and the others were not presented at the request of the opposite party who claimed to be facing a financial crunch. In September, 1999, the opposite party informed the complainants that he was not in a position to deliver the flat and shop in "City Avenue" as the construction thereof was not completed by Khan Realtors. The complainants have prayed for possession of the said flat and shop or alternatively for compensation of Rs. 16,80,000/- being cost of identical built-up space in the same locality. The complainants also prayed for compensation of Rs. 2,000/- per month from January, 1998 till the actual delivery of the flat and shop. The complainants also prayed for direction to the opposite party to pay the amount of Rs. 40,000/- being the amount of unencashed cheques.

Upon being noticed, the opposite party filed his written version and resisted the complaint on various grounds. Parties have filed their affidavits-in-evidence and documents were also produced by either side.

WE have heard Mr. Sudin M.S. Usgaoncar, Counsel for the complainants. The opposite party filed written arguments. WE have also gone through the records in minute detail. In light of the rival contentions, the following points arise for determination, in order to arrive at a conclusion for disposal of this complaint : (1) Whether the opposite party has failed to delivery possession of the flat and shop in "City Avenue Complex" to the complainant ? (2) Whether the complainants are entitled to the reliefs prayed for ? and (3) Whether M/s. Khan Realtors Pvt. Ltd. ought to have been joined as party to these proceedings ? Point No. 1 :

THE agreement dated 13.4.1994 specified that the flats and shops at para 4 would be delivered within 18 months from the date of construction licence subject to further extension of 6 months. THE possession of the said premises ought to have been delivered on or before 15.6.1996. THE opposite party has admitted that the project "City Avenue Complex" has not been completed by Khan Realtors due to financial difficulties and that he was unable to deliver possession of the said flat and shop. In fact, the opposite party submitted in his written version that it would take another 12 months to complete the said construction. THErefore, we find the first issue in the affirmative. Point No. 2 : The complainants have left it to the discretion of this Commission to grant the relief of either, (a) possession of the said flat and shop; or alternatively (b) an amount of Rs. 16,80,000/- as compensation for purchase of a flat and shop of identical area in the same locality. It is an admitted fact that construction of "City Avenue Complex" has not yet been completed even after more than five years. In his written version filed on 21.1.2000, the opposite party stated that the said construction would take another 12 months to complete. In his affidavit-in-evidence filed on 19.4.2000, the opposite party stated that the said premises would be completed in eight months time. However, the opposite party has not brought anything on record even at arguments stage to show that the said project is anywhere nearing completion. In view of this, a direction to deliver possession of the premises could be an exercise in futility and the complainant-consumers would be put to further hardships to obtain execution of the decree for possession of premises that are far from being complete. In our considered opinion, and keeping the interest of the consumer in mind, we direct payment of compensation equal to cost of typical premises in the same locality with interest at 18% per annum. On the issue of quantum of compensation being cost of suitable typical alternate premises in the same locality, the complainants have claimed an amount of Rs. 16,80,000/-. The complainants have not brought any quotation or offer on records to show the genuineness of their claim. However, there is an agreement dated 10.8.1995 executed by/between Khan Realtors, the complainants and the opposite party as the consenting party. This document has been produced and relied by the opposite party. In the said agreement, M/s. Khan Realtors has agreed to construct and sell to the complainants one shop on the ground floor and one flat on the first floor in the project "City Avenue" for consideration of Rs. 15,22,100/-. We are inclined to consider this figure for the purpose of valuation of alternative flat and shop in the locality.

IN view of our opinion above, we are not inclined to grant prayer (d) for direction to the opposite party to pay Rs. 2,000/- per month from January, 1998 till the actual delivery of the flat and shop.

ADMITTEDLY, the opposite party had issued 10 cheques for Rs. 5,000/- each to the complainants being compensation for delay in delivery of possession. Of these, two cheques amounting to Rs. 10,000/- have been encashed by the complainants, while eight cheques amounting to Rs. 40,000/- are yet to be honoured. We are of the view that the complainants are entitled to a direction for payment of Rs. 40,000/- to them by the opposite party. Point No. 3 : The agreement dated 13.4.1994 was executed between the complainants and the opposite party. In the said agreement, the opposite party had undertaken to deliver on flat and one shop in "City Avenue Project" at Boca-da-Vaca, Panaji. The record shows the opposite party undertook to comply with this commitment through M/s. Khan Realtors. The complainants, at the request of the opposite party, executed the agreement with M/s. Khan Realtors with the opposite party as the consenting party. The opposite party even paid an amount of Rs. 4,56,630/- to M/s. Khan Realtors towards consideration. There was no demand made by said Khan Realtors to the complainants for payment of any consideration. The said agreement was executed for the convenience of the opposite party to facilitate compliance of his commitment under the agreement dated 13.4.1994. The agreement dated 13.4.1994 between the complainants and the opposite party formed the basis of contract of service between the parties. We find no merit in the argument of the opposite party that M/s. Khan Realtors Pvt. Ltd. ought to have been impleaded as a party in this dispute. In view of what is discussed, we pass the following order : (i) The opposite party is directed to pay to the complainants, within 30 days, (a) an amount of Rs. 15,22,100/- alongwith interest at 18% p.a. from 16.6.1996 till the date of payment; and (b) an amount of Rs. 40,000/- alongwith interest at 18% p.a. from 7.10.1998 till the date of payment, and (ii) The opposite party is directed to pay to the complainants an amount of Rs. 1,000/- as costs of these proceedings. Order accordingly. Complaint disposed of.