G.L. Narasimham vs B.S. Venkateswarulu And Anr.

THE facts of the case in brief are that the complainant, Sri B.S. Venkateswarulu had purchased flat No. 101 for Rs. 4,95,000 payable in instalments from M/s. Kanyam Constructions, Hyderabad. He had paid Rs. 50,000 at the time of execution of agreement of sale on 14.2.1997 and further paid Rs. 2,25,000. It is the case of the complainant that he had obtained housing loan of Rs. 3,00,116. Out of the total sanctioned amount of Rs. 5,22,616 and as per the terms of agreement, actual possession of the flat was not delivered within two months. Though the complainant was ready to pay the balance amount of Rs. 2,20,000, the builder did not execute the sale deed. Hence he filed a complaint before the District Forum for direction to the builder and the owner of the property to execute sale deed and award compensation of Rs. 50,000 with costs.

THE builder contested stating that the complainant had not paid the balance amount despite notice issued to him. The possession was handed over but the agreement could not be executed due to dispute between the builder and the owner and the owner filed a civil suit in 1998 questioning the terms and conditions of the Development Agreement and the builder had made an application to the Municipal Corporation, Hyderabad for regularization as there were some deviations and the complainant had not sustained any monetary loss as he let out the flat from March, 1998.

MR . G.L. Narasimham, the owner of the property denied the allegations made by the complainant as well as Respondent No. 1. He stated that the flats constructed by M/s. Kanyam Constructions were illegal since they were not constructed as per the approved plan sanctioned by the Municipal Corporation, Hyderabad. A criminal case is also pending before the XVI Metropolitan Magistrate, Hyderabad. He further submitted that the builder has got only permissible possession to construct the flats and has no right to hand over possession of the flat to the complainant. Based on the evidence and pleadings, the District Forum allowed the complaint directing the builder to refund an amount of Rs. 2,75,000 along with interest @ 12% p.a. on Rs. 50,000 from 14.2.1997 till date of payment and interest @ 12% on Rs. 2,25,000 from 4.11.1997 till the date of payment together with costs of Rs. 1,000.

DISSATISFI ED by the said order, the complainant preferred an appeal before the State Commission.

BEFORE the State Commission, the learned Counsel for the complainant/appellant submitted that the District Forum failed to appreciate the fact that possession of the flat was with him and directing the builder to refund the amount with interest will dispossess the complainant. He submitted that before the State Commission, the builder and the owner of the property/respondents did not appear. Efforts made to send notices to them failed. Hence the State Commission as a last resort adopted the mode of substituted service through publication in the newspaper. It is clear from the records of the case that the owner of the property had refused to receive notice sent to them. The State Commission passed the following directions: "Taking into consideration that still the balance amount has to be paid by the appellant and the admission of respondent No. 1 in his counter about their willingness to register and also that the appellant is already in possession of flat No. 101, we allow this appeal directing the appellant to pay the balance amount prior to registration and the respondents are directed to register flat No. 101 within four weeks on payment of the balance amount by the appellant.

In the result, this appeal is allowed and the order of the District Forum is modified by directing the appellant to pay the balance amount prior to registration and directing the respondents to register flat No. 101 within four weeks on payment of the balance sale consideration by the appellant. We also direct the respondents to pay costs of Rs. 3,000 to the appellant."

AGGRIEVED by the order of the State Commission, Shri G.L. Narasimham, the owner of the land has filed this Revision Petition before us.

IT is useful to quote our observations dated 8th July, 2009 as under: "Heard the learned Counsel for the petitioner. This is a case where the Counsel for the petitioner has done blow hot and blow cold alternatively during the last two hearings. Learned Counsel for the petitioner had submitted that the State Commission had not at all issued notices to him, hence, the judgment of the State Commission should be set aside for having violated the principles of natural justice. Today the learned Counsel for the petitioner commits a summersault and submits that as the State Commission has served notice through substituted service by publishing the notices and the date of hearing in a Teluqu newspaper "Vartha". Generally, substituted service is resorted only after all efforts of serving notice on the party concerned by ordinary post, RPAD or Dasti notice had failed.

The original record received from the State Commission may be tagged to the admission file and placed before the Presiding Member of the Bench. Stand over to 27.7.2009 for admission hearing. Learned Counsel for the petitioner seeks permission to peruse the records of the State Commission and take the extract. He is permitted to do so in the presence of a responsible officer of the Registry."

A perusal of the records shows that the notice was in fact sent to the petitioner and it was refused and it is a settled law that refusal of notice tantamounts to service of notice. Despite that, the petitioner chose not to appear before the State Commission and argue his case. By this process he has lost a golden opportunity, having deliberately missed the bus when continuous efforts were made to serve the notice. Further the State Commission as a measure of abundant caution resorted to substituted service.

WE have heard the learned Counsel for the petitioner.

THE consumer cannot be made to suffer because of the dispute between the builder and the owner of the property. The facts that the consumer has paid substantial amount and is willing to pay the balance amount at the time of execution of sale deed and the building has already been constructed and possession has been handed over are not in dispute. The fact that there is a development agreement executed between the builder and the owner of the property dated 7th July, 1992 that the agreement permits selling of the remaining flats to third persons other than the flats, which are reserved for the owner of the property. Clause 6 of the agreement reads as under: "That the second party shall be permitted to alienate, sell the remaining four flats to the third persons for which the first party shall not have any objection and all the amount received from the alienation of the above said four flats shall he received by the second party and the first party shall not have any right to receive any amounts."

ACCORDINGL Y , we do not see any material irregularity or jurisdictional error in the order passed by the State Commission warranting our intervention under Section 21(b) of the Consumer Protection Act, 1986. Therefore, this Revision Petition is dismissed. There shall be no order as to cost.