GURINDER BEDI vs DELHI DEVELOPMENT AUTHORITY

BRIEFLY, the facts of the case are that the petitioner got herself registered for allotment of two bedroom flat under Self financing Scheme with the Delhi Development Authority on the terms and conditions given in the brochure issued by it and deposited an amount of Rs. 10,000/- as registration fee. She was allotted a flat on third floor in the area known as Sidhartha Extension, Pocket ''C'' vide letter dated 4.8.82 at an estimated cost of Rs. 1,24,000/-. She deposited 90% of the estimated cost of Rs. 1,24,000/- according to the schedule of payment. The balance of 10% was payable at the time when the letter of demand was issued. The said letter it is pleaded was to be issued. The said letter it is pleaded was to be issued within 24 months of the date of allotment of the flat. In May, 1988 she received a letter dated 10th May, 1988 from the respondent allotting her flat bearing No. 210-D at a price of Rs. 1,57,900/-. After giving a credit of Rs. 33,542/- on account of interest payable by D.D.A. to the complainant, she was required to deposit Rs. 13,042/-. The increase in the cost of the flat, it is pleaded, was unwarranted.

IT is also pleaded that the possession of the flat was delivered to her in September, 1988. Even at that time the flat was not fit for possession and it became fit for habitation in February/March, 1989. She has therefore, prayed that a decree for recovery of Rs. 1,12,373/-be passed in her favour as detailed below:- 1. The excess amount paid by the petitioner towards the price of flat by way of escalation. Rs. 33, 900.00 2. Interest upto May, 1988 @ 12% per annum credited yearly (Rs. 59,300/- minus Rs. 33,542/-) Rs. 15, 758.00 3. Interest from May, 1988 to December, 1988 @ 12% per annum on the amount of Rs. 1,57,900/- + Rs. 13,042,00 Rs. 14, 715.00 4. Compensation for mental torture for delay in possession of the flat@ Rs. 1,000/- per month Rs. 48,000.00 Total Rs. 1,12,373.00 The claim has .been contested by the respondent. It has been pleaded by it that the disposal cost of the flat allotted to the petitioner had been worked out on the basis of approved pricing policy of the authority based on no profit no loss basis. The main reason for escalation in the cost of flat over the tentative cost worked out in 1982, was that though the construction of the flats was started in 1982 but the same could not be completed till 1988. In the said period there had been tremendous increase in the cost of material and labour. The flats allotted at a cost of Rs. 1,42,200/- had been completed in 1986. Therefore, there was nominal increase in the cost taking into consideration the cost of the flats, which were completed in 1986.

The complainant in order to prove the case filed the affidavit of Shri Satinder M. Sedi & also produced him as a witness. He said in his statement that the estimated price of the flat in dispute was Rs. 1,24,000/-, out of which the complainant deposited Rs. 10,000,00 at the time of registration. At the time of allotment she was required to deposit 25% of the price which included the amount of Rs. 10,000/-. The amount was deposited by her by the due date. 20% of the price was to be deposited within six months, 25% within one year and another 20% within 11/2 year of the letter of allotment. The remaining 10% of the total price was to be paid when the letter of possession was to be given by the D.D.A. The D.D.A. had to issue letter of possession within 24 months from the date of letter of allotment. He further stated that in case a letter of possession was not issued within 24 months, the respondent was to pay interest on the amount deposited by the complainant. A letter was issued by the D.D.A. on 10th May, 1988 by which flat No. 210-D Pocket-C Sidhartha Extension was allotted to her. She was informed that the price of the flat would be Rs. 1,57,900/-. The respondent credited an amount of Rs. 33,542/- on account of interest in the account of the complainant. The persons to whom flats on 3rd floor were given in March, 1986, were charged Rs. 1,42,200/- per flat Those persons had been allotted the flats in the first instance on the same date, on which the complainant was allotted the flat. In Sukhdev Vihar, the price charged for a similar flat was Rs. 1,24,000/-. The possession in Sukhdev Vihar was given sometime in the year, 1985. In the affidavit dated 11th December, 1990, he further stated that flat No. 139-C and 140-C were both constructed in the year, 1986, being adjoining flats in the same building. Flat No. 139-C was allotted in 1988 at a cost of Rs. 1,61,500/- and flat No. 140-C in 1986 at a cost of Rs. 1,45,200/-. In another affidavit of the same date, he stated that the flat in dispute was incomplete when the possession was alleged to have been delivered. The glasses were fitted in November, 1988. On 7th September, 1988, the approach road to the flat in question has not been completed. The footpath were also not complete. These were completed in December, 1988.

THE D.D.A. produced the affidavits of Sh. J.S. Singhal, Financial Advisor (Housing), Shri R.L. Madan, Asstt. Director, Self Financing Scheme, D.D.A. and Sh. R.S. Verma, Executive Engineer, D.D.A. Shri Singhal in his affidavit stated that the cost of flat had been worked out on no profit no loss basis. THE construction was started in 1982 and completed in 1988. During that period, there had been tremendous increase in the cost of material and the rates of labour due to which the final cost became more than that of those flats, which were completed and elicited in 1986. He further stated that the escalation of 27.34% was reasonable in view of the actual construction period. THE flats, cost of which is Rs. 1,42,200/- were completed in 1986. Shri R.L. Madan said in the affidavit that the possession letter was prepared on 20th July, 1988 and it was issued on 4th August, 1988. He further stated that DDA issued 5th and final demand letter after receipt of Completion Certificate from the Engineering Wing. Shri R.L. Verma, Executive Engineer stated that the possession of the flat was delivered to the complainant on 7.9.88. THE flat at that time was complete in all respect and was in a habitable condition. None of the witnesses stated as to why there was delay in completion of the building. From a perusal of the aforesaid statement of Sh. Bedi, it is evident that the flats were to be completed by the D.D.A. within two years of the date of allotment of the flat. The above view finds support from the brochure marked ''A'' Clause 9 of the brochure relates to the mode of payments. The clause lays down that 25% payment shall be made as initial deposit, 20% after six months, 25% after next six months, 20% after next six months and last instalment of 10% at the time of delivery of the possession. The schedule shows that the payments in instalments were to be made after every six months from the date of initial payment. Though, no period has been prescribed for payment of last instalment yet from the schedule it is evident that the last payment was to be made within six months or shortly after six months from the date of payment of 4th instalment. It is further this conclusion finds support from clause 10 of the brochure wherein it is mentioned that interest at the rate of 7% on the amount deposited would be payable for the period beyond 2 years, upto the date of issue of possession letter, if the construction of the house was not completed by then. The provision for interest on the amount deposited by allottee, if the building was not completed within the period of two years, is a pointer to the conclusion that the DDA was to give possession of the flat within a period of two years. If the flat was not completed within the said period for any reasons, the D.D.A. was liable to pay interest on the amount deposited by the allottee @ 7% per annum. Normally the D.D.A. was entitled to charge escalation from the allottee if the building was not completed within a short period, after the expiry of two years. D.D.A. might also be justified in charging escalation cost, if it was not able to complete the building for the reason beyond its control. However, if the construction could not be completed for a long time on account of negligence on the part of D.D.A. it could not claim escalation for that period from the allottee. While taking a decision in this regard, it cannot be over looked that some delay does take place in completing construction of buildings. The D.D.A. is entitled to some benefit on that ground.

IT was the duty of the D.D.A. to explain as to why the flats were not completed within a period of two years. However, no affidavit of any officer in that regard has been filed. IT was also expected of the D.D.A. to have written to the allottees that in flats could not be completed for the reasons beyond their control. This was also not done. If the flats could not be completed within two years, these should have been completed another reasonable period thereafter say at the most within a period of 3 years. A heavy burden may on the D.D.A. to explain as to why those could not be completed within 3 years, which it failed to discharge. After taking into consideration all the aforesaid circumstances, I am of the view that the D.D.A. is entitled to claim escalation cost in construction of the flats at the most for a period of 3 years from the date of allotment. Thereafter, whatever is the cost of escalation that should be borne by the D.D.A. as the allottee cannot be allowed to suffer on account of dereliction of duty on the part of the officials of the D.D.A. The D.D.A. should enquire into the matter, and fix responsibility on the officials who are responsible for delay. Unless it is done consumers will go on suffering on account of negligence of the officials of this authority. The letter of allotment to the complainant was issued on 4.8.82 and taking into consideration, the period of 3 years, the building, in my view, should have been completed by August, 1985. I am consequently, of the opinion that the escalation cost upto August, 85 should be borne by the complainant and the escalation cost for the period thereafter would be borne by the D.D.A. It is in the statement of the complainant that the estimated price of the Flat in 1982 was Rs. 1,24,000/- and the actual cost in March, 86 was Rs. 1,42,200/-. Taking into consideration these two figures. I assess escalation at the rate of Rs. 450/- per month. Consequently, the price of the flat in August, 1985 comes to Rs. 1,40,200/-. It has however, been allotted to the complainant at the price of Rs. 1,57,000/-. The complainant is therefore, entitled to the refund of pay Rs. 17,500/- from the D.D.A. The complainant in our view is entitled to the interest @ 7% per annum on the said amount from 8th June, 1988 till March, 1991. It may be recalled that the balance amount was to be deposited by the complainant within one month of the letter dated 10.5.88 and possession of the flat was given in the 1st week of September, 1988. The amount of interest on the said amount @ 7% comes to Rs. 3,350/-. In all she is entitled to Rs. 20,850/-.

THE complainant has claimed an amount of Rs. 48,000/- on account of mental torture. However, I am not inclined to grant any amount on this score. It is well known that construction of house itself is a very difficult and time consuming work. In case the complainant would have constructed the house herself that might have been a greater torture for her. THE agent of the complainant has not brought to our notice any law in support of his contention that in addition to the damages by way of interest she was further entitled to damages. Consequently, I disallow this claim of the complainant. She. in my view, is not entitled to the interest as claimed by her.

FOR the aforesaid reasons, I partly accept the claim and direct the respondent to pay the complainant an amount of Rs. 20,850/- with future interest @ 10% per annum from 18th August, 1991 till the date of payment within a period of 3 months from the date of the order. The complainant shall also be entitled to the costs of this complaint which I assess at Rs. 1,000/-. B.L. Anand, Member-I do not agree to the above findings on the grounds that both the parties viz. the complainant and the D.D.A. were bound by the terms and condition incorporated in the brochure A & B on which the complainant has himself relied. 2. In the prayer he has claimed a sum of Rs. 1,12,373/- by way of escalation. At page 5 of the brochure ''B'' it is made amply clear that the 5th and final instalment was to be issued separately and the same could include the possible increase in the cost of flat. 3. Again at page 8 under the method of payment it was clearly mentioned that only the "tentative cost" of different schemes was indicated at the time of registration. In the brochure part ''A'' under Clause 17(V) at page 6, it is further explicitly provided that the cost indicated in the brochure issued for the specific-allotment of flats would be "provisional & liable to revision". 4. No where in the brochure DDA had undertaken to hand over the possession of the flat by a specific date or time period. 5. It is because of this sole reason that due provision has been fairly made under Clause 10 of the brochure that interest at 7% on the amount deposited will be paid for the period beyond two years to the date of the issue of the possession letter if the construction of the houses is not completed by then. 6. It is a known fact that sometimes the delays caused in the completion of such welfare projects are beyond the control of D.D.A. The short supply of vital materials like cement, steel, the labour disputes and trade union pressures are some of the factors beyond the control of D.D.A. or any such like agency. In quite few cases even the sites for the projects are encroached upon and due to socio-political and legal handicaps the squatters cannot be removed & such projects obviously get delayed. 7. It is because of such and other genuine difficulties that a provision to compensate the prospective buyers by way of awarding 7% interest on the delays has been made and the same was even paid to the complainant. The D.D.A. has no resources of its own for the construction of S.F.S. flats which are to be financed out of the deposits/payments made by the buyers and according to the schedule discussed ibid. The D.D.A. does not stand to have any earning or profit motive out of these projects and rather these projects are a drain on the resources of D.D.A. whereas the D.D.A. has to pay in advance for the acquisition and development of land on which the flats are constructed and the D.D.A. is obliged not to charge the market rates but concessional rates from the public. There is no evidence any where on record that the complainant was discriminated for the delayed allotment. Moreover, it was a voluntary act on the part of the complainant to have opted and applied for the flat and there was no compulsion from the side of D.D.A. for getting the registration for the flat 8. In the brochure itself there was a condition for voluntary withdrawal from the registration and in case the complainant was finding the delay in the execution of this project he could have very well withdrawn his option which he never did. 9. In view of the above reasons, I do not find that any compensation could be awarded to the complainant for the delayed allotment particularly so when there was no discrimination and he was duly compensated by way of interest about which he was informed in advance through brochure. 10. Moreover, the complainant did accept the possession without any protest and this complaint at a later stage after fully availing the services was nothing but an after thought and deserves no consideration. 11. The escalation in the cost was beyond the control of D.D.A. The prices of cement, steel, marble and other building components are increased almost every year on account of inflation and fiscal policies of the Central Govt. and is by and large a regular phenomenon. The Minimum wages Act is another factor which enhances the costs of such projects and no one like the D.D.A. can be blamed for such causes. It has been discussed earlier that there was no profit motive with the D.D.A. in the construction of these fiats. Moreover, it was clearly provided in the terms and conditions given in the brochure itself that the cost initially indicated by the D.D.A. was only the "Estimated Cost" and by no stretch of imagination the same could be treated as final & D.D.A. had every right to marginally increase the cost of flat

The complainant having voluntarily paid and after taking the possession has raised the issue subsequently. There is no protest recorded by him at the time of taking possession and as such his claim on this account is also nothing but an after thought. Moreover, he has failed to establish any motive or discrimination caused by the D.D.A. and as such his pleas are devoid of any force and merit rejection.

I also hold that such type of unwanted litigation against the welfare organisation like D.D.A. has to be discouraged and the complainant should be burdened with a cost of Rs. 1,000/-. Dr. (Mrs.) Avtar Pennathur, Member-I agree with the views expressed by Shri B.L. Anand, Member, and I also find no justification in the complainant''s prayer for a relief of Rs. 1,12,373/- on account of escalation of cost of flat of category II, 3rd floor in Sidhartha Extension. 2. The conditions governing the sale of these flats are set out in the brochure, issued by Delhi Development Authority (DDA) for the Fourth Self Financing Housing Registration Scheme, 7 January 1981 to 28 February 1981. On page 6 of the brochure at serial 17, General Clause (v) it is stated that "The costs indicated in the brochure issued for the specific flats would be provisional and liable to revision". Final cost was to be indicated in the letter of payment for 5th and final instalment. Shri R.L. Madan, Assistant Director, Self Financing (SFS), Housing Branch, DDA in his affidavit dated 8.11.90 has stated that the DDA issued 5th and final demand letter only after receipt of completion certificate from engineering wing and the cost details from the accounts section. It is well known that DDA undertakes construction of flats as a welfare measure on no profit no loss basis. 3. Some delays are inherent in construction activity and DDA has made provision for compensation to the consumers in such an eventuality. Serial 10, on page 4 of the brochure is relevant in this context, where it is stated, "Interest at @ 7% on the amount deposited will be payable for the period beyond two years to the date of the issue of the possession letter if the construction of the houses is not completed by then." The complainant has been given Rs. 33,542/- as interest on the total amount of Rs. 1,11,600/- paid by her in first four instalments.. 4. Further I find no merit in the complainant''s plea that she has been discriminated against. The case referred to by the complainant is support of her contention pertains to the allotment of flat No. 54-D of Category II, 3rd floor, Sidhartha Extension in March 1986 to Miss Sarita Malik who had also paid Rs. 1,11,600/- in four instalments like the complainant both of them were allocated flats as a result of draw held on 7.7.1982. Further she was allotted the flat as a result of draw held by DDA on 5.2.1986 and was informed vide DDA''s letter dated 17.3.86 that the final cost of the flat was Rs. l,42,200/- She had to make a final payment of Rs. 22.152.30p. after getting credit of Rs. 8,701/- as interest. Thus the net amount paid by her in March 1986 was Rs. 1,33,752.30p. The complainant was allotted the flat as a result of draw held on 1.3.88 and was informed by DDA vide letter dated 10.5.88, that the final cost of the flat was Rs. 1,57,900/- after getting credit of Rs. 33,542/- as interest she had to make a final payment of Rs. 13,042/-. The net amount paid by her was Rs. 1,24,642/- in May, 1988 as against Rs. 1,33,752.30p. paid by the allottee, (whose case has been quoted by the complainant) in March 1986, more than two years prior to the complainant. After registration for a particular scheme allocation for a specific locality is done by DDA by a draw held for the purpose. Later when the flats are almost complete, specific flats are allotted again through a draw. Thus a comparison of cases in different points in time becomes exercise in futility. 5. The complainant took possession of flat on 7th September, 1988 and has calculated interest due from DDA upto December 1988 as reflected at para 15, serial 3 on page of the complaint. This is a clear case of wanting to eat one''s cake and to keep it also. The complainant has paid a net amount of Rs. 1,24,642/- for the flat to DDA and sought a relief of Rs. 1,12,373/- on account of escalation of cost 6. The complaint is misconceived. Such avoidable litigation is to be viewed with serious concern and needs to be discouraged. The complainant is burdened with Rs. 1,000/- as costs.

Ordered accordingly.