GWALIOR VIKAS PRADHIKARAN vs SWEETY VERMA

THIS appeal has arisen from order dated 28.4.97 passed by District Consumer Disputes Redressal Forum (hereafter referred to as District Forum). Gwalior in complaint case No. 442/96.

FACTS of the case briefly stated are that respondent No. 1, deposited Rs. 500/- on 24.11.89 in order to become a member of Jai Trimurti Graha Nirman Samiti Ltd. Thereafter, she deposited Rs. 12,000/- with the appellant, for depositing his amount in the account of respondent No. 1, maintained by appellant, on 5.12.89. Thus, appellant has received this amount of Rs. 12,000/-. Respondent No. 1 waited for a long time to get a plot of land for which purpose, she had become a member of me society of respondent No. 2. Failing to get any satisfactory reply and also finding at the same time that the prices of land are rocketing, the respondent No. 1, filed a complaint in District Forum, Cwalior in November, 1996 and prayed for either allotment of plot in the City Centre Scheme, Gwalior or refund of the amount deposited by her with 24% interest. In addition she prayed that in view of enormous escalation in price of plot of land, she should be paid compensation of Rs. 50,000/ together with costs of Rs. 500/- and legal fee Rs. 1000/-. Appellant/opposite party in District Forum filed a reply in the District Forum and raised several legal objections, about the respondent No. 1 (complainant in District Forum) not being a consumer of the appellant and also that the complaint was barred by limitation. The District Forum, Gwalior after hearing both parties passed a detailed speaking order in which they dealt with all the objections raised by appellant (opposite party in District Forum). They held that respondent No. 1 (complainant) was a consumer and also that the complaint was not time-barred. They also held appellant guilty of deficiency in service and passed an order dated 28.4.97 by which they directed the opposite party to allot a plot of land for residential purposes in the City Centre Scheme within one month of the date of this order or if this was not possible then to refund the amount of Rs. 12,500/- with 18% interest from date of deposit to date of payment. They also ordered payment of Rs. 2000/- for mental agony, Rs. 500/- as proceedings cost and Rs. 1000/- as fee of Advocate. Instant appeal is against this order. In the appeal memo the appellants have described the circumstances and basis on which this scheme was launched. They also submitted that it was explained to all concerned that money deposited by them was an advance and that plot of land can and shall be allotted only after sanction was received from State Government. Unfortunately, sanction was not received and hence land could not be obtained or developed for allotment. Appellant however, contended that respondent No. 1 failed to request for refund of money herself and therefore was not entitled to award of interest. They cited several decisions of the National Commission and M.P. State Commission in which it was held that award of interestat 18% was a penal interest and unless circumstances were exceptional award of 10 to 12% interest should be the normal criteria. Appellant also contended that after awarding 18% interest no compensation or costs are generally awarded because penal interest at 18% cover penalty for the shortcomings.

We have heard both the parties at length and have also gone through the records of the case. We have also perused the judgments cited by appellant. It is true that various development authorities launch schemes on pious hopes of approval and sanction of State Government. In many cases the sanction does not come through. Even in cases where the sanction is received, the time which lapses in the receipt of sanction, makes it very difficult for the Development Authorities to stick to the schedule announced by them. It can therefore be said that all such institutions fall behind schedule in their commitments even though they have been established in public interest for public welfare. It is also true that M.P. State Commission has taken a view that interest charged from Development authorities should not generally exceed 12% unless exceptional circumstances warrant it. In the instant case perusal of records, and die submissions made do not reveal exceptional circumstances. In fact we find from record that respondent did not request for refund of money before approaching the District Forum and therefore she cannot be considered as entitled to award of 18% penal interest. Having observed this it will have to be recorded that appellant also the not take the initiative in refunding money, when they realised that sanction was not forthcoming and in all fairness, they could not keep consumers waiting, with all their money locked up. We feel certain that if they had offered to return money with simple interest early, their hands would have been cleaner and conscience much less guilty. We, therefore, feel that award of 18% interest is not justified and charging 12% interest would meet the ends of justice.

WE shall now consider whether order regarding payment of compensation and cost of proceedings and legal fees was justified in this case. Appellant has averred in the appeal memo, that respondent never demanded a refund and straightway approached the Forum. They also stated that they refunded the money with 5% interest. The fact that appellant could not get sanction and could do no work is no fault of the respondent. The fact remains that her money was locked up, while price of residential plots continued to rise. Still award of interest would cover the amount of compensation as has been held by this Commission earlier in appeal Nos. 420/95, 526/ 94, 326/94 and so we do not feel the amount of Rs. 2000/- awarded by the District Forum is justified. However, same can be said about award of legal fees of Rs. 1000/-. WE find from several judgmens that this fee does not exceed Rs. 250/- unless in exceptional circumstances, when we find the litigation was unnecessarily forced on the consumer. WE therefore feel that award of legal fee of Rs. 250/- would meet the ends of justice. We therefore feel that order of the District Forum should be confirmed with some modifications. In the light of our observations in preceding paragraphs. Record reveals that Rs. 500/- was deposited with the society and therefore we feel it necessary to add in the order that appellant should obtain permission of the President of Society if felt necessary.

IN the light of discussion in preceding paragraphs the appeal succeeds partially. Order dated 28.4.97 of District Forum, Gwalior is modified as follows: "Opposite party (appellants in this case) shall hand over a plot of land in City Centre Scheme within one month of the date of this order or if plot of land is not available they shall refund Rs. 500/- deposited as member fee, and Rs. 12,000/- deposited in the account within one month together with 12% interest from date of deposit to date of payment. Opposite party (appellant) shall also pay Rs. 250/- as proceeding cost and Rs. 250/- as fee of Advocate. Appellant may obtain approval of President of Society if considered necessary."

No order as to costs. Order confirmed with modifications. ______________