JANPAD PANCHAYAT, DURG vs TEJBHAN SADHWANI

THESE appeals under Section 15 of the Consumer Protection Act, 1986 arise from common order dated 28.11.2002 in Case Nos. 322/2002, 323/2002, 324/2002, 325/2002, 328/2002, 329/2002, 330/2002, 331/2002 and 267/2002 of the District Consumer Disputes Redressal Forum, Durg (hereinafter called as ''District Forum'' for short), whereby the said complaints were allowed and interest @ 18% per annum on the amount deposited by the complainants with the respondents was granted. Since common questions are involved in all these appeals, they are being disposed of by this common order.

THE facts no longer in dispute are : that the respondent Janpad Panchayat, Durg issued advertisement in the newspapers that it proposes to construct 24 shops on G.E. Road, Durg, and invited applications for allotment of shops in the said scheme. It was promised that allotment shall be made on ''first come, first served'' basis. THE complainants/respondents submitted their applications along with the prescribed registration fee for allotment of shops in response to the above advertisement. THE respondent Janpad Panchayat, thereafter, directed the complainants/appellants to deposit 50% of the premium amount. It is also not in dispute that the premium amount was deposited by all the complainants/appellants on 20.7.1998 or 21.7.1998, as enumerated in Para 5 of the impugned order. However, the opposite parties/appellants in their general meeting dated 6.2.2002 passed a resolution that the scheme be abandoned and that the amounts deposited by the various applicants be refunded to them. Intimation of the above resolution was given to the complainants/respondents on 7.3.2002. It is also not disputed that the amount was accordingly refunded to the complainants/respondents. However, no interest thereon was paid to them. The complainants/respondents in their complaint claimed that as the amount deposited by them was retained by the opposite party/appellant for a considerable period of about 4 years; therefore, interest should have been awarded on the amount deposited by them with the appellant-Janpad Panchayat by way of compensation.

The complaints were resisted by the opposite party/appellant. They averred that the complainants/respondents could not be termed as consumers. It was contended that amount deposited by the complainants/respondents was refunded to them. However, they were not entitled to any interest on the said amount.

THE learned District Forum by the impugned order held that the complainants/respondents were consumers. It was also held that since the amounts deposited by them were retained by the appellants/Janpad Panchayat, for a long period, it was liable to pay interest thereon. Accordingly, the learned District Forum directed payment of interest on the said amounts, for the period it was retained by the opposite party/appellant. Learned Counsel for the appellant/Janpad Panchayat in this appeal firstly urged that the complainants/respondents were not consumers. It was further urged that the learned District Forum has awarded excessive rate of interest i.e. 18% per annum which deserves to be reduced.

THE first question that arises for consideration is : as to whether the complainants/respondents were consumers of the appellant? Undisputedly, the appellants had issued an advertisement seeking applications for booking of shops proposed to be constructed on the G.E. Road, in the premises of appellant/Janpad Panchayat. The complainants/respondents in response to the said advertisement, submitted their applications for allotment of shops along with requisite registration fee. Thereafter, on the demand of the appellant, Janpad Panchayat, they also deposited 50% of the premium amount, as fixed by the appellant. Undisputedly, this amount was deposited with the appellant on 20/21.7.1998 by the complainants/respondents. It is also not in dispute that the scheme ultimately did not materialise and was abandoned by the appellant-Janpad Panchayat, intimation whereof was given to the respondents on 7.3.2002 and the amount refunded even thereafter later in the year 2002. It is, therefore, clear that the respondents proposed to purchase shops and paid booking amount as also part of premium to the appellant-Janpad Panchayat. In the circumstances, it is clear that complainants/respondents are consumers of the appellant-Janpad Panchayat. In the above context, the pronouncement of National Commission in George Thomas & Ors. v. Ghaziabad Development Authority & Ors., I (1999) CPJ 18 (NC), is explicit. In that case the complainant had applied for allotment of a flat under a scheme of Housing Board. However, possession thereof was not given to him for a considerable period. It was held to be deficiency in service and amount deposited by him was directed to be refunded with interest. In Lucknow Development Authority v. M.K. Gupta, III (1993) CPJ 7 (SC)=(1994) 1 SCC 243, it was observed that Government Bodies and Development Authorities under various enactments develop and allot plots or construct houses in discharge of their statutory functions. Thus, they render service convered by the provisions of the Consumer Protection Act, 1986. Any defect or deficiency in service would be unfair trade practice and would amount to denial of service.

THE learned Counsel for the appellant also submitted that since the complainants/respondents had booked shops, therefore, they could not be treated as consumers. However, the contention as above cannot be accepted because the booked premises was supposed to be sold as shop, the respondents were not consumers vis-a-vis the appellant - Janpad Panchayat. As noticed earlier, the appellant had extended an assurance of allotting the premises after construction for usage as shop. That scheme has however been abandoned and the premises could not be allotted to the respondents though they were required to pay registration fee as also 50% of the premium amount. Janpad Panchayat did not propose to take up the activity of development of site and construction of shops as its commercial activity. THE Chandigarh State Commission in c II (1999) CPJ 98=1999 (2) CPR 11, awarded compensation by way of interest in case of non-delivery of a commercial plot purchased in auction by the complainant. Reference may also be usefully made to the decisions of State Commission, Goa in M/s. Janata Auto Sales v. Madhavi Investment and Trading Pvt. Ltd., 1998 (3) CPR 209, and of State Commission, Uttar Pradesh in Rakesh Kumar v. Housing Commissioner, U.P. Housing and Development Board and Ors., III (2001) CPJ 35=2001 (2) CPR 332, wherein similar question was involved.

IN the circumstances, even if the complainants were intending purchasers of commercial plots and had booked the same, with the appellant-Janpad Panchayat, they would still be treated as ''consumers''. Therefore, there remains no scope for doubt that complainants/respondents were consumers of the appellant and the contention of the learned Counsel for appellant cannot be accepted. The next question that arises for consideration is : as to whether 18% interest awarded by the District Forum deserves to be reduced?

Learned Counsel for the appellant in the above context submitted that the appellant was forced to abandon the scheme on account of unavoidable circumstances. It was also submitted that the Bank rates of interest are consistently being lowered and at present, the maximum rate of interest on fixed deposits is around 6%. It has, therefore, been prayed that award of interest @ 18% per annum is excessive and would be too onerous on the appellant-Janpad Panchayat. Considering the facts and circumstances of the case and the period during which the amount was retained by the appellant and the consistent fall in the rates of interest, in our opinion, compensation by way of interest deserves to be reduced from 18% per annum to 15% per annum.

ACCORDINGLY, the appeal is allowed to the above extent and with the modification, limited to the rate of interest as above, in the impugned order of the District Forum, the appeals stand disposed of. However, costs of these appeals shall be borne by the parties as incurred. Appeals disposed of accordingly.