K.G. MANDAOKAR vs KETAN CONSULTANTS PVT. LTD.

-THIS is a complaint in which the complainant alleged the deficiency in the service of the opposite party, viz., the builder. Shortly stated, the facts are that the complainant entered into an agreement with the opposite party on 8.2.1990 to hire the services for construction of a flat at Nagpur for a consideration of Rs. 2,05,000/-. The complainant alleges that he was living as a tenant in the premises where the flats were to be constructed. The house belonged to Mr. Dilip Deoras. The opposite party is alleged to have entered into contract with said Doers on 9.9.1988 for development of the same land. The complainant further alleged that since he was residing on the same land in a tenement as a tenant, the opposite party could not construct the flats unless complainant vacated the tenement. According to complainant, there was again another agreement for vacating his rented premises on 24.1.1989. That agreement is also on record. According to complainant, the opposite party agreed to pay to the complainant Rs. 50,000/- as a consideration for vacating his premises in question so as to enable the opposite to proceed with construction. The complainant further alleged that by the same agreement, the opposite party agreed to sell a flat to the complainant in the said scheme. The complainant further alleged that he paid in cash Rs. 20,000/- at the time of the agreement and, thereafter paid Rs. 52,000/-. The complainant thus alleged that he paid Rs. 1,22,000/- including Rs. 50,000/- for vacating the tenement and the balance could not be paid due to his difficulties. Despite the agreements and payments of Rs. 1,22,000/- explained above, the opposite party on 17.7.1990 send the complainant a notice intimating the cancellation of the agreement in question. The complainant, therefore, filed his complaint alleging that the opposite party who had volunteered to render his services for construction of the flat failed to execute it as per the terms of agreement and unilaterally committed the breach of contract. Complainant approached this Commission claiming the possession of the flat or in the alternative refund of Rs. 1,22,000/- with interest at the rate of 18% p.a. In support of his allegations the complainant filed the necessary agreement and other documents. The opposite party filed its written version on 7.10.91 denying the claim of complainant. interalia the opposite party disputed the claim of complainant on the technical grounds that the complainant is not a consumer and consequently not entitled to approach this Commission.

WE have heard the complainant through Smt. Padolay, Advocate and Opposite Party through Shri Patwara an Advocate. WE have gone through the records of the case. The following points arise for our consideration : - (1) Whether the complainant is a consumer within the meaning of Consumer Protection Act, 1986? (2) Whether the complainant hired the services of opposite party and if yes, was there any deficiency in the service of the opposite party? (3) Whether the complainant is entitled for reliefs claimed in the complaint ?

Our answer to the above mentioned points are in the affirmative. As regards the first point, it is an admitted fact that the complainant had entered into an agreement with the opposite party on 8.2.1990. The copy of the agreement clearly shows that the aforesaid agreement was linked with another agreement dated 9.9.1988 in which the opposite party had agreed to develop the land in question at Nagpur for construction of flats. The agreement further shows that complainant had agreed to purchase apartment No. GB-3 on the ground floor of which the entire construction work was entrusted to opposite party. The estimated value of the construction of the flat is mentioned at Rs. 1,35,500/-. The stipulation about the payment is shown in para 1 of the agreement. The possession was to be handed over to complainant within 18 months from the commencement of the work. Thus, it is clear that the opposite party had volunteered to render the service of construction of a flat for the complainant'' as per the agreement. The contents of the agreement clearly show that the opposite party agreed to render necessary service for the construction of flat for complainant. In view of the decision of National Commission in the case of U.P. Awas Evam Vikas Parishad v. Garima Shukla, I (1991) CPJ 1 (NC), the activity in which opposite party is engaged clearly clothes the complainant with the status of a consumer. Thus, the complainant is a consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act. It is further stated by the complainant that the construction of the flat commenced in the month of May, 1989 and completed in the month of July, 1990.

The opposite party stated that the complainant had failed to make the balance payment and, therefore, the complainant was not entitled for the possession of the flat. The opposite party also disputed that Rs. 50,000/- were to be paid to the complainant for vacating his tenement. It is found from the agreement dated 24.1.1989 which is placed on record between the landholder and the complainant that the complainant was to receive Rs. 50,000/- for vacating the premises in his possession as a tenant which would be adjusted towards the cost of the flat in question. But there is no separate receipt for Rs. 50,000/-. Similarly, we find in agreement dated 8.2.1990 between the landholder G. Puranik and the complainant at page 4 that Rs. 20,000/- is paid by the complainant at the time of the execution of the agreement and no separate receipt is passed for that purpose. Thus, we find that Rs. 70,000/- had been paid by the complainant towards the consideration the flat as is reflected in the aforesaid two agreements which are admitted documents. In addition to above, one complainant has alleged that he has paid Rs. 24,000/- (? eligible). The complainant has filed on record the copies of the original receipts for the aforesaid payments which are marked to document No. 5,5-A and 5-B, respectively. The aforesaid payment of Rs. 52,000/- is supported by the three receipts. Thus, we find that the complainant has made a total payment of Rs. 1,22,600/- against the total price of the flat Rs. 2,05,000/-. From the aforesaid facts it is abundantly evident that the complainant had hired the services of the opposite party for the construction of a flat and had accepted Rs. 1,22,000/- towards the consideration and, therefore, the complainant is a consumer as he hired the services of opposite party for a consideration. Consequently the complaint is maintainable before this Commission.

FROM the preceding paragraphs, it is fully established that the complainant had hired the services of the opposite party for the construction of his flat. The stipulation in para 5 of the agreement shows that the flat was to be made available for complainant''s occupation within 18 months from the date of commencement of the work. The work is stated to have been commenced in 1989. In any case, the period of 18 months has ended long back. In the notice, the opposite party has agreed that complainant has paid Rs. 52,000/-. Opposite Party, however, had omitted to mention the amount of Rs. 50,000/- and Rs. 20,000/- received by him towards the consideration as discussed in the previous paragraphs. On consideration of the facts which are clearly stated by the complainant in this complaint and which are duly supported in his affidavit dated 12.7.1991, it is found that the complainant was a tenant in the premises and that he was promised Rs. 50,000/- for vacating the house to facilitate the opposite party to construct flats on the vacant land. It is also clear from the agreements that the complainant was promised Rs. 50,000/- for his vacating the tenancy and placing the complainant in vacant possession for the construction of the flats. It is also evident that the complainant was to get a flat bearing No. GB-3 on the ground floor in the proposed building at the estimated cost of Rs. 2,05,000/-. The complainant having demonstrated the payment of Rs. 1,22,000/- it was not correct on the part of the opposite party to serve him with a notice showing only receipt of Rs. 52,000/-. It appears that the complainant was being denied the entitlement of the flat taking undue advantage of his arrears for which he has sent letter to opposite party, the copies of which are placed on record explaining his difficulties in not making that payment. However, from the facts and circumstances of this case, we find that the complainant has demonstrated that the opposite party had received a consideration of Rs. 1,22,000/- and, therefore, the termination of the agreement unilaterally amounts to the breach of the conditions of the agreement. As it is an admitted fact that the opposite party had agreed to render the service to the complainant for construction of flat in pursuance of the agreement placed on record. In our view, issuing the notice purporting to terminate the contract is a short-coming in the manner of performance of the contract under which the opposite party has undertaken to perform in pursuance of contract. The delay in placing the complainant in possession is also a deficiency in the manner of performance which the opposite party had agreed. We, therefore, are of the view that the complainant has proved his allegations regarding the deficiency in the performance of the contract of service by the opposite party and, therefore, the complainant is entitled to claim the reliefs of possession or in the alternative the return of the amount. We further find that the delay is due to the terms of agreement. Shri Patwardhan, the learned Advocate appearing for the opposite party tried to argue that there was no direct contract between the complainant and the opposite party for the development of the land and for the service of construction. It is also argued that the transaction in question is for commercial purpose and, therefore, the complaint is not maintainable. In our view, the aforesaid contentions raised by Shri Patwardhan are totally untenable taking into consideration the facts of this case. The agreements in question clearly established that O.P. No. 2 was a party to the contract and that the transaction in question cannot be said to be for commercial purpose. Shri Patwardhan further submitted that the complainant was a defaulter and was entitled to pay interest at the rate of 24% p.a. in view of Clause 11 of the agreement dated 8.2.1990. It is true that such a clause exists. Therefore, at the most, the complainant is liable to pay interest at the rate of 24% p.a. balance of Rs. 11,508/- from the date of default till the payment. But non-payment of the balance does not in any way disentitle him to claim the possession of the flat. The amount of arrears is negligible and cannot be used as an excuse to deny the complainant possession of flat in question, when major and substantial amount of Rs. 1,22,000/- has been paid. Thus, we find that the claim of the complainant is justified. The complainant is entitled to the possession of the flat in question. Hence, we pass the following order : - ORDER The complainant shall be placed in possession of the flat No. GB-3 on ground floor viz. "Chinmayas Apartments" situated at Nagpur after the payment of Rs. 83,000/- by the complainant with interest at the rate of 24% p.a. from the delayed period of default. The complainant shall make the balance payment within a period of one month from the date of this order and, thereafter, the complainant shall be placed in possession of the flat on the same date by opposite party. If the opposite party fails to place the complainant in possession of the flat, then the opposite party shall pay to the complainant Rs. 1,22,000/- with interest at the rate of 18% p.a. from the date of the payment of the aforesaid amount till realization and shall also pay Rs. 50,000/- towards compensation for the loss caused to the complainant. The complainant also be paid the cost of Rs. 1,000/-. Complaint allowed with costs.