M.D.HEGDE vs Karnataka Housing Board

Mr. B.K.Taimni, Member

THIS revision petition has been filed by the petitioner/complainant against the order of the State Commission which allowed the appeal of respondent, Karnataka Housing Board and quashing the order of the District Forum which had accepted the prayer of the petitioner/complainant. Brief facts of the case are that petitioner/complainant was allotted an M.I.G. house in Doddanagudde in Udupi District, Mangalore in 1980 by the respondent Board. Admittedly the house had been built/completed in 1978. It is also not in dispute that para 12 of the intimation of allotment stated that "the allottees shall accept any alteration in the value of the house, if any, which will be intimated to him/her". House at time was to cost Rs. 60,685/- which was purchased by the petitioner under Lease-cum-Sale agreement. The petitioner paid the initial amount of Rs. 33,185/- and the balance was paid in ''equal instalments''. Clause 6 of the Lease Deed contained a provision which reads "the price of the house as now fixed is Rs. 60,685/-. It may be altered by the Board and the lessee/purchaser binds himself to accept such a price". When after making full payment, as given out to him, the petitioner approached the respondent Board for execution of the Sale Deed, instead of getting the order on execution of lease deed, petitioner was informed by a letter dated 12.10.1992 that price of the house has now been worked out at Rs. 87,891/-, hence he should deposit Rs. 27,206/-in order to execute the Sale Deed. It is against this that the petitioner/complainant approached the District Forum who after taking into consideration the pleas of the parties ordered petitioner Board to execute the Sale Deed in respect of the house allotted to the petitioner/complainant without demanding any further amount and also awarded costs of Rs. 500/- in favour of the complainant. The main grounds of allowing the complaint were : (i) As per Regulation 11 of Karnataka Housing Board''s Allotment Regulations, 1983 the Board is competent to revise the price of the sites/houses but keeping in view the fact that house in the instant case was completed in 1978, Regulations of 1983 were not applicable. What was applicable were the Regulations of 1967, which in spite of repeated discussions were not produced before the District Forum compelling them to draw adverse inference; (ii) No details of grounds of cost escalation were produced, nor any one from the respondent Board examined in support of the cost esclation, again forcing the District Forum to draw adverse inference; and (iii) Admittedly the house was completed in 1978 i.e. two years before allotment in 1980 to the petitioner. The escalated cost was demanded in October, 1992, after 14 years of completion of the house and 12 years of the Lease Deed signed with the complainant. There is no explanation as to why the respondent could not intimate the revised costing during this long period ?

Against this order of the District Forum, respondent Board filed an appeal before the State Commission who allowed the appeal and set aside the order of the District Forum relying upon an order of this Commission in which it was held that the question of pricing of the flat by Housing Authority is not a consumer dispute. It was within the powers of the respondent Board to revise the cost of the house in view of provisions in the Lease Deed as also a similar provision in the letter of intimation. It is against this order that revision petition has been filed by the petitioner/complainant.

IT was agreed by the learned Counsel for the petitioner that the State Commission erred in allowing the appeal as the respondent Board had no right after 12 years of the lease having been signed, to increase the cost for a house completed in 1978 i.e. 14 years also. This is compounded by the fact that it was a complex of only eight houses which were completed in 1978, Housing Board would have come to know of any change/revised price within a reasonale period. He tried to distinguish his case by stating that it is not the enhanced price which he is challenging. What he is challenging is the demand itself. Petitioner cannot be asked to pay more on the basis of 1983 Regulations of the respondent. District Forum was justified in drawing adverse inference for non-production of 1967 Regulations by the respondent Board. The order of the District Forum was just and proper and be maintained and the order of State Commission set aside as illegal and erroneous. On behalf of the respondent it was argued that it is a question of price escalation only and cannot be gone into by any Consumer Fora. State Commission''s order is perfectly legal especially when provision exists for asking for enhanced price for the petitioner. During the arguments he also produced a copy of a document giving details of various cost components. He prayed for dismissal of revision petition.

WE have perused the meterial on record and heard the arguments. There is no doubting the fact that the petitioner was allotted the house in 1980 which was built in 1978. What respondent produced before the District Forum was Regulations of their Board of 1983 which were rightly held to be not applicable in the instant case. Regulations of 1967, which were applicable were not produced. It is true that Consumer Fora cannot go into the question of costing, but it is now well established that the Consumer Fora can certainly go into the question whether the builder or the Urban Development Authority Housing Boards have adhered to the formula for increase in price, which in the present case perhaps could have been seen, had Regulation 1967 of the respondent Board been made available. In the absence of the material on record, it is not possible to establish one way or the other the bona fides of the respondent Board in escalating the cost. In our view, State Commission failed to appreciate nuances here and failed to distinguish the present case from the case he relied upon. In our view, District Forum was correct in observing as to what was the respondent Board doing for 14 long years ? Could they not have calculated the completed costs of the houses built in 1978 ? Why did they wait for a letter from the petitioner to reach them in 1992 for execution of Sale Deed to wake up to the escalation factor created from a dusty file of 1980 or so ? Details of cost escalation were not produced neither before the District Forum nor before the State Commission, but were produced before us at the stage of arguments. Only one fact is enough to nail the issue. While no period for calculation for interest at around Rs. 26,000/- was available in the calculation sheet, on query, it was stated by the learned Counsel for the respondent Board that period of interest runs upto 1987. House was completed in 1978, handed over in 1980, where is the point of interest being running beyond this period ? The high-handedness of the respondent Board is writ large; need really is for the respondent Board to put their own house in order. One cannot imagine that for a small house like the one in question, all mighty Housing Board shall take 14 long years to arrive at the revised cost, that too based on a certain opaque criteria. In this case no factor appears in favour of the respondent Board, to uphold the order of the State Commission. The order of the State Commission is set aside and the reasoned order of the District Forum is upheld. Costs of Rs. 2,000/- is also awarded in favour of the petitiner/complainant to be paid by the respondent Board. Revision Petition allowed.