M.M.SINGH vs CHARANJIT KOCHHAR, PROPRIETOR, CHARANJIT KOCHHAR ENGINEERS AND CONTRACTORS

THIS complaint has been filed against Charanjit Kochhar, Proprietor, M/s. Charanjit Kochhar Engineers and Contractors, who is Opposite Party No. 1 and M/s. Technology Parks Ltd., who is Opposite Party No. 2. According to the allegations in the complaint, the complainants are a group of 19 individuals, 17 of whom are working for M/s. Maruti Udyog Ltd. (for short MUL). In July, 1989 Opposite Party No. 1 issued a public advertisement inter alia in the Hindustan Times advertising a residential complex of flats proposed to be constructed under the banner of "Charanjit Tower" (hereinafter referred to as the Proposed Flats). The Proposed Flats were to be situated on Plot No. 26 in Vaishali Township, Ghaziabad, Uttar Pradesh. In response to the said advertisement, each of the complainants entered into an agreement with Opposite Party No. 1 for the purchase of one flat each of the Proposed Flats in August, 1989. These agreements were in a standard form, the terms of which are identical. The salient points of the agreements are the following : (i) There were proposed to be 4 sizes of flats in the complex. These were flats of area 736 sq.ft., 922 sq.ft., 982 sq.ft and 1380 sq.ft. (ii) Under Clause 8 of the agreements, the flats were proposed to be completed by December, 1992. (iii) Under Clause 12 of the terms and conditions of allotment, the Builders bound themselves liable to pay interest at the rate of 15% per annum on the amounts deposited by them if possession was not handed over to the complainants by December, 1992 in accordance with the agreements unless the delay was caused by "natural calamities". (iv) There was included in the said agreement a clause which specifically provided that there would be no escalation in the price of booked flats.

Opposite Party No. 1 had undertaken under the terms of the said agreements that development and construction of the proposed flats were to be undertaken by M/s. Charanjit Kochhar and not by any other organisation or builder.

FURTHER , vide Clause 6 of the Terms of Allotment of the land at Vaishali by the Ghaziabad Development Authority to Opposite Party No. 1, the latter were under obligation to complete construction upon the allotted land within a period of 3 years from the date of taking possession of the land. Opposite Party No. 1 had taken the possession of the land in 1989. However, construction of the flats has not even commenced on the site up to the date of the filing of the complaint which was filed on 26th July, 1993. Vide letters dated June 10,1993 Opposite Party No. 2 had communicated with some of the complainants that Opposite Party No. 2 had "taken over" the Charanjit Tower Project in which the complainants had booked flats. According to the Complainants, Opposite Party No. 2 was not a party to the agreements entered into by the complainants with Opposite Party No. 1 and till the time letters were received from Opposite Party No. 2 by individual complainants, the complainants had have no dealings with that party and did not know who the said Opposite Party was. Further the agreements that were entered into between the complainants with Opposite Party No. 1 were not assignable in any manner whatsoever. Opposite Party No. 2 which is a public concern and is an associated Company of Skipper Group of Companies. On June 23, 1993 an advertisement appeared in the Hindustan Times, New Delhi edition, offering for sale of apartments at a total cost of Rs. 90,000/- only. The proposed apartments were called "Park Apartments" and the developers were "Technology Parks Ltd. " a project of Charanjit Tower" and the apartments were to be situated in Vaishali Township, Ghaziabad, U.P. In the brochure issued in respect of the Park Apartments, the address of the site office for park Apartments was given as Plot No. 26, Vaishali, Ghaziabad, that is the same address as that of Charanjit Towers in which the complainants had booked their flats. Upon receiving the said letters from the Opposite Party No. 2 and having noticed the advertisement referred to above, the complainants requested and authorised their colleagues Mr. A.S. Nirvan and Mr. T.K. Banerjee (complainants Nos. 14 and 19 herein respectively) to visit the registered office of Opposite Party No. 2 to seek clarification from Opposite Party No. 2 regarding the letters that had been received by some of them. On visiting the said office, the above stated complainants managed to obtain the brochure in respect of Charanjit Tower/Park Apartments issued by Opposite Party No. 2. The said complainants were able to meet one of the Directors of Opposite Party No. 2-Company who informed that the Park Apartments project advertised by Respondent No. 2 was proposed to be constructed upon the same plot as the Charanjit Tower Project. As had been the modus operandi of Shri Tejwant Singh, Chairman of the Skipper Group of Companies earlier, his associate company Opposite Party No. 2 was similarly seeking to sell the same flats to a number of unsuspecting buyers under different names simultaneously. The complainants were also told that apart from the fact that the Park Apartments Project was planned on the same land as the Charanjit Tower Project, the Park Apartments Project was not financially viable at all since it was impossible to make flats available to people at a cost of Rs. 90,000/-. Therefore, the so-called Park Apartments Project would be embroiled in serious litigation and in the circumstances the complainants would never see the completion of their Charanjit Tower flats. While the said Director was talking to the said persons, the meeting was interrupted by Shri Tejwant Singh, who barged into the room aggressively, reprimanded the said Director and asked the said complainants to leave the room immediately. The complainants were disturbed by the ugly scene and altercation that they faced at the office of Opposite Party No. 2 and have thereafter lost all hope of ever seeing the residential flats promised to them by Opposite Party No. 1 and have seriously begun to apprehend that the Opposite Parties would not even return their money. That 13 of the complainants being complainants Nos. 1 to 5, 7,9,11 to 14,18 and 19 (all employees of MUL) have taken a loan from MUL in the form of house building advance, while complainant No. 8 has taken a loan from the American Express Bank. Against the moneys advanced by MUL, the proposed flats owned by the complainants were mortgaged to MUL. Opposite Party No. 1 had stated vide letter dated 23rd April, 1991 that they had no objection to the creation of the said mortgage in the name of M/ s. MUL. The decision of the said complainants to mortgage their proposed fla£s with M/s. MUL was based on the commitment made by the Opposite Party No. 1 that the proposed flats would be completed and possession thereof would be given to the complainants by December, 1992. " The 13 complainants referred to above have reason to believe that MUL would not disburse the remaining funds towards their house building advances to Opposite Party No. 2 since its commitment was to pay to Opposite Party No. 1 especially when it comes to the notice of MUL that the said project has now been taken over by the Skipper Group and that the said Group had already advertised for another project on the same site thus laying the ground for another scam.

THE complainants further alleged that they on the average draw salaries of about Rs. 4,500/- (take home) and would actually be required to pay about Rs. 3,000/- from their salaries towards loan repayments. However, sinc the employees are provided accommodation by MUL which rents such accommodation for the employees, in practice the recovery is made by leasing the flat to the employee himself and thereby no moneys are deducted from the salaries of employees. However, if flats are not available for occupation to the complainant-employees within the stipulated time, they would actually have to pay nearly their entire salary to MUL and would not be left with enough money to even make both ends meet.

UNDUE delay on the part of Opposite Party No. 1 in completing construction of the proposed flats would inordinately increase the burden of interest payable by the complainants to the MUL since the rates of interest would increase while at the same time the complainants would be denied the benefit of staying in their own flats and the burden of rentals would continue to be borne by them. MUL will commence recovery of the house building advance from the said 13 complainants from July, 1994 onwards. Immediately after the said visit of the said two complainants to the offices of Opposite Party No. 2, four of the complainants visited Opposite Party No. 1 and demanded their money back since construction of the building had not even started and there had been a fundamental breach of the contract. Opposite Party No. 1 kept on promising to return their money and stated that he had to speak to Shri Tejwant Singh about it. He took time from the complainants and later began avoiding telephone calls that the complainants made to him. Finally Opposite Party No. 1 sent a message to the complainants through his Accountant that if the complainants wished to take a refund of their moneys, they should contact Shir Tejwant Singh directly since Opposite Party No. 1 would not be able to help them. The said Accountant also categorically told the complainants that there was no possibility whatsoever of Shri Tejwant singh even refunding the money voluntarily. It was also averred by the complainants that the present complaint pertains to deficiency in service by Opposite Party No. 1 who had under the terms of the agreement entered into between them and his proprietorship concern had undertaken to complete construction of the flats by December, 1992. It was the further grievance of the complainants that upto the date of the filing of the complaint, actual construction of the proposed flats has not even commenced even though nearly 4 years have elapsed since Opposite Party No. 1 entered into agreements with the complainants. There is clearly no possibility of Opposite Party No. 1 completing construction in the foreseeable future and providing flats to the complainants as undertaken by him to do.

THE details of payments made by the complainants to Opposite Party No. 1 as on the date of filing of the present complaint are given in Annexure C9 which is annexed to the complaint. The total amount that the complainants have paid to Opposite Party No. 1 is Rs. 27,12,232/-. The flats which were agreed to be supplied by Opposite Party No. 1 at the rate of approximately Rs. 425-435 per sq.ft. and the agreement contained the specific clause providing for no escalation in such price. The flats have not been supplied at the agreed price, at the agreed time and the market price prevailing in that area is today not less than Rs. 650 sq.ft. as given in the brochure issued by Opposite Party No. 2 itself. Each complainant has, therefore, suffered an actual damage of approximately Rs. 2 lakhs which they are entitled "to claim.

THE complainants have made the following prayers: (a) To order the Opposite Parties or either of them to pay to the complainants a sum of Rs. 27,12,232 (Rupees twenty seven lakhs twelve thousand two hundred and thirty two only) as refund of the amounts paid by them to Opposite Party No. 1. (b) To order the Opposite Parties or either of them to pay to the complainants interest at the rate of 15% per annum calculated from the date of payment/deposit of instalments/ sums up to the date of payment as per the term of the agreement. (c) The alternative prayer to prayer (b) above, that the Opposite Parties or either of them pay a sum of Rs. 2 lakhs to each of the complainants as damages actually suffered by the complainants by reason of the conduct of the Opposite Parties.

The Opposite Party No. 1 did not appear in spite of service. Opposite Party No. 2 contested the complaint by filing a counter. Some preliminary objections were taken to the effect that this Commission has no jurisdiction to entertain the complaint as the values of none of the alleged claims is above Rs. 20 lakhs. According to the complainants own showing no consideration or part thereof has been paid or promised to be paid to the answering Opposite Party. According to the averments made in the petition, the agreements entered into between the complainants and the Opposite Party No. 1 are not assignable. No agreements has been entered into nor any transaction has taken place between the answering Opposite Party and the complainants giving rise to contractual relationship.

ON merits it was pleaded by Opposite Party No. 2 that the answering Opposite Party, namely, Technology Parks Limited is a public limited company registered under the Companies Act and has a separate and independent legal entity. The land under lease to M/s. Charanjit Kochhar hafs neither been sold nor mortgaged to the answering Opposite Party. The answering Opposite Party does not belong to the so called Skipper Group of Companies. According to the complainant''s own showing the project conttinues to be a project of Charanjit Towers which has been clearly indicated in the impugned advertisement. It is denied that Shri Tejwant Singh is a Director or holds any office in the Opposite Party. Other allegations of the complainants were also denied.

THE complainants were permitted to file affidavit evidence in support of their contention and the case was adjourned to 17th August, 1994. Opposite Party No. 2 did not request any adjournment to produce any evidence. On that date the parties were heard. In support of their case each of the complainants has filed his affidavit along with Photostat copies of receipts of the amount paid to Shri Charanjit Kochar, Opposite Party No. 1 who is Proprietor of M/s. Charanjit Kochar Engineers and Contractors. When the arguments were heard this Commission asked the complainants to prepare statement of payments that have been made by them to the Opposite Party. Accordingly a statement has been filed showing the amount paid by each of the complainants on various dates. This statement is supported by the photostat copies of the receipts produced by the complainants along with their affidavit. The Complainants have paid in all Rs. 27,648.80. This statement is marked as Annexure ''A''. There is nothing to doubt the veracity of this statement.

AS noticed earlier in response to the advertisement issued by the Opposite Party No. 1, each of the complainants had entered into an agreement with that party for the purchase of one flat each in the residential complex of flats proposed to be constructed under the banner of Charanjit Tower on Plot Nlo. 26, Vaishali Township, Ghaziabad. A copy of the typical agreement entered into between the complainants and Opposite Party No. 1 has been appended to the complaint as Armexure C-2. Salient points of the agreement have already been reproduced in the beginning of this order. The flats were proposed to be completed by December, 1992. However, upto this date, no-"construction has been made on the site. On the other hanchon June 30, 1993. (Annexure C4) Opposite Party No. 2 informed the complainant''s that their Company had taken over the Charanjit Tower Complex, Plot No. 26, Vaishali Township, Ghaziabad. It was further mentioned in that letter that the commitment made to all flat buyers as per the flat buyer agreement entered into between them have also been taken over. However, even after taking over the Charanjit Tower Complex, Opposite Party No. 2 did not start any construction on Plot No. 26, Vaishali. On the other hand it changed the project and the construction was proposed to be under the banner of Park Apartments (Annexure-C4). That project also has not come up upto this time.

IN may be mentioned here that Opposite Party No. 2 has not denied the issuance of letter dated June 10, 1993 (Annexure C 4) referred to above. Reference can be made to para No. 7 of the complaint petition and the corresponding para of the counter of Opposite Party No. 2. In the light of the above discussions we are of the opinion that both the Opposite Parties are liable for the loss occasioned to the complainants by the negligence or deficiency in the rendering of service in relation to house construction. Therefore, we order that the Opposite Party Nos. 1 &2 shall jointly and severally pay to each of the complainants the amount shown under the column "amount paid" of Annexure-A which document shall be deemed to be part of this order. The Opposite Party Nos. 1 and 2 are also ordered to pay interest on the said amount at the rate of 15% per annum calculated from the dates of payment of instalments/sums as shown in Annexure-A under the column date of payment'' upto the date of payment. The complainants are also awarded Rs. 10,000/- as costs which will be equally shared by the complainants.