MRS. RAMA DEVI vs Lucknow Development Authority

BY means of this complaint, the complainant has prayed for handing over possession of plot No. A-l/6 in Priyadarshani Scheme, Sitapur Road, Lucknow and interest @ 16% per annum on Rs. 1,74,000/- from 27.4.1991 till the date of possession of the plot. A sum of Rs. 14,10,500/- has been claimed as compensation towards the loss occurring on account of negligence of the opposite party. Further damages @ Rs. 2000/- per month have also been claimed for compensation of injury to the complainant since September, 1991 till the date of possession of plot to her. The facts of the case in brief are as under :

THAT the complainant applied for a plot in Priyadarshani Scheme and the registration number of her application was 00037268. Thereafter, the complainant was allotted plot No. A-l /6 in the same scheme by lottery draw on 20.7.1988. A letter for allotment was issued on 27/29.4.1989, copy of which is Annexure 2. The size of the plot was 14 x 28 square metre. A sum of Rs. 7,000 /- was with opposite party as advance money and Rs. 1,69,400/- more was demanded by the opposite party as cost of the plot payable in eight quarterly instalments of Rs. 21675 /- each on hire purchase and the last instalment was paid on 10.7.1991. Later interest for late payment of instalment was also demanded which is payable by complainant to the opposite party. It has further been alleged that even after full payment of amount, the opposite party is not getting the plot registered in her name nor the possession of it handed over so far. No reply was given of letter dated 26.7.1997 copy of which is Annexure 2. A notice dated 20.8.1997, copy of which is Annexure 3 was served upon the opposite party for handing over possession of the plot and payment of interest on deposited amount @ 16% per annum from 27.4.1991 till the date of possession of the plot. After expiry of one month the complaint is being filed. It is further alleged that cost of the construction was Rs. 2,000/- per sq. metre in April, 1991 but the same has now risen to Rs. 12850/- per sq. metre in May, 1997. Thus, the cost has been calculated on the basis of amount as demanded by opposite party from his allottees for plot in Avadh Apartments being constructed in Vipul Khand, Gomti Nagar Scheme, Lucknow. Out of this, Rs. 140/- per sq. metre is the cost of land per flat and in this way, complainant is suffering a loss of Rs. 10,850/- per square metre. Taking 1/3 area of the plot to be constructed, the constructed area comes to 130 square metre. Thus, deponent shall be suffering net loss of Rs. 14,10,500/-. Had the possession of plot been delivered by opposite party in time she would not have been liable to pay damages of Rs. 14,10,500/-. Opposite party was served by registered post notice which was sent in October, 1997 but none appeared from the opposite party. Hence, case proceeded ex-parte against it.

Learned Counsel Mr. G.S. Sachan was heard on behalf of complainant. According to the complainant, she had applied for a plot on loan in Sitapur scheme and deposited Rs. 1,76,400/- in instalments. The last instalment having been deposited on 10.7.1991. According to complainant, in spite of several verbal requests, and written correspondence, the possession of the plot was not handed over. Hence, notice dated 20.8.1997 was issued but even then compliance was not made by giving possession of the allotted plot. Hence, we are inclined to hold that there is no default in service on behalf of complainant as she deposited the entire amount on 10.7.1991, even though the possession of the plot could not be delivered before filing of the complaint.

NOW, we have to consider the compensation and other loss suffered by complainant due to inaction and deficiency in service of opposite party in not delivering possession of plot even despite of issuing allotment letter. According to the complainant when the amount was already deposited in 1991, the possession should have been delivered within a very short period. According to complainant the brochure has indicated that the possession shall be delivered within two years. Thus, the possession had to be delivered to the complainant by Lucknow Development Authority within a period of two years from the date of allotment letter, specially when the entire amount was deposited by the complainant. As such, the complainant has claimed compound interest @ 16% per annum on the ground that the opposite party, Lucknow Development Authority charges compound interest @ 21% per annum. According to the complainant, this fact has been mentioned in advertisement dated 14.5.1998 published in "Times of India".

A perusal of photostat copy goes to show that if the amount is not deposited in time then compound interest @ 21% per annum is to be paid. It has been consistingly held by the Court as well as National Commission that compound interest cannot be granted and only simple interest is to be granted. Complainant has claimed interest @ 16% per annum. Therefore, she will get interest on the amount deposited from the date of respective deposits @ 16% per annum simple interest in the form of damages till the date of payment. The calculation shall be made by the complainant and mentioned in application for execution. According to the complainant, due to non-handing over possession of the plot in dispute, the complainant has suffered damages on account of escalation of cost, both in prices in land as well as in the cost of construction. According to the complainant she was allotted plot measuring 14 x 28 square metre of land. According to the complainant the construction cost in the year 1991, when the possession of the plot was to be handed over was Rs. 2,000/- per sq. metre and cost of the land was about Rs. 140/- per sqr. metre. The complainant has taken this cost from eight-storey Avadh Apartments which was constructed by the opposite party. It has further been argued that the cost of construction in 1991 was about Rs. 11850/- per sqr. metre. According to the complainant, the cost of construction has gone to about Rs. 17,000/- per sqr. metre and cost of the land has also gone up proportionately. Thus, it is evident that there has been escalation of price, both in the value of land as well as construction. In 1992, the cost of construction was Rs. 2,000/- per sqr. metre while in 1997 the cost of construction had risen to about Rs. 5,000/- per sqr. metre. Hence, there is escalation of Rs. 3,000/- per sqr. metre on the construction cost. As such, the complainant is entitled to enhanced cost of construction @ 3,000/ - per sqr. metre. As far as the cost of land is concerned, the escalation has also arisen which can reasonably be taken to be Rs. 500/- per sqr. metre. The Hon''ble Supreme Court in the case of Lucknow Development Authority v. M.K. Gupta, III (1993) CPJ 7 (SC)=(1994) 1 SCC 243, has considered this aspect of the case. After considering the facts of that case the Hon''ble Supreme Court held in para 2 at page 252 of the judgment : "The provisions of the Act thus have to be construed in favour of the consumer to achieve the purpose of enactment as it is a social benefit oriented legislation. The primary duty of the Court while construing the provisions of such an Act is to adopt a constructive approach subject to that it should not do violence to the language of the provisions and is not contrary to the attempted objective of the enactment."

In para 8 it was further held : "The word "compensation'' is again of very wide connotation. It has not been defined in the Act. According to dictionary it means ''compensating or being compensated; thing given as recompense''. In legal sense it may constitute actual loss or expected loss. Therefore, when the Commission has been vested with the jurisdiction to award value of goods or services and compensation it has to be construed widely enabling the Commission to determine compensation for any loss or damage suffered by a consumer which in law is otherwise included in wide meaning of compensation. The provision in our opinion enables a consumer to claim and empowers the Commission to redress any injustice done to him. Any other construction would defeat the very purpose of the Act. The Commission or the Forum in the Act is thus entitled to award not only value of the goods or services but also to compensate a consumer for injustice suffered by him."

THUS this Commission is invested with powers to adequately compensate the consumer to which she has been put on account of inaction or delayed action of Development Authorities.

ACCORDING to the complainant, she had suffered agony and torture, etc. in running from pillar to post in order to get possession of the plot but the opposite party did nothing to hand over the possession of the disputed plot. Thus, in our opinion, a sum of Rs. 7,000/- shall be sufficient to cover the mental torture and agony, besides Rs. 3,000/- as cost. Complainant is entitled for compensation as mentioned in the earlier part of the judgment but the entire claim shall not exceed Rs. 20 lacs. ORDER

The complaint is decreed partly. The opposite party is directed to hand over possession of allotted plot to the complainant within two months from today. The opposite party shall also pay interest in the form of damages @ 16% per annum from the date of respective deposit till the date of possession of the plot. (The opposite party will also pay for the claimant as compensation enhanced cost of construction @ Rs. 3,000/- per sq. metre for 262 sq. metre area from 1.1.1992 till the date of handing over possession. The opposite party shall also pay as compensation Rs. 500/- per sq. metre as enhanced cost of the land area of 392 sq. mtrs. (14 x 28) allotted to complainant).

IF the possession of plot allotted cannot be handed over to complainant as directed then the entire amount deposited by the claimant shall be refunded alongwith damages in the form of interest @ 16% per annum from the date of respective deposits till the date of refund. Cost of Rs. 3,000/- shall also be paid by opposite party. In addition to this the opposite party will also pay the claimant as compensation enhanced costs of construction @ 3,000/- per sq. metre for 262 sq. ft. area and compensation @ Rs. 500/- per sq. metre as enhanced cost of the land area of 392 sq. ft. allotted to the complainant from 1.1.1992 till the date of payment. IF the payment is not made within two months from today then damages in the form of the interest @ 16% per annum shall be payable till the date of payment after expiry of two months'' time today on the amount awarded. Let the compliance of this order be made within two months from today by the opposite party. Let the copy of this order be made available to the parties as per rules. Complaint allowed.