Mussorrie Dehradun Development Authority vs The State Commission for Redressal of Consumer Disputes and Others

Tarun Agarwala, J.—The Petitioner has filed the present writ petition questioning the order of the Consumer Forum as well as the Appellate Authority under the Consumer Protection Act, 1986. The facts leading to the filing of the writ petition is that the Petitioner, i.e., Mussorrie Dehradun Development Authority, floated a housing scheme known as Nehru Puram and Indira Puram Housing Scheme for providing houses to middle income group, higher income group and lower income group. Advertisements were made and applications were invited through brochures. In this scheme, it was indicated that the possession of the constructed house would be given within two years. The Respondent Nos. 3 to 41 are those persons who had applied under the scheme.

It is alleged by the Petitioner that for the aforesaid project, the Petitioner had to apply for loan from HUDCO which was sanctioned and, based on the amount released, the construction was started. It was also alleged that because of the delay in the release of the loan amount, there was a delay in the execution of the project. Further, delay happened because the area in question was a low lying area and the land had to be filled up. Further, high tension wires were going over the land which was required to be removed and, accordingly, there was a delay in the execution of the project. It has been stated that the Respondents were given possession sometimes in the year 1993 but after a period of two years.

Upon giving possession to the Respondents and, upon their deposit of their installment, it is alleged that the Respondents filed a complaint u/s 12 of Consumer Protection Act praying for a compensation of Rs. 50,000/- on the ground that the housing scheme was not completed within the stipulated period and that the price was arbitrarily enhanced from 1.10 lacs to 1.57 lacs. The Respondents objected to the stand and submitted that the complainants were not entitled for any compensation and that the delay in giving possession to the complainant was on account of unforeseen circumstances which was beyond their control. The Consumer Forum, after hearing the matter, passed an order dated 20th April, 1995 directing payment of simple interest @ 15% p.a. and to rectify the defects in the construction raised by the Petitioner.

The Petitioner, being aggrieved, filed an appeal which was dismissed by an order dated 20th April, 1997. The Petitioner, thereafter, has filed the present writ petition.

The learned Counsel for the Respondents has raised a preliminary objection contending that the writ petition was not maintainable and that the Petitioner has a remedy of filing a revision before the National Consumer Forum under 21 of the Act.

No doubt, there is a remedy of filing a revision before the National Consumer Forum but the Court is of the opinion that the writ petition should not be dismissed at this stage on the ground of an alternative remedy. The Court finds that the writ petition was filed before the Allahabad High Court in the year 1998 and was duly entertained and, an interim order was passed. Upon the creation of the State of Uttarakhand, the matter has been transferred to this Court. Since affidavits have been exchanged, this Court is of the opinion that the writ petition should be decided on merit instead of relegating the matter to an appeal. Consequently, the preliminary objection of the Respondents is rejected.

Having heard the learned Counsel for the Petitioner at some length, the Court finds that there is no palpable error in the order of the Authority below whereby compensation has been awarded to the Respondents by payment of interest @ 15% p.a. The contention of the learned Counsel for the Petitioner that there was a delay in the execution of the contract on account of unforeseen circumstances, such as, removal of the high tension wires and filling up of low lying area is clearly an afterthought. The Petitioner was well aware of the area being a low lying area and was aware of the existence of the high tension wires. It was their responsibility to remove the wires and to fill up the land and, if there was a delay in the execution of the project, the Petitioner was solely responsible. On one hand, the Court finds that the Petitioner had delayed the project and, on the other hand, the Petitioner was justifying the increase in the price of the houses that were being constructed by them.

In the light of the aforesaid, the Consumer Forum was perfectly justified in imposing interest. The learned Counsel for the Petitioner contended that the brochure only contemplated an estimated period of two years and that the Petitioner did not certify that possession under any circumstances would be given within two years. The contention of the learned Counsel for the Petitioner is not correct. When an advertisement is being made that possession would be given in two years, the burden is upon the Petitioner to ensure that possession is given within the stipulated period failing which, interest would be liable to be paid by them.

In the light of the aforesaid, the Court is of the considered opinion that the order of the Consumer Forum as affirmed by the appellate Court does not suffer from any palpable error.

However, the Court finds that the imposition of interest @ 15% p.a. was highly excessive and unwarranted. The Court further finds that by an order dated 4th March, 1998, the Court directed the Petitioner to pay simple interest @ 6% p.a. to the complainants. In the light of the aforesaid interim order, the Court modifies the order of the Consumer Forum to the extent that instead of paying interest @ 15% p.a., the Petitioner will pay interest @ 6% p.a. The writ petition is partly allowed.