N Chikke Gowda vs Cyma Exports Pvt Ltd

IN this complaint, the complainant has sought the following reliefs : ''8. For the reasons stated above and in the circumstances narrated above the complainant humbly prays that this Hon''ble Commission be pleased to take such action and issue such directions or orders as it deems fit proper to respondents 1 and 2 for the redressal of his grievances in the interests of justice. 9. The complainant further prays that - (i) Respondents 1 and 2 be directed to complete the construction work of the schedule property and handover possession to the complainant along with all necessary papers including the occupancy certificate; (OR) (ii) In the alternative direct Respondents 1 and 2 to execute forthwith the sale deed pertaining to the schedule property in favour of the complainant and hand over possession along with a refund of a sum of money needed to complete the construction of the schedule property. (AND) (iii) direct respondents 1 and 2 to pay such compensation as the Hon''ble Commission deems adequate proper and just for the enormous and unjustified delay in delivering the schedule property and for the damage and injury and loss caused to the complainant as a direct result of the conduct of respondents 1 and 2. (AND) (iv) issue such directions or orders to ensure that respondents 1 and 2 do not escape their financial and legal liability and for the redressal of the complaints grievances.''

THE complainant, averred that in pursuance of an advertisement and publicity given by the opposite party -the builder, the complainant applied for a flat and the opposite party allotted a flat bearing No. 6 on the first floor in ''Rajanigandha'' of Garden Apartments on No. 21, Grant Road, Bangalore, for a price of a sum of Rs. 1,98,000/ - in the month of October, 1979. The complainant made an advance payment of a sum of Rs. 20,000/ - to the opposite party at the time of executing the agreement for sale, as per Ex,C -l and agreed to pay the balance consideration amount of Rs. 1,78,000/ - as per the terms specified under Clause 4 of the agreement for sale, Ex.C -1, in instalments at various stages of construction. As per the terms of the agreement for sale, Ex.C -1, the opposite party was to complete the construction of the apartment and deliver the possession of the same on or before 30.6.1980. The complainant, thereafter, paid further sums of Rs. 1,20,000/ - at different states of construction by the end of June, 1980, as under : Rs. Paid on As per Exhibit 10,000.00 4.1.1980 2 10,000.00 22.1.1980 3 50,000.00 18.2.1980 4 25,000.00 1.3.1980 5 25,000.00 18.6.1980 6 In all a sum of Rs. 1,40,000/ -.

4.IT is the further case of the complainant that the opposite party did not commence and complete the construction and deliver the possession of the flat to the complainant as stipulated under the agreement for sale, as per Ex.C -1.

THE complainant, nextly averred that the various flat owners who had thus made the payment to the opposite party, constituted an Association called ''Garden Apartment Owners Association'' and through that Association -opposite party No. 3 herein, began to put pressure upon the builder -the opposite party, to commence the work of construction of the apartment and to complete the construction at an early date. A meeting was held between the opposite party and the office bearers of Garden Apartment Owners Association, on 18.4.1986, as per Ex.C -7, wherein the opposite party agreed to commence the work of construction on 15.1986 and complete the construction of the flats n Rajanigandha apartments by 1.1.1987. The opposite party had even agreed, as per Clause 4 in Ex.C -7, in the said minutes of the meeting, that he would not claim any cost escalation from the complainant and others. The opposite party, even thereafter, did not commence the work of construction. The complainant further averred that the opposite parry upto this time has not completed the construction and in consequence of which the complainant suffered heavy loss and mental agony.

THE complainant, nextly averred that when the apartment owners including the complainant, began to put pressure upon the opposite party to complete the construction immediately, the opposite party began to demand cost escalation. The opposite party claimed a sum of Rs. 1,38,000/ - towards cost escalation, by its letter dated 15.3.1991, as per Ex.C -9, from the complainant.

THE complainant further averred that the opposite party had no right to demand any cost escalation when there is no provision under the terms of agreement for sale, as per Ex.C -1, and the opposite party had specifically agreed, as per Ex.C -7, that he would not demand any cost escalation. On the basis of these averments, the complainant, sought the reliefs as narrated above.

THE opposite party filed its version and admitted the fact that the complainant was allotted a flat, as averred by the complainant in the complaint. The opposite party also admitted the fact of receipt of money from the complainant as averred by him at para 7 of its version.

THE opposite party further averred that it could not complete the construction of the apartment due to various reasons beyond its control. The opposite party, has in this regard, at para 8 of its version averred thus : ''8. The respondents do not admit most of the averments and allegations in para 3 of the complaint at the inability of the respondents to hand over possession is due to circumstances beyond the control of respondents. The reasons are as follows : Between 1.11.1979 and 28.2.1983 there was severe shortage of cement which was not available due to control. The Government has taken the decision to allot only 1,000 bags of cement per quarter to each high rise building complex irrespective of the total requirements. The total requirement of ''Garden Apartment'' was 1,50,000 bags. The construction was also delayed due to the work being stopped by the Municipal Corporation Authority because of cancellation of all high rise building plans in 1980 till they were re -sanctioned in 1981. Between September 1983 to December 1984, the construction of high rise buildings were stopped by the Government by public notice immediately after the collapse of the ''Gangaram Complex'' on or about 9.9.1982 which caused stoppage and delay in construction. Between January 1985 and September, 1989 the construction was delayed due to the refusal of the Municipal Corporation to grant ''occupation certificates'' due to the State Government Circular of 1984, questioning the validity of plans/ buildings, having a height of more than 50 feets. Thereafter non -availability of construction material as well as non -payment of the costs of escalation by the complainant and other purchasers has been the main cause of the respondents being unable to complete the said project.''

The opposite party further averred that it was justified in demanding cost escalation from the complainant, considering the steep rise in the cost of building materials like cement and steel and cost of labour etc.

THE opposite party further averred that this Commission has no jurisdiction to entertain the complaint as the complainant cannot be classified as a ''consumer'' and the complaint would not amount to a ''complaint under the provisions of the Consumer Protection Act, 1986.

THE opposite party, on the basis of these averments, sought the complaint to be dismissed. During enquiry, the complainant filed the affidavit of the complainant, in evidence. The documents produced by the complainant were marked in evidence as Ex.C -1 to C -9.

THE opposite party did not lead any evidence nor filed the affidavit in evidence nor documents were marked in evidence on its part. The opposite party after filing its version, has all along remained absent during enquiry. So, the complainant has heard. 16a. The learned Counsel for the opposite party on 14.12.1993 filed a Memo agreeing to refund the amount with interest at 18% p.a. from 1.1.1987 till the date of payment. The said Memo reads as under : - ''The undersigned Advocate for the opposite party submits that the opposite party has ''No objection'' for this Hon''ble Commission ordering interest on the principal amount @ 18% p.a. from 1.1.1987 till date of payment.''

WE have perused the pleadings of the parties and the documents filed by the complainant and heard the learned Counsel for the complainant. Having regard to the pleadings of the parties and the submissions made, the only point that arises for our consideration is ''whether there was any deficiency in service rendered by the opposite party and in consequence of which did the complainant suffered any loss or injury and if so to what compensation the complainant is entitled to''?

THE preliminary objection regarding the maintainability of the complaint taken by the opposite party was heard on 26.11.1991 and it was held by this Commission, by its order made on 30.11.1991, that the Commission had the jurisdiction to entertain the complaint.

IT is not disputed that the opposite party allotted a flat bearing No. 6, in first floor of Rajanigandha Apartment building which was to be constructed by the opposite party at No. 21, Grant Road, Bangalore, in consideration of a sum of Rs. 1,98,000/ - to the complainant. Ex.C -1 is the agreement for sale entered into between the complainant and the opposite party which gives the details of the amount paid and to be paid by the complainant and delivery of the flat to be made after its complete construction to the complainant. It is also hot disputed that the opposite party had received by the month of June 1980 in all a Sum of Rs. 1,40,000/ - from the complainant. This payment is admitted by the opposite party in its version at para 7. The payments are evidenced by the receipts, Ex.C -2 to C -6 and Ex.C -1 - the agreement for sale.

THE recital contained at para 6 of Ex.C -1, agreement for sale, read as under : ''6. Subject to the availability of cement, steel and other building materials, electrical and/or power connection and drainage connection and subject to force majeure including any act of God, drought, flood and any other natural calamity and/or war, restrictions by the Government, Municipal Corporation or other public authorities or any other acts beyond the control of the Builders, the Builders agree to hand over possession of the said flat to the Buyer on or before 30th June, 1980.''

THIS would go to show that the opposite party was to complete the construction of the building and deliver the possession thereof to the complainant on or before 30.6.1980, that is the averment made in the affidavit of the complaint and also the averments contained in the complaint. The opposite party failed to complete the construction by that date. Ex : C -9 is the letter written by the opposite party to the complainant on 15.3.1991, wherein he had given various reasons for not completing the construction of the building and demanded cost escalation from the complainant in a sum of Rs. 1,38,000/ -.

EX . C -7 is the minutes of the meeting held on 18.4.1986, the recital contained at para 4 of the said minutes of the meeting would go to show that the opposite party had agreed not to collect the escalation charges from the complainant and other flat owners.

THE opposite party has pleaded various circumstances, at para 8 of its version, as referred above, which caused delay in constructing the building. The opposite party has stated that there was scarcity of cement and there was steep rise in the price of building materials, Municipal Corporation had stopped the work, the Government had issued public notice stopping the construction of the high rise building etc. The opposite party has neither produced any material to prove this allegation made by it nor has lead any evidence either, oral or documentary. Therefore, the submissions made by the opposite party giving various reasons for the delay in construction of the flat, has remained only at the stage of allegations. The opposite party has failed to establish these circumstances to justify in not completing the construction of the flat and hand over the possession of the same to the complainant as stipulated under Clause 6 of the agreement for sale, Ex.C -1. The material on record would further go to show that even in the month of April, 1986, the opposite party had agreed to complete the construction of the flat at an early date and deliver the possession of the same without collecting any cost escalation by 1.1.1987, as per Ex.C -7.

THEREFORE , it is clear that the opposite party has failed to complete the construction and deliver the possession of the flat in Rajanigandha Apartment without valid reason whatsoever. Therefore, the services rendered by the opposite party are clearly deficient in nature.

IT is evident from the material on record, as referred above, that the opposite party failed to complete the construction and deliver the possession of the flat to the complainant, as per its promise made, and in our opinion, this lapse is due to the negligence on the part of the opposite party only. The complainant, who has made the payment of Rs. 1,40,000/ - by the end of June 1980, and so far has not been able to get the delivery of the possession of the said flat from the opposite party and so the complainant has been put to lot of suffering and injury and therefore, the complainant is necessarily to be compensated for the same.

IT is material on record that in the month of April, 1986, the opposite party had agreed to complete the construction and handover the delivery of possession of the flat by 1.1.1987 without collecting any escalation charges. So in our opinion, it would be just and proper to award reasonable interest on the amount of Rs. 1,40,000/ - paid by the complainant to the opposite party towards compensation from 1.1.1987 till the date of delivery of the possession of the flat to the complainant in a condition fit to occupy the same with all necessary amenities by collecting the balance amount of Rs. 58,000/ - from the complainant. ORDER In the Result, therefore, this complaint is allowed. The opposite party Nos.l and 2 are directed to pay interest at the rate of 18% p.a. on the sum of Rs. 1,40,000/ - from 1.1.1987 till the date of delivery of possession of the flat to the complainant in a condition fit to occupy the same with all necessary amenities by collecting the balance consideration amount of Rs. 58,000/ - from the complainant. The opposite party Nos.l and 2 shall also pay a sum of Rs. 2,500/ - to the complainant towards the costs of the proceedings. The opposite parties shall pay the sums so awarded to the complainant within a period of two months from this day.