N.K.GUPTA vs ANAND CONSTRUCTIONS (DELHI) PVT. LTD.

BRIEFLY the facts are that respondent No. 1 is carrying on the business as developers and builders as a residuary of M/s. Shippara Construction Pvt. Ltd. Respondent No. 2 is an agent of respondent No. 1. The complainants purchase a flat consisting of area of 335 sq. feet in a commercial building to be constructed by respondent No. 1 in Laxmi Nagar Center, as the instance of the respondents @ 398/- per sq.ft. They paid Rs. 85,000/-to respondent No. 1 in installments including the initial installment of Rs. 25,000/-. It is alleged that respondent No. 1 has not even taken possession of the plot from D.D.A. nor paid the installments due to the D.D.A.

IT is further pleaded that respondent No. 1 had been receiving the installments from the complainants on false representation. Consequently the complainant has prayed for recovery of Rs. 85,000/- with interest @ 24% p.a. and Rs. 1,00,000/-as damages. Respondent No. 1 in the written statement contested the complaint and, inter-alia pleaded the Commission had no jurisdiction to entertain the complaint. On merits they pleaded that they deposited Rs. 42 lacs with the D.D.A. towards the cost of the land. The D.D.A. had not delivered possession of the same to them. Respondent No. 2 in their written statement pleaded that they were not liable to refund the amount as the amount had been paid by them to respondent No. 1.

The first question that arises for determination is whether the complainants are consumers. The matter is not res integra and has been settled by the National Commission in U.P. Awas Evam Vikas Parishad v. Garima Shukla, I (1991) CPJ 1 (NC). In similar circumstances it was held by the National Commission that the Board constructs houses for the general public and is thus rendering service to them. The person who applies for flat/plot to such an authority was a consumer. Consequently, we are of the opinion that the complainants are consumers.

THE second question that arises for determination is as to whether the complainants are entitled to refund of the amount. THE complainants started depositing the installments in February, 1993 but till date even the possession of the plot has not been taken by respondent No. 1 from D.D.A. In the circumstances we are of the view that the complainants are entitled to the refund of the amount deposited by them with respondent No. 1. The third question that arises for determination is, whether respondent No. 2 is also liable to 2refund the amount to the complainants. It is argued by the Counsel for the complainants that the initial installment of Rs. 25,000/- was paid by the complainant through respondent No. 1 and they agreed to purchase the plot on the joint representations of both the respondents. In the aforesaid circumstances it is argued that respondent No. 2 is personally liable to reimburse the complainant.

WE have given due consideration to the argument but do not find any substance therein. Section 230 of the Contract Act provides that the agent is not personally bound by the contracts entered into by him on behalf of the principal. However, Come exceptions have been carved out in the said section. The case of the complainant does not fell in any of those exceptions. The name of the principal had been disclosed to the complainants by respondent No. 2 at the time when they entered into the agreement. In the circumstances respondent No. 2 is not personally liable to pay the amount. Now the question arises what rate of interest the complainants are entitled to get. The complainants have claimed interest @ 24% p.a. In our view it is on the higher side. Consequently we grant interest to them @ 18% p.a. The amount of interest from the dates of deposit up to the date of filing the complaint i.e. 28.4.1992 at the said rate comes to Rs. 1,53,818/- as shown in Annexure ''A''. Thus the total amount which is due to the complainant from respondent No. 1 comes to Rs. 2,38,818/-. For the aforesaid reasons we partly accept the complaint with costs and direct respondent No. 1 to pay to the complainants an amount of Rs. 2,38,000/- with interest from 29.4.92 till the date of payment at the said rates of 18% per annum within a period of 3 months failing which an action shall be taken under Section 27 of the Consumer Protection Act. Costs Rs. 2,000/-. Complaint allowed with costs.