SANJEEV SHASHIKANT RASAIKAR vs LOK HOUSING AND CONSTRUCTION LTD.

HEREIN after the complainant is referred to as "flat purchaser" and O.P. as "builder" for brevity sake.

THE flat purchaser has filed this complaint claiming refund of Rs. 3,22,900/- being balance amount of consideration which he has paid to the builder with 21% interest in addition to compensation of Rs. 1,50,000/-, refund of Rs. 22,495/- paid towards stamp duty and cost of Rs. 15,000/- for the complaint proceedings have been claimed. Although it is not necessary to have detailed advertance to the factual aspects, in view of subsequent development and understanding reached between the parties herein, it would be necessary to mention few facts. Since it is the grievance of the complainant, that the understanding reached and agreed between the parties herein have also not been adhered to by the builder and thus there is failure on the part of the builder which tantamounts to deficiency in service.

The undisputed facts show that the flat purchaser booked in the scheme of the builder known as Lokupahar at Virar (West). It was documented by execution of agreement dated 10.12.1996 which forms part of Annexure to the complaint. The same was preceded by allotment letter dated 26.10.1995 by the builder to the flat purchaser provisionally allotting Flat No. 504 in Building No. A-9 in the said project. The same exhibited with the complaint.

THE flat purchaser from time to time paid a sum of Rs. 3,69,900/- being full consideration of the flat to the builder, which fact is also not in dispute. Some way or the other the schedule of construction of the buildings did not go ahead as agreed which followed by correspondence emanating from the flat purchaser to the builder.

IT is noticed that for some reason the builders were not in a position to make available Flat No. 504 in Building A-9 allotted to the flat purchaser and, therefore, the flat purchaser vide letter dated 27.7.1999 to the builder in response to the probably offer or proposal made by the builder indicated the choice to Flat No. 302 in a project known as Evershine City in Vasai. The said letter is exhibited. IT is to be stated that there is no response whatsoever to the said letter from the builder for choice of option so indicated was acceptable or otherwise to them. The flat purchaser waited for about a month and since there was no response, he addressed a letter on 13.8.1999 (which is exhibited as "G" to the complaint) to the builder stating that despite exercise of option for another flat there was no response from the end of the builder and he, therefore, called upon the builder to repay the consideration paid by him as also stamp duty etc. etc. and also claimed interest. To this also there was no response and, therefore, the flat purchaser wrote two letters being dated 29.9.1999 and 27.10.1999 to the builder as and by way of reminders to his letter dated 13.8.1999. It is to be stated that the builder has acted upon the arrangement reached between the parties for refund of the amount and issued a cheque for a sum of Rs. 37,000/- on 28.12.1999 as part of refund of the amount claimed by the flat purchaser. The flat purchaser received the said cheque and he has realized proceeds thereof about which there is no dispute. Since thereafter there was complete lull and silence on the part of the builder, the flat purchaser lost his patience and became concerned and hence approached this Commission with his complaint.

THE written statements filed at the outset needs to be stated that on factual aspect mentioned herein above viz. agreement, receipt of consideration, subsequent understanding for refund of the consideration to the flat purchaser etc., there is no effective denial as such.

THE point raised is something which is not germane akin to the matter of the nature. In that reference is made to the notification being dated 3.2.2001 issued by the Government of Maharashtra under the provision of Bombay Relief Undertaking (Special Provision) Act, 1958 (Bombay XCVI of 1958) declaring the builder Company as being entitled to the relief under the said Act. It is suggested that in view of the declaration in the said Act, as far as builders are concerned, the proceedings in the complaint herein should not proceed ahead. The learned Advocate for builder had made reference to the judgment of the Gujarat High Court stated to be rendered by Hon''ble Single Judge of the Court in the case of Kantilal Shah & Ors. v. State of Gujarat, reported in ILLJ decided on 5/6th July, 1982.

As is the case, in view of the fact that there is no dispute as far as claims made by the complainant are concerned, the only point that falls for our consideration is as to what is the effect of the notification issued by the State Government under the Act mentioned hereinabove.

IN our considered view such notification would not operate as an impediment to this Commission which is established and functioning under the provision of Consumer Protection Act, 1986, which is a special and central statute enacted with special provision for protecting the consumers in their legitimate grievance covered under the said Act. Needless to add that the dispute of the type as made out in the complaint herein would squarely fall under the category of consumer disputes, in view of the enlarged scope of the consumer effected in the year 1993 by way of amendment in the said Act bringing under its sweep and ambit the Building Construction Activities as a Consumer Dispute.

ANOTHER ground which persuades us to proceed ahead with the proceedings in the complaint is based on the special provision as appearing in Section 13(ii)(b) of the Consumer Protection Act, 1986, which inter alia postulates that matter of such nature, the Consumer Fora functioning under the said Act are obliged, to drepeat as the said section reads, "shall proceed to settle consumer dispute". The marked difference which is a unique and fundamental as apparent in the provision of the said Act mentioned herein above is not available in other statutes which provides for disposal/decision of the dispute. Further as at present what this Commission is required to do is to settle the dispute or rather claim, which, in simple word is the stages of adjudication of the claim. That being so the question of staying the proceedings herein is not warranted.

THE judgment of the Hon''ble Gujarat High Court referred to herein above has been rendered in July, 1982 when Consumer Protection Act, 1986, was not enacted and brought in force. THE unique provision as contained in Consumer Protection Act, 1986, did not exist then which would certainly make difference.

WE do not find any reason to stay proceedings in the complaint. It is further to be stated that even if one reads the objects of 1958 Act referred to hereinabove and its preamble so also other provision, same covers only the specified aspects of the commercial undertaking which would be entitled to the declaration as above viz. to protect the interest of the labour and secured creditors. In the instant case if we accept the projection raised by and on behalf of the Builders/O.Ps. it will mount that the benefit of the said Act of 1958 would be made available to the party in respect of the claim not covered under the said Act 1958 and that being so we reject the prayer made by and on behalf of the builder for staying off the proceedings in the complaint. Usefully we may refer to the decision of the Apex Court in the case of Deputy Commercial Tax Officer & Ors. v. C. Pharmaceutical & Ors., reported in AIR 1997 SC 2027, in which similar plea was sought to be put forth, in the light of Section 22 of Sick Unit Act, which the Apex Court turned down holding that same Bar would not apply to legitimate dues. The Apex Court has posited that Bar would operate only to such of those dues reckoned or included in sanctioned scheme for rehabilitation only and not those dues which are legitimate and undisputed. In a recent judgment, Mumbai High Court, in Writ Petition No. 1688/2000, decided on 15th September, 2000, in the case of Ralliwalh Ltd. v. Registrar, Provident Fund & Ors., has also reiterated the same view, by surveying the legal position extensively. In the case in hand it is necessary to add that the O.Ps. have admitted dues of the complainant and hence undertaken to repay the same. To accept the plea of the O.P. as above, would violate and defeat the object of Consumer Protection Act, 1986, which protects the rights and interest of the consumers, like the complainant herein and give handle in the hands of the parties, like O.P. herein to frustrate the benevolent object of the Consumer Protection Act, 1986, which is a Central Statute as against the said Statute of 1958, which is the State Statute, and as such cannot over-ride the Central Statute,. In any case the party cannot be permitted to use the Bar under the said Act of 1958 as a shield to defeat the rightful and genuine dues of the other party in the manner as done.

As stated a sum of Rs. 3,32,900/- is due and payable by the builder to the flat purchaser. In fact the subsequent arrangement reached and agreed by the parties has been acted upon by both the parties including the builder the O.P. In that the builder as per arrangement, paid a sum of Rs. 37,000/- to the flat purchaser which clearly shows that the builder had accepted the said arrangement. Further, the flat purchaser received the said payment made which further shows the flat purchaser also accepted and acted upon the arrangement reached. It is to be noted that the amount now payable to the flat purchaser arise out of the consideration which the flat purchaser had paid to the builder for purchase of the flat in the agreement.

WITH such factual background we hold the flat purchaser/complainant is entitled to the order of refund of Rs. 3,62,900/- since two and a half years the builder has not acted upon the said arrangement and discharged their obligation thereunder, which constitutes deficiency in service. Now as far as prayer (b) is concerned whereby the flat purchaser claimed a sum of Rs. 1,50,000/- as compensation. In this regard we wish to refer to the judgment rendered by this Commission in the case of M/s. Paranjpe Construction Co. v. Nilesh Ramam Marathe, in Appeal No. 584 of 1998 in Complaint No. 365 of 1995 decided on 20th June, 2001 reported in 2001 (3) ALLMR (Journal), which also pertained to dispute between flat purchaser and builder and in which we have taken review of the judicial pronouncement of the Supreme Court, National Commission and High Court as also of the State Commissions in the country and we have held that in the event of deficiency being established against the builders, the flat purchaser has to be reasonably compensated. In that case we allowed the interest at the rate of 15% p.a. as against 9% p.a. as provided under Section 8 of Maharashtra Government Act, 1963 bearing in mind that interest at higher rate would provide as a mode of compensation. In our view this is the case where also same principle can be extended. ORDER 1. We order the Builder to pay interest for the said amount of Rs. 3,32,900/- at the rate of 15% p.a. from 1.1.1996 till realization. 2. The interest at 15% p.a. shall be paid on the said amount of Rs. 3,70,000/- till 28.12.1999 and thereafter the interest payable at 15% p.a. will be upon Rs. 3,32,900/- till realization. 3. Prayer for refund of Rs. 22,495/- paid by the flat purchaser towards stamp duty to the builder also stands granted. 4. As far as cost is concerned, the builder shall pay cost in this complaint quantified as Rs. 5,000/- to the flat purchaser/complainant. 5. Complaint stands disposed of. 6. Eight weeks'' time is granted from today for the compliance of the order by the builder/O.P. Complaint disposed of.