SHIVMUDRA CONSTRUCTIONS vs SHAM C. GAIKWAD

This Revision Petition under Section 21(b) of the Consumer Protection Act, 1986 (for short the "Act"), is directed against the order dated 27.08.2010 passed by the State Consumer Disputes Redressal Commission, Maharashtra (for short the ''State Commission''), in Appeal No. 05 of 1952. By the impugned order, the State Commission has dismissed the Appeal, preferred by the Petitioner and concurred with the order of the District Consumer Forum, Kolhapur, which had allowed the Complaint, directing the Revision Petitioner herein to hand over possession of the subject flat or in the alternative refund the amount paid with interest, compensation and costs.

The brief facts as set out in the Complaint are that the Complainant had entered into an agreement for sale dated 30.5.1989 in respect of a flat in ''Divyaraj Laxmi Apartment'', admeasuring 750 sq. ft. for a total consideration of 1,42,500/- and paid an amount of 1,28,000/- to M/s. Shivmudara Constructions and obtained an acknowledgment. The Complainant averred that he was serving in Maharashtra State Electricity Board and was transferred to different places and was constantly contacting the partners of M/s. Shivmudara Constructions, namely Shri Sambhajirao Tukaram Ghorpade and Shri Subhash Laxman Rao Sapale requesting them to give possession of the flat. Meanwhile, Shri Sambahjirao had expired and the other partner, at the relevant time, Shri Sapale avoided giving the possession of the subject flat. Thereafter Shri Saple had informed the Complainant that due to some financial problems he had sold the said flat and subsequently obtained a loan of 65,000/- from the Complainant promising him a flat on the newly constructed terrace. On 6.10.2002 the Complainant had seen an advertisement published in the daily ''Pudhari'' Paper for sale of the flat on the terrace, promised to be given to him in lieu of the flat initially booked, and sent a registered notice to the second Opposite Party and other partners on 18.10.2002 seeking possession of the flat and repayment of the hand loan amount. In his reply to the notice, the second Opposite Party denied the very transaction. There was no reply from the third Opposite Party. Hence, the Complainant approached the District Forum seeking direction to the Opposite Parties to hand over possession of flat No. 1 or any other flat in ''Divya Raj Laxmi Apartment'' or refund the amount with interest @21% per annum together with compensation and costs.

The first and second Opposite Parties filed their written versions denying the execution of the agreement and averred that Sambhajirao Ghorpade was never a partner of Shivmudra Constructions and that if any agreement had been executed by him, it is not binding on them. They pleaded that there was no privity of contract with the Complainant and therefore, the question of deficiency of service does not arise. They further pleaded that the complaint was barred by limitation as the said amount was alleged to have been paid in the year 1989 whereas the complaint was filed in the year 2002.

The District Forum, based on the evidence adduced, allowed the Complaint directing Opposite Parties 1 and 2 jointly and severally to hand over the possession of the flat to the Complainant as per the agreement dated 30.5.1989 and also pay compensation of 98,000/- to the Complainant, failing which they were made liable to pay interest @ 18% per annum on the amount of 1,28,000/- from 29.4.1991, within 30 days from the receipt of the order, together with costs of 10,000/-.

Aggrieved by the said order, Shivmudra Constructions, which is the first Opposite Party, preferred an Appeal before the State Commission, which was dismissed for default on 19.06.2006. The restoration petition was also dismissed on the ground of limitation. Thereafter, the Appellant filed a Revision Petition before this Commission and the matter was remanded back to the State Commission for fresh adjudication.

As afore-noted, the State Commission has dismissed the Appeal, concurring with the order of the District Forum, observing as follows:

"Admittedly, the property which is a subject matter of the present litigation is owned by Sarlabai Ghorpade, Shivaji Ghorpade and Mamata Ghorpade. The appellants are closely related with each other. Subhash Laxman Saple is one in law of Sarlabai Tukaram Ghorpade. Surekha Saple is wife of Suresh Saple and daughter of Sarlabai. Shivajirao Ghorpade, Sambhajirao Ghorpade and Mamta Ghorpade are sons and daughter of Sarlabai Ghorpade and Sambhajirao Ghorpade is power of attorney for Sarlabai Ghorpade and in development agreement dated 12.01,1990 he is power of attorney holder for Shivaji Ghorpade. It is the case of the appellant that on 30.05.1989 Shivmudra Construction was not in existence and the firm Shivmudra Construction has come into existence on 12.11.1991. In lower court papers there is important document of evidence. Respondent/Complainant has filed an invitation card of foundation laying ceremony of Divyaraj Laxmi apartment wherein the name of Shivmudra Construction is there and Subhash Laxman Saple and Sambhajirao Ghorpade are shown as organisers. The function was held on 26.01.1991. Hence, it is clear and established fact beyond doubt that previously Shivmudra Construction was in very much in existence and Sambhajirao was one of the proprietors. We do not know why the appellant have came with new partnership firm on 12.11.1991. In the newly formed firm also the Sambhajirao is power of attorney holder. Again there is power of attorney in favour of Sambhajirao dated 19.07.1989 executed by Sarlabai Ghorpade. Taking into consideration the relationship between the appellant and Sambhajirao, there is no doubt that in a Shivmudra Construction old and new also he is the authorised person. As regard the development agreement and irrevocable power of attorney in favour of the appellant these are the subsequent developments and hence, the agreement executed on 30.5.1989 by virtue of which the complainant/respondent has booked a flat cannot take away the right of the respondent/complainant and liability of the appellant. Before the Forum below the respondent/complainant had proved his case beyond doubt. As regards the point of limitation raised by the appellant it is clarified that here the cause of action is continuous one and respondents/complainants is trying and fighting for his lawful claim. The Forum below has taken into consideration the facts and circumstances of the case, evidence filed by both the parties and has arrived at the conclusion which is just, reasonable and fair".

The main contention of the Petitioner herein is two fold: (a) that the Complaint is barred by limitation; and (b) that the payments were made in 1989 to one Sambhaji Ghorpade who received the amounts in his personal capacity as he was not a partner in the firm and therefore, any agreement executed by him with the Respondent-Complainant is not binding on them.

Learned counsel for the Petitioner submitted that there is no evidence on record to show that Shri Sambhajirao Ghorpade was a partner in the said Construction Company and that the last payment made by the Respondent to the said Shri Sambhajirao Ghorpade was on 29.4.1991, whereas the firm came into existence only on 12.11.1991.

Learned counsel for the Respondent/Complainant, on the other hand, drew our attention to the agreement said to have been executed between the Complainant and the said Shri Sambhajirao Ghorpade, partner of Shivmudra Construction on 30.5.1989. There is no date of possession mentioned in the said agreement. The agreement is for 750 sq. ft. (built-up area) of Flat No. 1 in Divyraj Laxmi Apartment for a total consideration of 1,42,500/-. Clause 6 of the Agreement reads as follows: "The possession of said flat shall be delivered to the flat holder for use and occupation provided all the amounts due from the flat holder are cleared. The flat holder shall take possession of the flat within 10 days of the Builders giving written notice to the flat holder intimating that the flat is ready and for use and occupation".

We observe from the record that this Agreement has been signed by Shri Sambhajirao Ghorpade in his capacity as partner of Shivmudra Construction. The Respondent/Complainant filed the Power of Attorney dated 24.8.1978 by which Shri Sambhajirao Tukaram Ghorpade had appointed Shri Sambhaji Tukaram Ghorpade as a power of attorney holder and empowered him to sell the open plots and also construct the Apartment on R.S. No. 221A/1A of Kolhapur. The Complainant had also filed Power of Attorney by Mamata Ghorpade for development purpose of Survey No. 22-1-A/1-A. This POA was given to Tukaram Ghorpade as partner of Shivmudra Construction. Both the Fora noted that these documents substantiate that Sambhajirao Tukaram Ghorpade had taken the amounts from the Respondent/Complainant in his capacity as partner of the Petitioner firm. The State Commission further held that taking into consideration the relationship between the Petitioner and Shri Sambhajirao Tukaram Ghorpade, the POAs executed in favour of Shri Sambhajirao Tukaram Ghorpade cannot be doubted.

With respect to the point of limitation, we agree with the concurrent finding of both the Fora below that the cause of action is a continuous one as the Complainant had paid the said amounts; executed an agreement and has waited for the notice with respect to the completion of his Apartment as per clause-6 of the Agreement. The question whether the Power of Attorney is genuine or not cannot be gone into at this belated stage, in the limited revisional jurisdiction as both the Fora below have concurred with the finding of fact with respect to the said Shri Shivaji Ghorpade, acting on behalf of the firm, notwithstanding the fact - whether or not he was actually a partner of the said firm.

While we agree with the State Commission regarding the amounts paid and the execution of the agreement, but having regard to the fact that the said flat had already been sold in the year 1994 and as per the Petitioner''s submission, no alternative flat can be provided, we confirm the second direction of the District Forum with respect to refund of the money paid i.e. 1,28,000/- and compensation of 98,000/-. However, as we find that having slept over the matter till 18.10.2002, on which date, for the first time he had got issued a legal notice, we are of the view that there is contributory negligence on the part of the Respondent/Complainant. Under the circumstances, we are of the view that interest @ 18% per annum from 29.4.1991, is on the higher side. In our opinion, award of interest @ 9% per annum from 18.10.2002 till the date of realisation, alongwith

costs of 10,000/- would meet the ends of Justice. By order dated 30.3.2012, by this Commission, the Petitioner had deposited an amount of 2,50,000/- with the State Commission which was permitted to be withdrawn by the Respondent/Complainant. While computing the amount refundable to the Complainant in terms of this order, the said amount shall be accounted for. Deficiency, if any, shall be made good within--- a period of four weeks from the date of receipt of this order.

Resultantly, the Revision Petition is partly allowed to the extend indicated above, with no order as to costs.