S.N. KANCHHAL vs DELHI DEVELOPMENT AUTHORITY

THE present complaint has been filed by Mr. S.N. Kanchhal against Delhi Development Authority under Section 17 of the Consumer Protection Act, 1986. THE facts of the case relevant for the disposal of the present complaint are as follows:

THE complainant applied for allotment of a flat under 5th Self Financing Registration Scheme, 1982, Category II floated by the O.P.-D.D.A. on 9.8.1982. It was assured that the complainant would be allotted a flat within 3-4 years and the cost of the flat will be around Rs. 3,00,000/-. Subsequently, on the basis of draw held on 31.12.1987, the complainant was allotted a flat in category III, Ground Floor, Block B, Pocket 10, Vasant Kunj, New Delhi and the estimated cost of the flat was disclosed as Rs. 3,39,600/-. THE said money was to be paid in four instalments vide the letter dated 8.5.1988. It was also mentioned that the estimated cost of the flat is provisional and is subject to revision and also that normally it takes 2 to 2 years period for completion of the project, it was also mentioned in this letter that if due to unforeseen reason, the project is delayed then the applicant will be entitled to interest in a phased manner. It is stated that the complainant paid four instalments upto 15.7.1989. THE case of the complainant is that the complainant was neither given possession nor any intimation was given to him even though the O.P. handed over possession of the houses to other allottees whose names appear in the draw held on 31.12.1987. THE complainant made representations and after the intervention of a Member of Parliament, the complainant was allotted a flat in Sector B, Pocket 10; Vasant Kunj and the complainant made full payment. However, the possession was never given to the complainant as the flats were never constructed in Pocket 10. Subsequently, vide letter dated 4.3.1992, the complainant was allotted a flat No. 4002 (Floor + 1st Floor Category III) Pocket 5-8, Scheme B in Vasant Kunj and the O.P. informed the complainant that cost of the flat would be around Rs. 3,39,800/- later, vide letter dated 8.5.1992 the O.P. informed the complainant that cost of the flat would be Rs. 3,64,800/- and asked the complainant to deposit a sum of Rs. 68,963.80 p. It is however, stated by the complainant that vide letter dated 28.5.1993 the O.P. again arbitrarily increased the cost of the flat to Rs. 6,80,700/- and asked the complainant to pay the balance amount of Rs. 2,83,769.75 p. THE complainant protested the same but due to threat of cancellation, paid the amount under protest on 30.8.1993. Later on the O.P. vide letter dated 16.11.1993 informed the complainant that the cost of the flat would be Rs. 5,20,800/- and there is credit balance of Rs. 1,31,923.95 p. in the account of the complainant which shall be refunded to him. THE O.P then refunded Rs. 1,35,002. 40 p. to the complainant without any clarification or details of this amount. Vide letter dated 3.3.1994, the complainant was given possession of the flat on 22.11.1993. THE case of the complainant is that the O.P. is a statutory body and it arbitrarily, without assigning any reasons, increased the price of the flat three times within a short period and subsequently reduced the price arbitrarily without showing any justification. It is also the case of the complainant that the original estimated price of the flat was mentioned by the O.P. as Rs. 3,39,600/-. This was almost doubled within a period of one year without any justification. Similarly, after the entire amount was deposited by the complainant, the price of the flat was reduced a bit and the excess amount was refunded after six months without any interest. Hence alleging deficiency in service and unfair trade practice on the part of O.P., the present complaint has been filed with the prayer that the O.P. be directed to refund the additional cost of the flat charged by the O.P. along with 18% interest from the date of payment till refund. THE complainant has also claimed 18% interest on the excess amount of Rs. 1,31,000/- received by the O.P. on 13.9.1993 and subsequently refunded on 3.3.1994. THE complainant also claimed compensation in the form of house rent for the period 1.11.1989 to 22.11.1993 @ Rs. 5,000/- p.m. amounting to Rs. 2,00,000/- and also compensation for harassment and mental agony suffered due to delay in allotment and construction of the flat. The O.P. in its reply/written version stated that the construction of the flat depends upon various factors which are beyond the control of the O.P. and, therefore, in case of delay in construction, O.P. pays interest on the deposited amount as per Clause 11 of the allotment. It is also stated that construction of the flats depends on various factors and sometimes due to reasons beyond the control of the O.P. construction of flats is not taking place in a fixed period. It is also stated that since the flats in Pocket B-10 were not constructed as per requirements, the complainant was allotted a specific flat in Pocket 5 in Vasant Kunj. It is further stated that the complainant did not surrender the original FDR on account of which final payment letter was not issued. According to the O.P. in the letter dated 8.5.1992 only the estimated price of the flat was indicated and the final figure was to be worked out at the time of final payment. O.P. asserted that cost of the flat has been worked out as per policy and there is no arbitrary increase in the cost as alleged. The O.P. also stated that disposal cost of the flat allotted by the O.P.-D.D.A. is worked out by making material calculations and according to the approved pricing policy based on no profit no loss. It is also stated that at the time of release of particular scheme only the estimated cost is worked out and final cost is worked out after the construction of the flat is completed. During the process of execution of particular scheme, the price of the building material and also labour cost increases which is beyond the control of the O.P. The O.P. also pointed out that in case of any mistake, the same was rectified and the complainant has also been given the benefit of it by reducing the cost of the flat from Rs. 6,80,700/- to Rs. 5,29,600/-. Hence it was stated that there is deficiency or unfair trade practice on the part of O.P. and the complaint is frivolous.

Both the parties have filed evidence in the form of affidavit. Besides documents relied upon by both the parties including letters of allotment, letter of amended price and second allotment, etc.

WE have heard both the parties at length and have also carefully gone through the documents/material on record. Most of the facts stated above are not in dispute. The case of the complainant is that O.P. has increased the price of the flat three times and no reason has been given for this increase. The complainant deposited the demanded amount but he protested against this arbitrary increase. The estimated price of the flat was stated to be Rs. 3,39,600/- in March, 1992 it was increased to Rs. 3,64,800/- in May 1992. However, in May, 1993, the price was almost double at Rs. 6,89,700/-. On the face of it, the increase in the price appears arbitrary. In the W.S. filed by the O.P. no specific explanation has been given by the O.P. as to why the price of the flat was almost doubled within a year and what were the reasons for this increase in price. It is no doubt true that the question of pricing cannot be gone into by the Consumer Foras, since the price of the flat is not fixed by any law as held by the Hon''ble National Commission in case DDA v. A.N. Sehgal, I (1996) CPJ 34 (NC). However, frequent increase in the price without showing any justification would not only amount to deficiency in service but certainly it amounts to unfair trade practice. Nominal increase in price of the flat may be due to escalation in price of the building material and labour but if the price of the flat is increased to double within a period of one year without any justification it appears to be an arbitrary act and it amounts to unfair trade practice. Development Authorities have been established for the benefit of the consumers to provide flats at a reasonable price on the basis of no profit no loss basis. The poor consumer who at the time of registration was informed the estimated price of the flat was shocked to find out that price of the flat has been doubled. It must have caused a lot of mental tension and agony to the complainant who had to pay almost double the price without any sufficient cause. In view of the law laid down by the Hon''ble National Commission in A.N. Sehgal''s case, we are not inclined to enter into the question of pricing which is not within the jurisdiction of the Consumer Foras. However, in view of the arbitrary attitude of the O.P., the complainant has to undergo mental agony and harassment and we are inclined to compensate the complainant. Recently, in a decision of the Hon''ble Supreme Court in the case of Ghaziabad Development Authority v. Balbir Singh, II (2004) CPJ 12 (SC)=III (2000) SLT 161=(2004) 8 CLD 861 SC, it has been held as under: "Under our Constitution sovereignty vests in the people. Every limb of the constitutional machinery is obliged to be people oriented. No functionary in exercise of statutory powers can claim immunity, except to the extent protected by the statute itself. Public authorities acting in violation of constitutional or statutory provisions oppressively are accountable for their behaviour before authorities created under the Statute like the Commission or the Courts entrusted with responsibility of maintaining the rule of law. Each hierarchy in the Act is empowered to entertain the complaint by the consumer for value of the goods or services and compensation. The word ''compensation'' is again of very wide connotation. It has not been defined in the Act. According to dictionary it means, ''compensating or being compensated''; thing given as recompense. In legal sense it may constitute actual loss or expected loss and may extend to physical mental or even emotional suffering, insult or injury or loss. Therefore, when the Commission has been vested with the jurisdiction to award value of goods or services and compensation it has to be construed widely enabling the Commission to determine compensation for any loss or damage suffered by a consumer in which law is otherwise included in wide meaning of compensation. The provision in our opinion enables a consumer to claim and empowers the Commission to redress any injustice done to him. Any other construction would defeat the very purpose of the Act. The Commission or the Forum in the Act is thus entitled to award not only value of the goods of services but also to compensate a consumer for injustice suffered by him." On the demand of the O.P., the complainant deposited Rs. 2,83,769.75 p. on 30.8.1993 out of this amount of Rs. 1,35,002.40 p. was refunded to the complainant on 3.3.1994 as excess amount due to decrease in the price of the flat. The complainant claimed that 15% interest should be paid by the O.P. for the period when the amount remained deposited with the O.P. between 30.8.1993 and 3.3.1994. This demand of the complainant is genuine and the Counsel for the O.P. could not show any ground on account of which the interest for this period is not paid to the complainant. During this period, the excess amount remained with the O.P.-D.D.A. and it must have been utilized by the O.P. Hence the O.P. is liable to pay interest on this amount. Considering the circumstances of the case, we are inclined to grant 12% interest to the complainant on the excess amount deposited for the period during which it remained with the O.P.-D.D.A. i.e., 30.8.1993 to 3.3.1994.

IT has further been claimed on behalf of the complainant that he be awarded compensation for the rent he would have earned if the possession would have been given to him in time. However, no specific proof has been filed in this respect on behalf of the complainant to prove that he had to pay rent at other places or that he would have earned rent from the house hence there is not sufficient ground to award compensation on this ground. Before awarding any compensation for harassment, mental agony, it is also relevant to note that complainant was first allotted another flat in Vasant Kunj, Block B, Pocket 10 vide draw dated 31.12.1987 and the complainant was asked to make payment in four instalments. This was done in 1988. However, these flats were not constructed and subsequently on the representation of the complainant and on the intervention of a Member of Parliament another flat bearing No. 4002 Ground Floor + First Floor in Category II, Vasant Kunj was allotted in 1992. This certainly indicates arbitrary attitude of the O.P. and deficiency in service on its part. The complainant had to run from pillar to post for getting alternative flat when he could not get possession of original allotted flat in four years. The case of the complainant is that possession has been given to other allottees in that area but not to him. However, there is nothing on record to prove this fact. In any case, the complainant had to undergo lot of harassment and agony at the hands of the O.P. for which he is entitled for suitable compensation. Considering the facts and circumstances of the case, the O.P. is directed to pay compensation of Rs. 20,000/- to the complainant for mental agony and harassment. The O.P. is further directed to pay 12% interest to the complainant on the amount of Rs. 1,31,923.95 p. for the period 30.8.1993 to 3.3.1994. The above order should be complied with within 30 days of the date of receipt of this order by the O.P. failing which the complainant shall be free to move appropriate application under Sections 25/27 of the Consumer Protection Act, 1986. In case of delay in making payment, the O.P. shall also pay interest @ 12% on the aforementioned amount from the date of decision till payment. The above mentioned complaint, filed by the complainant, stands dispose of in above terms. Complaint disposed of.