National Consumer Disputes Redressal
Society Of Catalysts vs Delhi Development Authority on 2 September, 2016
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 134 OF 2008 1. SOCIETY OF CATALYSTS N-130, Panchseela Park New Delhi-110017 Delhi ...........Complainant(s) Versus 1. DELHI DEVELOPMENT AUTHORITY Vikas Sadan B-Block, 1st Floor, I.N.A New Delhi 2. . . . . ...........Opp.Party(s) BEFORE: HON'BLE MR. JUSTICE AJIT BHARIHOKE,PRESIDING MEMBER HON'BLE MRS. REKHA GUPTA,MEMBER
For the Complainant : Mr. Omesh Saigal
(President of the Complainant Society)
With Mr. Y N Vidyarthi, Advocate For the Opp.Party : Mr. Rajiv Bansal, Advocate
Ms. Sukriti Kashyap and Ms. Soumya P., Advocate
Dated : 02 Sep 2016 ORDER
Delhi Development Authority (opposite party) on 6.8.2008 launched a scheme of allotment of 5010 flats in various parts of Delhi to the eligible applicants. As per the scheme the eligible applicants were supposed to file application for allotment of flat under the scheme by purchasing an application form at the cost of Rs.100/- or by downloading the application form from the website of DDA and submit the same with an application fee of Rs.100/-. It was further the requirement of the scheme that eligible candidate alongwith the application form must deposit a sum of Rs.1.5 lakhs by way of bank draft. The said deposit was refundable to the unsuccessful applicants within three months of the draw without any interest thereon. However, in case of the delayed refund there was a stipulation that the deposited amount would be refunded alongwith interest. As regards the successful applicants, the deposited amount was to be adjusted against the consideration of the flat allotted to him/her.
2. It is further the case of the applicant that after the announcement of scheme, number of commercial banks floated the loan schemes for those interested in applying under the scheme by the DDA. In most of the said loan schemes the applicant for loan was supposed to pay a sum of Rs.6,500/- as interest on the loan amount of Rs.1.5 lakhs in advance by way of a cheque alongwith the post-dated cheques for the principal amount in the event of failure of the loanee to succeed in the draw of lots.
3. It is alleged that the condition requiring the applicant to purchase application form at a cost of Rs.100/- and submit the application with interest free deposit of Rs.1.5 lakhs irrespective of the applicant succeeding or failing to get the allotment amounts to restricted trade practice as defined under section 2 (1) (nnn) of the Consumer Protection Act as also unfair trade practice as defined under section 2 (1) ( r ) of the Consumer Protection Act, 1986. The complainant, therefore, has filed the instant complaint seeking following reliefs:
"That the complainant would like the Hon'ble Commission to declare the holding of the allotment of flats by the OP as a 'restrictive trade practice' and bar the OP from holding it. It may also be held that it is an 'unfair trade practice' and the OP be restrained from indulging in such practices.
That the complainant would like the Hon'ble National Commission to order for the refund of the amount that the contestants have paid to the OP i.e. a total amount of Rs.12 crores collected by it from the sale of forms and the interest that the consumer has had to pay i.e. Rs.6600/- each ( Rs.6500 interest paid to bank and Rs.100 spent on the purchase of form) to Sri Jyoti Prakash and all the other 5.12 lac person who have deposited the forms. The total amount to be returned works out to Rs.338 crores which may be ordered to be deposited in the Consumer Fund till it can be returned to the rightful claimants. In addition the Hon'ble Commission may be pleased to order for the payment of punitive damages under the provisions of Sec 14 (d) of the Consumer Protection Act, 1986 which the OP may be asked to deposit in the Consumer Welfare Fund and also pay the applicants suitable compensation for the mental harassment and agony that they have had to undergo.
Award costs to the complainant not just to cover the costs of the proceedings as it may deem fit but also the cost of conducting the survey and other research."
4. The opposite party in its written statement has resisted the complaint and justified charging Rs.100/- per application form as also seeking the deposit of Rs.1.5 lakhs from every applicant as interest free deposit refundable to the unsuccessful candidates within three months of the date of draw of lots.
5. Both the parties have filed evidence by way of affidavit in support of their respective stand.
6. We have heard the parties and perused the record. It is admitted position that complainant society has filed the instant complaint on behalf of one Jyoti Prakash and about 5.12 lakh other applicants who were declared unsuccessful in the draw of lot for allotment of flats under the subject scheme launched by the opposite party. Thus, the legal question arises for consideration is as to whether in absence of allotment of flat in favour of Jyoti Prakash or other unsuccessful applicants, can they be termed as "Consumers" of opposite party authority?
7. In the matter of Morgan Stanley Mutual Fund Vs. Kartick Das (1994) 4 SCC 225 dealing with the case of unsuccessful allottee, Hon'ble Supreme Court inter-alia held as under:
"Therefore, it is after allotment, rights may arise as per the contract (Article of Association of Company). But certainly not before allotment. At that stage, he is only a prospective investor (sic in) future goods. The issue was yet to open on 27.04.1993. There is not purchase of goods for a consideration, nor again could he be called the hirer of the services of the company for a consideration. In order to satisfy the requirement of above definition of consumer, it is clear that there must be a transaction of buying goods for consideration under Clause 2(1)(d)(i) of the said Act. The definition contemplates the pre-existence of a completed transaction of a sale and purchase. If regard is had to the definition of complaint under the Act, it will be clear that no prospective investor could fall under the Act".
8. Similarly in the matter of Delhi Development Authority Vs. Krishan Lal, First Appeal No. 486 of 2006, decided on 27.09.2011, this Commission took the view that mere registration by a person in any scheme for allotment of plots or flats launched by DDA, would not make such person a consumer within the meaning of Consumer Protection Act.
9. Similar view was taken by this Commission in the matter of Punjab Urban Planning and Development Authority & Anr. Vs. Krishan Pal Chander, I (2010) CPJ 99 (NC).
10. In view of the above noted position in law, we are of the opinion that since Jyoti Prakash and other unsuccessful applicants on whose behalf complainant society has filed the complaint were not allotted flats, it cannot be said that they hired or availed of services of the opposite party Authority. Consequently, Jyoti Prakash and other unsuccessful applicants cannot be termed as consumers of the opposite party authority. Thus they not being the consumers could not have maintained the consumer complaint and if they could not have maintained the consumer complaint, the complainant society also cannot maintain the consumer complaint on their behalf. On this count alone, the complaint is liable to be dismissed.
11. Even if it is assumed for the sake of arguments that the instant consumer complaint is maintainable in the Consumer Fora, then also the complainant has no case on merits. The first grievance of the complainant is that the opposite party has unfairly demanded the application fee of Rs.100/- to participate in the subject scheme. We do not find any merit in this contention for the reason that the opposite party obviously must have spent some money on the printing of the application forms besides the administrative expenses involved on processing of the lacs of application form before the draw of lots. If the opposite party has charged said amount to meet those expenses, it cannot be said to be unfair or termed as unfair or restricted trade practice.
12. The second grievance of the complainant is that the opposite party by insisting on an interest free deposit of Rs.1.5 lakhs to participate in the subject scheme has indulged in unfair trade practice.
13. In order to find answer to the above plea of the complainant, it would be useful to have a look on the definition of the term "unfair trade practice" as given in Section 2 (1) (r) of the Consumer Protection Act, 1986. The relevant portion of the section reads as under: -
"unfair trade practice" means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the following practices, namely;--
(1) the practice of making any statement, whether orally or in writing or by visible representation which,--
XXXXXXXXXXXXXX"
14. On reading of the above, it is clear that unfair trade practice is a trade practice adopting unfair method or deceptive practice for the purpose of promoting the sale, use or supply of any goods or for the provision of any service. We fail to appreciate as to how the scheme insisting on deposit of interest free Rs.1.5 lakhs alongwith the application form would help in promoting the scheme seeking applications for the allotment of flats offered under the scheme. Rather it would discourage non-serious persons. Therefore, the condition of deposit of Rs.1.5 lakhs alongwith the application form cannot be termed as "unfair trade practice." Otherwise also, we cannot lose sight of the fact that there is acute shortage of residential accommodations in Delhi. The opposite party authority has been created to ensure planned development of Delhi and to achieve the object of residence for all. It is the common knowledge that the DDA construct and allot flats to the public on no profit no loss basis and the cost of the flats constructed and allotted by the opposite party DDA is much less as compared to the flats constructed and sold by the private builders. In such a situation it is but obvious that number of persons who are not in genuine need of the accommodation would apply in the scheme with the motive to make a fast buck by resale of the flat if declared successful in the draw of lots. Therefore, in order to discourage such unscrupulous persons to apply under the scheme the demand of deposit of Rs.1.5 lakhs alongwith the application as a proof of earnestness of the applicant cannot be termed as either unfair or restrictive trade practice. On the contrary, the condition of deposit of Rs.1.5 lakhs alongwith the application form was to ensure that only the serious applicants in need of residential accommodation may apply under the scheme.
15. In view of the above discussion, the complaint is devoid of merit and otherwise not maintainable. Complaint is accordingly dismissed.
......................J AJIT BHARIHOKE PRESIDING MEMBER ...................... REKHA GUPTA MEMBER