State Consumer Disputes Redressal Commission
Madanmohan Tolaram Daga vs M/S Shewalkar Developers Ltd. on 6 May, 2016
Cause Title/Judgement-Entry STATE CONSUMER DISPUTES REDRESSAL COMMISSION MAHARASHTRA NAGPUR CIRCUIT BENCH NAGPUR Complaint Case No. CC/08/13 1. Madanmohan tolaram Daga Karmanya Dandige layout, Shankar Nagar, Nagpur. ...........Complainant(s) Versus 1. M/s Shewalkar Developers Ltd. Kamal Niwas, West High Court Road, Dharampeth, Nagpur. ............Opp.Party(s) BEFORE: HON'BLE MR. B.A.SHAIKH PRESIDING MEMBER HON'BLE MRS. Jayshree Yengal MEMBER For the Complainant: Adv. Mr S B Mohta For the Opp. Party: Adv. Mr Dodani, for Opposite Party Nos.1 & 2. Adv. Mr Harwani, for Opposite Party Nos.3 & 4. ORDER (Passed on 06.05.2016) Per Mr B A Shaikh, Hon'ble Presiding Member
1. This complaint filed under Section 17 of the Consumer Protection Act, 1986.
2. The case of the complaint as set out in the complaint in brief is as under.
a. The opposite party (for short O.P.) No.1 is developer and a registered company and called as M/s Shewalkar Developers Ltd. O.P. No.2 is the Director of O.P.No.1 Company. O.P.Nos. 3 & 4 are the subsequent purchasers of disputed two penthouses. The complainant resides at Nagpur. O.P.No.1 is doing business of construction activities by developing land. The complainant agreed to purchase from O.P. Nos. 1 & 2 as per two agreements of sale and construction dtd.10.01.2004 and 01.09.2006, two penthouses described in detail in the complaint. First penthouse is numbered as A-600-602 and A-701-702 of Block No.A situated at 6th & 7th floor of the building called as "Shewalkar Garden". The second penthouse is numbered as E-603-604 & E-703-704 situated at Block No.E of 6th & 7th floor of the aforesaid building. The said building is situated at Gopalnagar, Opposite VNIT, South Ambazari Marg, Nagpur. Total consideration of first & second penthouse was respectively fixed at Rs.30.00 Lacs & Rs.40.00 Lacs as per aforesaid two agreements dtd.10.01.2004 and 01.09.2006. Both the said agreements were executed jointly by the complainant and O.P.Nos.1 & 2. The complainant paid various amounts from time to time to O.P. Nos. 1 & 2 through bank cheques which O.P. Nos.1 & 2 accepted. The complainant accordingly paid total Rs.33.00 Lacs and Rs.24.00 Lacs respectively in for the first & second penthouse, which is described in the complaint as penthouse No."A" and penthouse No."E" by the complainant. Thus, total payment made by the complainant to O.P.Nos.1 & 2 is Rs.57.00 Lacs as against the total consideration of Rs.70.00 Lacs of both penthouses. The complainant made payment more than work done by the O.P. The work has been done only up to plumbing work of both the penthouses and thereafter they stopped it further work of both penthouses as per time limit given in both the agreements. Hence, the complainant issued notice dtd.01.05.2008 through his advocate to O.P.No.1, but no reply of that notice was given and construction of both the penthouses was not completed. The complainant is therefore facing losses and inconvenience.
b. During the pendency of the complaint, the O.P.Nos.1 & 2 sold both the penthouses to O.P.Nos.3 & 4 by executing registered sale-deeds in their favour though the complainant had published a public notice in two newspapers and though the complainant had registered factum of pendecy of present complaint with Sub-Registrar of Nagpur on 17.11.2012 and though complainant had also given notice to all the Sub-Registrars of Nagpur for not registering sale-deed of the penthouses of any third party. Therefore, the complainant with the permission of this Commission amended the complaint and joined to the complaint as O.P.Nos.3 & 4 the subsequent purchasers of both penthouses.
c. The O.P.Nos.1 & 2 have also delivered possession of both penthouses to O.P.Nos.3 & 4 in the month of February 2014 or March 2014. The said transfer of penthouses is hit by the provisions of pendente lite and therefore they are not binding on the complainant. The said sale-deeds are executed by O.P.Nos.1 & 2 in favour of O.P.No.3 & 4 with mala fide intention and with a view to create complications in the matter and to defeat the claim of the complainant. The O.P.Nos.1 & 2 have thus rendered deficient service to the complainant. Therefore, the complainant prayed that direction be given to O.P.Nos.1 & 2 to complete construction of both the penthouses and to execute registered sale-deeds of both the penthouses in favour of the complainant, which are the subject matter of both the agreements dtd.10.01.2004 and 01.09.2006.
The complainant also prayed that the O.P Nos.3 & 4 may be directed to join to the execution and registration of sale-deeds of both the penthouses in favour of the complainant.
The complainant also prayed that O.P.Nos.1 to 4 be directed to handover physical possession of both the penthouses to him after making complete construction of the same and also to pay him compensation of Rs.25.00 Lacs for damages, mental agony & harassment and also to pay him cost of the complaint, with notice charges of Rs.3,000/-.
3. The O.P.Nos.1 & 2 filed their common reply / written version and thereby resisted the complaint. Their submission in brief is as under.
a. The complainant is not a consumer but an investor. Both the agreements have been actually security agreement executed in favour of M/s Daga Investment & Consultant. Moreover, assuming that both are the agreements of sale but still the complaint is not maintainable as the complainant has not booked the said penthouses for his residential purpose or personal use. He is not an end user but he has made an investment for commercial purpose i.e. to earn interest on his investment and hence he is not a consumer. The complainant lives in a posh bungalow in market locality of Nagpur and he is not in need of both penthouses to live therein and it is just business part for him and nothing more. Both the penthouses are situated in two extreme towers of the project and they are not feasible to be connected or to be used as a single house. The distance in between them is about 200 ft and they cannot be used as a single unit.
b. The complainant is doing money lending business on interest since the year 1993 and he has been lending money on interest to O.P.Nos.1 & 2 either in his own name or in the name of his family members or relatives. The complainant is also a Finance Broker and he finances money to various parties as specified in the reply / written version in detail. O.P.Nos.1 & 2 paid interest by cheques to the complainant by way of Tax Deduction at Source (for short TDS) and remitted the same as TDS to Income Tax Department (for short ITD). The complainant regularly claimed the said TDS in his IT returns and taken refund of the same from ITD.
c. Clause No. 2(A) of both the alleged agreements provides that interest would be paid by O.P.No.1 on booking amount of Rs.8.00 Lacs and Rs.5.00 Lacs respectively @ 25% p.a. till October 2006 and accordingly, the interest has been paid as above after deducting TDS. It was regular practice between the complainant and O.P. Nos.1 & 2 to lend and take money on interest and the complainant used to give loan in name of himself or his relatives and also to take agreement of sale of the flats / apartments from on going projects of O.P. Nos. 1 & 2 for the purpose of security. The O.P. Nos.1 & 2 used to execute the said security agreement and used to pay interest on the loan and on repayment of the money, the same agreement used to be taken back and destroyed. The agreements, in question, were not destroyed as repayment of the loan was not yet made and lying as security with the complainant.
d. During the period from December 2002 to December 2003 the rates on which the O.P. sold other flats in the same scheme, were between Rs.1,150/- to Rs.1,300/- per sq.ft. as against the rates of Rs.774/- per sq.ft., mentioned in the disputed agreements of the year 2003. During the year 2004-05 other flats in the same scheme were sold @ Rs.1,250/- to Rs.1,450/- per sq.ft., which were much higher than the other agreements of the year 2004, which is shown in the agreement @ Rs.1,032/- per sq.ft. Several clauses of the agreement indicate that they are not sale agreement, but they are entered upon for the purpose of creating security. Those clauses are regarding price variation, escalation clause, inadequacy of stamps of the agreement and signing copy of the agreement by the complainant provided to the O.P. There is also arbitration clause in both the agreements for settlement of dispute.
e. The O.P.Nos.1 & 2 had taken a loan of Rs.57.00 Lacs from the complainant to be repaid with interest @ 21% p.a. The complainant had promised to give loan of Rs.70.00 Lacs but did not keep his words and paid only loan of Rs.57.00 Lacs. Therefore, it was decided by both the parties to calculate interest at the lesser rate i.e. @ 15% p.a. because of short investment. It was also agreed that the O.P. will return principal amount of Rs.57.00 Lacs with total interest of Rs.10,49,031/- in February 2008 and after receipt of the same the complainant will give back both security agreements. A draft of Memo of Understanding (for short MOU) was also prepared accordingly. However, the complainant started demanding interest @ 21% p.a. and therefore, the O.P. refused to accept the said demand. The complainant is misusing both the agreements with the intention to grab the property of O.P. Nos.1 & 2. The complainant and O.P.Nos.1 & 2 were in talk about amicably settlement of the amount and hence, the O.P. did not give reply of the notice to the complainant. Many Complicated questions of law & facts are involved in the complaint and therefore detail evidence is required to prove the case and it is not possible in summary procedure of the complaint and thus the complaint is beyond the scope and power of this Commission.
There was never any such transaction between the parties about sale-purchase of both the penthouses. The sale-deeds of both the penthouses have been executed by O.P.Nos.1 & 2 in favour of O.P.Nos. 3 & 4 respectively on 19.12.2013 and 31.12.2013 and they have been duly registered with Sub-Registrar of Nagpur - 4. Valuable consideration has been paid for both the sale-deeds by O.P.Nos.3 & 4 to O.P.Nos.1 & 2 and possession of both the penthouses has been also given to O.P. Nos.3 & 4 in the month of February and March 2014. The O.P. Nos. 3 & 4 are the bona fide purchasers. The sale-deeds were executed as there was no stay or prohibition order passed by this commission. It is denied that the O.P. Nos.3 & 4 are transferee pendent elite and that the sale-deeds are not binding on the complainant. The present complaint has become in fructuous as both the penthouses have been duly transferred in the name of O.P.Nos.3 & 4. Therefore, O.P. Nos.1 & 2 submitted that the complaint deserves to be dismissed.
4. The O.P. Nos.3 & 4 also resisted the complaint by filing their common reply / written version. Their case in brief is as under.
a. The documents placed on record coupled with written version of O.P.Nos.1 & 2 shows that there is no transaction of sale & purchase in between the complainant and O.P.Nos.1 & 2 relating to both penthouses and it appears to be money lending transaction between them and agreements appear to be security documents and the complainant has misused the same. The O.P.Nos.3 & 4 are the bona fide purchasers of both the penthouses as they purchased the same from O.P.Nos.1 & 2 under two registered sale-deeds dtd.19.12.2013 and 31.12.2013 for valuable consideration of Rs.1.71 Crores each i.e. for total Rs.3.42 Crores. There was no injunction order at any time against the said transaction. The O.P. Nos. 3 & 4 have learnt about the present complaint after receiving notice of this complaint from Commission. They also got possession of both the penthouses and title of the same vest in them (O.P.Nos.3 & 4). The complainant is not a consumer but a money lender.
b. Civil Suit bearing Special Civil Suit No.271/2006 is filed by the complainant against one Mr Anil Prabhakar Kulkarni alleging that Mr Anil Kulkarni executed agreement to sell in his favour, who refused to execute the sale-deed. The said suit is pending before the Civil Court. Mr Anil Kulkarni filed written statement in that suit stating that it was actual loan transaction in between him and the complainant and agreement was executed as a security for repayment of loan and the complainant misused that agreement. One Mr Sudhir Joshi in a reply to the notice given by the complainant to him stated that there was actually loan transaction in between him and the complainant and the documents executed as the security were misused by the complainant.
c. The complaint is not maintainable before this Commission. The existence of the condition about payment of interest @ 21% over the amount mentioned in both the agreements and existence of the other clauses prove that it is actually a money lending transaction. Moreover, the lesser rate of penthouse shown in both agreements is also sufficient to prove that both agreements are security documents. The O.P. Nos. 3 & 4 also supported the aforesaid case of O.P. Nos. 1 & 2 about the loan transaction in between the complainant and O.P. No. 2.
d. Lastly O.P. Nos. 3 & 4 submitted that the complaint is liable to be dismissed with cost.
5. The complainant filed his rejoinder denying the allegations made by O.P.Nos.1 to 4 in their reply / written version.
6. The complainant also filed copies of following documents.
i. Both the disputed agreements of sale and building construction. ii. Receipt of payments of total amount of Rs.57.00 Lacs.
Advertisement in newspapers given by O.P. Nos.1 & 2 about sale of penthouses.
Public notice given by O.P. Nos. 1 & 2 in three newspapers.
Receipt of payment of public notice charges.
Photographs of the front side of both the penthouses.
7. On the other hand, O.P.Nos.1 & 2 filed alongwith Pursis copy of Special Civil Suit bearing No.271/2006 filed by the complainant against Mr Anil Prabhakar Kulkarni before Civil Court at Nagpur. The O.P. Nos.1 & 2 also filed copy of written statement of Mr Anil Kulkarni filed in that suit, copy of the reply given by Advocate Mr Sudhir Joshi to the complaint, reply of that notice given by the complainant to Advocate Mr Sudhir Joshi, letter of possession issued by O.P. Nos.1 & 2 to O.P. Nos.3 & 4 about delivery of possession of both the penthouses to O.P. Nos.3 & 4, copies of sale-deeds executed by O.P. Nos.1 & 2 in favour of O.P. Nos. 3 & 4 in respect of both the penthouses. Advocates of both the parties also filed their respective Written Notes of Arguments. We have also heard the learned advocate of both the parties and perused the complaint, written version of O.Ps, affidavits and other documents filed on record as above.
The O.P. Nos.1 & 2 served 20 interrogatories to the complainant and complainant filed reply to those interrogatories.
8. The first and foremost question involved and to be decided by this Commission is whether both the disputed agreement of sale and construction are security documents executed by the O.P. Nos.1 & 2 in favour of the complainant for repayment of loan as alleged by O.P. Nos.1 & 2 and as such whether the complainant is a consumer or not a consumer.
9. The learned advocate of the complainant has taken us through the recitals of both the agreements and copies of receipts of payment made by the complainant to O.P.No.1 from time to time and submitted that the said documents coupled with the affidavit of the complainant is sufficient to come to the conclusion that both the agreements are actually relating to sale - purchase transaction of both penthouses and they are not the security documents as alleged by O.P.Nos.1 to 4. He further submitted that both the penthouses are required by the complainant for residing of himself and his family members and therefore, the transaction from both the agreements have been made by the complainant with O.P.Nos.1 & 2. He relied on the observations made in the following cases.
i. Kavit Ahuja Vs. Shipra Estate Ltd. & Jai Krishna Estate Developers Pvt Ltd & Ors., I(2016) CPJ 31 (NC) It is observed under facts & circumstances of the said case that booking of three flats are not for commercial purpose and the commercial purpose is question of fact to be decided in fact of each case.
Sanjay Zhanwar Vs. Vatika Limited, III(2013) CPJ 52 (Raj.) It is observed that booking of two flats does not reflect that purchase was intended to commercial purpose only. There is no legal bar that two or more residential flats cannot be purchased for residential purpose.
iii. M/s National Seeds Corporation Ltd. Vs. M Madhusudhan Reddy & Anr. AIR 2012 Supreme Court 1160.
Plain reading of Section 3 of Consumer Protection Act makes it clear that remedy if in the said Act is in addition to and not in derogation of provisions of any other law for the time being in force.
iv. State Bank of India & Anr. Vs. Mula Sahakari Sakhar Karkhana Ltd., 2006(6) Mh.L.J. 257.
It is observed that the documents must be primarily construed on the basis of terms & conditions contained therein. While considering a document the Court shall not supply any words which the author of document did not use.
v. Cauvery Coffee Traders, Mangalore Vs. Hornor Resources ( International) Co. Ltd., (2011) 10 Supreme Court Cases 420 It is observed that where any person knowingly accepts benefits of a contract or conveyance or any order, he is estopped to deny its validity or binding effect on him. A party cannot be permitted to blow hot & cold, fast and loose or approbate and reprobate.
vi. Sanjay Kumar Gupta Vs. Kebal Kishan Barm & Ors., 2014(3) CPR 236 (NC).
It is observed that having pocketed money from the complainant and then reselling the same flat to respondent without raising any demand from complainant or putting him to notice of any kind, their conduct in walking out of agreement was most unethical. Respondents have indulged in unfair trade practice. Claim of the consumers cannot be defeated on technical grounds.
vii. Shewalkar Developers Ltd & Anr. Vs. Madanmohan, III (2015) CPJ 580 (NC).
The rigors of the Evidence Act or Civil Procedure Code are not to be strictly applied, like a trial under Civil Procedure Code.
viii. Geetha Bhat ( Dr.) & Anr. Vs. Adarsh Developers, II(2009) CPJ 23.
It is observed that the Fora are empowered to interpret documents in question on basis of undisputed facts. If more than one interpretation is possible, interpretation in favour of consumer to be accepted.
ix. M/s Vora Land Developers through Mr Shailesh P Vora, Partner Vs. Mr Jayantilal Hirji, 2014(I) CPR 21 (NC).
It is observed that unscrupulous builders, who after taking substantial cost of building do not perform their part of obligation, should not be spared.
M/s Gharge-Salunkhe Associates & Ors. Vs. Mr Shivaji Pandurang Sawant & Anr., in first appeal No.FA/14/189 decided by learned State Consumer Disputes Redressal Commission, Mumbai by common order on 23.09.2014.
It is observed that no builder would ordinarily execute receipts for amounts not received. The opponents must be maintaining their books of account. They could have shown from the books of accounts maintained in the regular course of business that no such amount as mentioned in the receipts were actually received by them.
xi. Mr Khurshed N Wadia Vs. United India Insurance Co. Ltd., in first appeal No.A/07/688 decided by learned State Consumer Disputes Redressal Commission, Mumbai on 17.04.2012.
It is observed that whether a particular clause of the contract is valid or invalid and whether it should be treated as cancelled or not is declaratory relief which will not fall within the empowerment of the Forum considering provisions of Section 14 of the Consumer Protection Act 1986.
10. On the other hand, the learned advocates of O.P.Nos.1 to 4 made a common submission that there are various circumstances as pointed out in the respective reply / written version submitted by O.P. Nos.1 to 4, which are sufficient to come to the conclusion that the said two documents are actually security documents for repayment of loan of Rs.57.00 Lacs obtained by O.P.Nos.1 & 2 from the complainant.
The learned advocate of O.P.Nos.1 & 2 has also drawn our attention to the answers given to the interrogatories by the complainant as submitted to them by O.P.Nos.1 & 2 as per permission granted by this Commission and as well as by National Commission in the appeal. Learned advocate of O.P. Nos.1 & 2 in his argument pointed out that as to how the complainant avoided to give answers to those interrogatories and had he given reply, that would have disclosed that it is actual a money lending transaction. The learned advocate of the O.P.Nos.1 & 2 also submitted that both alleged agreements are unregistered documents and as they are not duly registered and executed on stamp of Rs.10/- only, reasonable inference can be drawn that they are only security documents. He relied upon the observations made in the following cases.
i. Hansa V Gandhi Vs. Deep Shankar Roy & Ors., 2013(4) Bom.C.R. 123 (Supreme Court) It is observed that in the absence of registered documents, plaintiff could not get any right in regard to flats and even subsequent purchasers could not be said have notice for earlier agreement nor any presumption can be raised that they had such notice. Further not specific purpose of unregistered document could be ordered hence decree by trial Court is not sustainable.
I S Sikandar (Dead) by LRs Vs. K Subramani & Ors., (2013) 15 Supreme Court Cases 27.
In that case agreement for sale of immovable property with plaintiff terminated for non-performance of contract and there was subsequent sale of same property to another person at a higher price holding that subsequent purchaser cannot be treated as not being a bona fide purchaser as earlier agreement was not subsisting at time of subsequent sale.
iii. Tejram Vs. Patirambhau, (1997) 9 Supreme Court Cases 634.
In that case, a question arose whether it is agreement of sale of land or money lending transaction. Under the facts & circumstances of that case, it is observed that agreement in reality was a monetary transaction and the amount payable towards interest on unpaid loan taken by the appellant from respondent, moneylender and hence relief of specific performance cannot be granted. However, in that case an admission was made by the respondent by way of endorsement that he has received balance of Rs.48,000/- and in the absence of any specific circumstance and in view of doubtful conduct of both parties it is not possible for us to reach to any satisfactory conclusion on the basis of evidence as to what was the amount actually due and paid by the appellant to the respondent. Therefore, the Hon'ble Supreme Court confirmed the order of the Hon'ble High Court that a sum of Rs.48,000/- was paid by the respondent to the appellant. No interest was awarded to the respondent.
iv. K Narendra Vs. Riviera Apartments (P) Ltd., (1995) 5 Supreme Court Cases 77.
In that case, it is observed that Section 20 of Specific Relief Act, 1963 provides that jurisdiction to decree specific performance is discretionary and the court is not bound to grant such relief merely because it is lawful to do so. But the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a Court of appeal.
The learned advocate of O.P.No.s.1 & 2 also submitted that even if it is accepted for the sake of arguments that both the documents relied on by complainant are agreement to sell, still their contents coupled with various facts & circumstances as stated in the reply of O.P.Nos.1 & 2 and as brought on record, which he pointed out in his arguments prove that alleged transaction is made purely for commercial purpose and hence it is proved that complainant is not a consumer and complaint is not maintainable under Consumer Protection Act.
Perusal of both the alleged agreement of sale and building construction shows the following material facts.
i. O.P.No.1 shall pay interest @ 21% p.a. on booking amount of Rs.8.00 Lacs from the month of November 2003 till October 2006 to M/s Daga Investments & Consultant and also to pay interest @ 21% p.a. over another booking amount of Rs.5.00 Lacs for the period from March 2006 till October 2006 to M/s Daga Investments & Consultant by O.P.No.1.
Both the agreements are obtained by M/s Daga Investments & Consultant through the complainant Madanmohan Daga.
The rates of cement, still, bricks, wood and lift mentioned in both the agreement, would remain unchanged.
12. It is also pertinent to note that M/s Daga Investments & Consultant is engaged in investment of the money as seen from its title. Thus, it is an investor. The complainant obtained both the alleged agreements not in his personal name but in the name of M/s Daga Investments & Consultant. No explanation is given by complainant why agreements are obtained in favour of proprietary concern and not in his personal name.
13. Moreover, it is also admitted by the complainant that he actually received interest @ 21% over the alleged booking amount of Rs.8.00 Lacs & Rs.5.00 Lacs from the O.P. for the period mentioned in both the alleged agreements.
14. The twenty interrogatories were submitted by O.P.Nos.1 & 2 to the complainant for giving reply to the same by him. Those material interrogatories are as follows.
i. As to whether 14 Civil Suits for specific performance of contract and recover of the amount are filed by the complainant against various persons in the Civil Court of which list is given as Annexure - 'A' alongwith interrogatories.
Whether 30 criminal complaints under Section 138 under Negotiable Instrument Act are filed by the complainant against various persons of which details are given in Annexure - 'B' by O.P.No.1 ?
Can you tell the nature of business of firm M/s Daga Investments & Consultant, office address of the said firm and whether the same firm is in existence?
Do you have money lending licence and if yes, specify the period of the said licence?
Can you submit any Tax Return for the last three years of the firm M/s Daga Investments & Consultant.
Do you finance money to O.P.No.1 - M/s Shewalkar Builders Ltd in the name of your family members?
15. The complainant has given reply to those questions that they are irrelevant. We find that those questions are not irrelevant. On the contrary, they are very relevant when it is the case of O.P.Nos.1 & 4 that agreement in dispute, are actually security documents and they were executed as security for repayment of loan given by the complainant to O.P.No.1. Had the complainant given reply to those questions, that would have disclosed as to whether complainant filed 14 Civil Suits in court of law for specific performance of similar contracts against various persons and as to whether he had filed 30 criminal cases under Section 138 of Negotiable Instrument Act against various persons for dishonour of the cheques given by them to the complainant. The list of all those Civil Suits and Criminal cases were also supplied to the complainant by the O.P. alongwith the interrogatories, but no specific reply was given to them by the complainant. In our view, therefore, adverse inference can be drawn against the complainant.
16. It is also the case of O.P.Nos.1 & 2 that both penthouses cannot be united and they are situated in two different towers and there is a distance of 250 ft. in between them and they cannot be used on single unit by any single person for residence. On the contrary, it is the case of the complainant that he wanted to purchase both the penthouses for residing himself and his family members. Therefore, following questions were asked by way of interrogatories by O.P.Nos.1 & 2 to the complainant.
Can you tell the plot area and total construction area of your own residence and since when you are residing and also the approximate valuation of your bungalow at Shankarnagar, Nagpur, wherein you have been residing alongwith your son Mr Rahul Daga? As stated by you that you had booked and purchased two penthouses, can you tell the purpose for which you had allegedly purchased the said two penthouses, which are situated in two extreme towers of the project and are 250 ft. away from each other, which are never physically connected and can he use those two penthouses as single house?
The complainant, to this question, has given reply that it is irrelevant. The complainant, to another question, has given reply that he has booked penthouses for residence purpose for himself and for his family members / son / daughters and it is none of its business that how he is going to utilise and it is not relevant question how I am going to use the said penthouses.
17. We find that the complainant has not specified clearly that he is not residing in any such bungalow alongwith his son at Shankarnagar, Nagpur. Moreover, the complainant has also not specified that as to whether he wants to shift himself or his family members to penthouses after leaving the bungalow. In our view, the complainant has given very vague reply to the aforesaid both questions. It was necessary for the complainant to give details as to who out of his family members would occupy two penthouses. No affidavit of his family members is filed to support his case about personal use of penthouses. Considering that the complainant alongwith his son is residing in a bungalow and considering that the two penthouses are situated in separate two towers at a distance of 250 ft. from each other, it can be said that both the penthouses were not intended to be purchased by the complainant for residential purpose for himself or his family members.
18. Moreover, both the alleged agreements were not duly registered though it is seen that the agreements are relating to two big penthouses and having total consideration of Rs.70.00 Lacs. The first agreement is executed on stamp paper of Rs.10/- only and second agreement is executed on stamp paper of Rs.100/- only. This also creates doubt about genuineness of the transaction entered as per both the agreements in between both the parties.
19. It is also pertinent to note that the alleged booking amount of Rs.8.00 Lacs was paid on 11.11.2003 and alleged booking amount of Rs.5.00 Lacs was paid on 17.03.2006 by the complainant to O.P.No.1. But the agreements were executed respectively on 10.01.2004 and 01.09.2006 and as per both agreements interest over the said amounts was paid @ 21% p.a. from the month of November 2003 till October 2006 and from March 2006 to October 2006 by O.P.No.1 to M/s Daga Investment & Consultants. This also goes to show that it is simply a money lending transaction entered into between both the parties. Had both documents as agreements to sell, there would not have been any such term of payment of interest over such booking amounts.
20. Moreover, the fact that the price of cement, still, bricks, wood and lift as mentioned in the agreements would remain intact is also one of the circumstances to show that they are not usual agreements of sale. Had been such agreements to sell, there would have been a clause that if price of the material is increased more than 5% during the period of construction as per agreement, there would be increase in proportion of the value of the penthouses.
21. Entering of both the agreements not in the name of complainant actually but in the name of concern namely M/s Daga Investment & Consultants is also one of the material ground to come to the conclusion that both agreements are executed so as to get benefit of interest by M/s Daga Investment & Consultants in the course of its money lending transaction.
22. Though the complainant alleged in the complaint (Para No.10) that he made payment of amount more than value of work done by O.P.Nos.1 & 2. He has not made clear as to why he made more payment than actual work done.
23. In our view, all these circumstances give clear inference that both alleged agreements are nothing but they are security documents entered into between both the parties to secure repayment of loan as alleged by the O.P.Nos.1 & 2. Moreover, the transaction as per both the agreements is nothing but purely commercial transaction as discussed above and therefore, the complainant is not a consumer. A person is excluded from the definition of a consumer given under Section 2(i)(d)(ii) of Consumer Protection Act, if he hires or avails services purely for commercial purpose. All the aforesaid decisions submitted by the learned advocate of the complainant are not applicable to the facts & circumstances of the present case as they are totally different from those of said cases. On the contrary, the Hon'ble National Commission in the case of Indrajit Vs. Samruddhi Developers Pvt Ltd. & Ors., 2015(I) CPR 692 (NC) clearly observed that when a consumer has booked more than one unit of residential premises, it amounts to booking of such premises for commercial purpose. In the said order, Hon'ble National Commission has also referred to its earlier decision in the case of Jagmohan Chhabra & Anr. Vs. DLF Universal Ltd., IV (2007) CPJ 199 in which it is observed that as the complainant has booked two flats on two floors, he does not fall within the purview of consumer.
24. We, therefore, hold that as these both agreements are not actually agreement of sale & construction but they are actually security documents, the complainants are not entitled to seek relief of sale-deed of both the penthouses.
25. The learned advocates of the O.P.Nos.1 to 4 also argued that the landowners are not joined to the complaint as O.Ps and in their absence no direction for sale-deed can be given. The O.P.Nos.1 & 2 also submitted that they are ready to refund Rs.57.00 Lacs with interest to the complainant if this Commission comes to the conclusion that the complainant is a consumer under Section 2(i)(d)Iii) of Consumer Protect Act.
26. On the other hand, learned advocate of the complainant submitted that the landowners are not necessary party to the complaint since they have already executed power of attorney in favour of O.P.No.2 as seen from the sale-deed executed in favour of O.P.Nos.3 & 4 on behalf of landowners by O.P.Nos.1 & 2 on the basis of that power of attorney. He further stated that the sale-deed can be executed by O.P. Nos.1 & 2 in favour of the complainant and O.P. Nos. 3 & 4 can be directed to join O.P. Nos.1 & 2 for execution of sale-deeds in favour of the complainant since O.P.Nos.3 & 4 obtained sale-deeds from O.P.Nos.1 & 2 with full knowledge that the complaint about both penthouses is pending before this commission.
27. On the other hand, learned advocate of O.P. Nos. 3 & 4 submitted that no such direction can be given to O.P. Nos. 3 & 4 to join O.P. Nos. 1 & 2 for execution of sale-deed in favour of the complainant since O.P. Nos.3 & 4 are the bona fide purchasers and they have parted huge amount of consideration for obtaining both sale-deeds from O.P.Nos.1 & 2.
28. The learned advocate of the complainant relied upon the observations made in the following cases.
i. Guruswamy Nadar Vs. P Lakshmi Ammal (dead) through LRs & Ors., 2008(6) Mh.L.J. 521. (Supreme Court) It is observed that the suit for specific performance on the basis of an agreement for sale was filed on 03.05.1975 and second sale of the suit property took place on 05.05.1995 and therefore, the principle of lis pendence is attracted and the second sale cannot have the overriding effect on the first sale.
Dilip Bastimal Jain Vs. Baban Bhanudas Kamble & Ors., 2001(3) Mh.L.J. 730.
It is observed that in a suit for specific performance of contract of sale, transferees to be necessary impleaded as parties without seeking any specific declaration against them and those subsequent transferees are required to be directed to join in the sale which is directed by decree for specific performance of contract. It would not be necessary at all to seek any specific declaration against the subsequent transferees.
iii. Shri Krishna Rambhau Nandanwar Vs. M/s Revati Construction & Developers in First Appeal No.A/11/237, decided by State Consumer Disputes Redressal Commission, Maharashtra, Circuit Bench, Nagpur on 18.07.2014.
In that case, power of attorney was executed by owners of the land in favour of Deepak Nilawar and that only inference can be drawn is that plot owners have executed power of attorney holder in favour of the opposite party and they are bound by every act by power of attorney holder as assigned by the said documents and executing sale-deed and handing over possession is included in the said documents and direction given by the Forum is binding on landowners of the plot.
29. In the instant case, no such power of attorney executed by the landowners in favour of O.P.Nos. 2, is produced on record. In our view, merely because there is reference of some power of attorney given by the landowners to O.P.Nos.2, as mentioned in the aforesaid sale-deed obtained by O.P.Nos. 3 & 4, that does not absolve the complainant from producing any such power of attorney on record. In the absence of any such power of attorney on record, we are not inclined to hold that the landowners have duly authorised the O.P.Nos.1 & 2 to execute the sale-deeds of both disputed penthouses to the prospective purchasers at the relevant time. Therefore, in the absence of power of attorney on record and the landowners as a party to the present complaint, no direction for sale-deed can be given as the sale-deeds involve sale of undivided share in the land on which Shewalkar Gaden building comprises of both the penthouses constructed. Therefore, aforesaid decisions relied upon by the learned advocate of the complainant are not applicable to the present case.
Moreover, the provisions of lis pendence are not applicable to the present case since we find that the agreements of sale produced on record are not actually the agreements of sale but the documents of security. Moreover, this Commission has no power to give any direction to O.P. Nos.3 & 4 to join O.P.Nos. 1 & 2 in execution of sale-deed in favour of the complainant since there is no relationship of consumer and service provider in between them and since this commission has no power to declare the subsequent sale-deed obtained by O.P.Nos.3 & 4 as hit by provisions of lis pendence. On this count also we hold that the complainant is not entitled to sale-deed of both the penthouses.
30. However, we find that since it is admitted by O.P.Nos.1 & 2 that they have obtained loan of Rs.57.00 Lacs from the complainant and it is to be repaid by them with interest, it is necessary to give direction to O.P.Nos.1 & 2 to refund the said amount to the complainant with interest @ 9% p.a. from the date of complaint till its realisation by him.
31. The learned advocate of the O.P.Nos.1 & 2 has also conceded for the refund of that amount but according to him, that can be refunded if it is found by this Commission that the complaint is maintainable. However, we find that though the complainant is not a consumer, still the direction can be given when it is admitted that the complainant has paid said amount of Rs.57.00 Lacs to the O.P. Nos.1 & 2 as a loan and the complainant is dealing in such investment in regular course. Accordingly, we hold that the complaint deserves to be partly allowed.
ORDER i. The complaint is partly allowed. ii. The opposite party Nos.1 & 2 are directed to refund Rs.57.00 Lacs to the complainant with interest @ 9% p.a. from the date of complaint i.e. from 01.09.2008 till its realisation by the complainant. iii. The complaint to the extent of seeking direction to the O.P. Nos. 1 & 2 to execute the sale-deeds of both the penthouses and direction to O.P.Nos.3 & 4 to join O.P. Nos.1 & 2 in execution of the sale-deeds and further direction to O.P. Nos.1 & 2 to deliver the possession of both the penthouse to the complainant is hereby dismissed. iv. In the peculiar facts & circumstances of the preset case, both parties to bear their own cost of the complaint. v. Copy of the order be furnished to both parties free of cost. [HON'BLE MR. B.A.SHAIKH] PRESIDING MEMBER [HON'BLE MRS. Jayshree Yengal] MEMBER