State Consumer Disputes Redressal Commission
Ludhiana Improvement Trust Through Its ... vs Lueena Puri Wife Of Anil Puri on 9 January, 2026
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
First Appeal No. 592 of 2023
Date of institution : 31.08.2023
Reserved on : 05.12.2025
Date of Decision : 09.01.2026
1. Ludhiana Improvement Trust, Ludhiana, through its Chairman
2. Chairman, Ludhiana Improvement Trust, Ludhiana
...Appellants/Opposite Parties
Versus
Lueena Puri W/o Sh. Anil Puri, R/o 307-A, Rajeev Enclave, Shahid
Bhagat Singh Nagar, Ludhiana
...Respondent/Complainant
First Appeal under Section 41 of the
Consumer Protection Act, 2019 against the
order dated 02.02.2023 passed by the District
Consumer Disputes Redressal Commission,
Ludhiana in C.C. No. 236 of 2019.
Quorum:-
Hon'ble Mrs. Justice Daya Chaudhary, President
Ms. Simarjot Kaur, Member
Mr. Vishav Kant Garg, Member
1) Whether Reporters of the Newspapers may be allowed to see the Judgment? Yes/No
2) To be referred to the Reporters or not? Yes/No
3) Whether judgment should be reported in the Digest? Yes/No Present:-
For the appellants : Ms. Kavita Arora, Advocate
For the respondent : Sh. Hitesh Sood, Advocate
First Appeal No. 592 of 2023 2
VISHAV KANT GARG, MEMBER :
Appellants/Opposite Parties i.e. Ludhiana Improvement Trust, have filed the present Appeal through its Chairman to challenge the impugned order dated 17.05.2019 passed by the District Consumer Disputes Redressal Commission, Ludhiana (in short, "the District Commission"), whereby the Complaint filed by the Respondent/Complainant-Lueena Puri had been partly allowed.
2. It would be apposite to mention here that hereinafter the parties will be referred, as were arrayed before the District Commission.
3. Briefly, the facts of the case as made out by the Respondent/ Complainant in the Complaint filed before the District Commission are that the OPs on the basis of draw of lots had allotted one Plot No.1066-G, measuring 125 sq. yards in Shahid Bhagat Singh Nagar to Mehar Singh s/o Bachittar Singh. Allotment Letter No. LIT/SB/11786 dated 04.11.1999 was issued in his name. Total amount of Rs.1,81,875/- was paid by the allottee and the OP-Trust had executed Agreement of Sale with the allottee on 16.02.2004. Thereafter, said plot was transferred in the name of Satwinder Singh s/o Kirpal Singh on resale and Sale Deed in this regard was executed on 11.11.2005. Said Satwinder Singh had further sold the plot to the Complainant on 06.06.2011. The Complainant had averred that as there was huge encroachment in the street closed to her plot and the area was blocked, therefore, she was unable to raise the construction and was forced to live in a rented accommodation. The Trust had constructed the road up to Plot No. 1068-C and not upto the plot of the Complainant. The Complainant had approached the OPs on number of times and requested them to remove the encroachment but of no use. Inspite of First Appeal No. 592 of 2023 3 removing the encroachment, the OP-Trust vide letter No.LIT/SB/81316 dated 02.05.2018 had raised illegal demand of Rs.3,84,375/- on account of non-construction fee relating to the period w.e.f. 2006 till 2018 and Rs.24,912/- on account of enhancement in the price of the plot. Total amount of Rs.4,09,287/- was asked to be deposited by the Complainant. On this, the Complainant had approached the OPs and informed them that the said demand was illegal and arbitrary, against the terms and conditions of the Allotment Letter/Sale Agreement & Sale Deed. She had prayed to withdraw the same as no such condition of demanding non-construction charges had been mentioned in the allotment letter. Since the Rules were amended later i.e. after the actual date of allotment of the plot, therefore, the same were not applicable with retrospective effect in the case of the Complainant.
4. Stating the act of the opposite parties to be a case of 'deficiency in service' and 'unfair trade practice', it was prayed in the Complaint that the OPs be directed to withdraw the demand of Rs.3,84,275/- and Rs.24,912/- as non-construction fee and enhancement amount, respectively. Further the OPs be directed to remove the encroachment near the plot of the Complainant and to sanction the building plan of the Complainant. The Complainant had also prayed that the OPs be directed to pay Rs.2 lakh as compensation for causing mental tension, harassment and agony and Rs.55,000/- be awarded on account of litigation expenses.
5. Upon issuance of notice in the Complaint, the Appellants/ Opposite Parties had filed the written statement by raising certain preliminary objections that the Complainant had no cause of action to challenge the demands. The Complaint had been filed on false and First Appeal No. 592 of 2023 4 frivolous grounds and the Complainant had concealed the true and material facts from the Commission. It was pleaded that there was no encroachment in front of the plot of the Complainant, rather, there was 30 ft. street existed at the spot. The Complainant had wrongly stated that the demand was raised illegally whereas the purchaser is bound to construct the plot within 3 years from the date of its purchase but till date no construction had been done on the plot. The OPs as per rules and norms of Ludhiana Improvement Trust (LIT) had served notice upon the Complainant and had asked her to pay the non-construction charges. The Complainant had raised false and frivolous allegations regarding encroachment over the street. Said street was 30 ft. in width and if the Complainant was/is willing to raise the construction, she could have done the same easily but have levelled false allegations to save herself from paying the non-construction fee. Number of Houses had already been constructed in the area. The negligence of the Complainant had been clearly proved from the fact that till date she had neither submitted and got approved the site plan of the House nor has paid the requisite charges in this regard with the OPs. The demands had been rightly raised and the Complainant is liable to pay the same. It was prayed that the Complaint being devoid of any merit, be dismissed.
6. After considering the contents of the Complaint and the reply thereof filed by the Opposite Parties as well as on hearing the oral arguments raised on behalf of both the sides, the Complaint filed by the Complainant was partly allowed by the District Commission vide order dated 02.02.2023. The relevant portion of said order as mentioned in Para- is reproduced as under:
First Appeal No. 592 of 2023 5
"11. As a result of above discussion, the complaint is partly allowed with an order that the demand of levying and recovering the non-construction charges of Rs.3,84,375/- raised by the opposite parties vide letter dated 02.05.2018 along with its incidental or consequential charges is hereby quashed. The opposite parties shall pay composite compensation of Rs.20,000/- (Rupees Twenty Thousand only) to the complainant. Compliance of the order be made within 30 days from the date of receipt of copy of order..."
7. The aforesaid order dated 02.02.2023 passed by the District Commission has been challenged by the Appellants/Opposite Parties by way of filing the present Appeal by raising a number of arguments.
8. There was delay of 144 days in filing the Appeal. M.A. No. 1212 of 2023 was filed for condonation of delay in filing the Appeal, which was supported by an affidavit. The delay of 144 days in filing the Appeal, was condoned vide order dated 23.10.2024.
9. Ms. Kavita Arora, Advocate, learned Counsel for the Appellants has submitted that the plot was allotted to Mehar Singh on 04.11.1999, who was required to complete the construction within 3 years from the date of allotment whereas the said allottee had sold the plot to another person, from whom the Complainant had purchased the same. As till 2018, construction had not been done on the plot, therefore, the OPs had raised a demand of Rs.3,84,375/- on account of non-construction charges for the period 2006 to 2018 and Rs.24,912/- as enhancement charges. To save herself from the liability to deposit the non-construction charges, the Complainant had levelled the false and frivolous allegations of encroachment/dumping garbage over the road near her plot. The District Commission had not considered all these aspects and had passed the impugned order on the basis of assumptions and presumptions. The District Commission has passed the impugned order by not applying First Appeal No. 592 of 2023 6 judicious mind and ignoring the rules of the LIT/Government and has illegally granted the relief to the Complainant.
10. On the other hand, Sh. Hitesh Sood, Advocate learned Counsel for the Respondent has submitted that in compliance with the directions issued in the impugned order, the Complainant had already deposited the draft of Rs.24,912/- as enhancement price of the plot on 09.03.2023 and also had submitted the Building Plans but the same had been returned by the OPs after 8 months. The OP-Trust had not removed the encroachments from the street, which was creating an obstruction in completing the building on the plot by the Complainant, therefore, the OPs were deficient in service. Further has argued that with regard to the contention of the OPs that the District Commission had not considered the provisions of Clause 8 of the Allotment Letter and Condition No. 2 of the Agreement to Sell. It was held by this Commission in case F.A. No. 592 of 2005 "Improvement Trust, Barnala Vs. Urmila Devi" that since there was no condition to levy Non-construction Charges in the allotment letter, therefore, the OP-Trust cannot impose the non-construction charges upon the allottee/owner and had dismissed the Appeal of the OP-Trust. Said law had already been upheld by the Hon'ble National Commission. It was argued that the District Commission after considering the grievance of the Complainant in depth, conditions of the allotment letter and contentions of the OP-Trust, had rightly quashed the demand of Rs.3,84,375/- raised by the OP-Trust on account of non-construction charges and has partly allowed the Complaint. It was prayed that the Appeal being without any merit, be dismissed.
11. We have heard the oral arguments of the learned Counsel for the parties and have also carefully perused the impugned order passed by First Appeal No. 592 of 2023 7 the District Commission, written arguments submitted by the parties and all the relevant documents available on the file. We have also gone through the judgments cited by both the parties in support of their versions.
12. It is not in dispute that the Plot No.1066-G, measuring 125 sq. yards in Shahid Bhagat Singh Nagar was allotted to Sh. Mehar Singh s/o Sh. Bachittar Singh vide Allotment Letter No. LIT/SB/11786 dated 04.11.1999 by the OPs. Total amount of the same had already been paid to the OP-Trust. Thereafter, said plot was transferred in the name of Satwinder Singh s/o Kirpal Singh and thereafter to the Complainant on 06.06.2011, who is presently the owner of the plot in question. It was stated that the Trust had only constructed the road upto Plot No. 1068-C and not upto the plot of the Complainant. The reason shown by the Complainant for not raising the construction over the plot was that there was huge encroachment/blockage in the street near her plot.
13. The OPs had denied the said allegations of the Complainant and argued that the Complainant had neither raised such issue before the OPs nor had submitted any representation informing that there was blockage/encroachment near her plot and she was unable to raise the construction. It was argued that since the allotment of the Plot from 1999 till date, the construction had not been raised over the plot inspite of the fact that 30 ft. road was there, still is existing at site, therefore, the Complainant was liable to pay the non-construction charges and enhancement of the price of the plot.
14. The Complainant had agitated the said demand of the OPs on the ground that neither in the Allotment Letter nor in the Sale Agreement, there was any such condition, which permits the OPs to raise demand of First Appeal No. 592 of 2023 8 the non-construction charges from the Complainant with retrospective effect.
15. To examine the said issue, we have gone through the conditions mentioned in the Allotment Letter and in the Agreement for Sale. After purchasing the plot in re-sale, the Complainant had stepped into the shoes of the original allottee, therefore, the same were the initial documents to be considered while deciding the controversy between the parties. In the Allotment Letter only the total consideration amount, options available to deposit the amount by different means and installments with interest have been mentioned. It was also mentioned in the allotment letter that in the case of enhancement of compensation by the Court, the allottee had to pay the additional price of the plot, which the Complainant had agreed to deposit the same, therefore, regarding enhancement price of the plot, there was no dispute between the parties and the Complainant had agreed to pay the same.
16. The only dispute remains with the construction over the plot or in default thereof, what penalty can be imposed/levied by the OP as per terms and conditions of the Allotment Letter/Agreement for Sale. Under Condition No.8 of the Allotment Letter, the time period for raising construction was mentioned as 3 years, calculating w.e.f. 04.11.1999 i.e. the date of issue of the Allotment Letter by the OPs. As per Condition No.14, the allottee was required to deposit Rs.500/- as Security with the OP-Trust. There was specific Condition No. 16 in the Allotment Letter that the allotment was subject to the provisions of the Punjab Town Improvement Act, 1922 and the Punjab Town Improvement (Utilization of Land & Allotment of Plots) Rules, 1983. In the Agreement for Sale, it was clearly mentioned that the Allottee had deposited with the Trust a sum of First Appeal No. 592 of 2023 9 Rs.500/- as security. In the Agreement for Sale, there was only Condition No.13, allowing the OPs to forfeit the amount in case of default on the part of the Allottee while complying with the conditions of the Allotment Letter. It was clearly mentioned that if the allottee fails to comply with the conditions, said surety amount of Rs.500/- deposited by the allottee was to be forfeited by the Trust. Except this, there was no condition mentioned in the Agreement for Sale that if the allottee fails to raise the construction within the 36 months period, the OPs will have the right to raise the non- construction charges from the allottee.
17. The OPs have argued that as the Complainant was the transferee of the plot and the same had been transferred in her name only in the year 2011, then the Rules applicable at that time were applicable in the case of the Complainant and she was bound to raise the construction over the plot within the period of 3 years from the date of transfer. Whereas on the other hand, learned Counsel for the Complainant has argued that as the said Rules were not in operation at the time of allotment of the plot to the original allottee, therefore, the OP-Trust cannot take the benefit of any Rules, which were imposed subsequently. When there was no such condition in the Allotment Letter to raise the demand of non- construction charges, therefore, the OP-Trust was not legally authorized to raise any such demand lateron. While quashing the demand of the OPs being illegal, the District Commission in para No. 8 of the impugned order, observed as under:-
"8. By applying the ratio of the above cited cases, it is held that there is no condition in the allotment letter Ex. C1 with regard to levying and recovering of non-construction charges even if the construction is not raised within three years. So the complainant stepped into shoes of original allottee and the parties are bound by First Appeal No. 592 of 2023 10 the terms and conditions of these documents. The concept of levying non-construction charges was introduced w.e.f. 15.12.2005 when the rules framed under Punjab Town Improvement Act, 1922 were suitably amended. Despite the amendment, these new conditions were not incorporated in the allotment letter or subsequent transfer documents by the opposite parties. The amended rules were to take effect prospectively. So as a sequel of the above discussion, the act of the opposite parties levying and recovering the non-construction charges of Rs.3,84,375/- along with interest vide letter dated 02.05.2018 cannot stand legal scrutiny and accordingly the demand letter dated 02.05.2018 is hereby quashed to that extent."
18. To contradict the above findings by giving the justification that the demand of non-construction charges had been rightly raised, the OPs had relied upon the judgments of the Hon'ble National Commission i.e. "PUDA Vs. Tripta Rani Puri", 2015 (1) CPJ Page 412, "Improvement Trust Barnala Vs. Meena Modi", 2011 (2) CPJ 123 that the non- construction charges demanded on account of statutory Rules cannot be said an act of 'deficiency in service' or 'unfair trade practice'. Further relied upon the judgment of the Hon'ble Supreme Court in case "State of Punjab v. Dhanjit Singh Sandhu" 2014 (15) SCC 144, stating that the defaulting allottees of valuable plots cannot be allowed to approbate and reprobate by first agreeing to abide by terms and conditions of allotment and later seeking to deny their liability as per the agreed terms. Further argued that the original allottee had already paid the amount of Rs.28,125/- to the OPs raised on account of non-construction charges vide receipt dated 06.09.2004, therefore, the present Complainant (Transferee) is also liable to pay the non-construction charges as demanded by the OPs. As the OPs had not produced any document to show that the original allottee had already deposited the amount on account of non-construction charges with the OPs, therefore, such plea of the OPs cannot be accepted First Appeal No. 592 of 2023 11 in the absence of specific proof on record. Also, no such plea was raised by the OPs before the District Commission or in the Appeal filed before this Commission.
19. The main contention of the OPs is that under Condition No.8 of the Allotment Letter, the specific time period of 3 years was mentioned for raising construction over the plot, therefore, the Complainant was also bound to raise the construction within a period of 3 years from the date of transfer of the plot in her name. As the original allotment was issued by the OPs in the year 1999 and in the said allotment letter there was no specific condition mentioned relating to charging of non-construction charges on account of delay in raising the construction beyond the period of 3 years, therefore, any rules/instructions/guidelines issued lateron, will not be applicable in the case of the Complainant. There was no provision in the Punjab Town Improvement Trust Act, 1922 nor in the Rules framed under this Act, to levy or recovering non-construction fee on account of not raising the construction over the plot within the stipulated period. As such, the Rules amended lateron in the year 2005 vide notification dated 13.12.2005, would not apply with retrospective effect. The Rules applied by the OPs for raising non-construction charges related to the year 2005 were not applicable in the present case because the said Notification clearly says that it will come into force from the date of its publication. The OPs had no right to amend the terms and conditions of the allotment letter on its own by taking the shelter of any notification which was issued subsequently. In case "Export Credit Guarantee Corporation of India Vs. M/s Garg Sons International", 2013 (1) CPC 192, it was specifically held by the Hon'ble Supreme Court that the parties are governed by the Contract. As discussed above, the Agreement for Sale only authorizes the First Appeal No. 592 of 2023 12 OPs to forfeit the security amount deposited by the allottee with it in case the allottee/transferee fails to comply with any conditions of the allotment letter, which in the present case was only Rs.500/-. The Complainant in support of his arguments regarding the demand of non-construction charges by the OPs, ignoring the terms and conditions of the Allotment Letter had produced a number of judgments which says that the terms of the agreement executed between the parties was the important factor between the parties and the parties were bound to follow the conditions of the same. No party will be authorized to add any condition lateron as per its convenience to raise any demand. It was already held in number of times in the cases relating to the OP-Trust that when there was no condition in the allotment letter regarding raising the demand on account of non-construction charges, the notification issued afterward cannot be applicable with retrospective effect. Moreover, there is no document on record vide which the OPs have intimated to the Complainant regarding the applicability of Non-Construction Charges nor that the OPs had amended the terms and conditions of the Allotment Letter.
20. The Counsel for the Appellants has failed to convince this Commission how the Appellants are entitled to recover the non- construction charges when the plot was allotted in the year 1999 and there was no such condition in the Allotment Letter at that time. Also, the judgment relied upon by the Appellants is not applicable in the present case because in that case there was condition of resumption of the plot but in the allotment letter issued to the allottee in the present case, there was no such condition. The allottee was only asked to deposit Rs.500/- as security for the fulfillment of the conditions of the Allotment Letter. Vide Agreement for Sale, under Condition No. 13 i.e. 'Default', the OPs were First Appeal No. 592 of 2023 13 entitled to forfeit the security in the case of failure of the allottee/transferee to comply with the conditions of the Allotment Letter. Even in the Agreement for Sale, there is no condition to levy non-construction charges, if the allottee does not raise the construction within three years. Therefore, the judgments relied upon by the Appellants/OPs are not applicable in the present case. Also, this Commission had recently decided the case of the OP-Trust relating to similar issue i.e. F.A. No. 579 of 2024 "Ludhiana Improvement Trust, Ludhiana Vs. Sunit Sandhu", decided on 28.08.2025, wherein following the earlier decision of this Commission that when there was no provision in the terms and conditions of allotment letter to charge non-construction charges, the Improvement Trust cannot legally do so. The Appeal of the Appellants-OPs Trust was dismissed.
21. In view of the above discussion, it is clear that the District Commission had thoroughly considered the stand of the parties and judiciously relied upon the law on the subject. The Appellants have failed to raise any ground, which the District Commission had not considered in its order. The law cited by the Appellants on the subject is not applicable in the present case. Therefore, the present Appeal being devoid of any merit is hereby dismissed and the impugned order dated 02.02.2023 of the District Commission is upheld.
22. Since the main case has been disposed off, so all the pending Miscellaneous Applications, if any, are accordingly disposed off.
23. The Appellants had deposited a sum of Rs. 10,000/- at the time of filing of the Appeal. Said amount, along with interest which has accrued thereon, if any, shall be remitted by the Registry to the District Commission forthwith. The Concerned Party may approach the District First Appeal No. 592 of 2023 14 Commission for the release of the same and the District Commission may pass appropriate order in this regard in accordance with law.
24. The Appeal could not be decided within the statutory period due to heavy pendency of Court Cases.
(JUSTICE DAYA CHAUDHARY) PRESIDENT (SIMARJOT KAUR) MEMBER (VISHAV KANT GARG) MEMBER January 09, 2026.
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