State Consumer Disputes Redressal Commission
M/S. Skylark Construction vs Smt. Latika Mondal on 5 July, 2016
Cause Title/Judgement-Entry STATE CONSUMER DISPUTES REDRESSAL COMMISSION WEST BENGAL 11A, Mirza Ghalib Street, Kolkata - 700087 First Appeal No. FA/651/2013 (Arisen out of Order Dated 20/05/2013 in Case No. CC/273/2012 of District North 24 Parganas) 1. M/s. Skylark Construction Represented by its Prop. Sri Gaya Nath Das, S/o Late Sankar Das, 311/24/1, N.N. Road, P.S. Dum Dum, Kolkata - 700 028. ...........Appellant(s) Versus 1. Smt. Latika Mondal W/o Late Gopi Nath Mandal, 2, Motilal Colony (Mazumder Para), P.S. Airport, Kolkata - 700 079. 2. Smt. Maya Bhattacharjee W/o Late Dulal Chandra Bhattacharjee, 2, Babutala Road, Nager Bazar, P.S. Dum Dum, Kolkata - 700 028. 3. Smt. Rakhi Mukherjee W/o Sri Arup Mukherjee & D/o Late Dulal Chandra Bhattacharjee, 2, Babutala Road, Nager Bazar, P.S. Dum Dum, Kolkata 700 028. ...........Respondent(s) BEFORE: HON'BLE MR. SAMARESH PRASAD CHOWDHURY PRESIDING MEMBER HON'BLE MRS. MRIDULA ROY MEMBER For the Appellant: Mr. Amit Kumar Biswas Mr. Dhiman Ch. Biswas Mr. Krishnendy Chakraborty, Advocate For the Respondent: Mr. Sebak Kundu, Advocate Mr. Barun Prasad, Advocate ORDER Date of Hearing - 23.06.2016 Date of Judgement - 05.07. 2016. PER HON'BLE SAMARESH PRASAD CHOWDHURY, PRESIDING MEMBER JUDGEMENT
This is an appeal at the behest of the Developer/OP no.1 Under Section 15 of the Consumer Protection Act, 1986 (hereinafter referred to as Act) to impeach the judgement and final order dated 20.05.2013 passed by the Ld. District Consumer Disputes Redressal Forum, North 24 Parganas at Barasat in Consumer Complaint no. 273/2012. The FA/661/2013 has been filed by the Land Owners (OP nos. 2 & 3) against the intending purchaser/Complainant and the Developer/OP no.1 in respect of same judgement and final order between the parties. Similarly, the Complainant/Intending Purchaser has preferred the appeal against the OPs/Developer and Land Owners being FA/947/2013. Since, all the three appeals have arisen out from a same judgement between the self same parties, the FA nos. 661/2013 and 947/2013 shall be governed by this judgement and all these three appeals will be disposed of by a common judgement.
The Appellant of FA/947/2013 being Complainant initiated the Consumer Complaint u/s 12 of the Act against the developer as well as Land Owners on the allegation that on 29.01.2005 he has entered in an Agreement with the OP no.1/Developer to purchase of a self contained flat measuring about 650 sq. ft. of super built area on the 4th floor at Premises no.2, Babutoal Road, P.S.- Dum Dum, Kolakta 700028 at a consideration of Rs.5,50,000/-. The Complainant has paid part consideration amount of Rs.4,50,000/- to the Developer on diverse dates. However, the Developer has not yet completed the said project and all the requests and reminders of the Complainant remain unheeded. On 10.03.2012, Complainant sent a letter to the Proprietor of OP no.1 Shri Gaya Nath Das asking him to hand over the flat in question but it yielded no result. Hence, the complaint with a prayer for certain reliefs, Viz. - a) an award of Rs.15,00,000/- + Interest as well as compensation; b) litigation costs etc. The OP no.1/Developer, M/S. Skylark Construction by filing a written version has stated that he has entered into an Agreement with the Complainant for selling a self-contained flat after receiving the earnest money. However, disputes and differences between them and the Original Land Owner Dulal Chandra Bhattacharjee was cropped up for which the said Dulal Chandra Bhattacharjee cancelled the Power of Attorney and the OP nos. 2 & 3 being Legal Heirs and Successors of the said Dulal Chandra started creating disturbances on and from 10.12.2006. Ultimately, OP no.1/Developer was compelled to institute a suit for declaration and injunction against the Land Owners being T.S. No. 304/2007 in the Court of Ld. Civil Judge (Jr. Division), 3rd Court at Sealdah and the said Suit is still pending for disposal. In such a situation, the Developer could not complete the construction of the building.
The OP nos. 2 & 3/ Land Owners by filing a separate written versions have stated that Shri Gaya Nath Das, being Proprietor of OP no.1 disobeyed and violated the terms and conditions of the Development Agreement dated 22.08.2003 and the OP no.1 did not complete the construction of the multi-storied building and for that reason, the Original Land Owner during his life time cancelled and revoked General Power of Attorney on 14.02.2006. Then Gaya Nath has filed a Suit in respect of the property and the same is pending before the 3rd Court of Civil Judge (Jr. Division) at Sealdah being T.S. No. 304/2007 which is pending for peremptory hearing. The OP nos. 2 & 3 have submitted that the Complainant has no cause of action against them and as such it should be dismissed against them.
After perusal of the statements of the parties, the Ld. District Forum framed three points for consideration:- 1) Is the complaint maintainable under the C.P. Act? ; 2) Was there any negligence or deficiency in service on the part of OPs? and 3) Is the Complainant entitled to get the relief, as prayed for? After assessing the materials on record, Ld. District Forum by the impugned order allowed the Complaint on contest against the OPs with costs of Rs.10,000/- with direction upon the OP no.1/Developer to refund an amount of Rs.4,50,000/- only, with the consolidated interest for a long period of 8 years and further sum of Rs.4,50,000/- only i.e. the OP no.1 shall have to pay an amount of Rs.9,00,000/- only in total to the Complainant within one month from the date of this order. The Ld. District Forum has also proceeded to direct that in the event of non-compliance with the order within a month, the OPs shall pay penalty for a sum of Rs.250/- per day from the date of order till full satisfaction of the decree. Being aggrieved and dissatisfied with the impugned order, the Developer, Land Owners as well the intending purchasers have come up in this Commission with the present appeal.
Mr. Dhiman Ch. Biswas, Ld. Advocate appearing for the Developer has submitted that the Complainant has not prayed for execution or registration of the flat in question rather she has claimed for refund of money with interest and compensation and as such the Ld. District Forum should have dismissed the complaint being not maintainable. He has further submitted that his client has constructed the building partly but could not complete the construction owing to cancellation of Development Agreement by the Original Owner Dulal Ch. Bhattacharjee, since deceased by giving notification in a daily Bengali newspaper published from Kolkata on 05.03.2006. Thereafter, finding no other alternative, his client has filed a Suit for declaration and injunction against the present Land Owners being T.S. No. 304/2007 before the Ld. 3rd Court of Civil Judge (Jr. Division) at Sealdah and the said Suit is pending for hearing. Ld. Advocate for the Developer/OP no.1 has candidly submitted that unless the dispute between the Land Owners-Developer ends, his client is unable to construct the building any further.
Mr. Barun Prasad, Ld. Advocate for the Land Owners has drawn our attention to the operative part of the order and submitted that the Ld. District Forum has committed a wrong by imposition of penalty upon the Land Owners as well with the Developer. He has also submitted that the OP no.1/Developer has violated the terms and conditions of the Development Agreement which compelled the predecessor in interest of the OP nos. 2 & 3 to revoke the General Power of Attorney given to the Developer and when there is no fault on the part of Land Owners, no liability can be attributed upon them.
Mr. Sebak Kundu, Ld. Advocate for the intending purchaser, Complainant has submitted that his client has paid Rs.4,50,000/- out of total consideration amount of Rs.5,50,000/- about ten years back for a roof over his head but his entire dream has been shattered and as such some amount of compensation should have been paid as compensation in favour of his client on account of harassment and mental agony.
We have considered the rival contention of the parties. One Dulal Chandra Bhattacharjee, since deceased was the Owner of a piece of land measuring about 6 cottachs, 6 chhitaks lying and situated at Premises no.2, Babutoal Road, P.S.- Dum Dum, Kolkata - 700028 within the District of North 24 Parganas. On 22.08.2003 the said Dulal had entered into a Development Agreement with the OP no.1 on certain terms and conditions and simultaneously executed a Registered General Power of Attorney empowering the Developer/OP no.1 to do any act including entering Agreement for Sale with different intending purchasers. Being empowered with such authority, the Developer entered into an Agreement for Sale with the Complainant on 29.01.2005 for selling out a self-contained flat measuring about 650 sq. ft. super built up area on the Southern side of the 4th floor in the same premises at a consideration of Rs.5,50,000/-. Out of the said total consideration amount, the Complainant has paid Rs.4,50,000/- to the Developer on diverse dates and an amount of Rs.1,00,000/- is due and payable by the Complainant for the said purpose. The Complainant is ready and willing to make payment of the said amount but as the Original Land Owners has already revoked the General Power of Attorney, there is hardly any scope to undergo further construction by the Developer, more particularly, when a Civil Suit in this regard being T.S. no. 304/2007 is pending between the Developer on one hand and the Land Owners on the other hand. All these are admitted facts.
Needless to say, the parties are bound by the terms of the Agreement. Both the Developer as well as intending purchasers have signed the Agreement with open eyes evaluating its pros and cons and, therefore, nothing can be added or detracted from the terms and conditions of the Agreement. Therefore, according to the terms of the Agreement when the Developer has failed to deliver the possession of the flat in question even after payment of the balance consideration amount, it amounts to deficiency in services on the part of them. It is pertinent to note that an inter-se dispute between the Land Owner-Developer cannot be a ground to defeat the object of the Agreement in question. In this regard, it would be profitable to have a look to Paragraph-23 of a Judgement of Supreme Court of India reported in 2008 (4) ICC 595 (Faqir Chand Gulati - Vs. - Uppal Agencies Pvt. Ltd. & Anr.) which runs as follows -
"we may notice here that if there is a breach by the land owner of his obligations, the builder will have to approach a Civil Court as the land owner is not providing any service to the builder but merely undertakes certain obligations towards the builder, breach of which would furnish a cause of action for specific performance and/or damages. On the other hand, where the builder commits breach of his obligations, the owner has two options. He has the right to enforce specific performance and/or claim damages by approaching the Civil Court or he can approach the Forum under the Consumer Protection Act for relief as consumer, against the builder as a service-provider. Section-3 of the Act makes it clear that the remedy available under the Act is in addition to the normal remedy or other remedy that may be available to the Complainant".
Therefore, considering the facts and circumstances and relying upon the authority as mentioned above, we have no hesitation to hold that due to internal disputes between the Land Owner and the Developer, an intending purchaser who is a 'Consumer' within the meaning of Section-2(1)(d)(ii) of the Act should not suffer. In that perspective, the Ld. District Forum was quite justified in allowing the complaint with a direction upon the OP no.1/Developer to refund the amount of Rs.4,50,000/- with consolidated interest of Rs.4,50,000/- aggregating of Rs.9,00,000/- as the dispute was pending before the Ld. District Forum for long 8 years.
However, the Ld. District Forum has misdirected itself by holding that both the Developer as well as Land Owners, in the event of failure on the part of OP no.1 to make payment of penalty of Rs.250/- per day. The Complainant did not make any prayer for penalty in the prayer portion of his petition of complaint. Therefore, the Ld. District Forum had a scope to impose interest for non-payment of the amount of Rs.9,00,000/- by the Developer in favour of intending purchaser because imposition of interest is not a penalty or punishment at all but is the normal accretion on capital; that in equity a person keeping the money is required to pay the interest being normal accretion on principle amount. In this regard, the decision of Hon'ble National Consumer Commission reported in 2013 (1) CCC 129 (Smt. Sheela Wanti & Anr. - Vs. - State Bank of India & Anr.) should have been taken into consideration by the Ld. District Forum. Therefore, relying upon the provision contained in Section -3(1) of the Interest Act, 1978 and the decision of the National Consumer Commission, we have no hesitation to hold that the imposition of penalty at Rs.250/- per day is outside the scope of the scheme of the Act as prescribed by the legislature. However, when it is quite apparent that the OP no.1/Developer has not complied with the order as yet, the Developer is under obligation to make payment of interest over the amount of Rs.9,00,000/- and we assess such interest @9% p.a. from the date of order passed by the Ld. District Forum on 20.05.2013 till its full realisation.
So far as claim of compensation by the Complainant is concerned, we feel that the Ld. District Forum has awarded Rs.4,50,000/- in addition to the amount of Rs.4,50,000/- paid by the Complainant in favour of OP no.1/Developer as part consideration money and it appears to us that the additional amount of Rs.4,50,000/- so awarded, keeping in view the prayer of compensation and as such we are in agreement with the Ld. District Forum and do not like to interfere with that part of order.
For the reasons aforesaid, the FA/651/2013 & FA/947/2013 are dismissed on contest. The FA/661/2013 is allowed on contest in part with a modification to the impugned order that the Developer/OP no.1 shall make payment of interest @9% p.a. over the amount of Rs.9,00,000/- from the date of the judgement passed by the Ld. District Forum i.e. from 20.05.2013 till its realisation and the order of imposition of penalty is hereby set aside.
All the three appeals are stand disposed of without any order as to costs with the modification, as indicated above.
The Registrar of this Commission is directed to send a copy of this order to Ld. District Consumer Disputes Redressal Forum, North 24 Parganas at Barasat for information. [HON'BLE MR. SAMARESH PRASAD CHOWDHURY] PRESIDING MEMBER [HON'BLE MRS. MRIDULA ROY] MEMBER