State Consumer Disputes Redressal Commission
M.Lakshma Reddy, Hyderabad vs M/S.Vishnu Homes Builders & Developers ... on 27 May, 2009
BEFORE THE A BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION:HYDERABAD. FA.No.1136/2006 against C.D.No.254/2004, District Forum-III, Hyderabad. Between: 1. M.Lakshma Reddy, S/o.late M.Chandra Reddy Aged 56 years, Occ:Advocate. 2. M.Vamsi Krishna, S/o.M.Lakshma Reddy, Aged 28 years, Occ:Business. Both R/o.Flat No.504, H.No.8-3-236/1. Muralikrishna Enclave, Yousufguda Main Road, Hyderabad. ..Appellants/Complainants And M/s.Vishnu Homes Builders & Developers Rep. by its Managing Partners K.Krishna Prasad & K.Sambasiva Rao, Occ:Business, R/o.205 Nilgiri Block, Aditya Enclave, Ameerpet, Hyderabad. Respondent/Opp.party Counsel for the Appellants : Mr.B.Vijayasen Reddy Counsel for the Respondents: M/s.S.Surya Prakasa Rao QUORUM:THE HONBLE SRI JUSTICE D.APPA RAO, PRESIDENT. SMT.M.SHREESHA, MEMBER. AND SRI K.SATYANAND, MEMBER. WEDNESDAY, THE TWENTY SEVENTH DAY OF MAY, TWO THOUSAND NINE ORAL ORDER:
(Per Honble Sri K.Satyanand, Hon'ble Member.) *** Not satisfied with the quantum of relief granted by the District Forum, the complainants filed the present appeal obviously for enhancement of the compensation in terms of their prayer in the complaint.
The facts that led to filing this appeal are briefly as follows:
The opposite party builder approached the complainants with a proposal to develop their premises into a residential-cum-commercial complex. Accordingly they entered into a development agreement. The builder undertook to complete the project within 20 months failing which he undertook next afterwards to pay penalty at the rate of Rs.3/- per sq.ft. per month apart from the rental value of Rs.5,000/- per month. The opposite party did not even apply for sanction of plan to the MCH till September, 1999 though the complainants handed over the premises on 27-7-1997 itself.
The permission was ultimately obtained on 01-10-1999 and thereby a delay of 21 months occurred, finally the opposite party handed over the premises on 20-12-2001 causing further delay of 7 months.
The complainant therefore estimated the liability accrued thereof at Rs.16,14,900/-. It was next submitted that as per clause 8 (b)(iii) of the Development Agreement, the opposite party had agreed to give the pent house to the complainant with a plinth area of 2500 sq. ft. The opposite party did not construct the pent house in respect of which the opposite party paid only Rs.5,00,000/- as compensation to the complainants. Later the opposite party constructed and handed over a pent house with plinth area of 700 sq. ft. for the actual construction cost of Rs.2,80,000/- to the complainants instead of ground floor area of 1000 sq. ft. on exchange basis as per the supplementary agreement dated 18-12-2001 and development agreement dated 27-12-1997. In view of these changes, it is claimed by the complainants that the opposite party was due to them an amount of Rs.24,70,000/- representing the deficit amount as per the market value for non construction of 2500 sq. ft. pent house.
It was next complained that though the supplementary agreement indicated the allocation of flats, the opposite party in violation thereof sold away flat No.306 to another person in third floor though it was allotted to the complainants without the knowledge of the complainants and appropriated the said amount for some time and paid it later after a long lapse of time and therefore the opposite party rendered itself liable to pay interest thereon. The next grievance is that the entire structure developed cracks within six months and seepage of rainwater had set in as no canaby was provided and no provision for free flow of rain water was made resulting in the stagnation at the ground floor. It was likewise complained that instead of naming the complex as 'Murali Krishna Enclave' it was assigned the name of 'Vishnu Homes' which in their view requires immediate rectification conforming to the terms of the agreement. it was complained that the opposite party failed to provide parking slot. Likewise the opposite party also sold away terrace rights to some others though they remained vested in the complainants as per clause 8(b)(iii) of the Development Agreement. The opposite party failed to provide 50% share of the parking space as per the terms of the Development Agreement. Similarly it also failed to give the facility of lift beyond the 5th floor in breach of the development agreement. It was next urged that the opposite party breached the provisions of clause 8(b)(i) of the Development Agreement by constructing residential flats in the first floor though it was agreed to be utilized for commercial purpose. The complainants claimed reparation for monitory loss ensuing therefrom such conversions.
Although the complainants made several allegations, the prayer was restricted to the following issues:
a) Damages for the delay to a tune of Rs.16,14,900/-
b) The market value of the pent house quantified at Rs.24,70,000/-
c) Compensation of Rs.50,000/- for wrongful appropriation of the sale proceeds of flat No.306 and for delayed payment of the sale proceeds to the complainants.
d) Demand to construct and provide shares as per agreement or in the alternative to pay damages as per market rates.
Originally this complaint was filed in the State Commission. By an order dated 14-8-2003, this Commission observed that the claim appeared to be exaggerated in order to attract the jurisdiction of this Commission and therefore returned the same for presentation before the proper District Forum but at the same time making an observation to the effect that after reception of the evidence, if the District Forum felt that it was a case that should be heard by the State Commission in view of the reliefs, the complainant was at liberty and it was open to the District Forum to send record to this Commission for disposal. However the complaint never took that turn as provided for by the said order nor had the complainant abridged the complaint to bring it within the jurisdiction of the district Forum i.e. by reducing the value of the complaint to an amount less than Rs.20,00,000/-. It was allowed to remain on record as it was before the State Commission. Be that as it may, the District Forum proceeded to adjudicate the matter ignoring that aspect.
The opposite party which was originally wrongly described as Vishnu Housing Private Limited initially filed a counter disowning the entire transaction on the ground that Vishnu Housing Pvt. Limited as such never entered into any development agreement.
Subsequently realizing the mistake, the complainant amended the complaint by correctly describing the opposite party as 'Vishnu Homes Builders and Developers.
After the amendment, the opposite party, properly described, filed a fresh counter resisting the entire claim by transversing the averments in the complaint para after para. The opposite party maintained that the Municipal corporation of Hyderabad gave permission only to construct residential complex and the complainants very well knew the fact that MCH did not accord permission for any commercial construction. In fact the M.C.H. acted in response to the objection raised by the association.
Initially the opposite party agreed to give the pent house with an extent of 2500 sq. ft. but it was also not constructed as there was no permission from the M.C.H., however, in order to compensate the loss, the opposite party in lieu of relinquishing their rights for construction of a pent house as was evident from Supplementary Agreement entered into between the complainants and opposite party, opposite party agreed to pay compensation. It also maintained that it was boldly named as Murali Krishna Enclave. The initial delay occurred according to the opposite party was very much to the knowledge of the complainants as the opposite party bargained for adjacent property to bring about a vast complex and the said property belonged to the relatives of the complainants themselves. There was no delay of 25 months as the flats were handed over on time.
Though the official handing over of the flats occurred on 30-12-2001, it rejected the claiming of paying Rs.3/- per sq. ft. for 25 months calling it as imaginary and illegal. As regards the pent house compensation, it also maintained that it was specifically relinquished by a subsequent amendatory Supplementary Agreement. As regards flat No.306, it also maintained that the said flat was sold by the complainants themselves and they in fact executed the registered sale deed in favour of the purchaser and appropriated the sale proceeds and the claim of interest on the alleged delay in making over the proceeds to the complainant was a got up story. The defects were also figments of imagination. When the complainants relinquished their rights of construction of pent house, the question of allotting parking slot to them did not arise.
It also maintained that the selling of terrace rights in favour of the flat owners was also false. In as much as there was no permission to construct the pent house, there was no question of providing lift up to the terrace. As there was no permission for making a commercial construction, there was no question of construction of shops, the opposite party added. The opposite party also took objection to the jurisdiction as also to the status of the complainants being consumers. It also took an objection that the complaint was not maintainable without exhausting the remedy by way of arbitration.
In support of their case, the complainants filed an affidavit and relied upon documents marked as Exs.A1 to A6.
Likewise, opposite party also filed affidavit and relied upon documents marked as Exs.B1 to B8.
On a consideration of the evidence adduced on either side and the contentions canvassed before it, the District Forum passed a cryptic order embodied in para
34. It reads as follows:
In the written arguments the complainant stated that his total share is 19,225 sq. ft. and so compensation works out as 19,225 x 3 x 20 months =Rs.16,14,900/-. But in the complaint it is stated that rental loss is Rs.5000/- per month i.e. Rs.1,40,000/- in total for 28 months. But as discussed above the delay caused in hand over possession is six months for which the rental loss works out to Rs.30,000/-. The contention of the complainant is that he is entitled to claim compensation for the delay caused and also for loss of rent for the period of delay. In the circumstances of the case a sum of Rs.50,000/- appears to be reasonable compensation payable by the opposite party to the complainant.
Aggrieved by the said order, the complainant filed this appeal seeking the whole of the relief prayed for instead of the limited relief granted to it by the District Forum on the following among other grounds. The District Forum waas wrong in coming to a conclusion that the delay was only for 6 months and on the otherhand the delay ought to have been reckoned from the day possession was handed over to the respondent by appellants on 27-12-1997.
The District Forum erred in not awarding compensation in the form of rents at the rate of Rs.5,000/- per month from the date of handing over possession till the date of handing over the appellants share of built up area. It failed to see that the claims at the rate of Rs.3/- per sq. ft. and the claim for rental value of Rs.5,000/- per month are two independent prayers ( in fact there is no prayer for payment of rent). The District Forum erred in upholding the name of the building with two names.
It failed to see that the complainants were entitled to 50% of the parking area as they were owners of 50% of the flats. It ought to have upheld the claim of the complainants asking for the lift facility for the entire building. It erred in thinking that flat No.306 of the appellants was not sold by the opposite party.
The counsel for the appellant filed written arguments with details of claim amount. None appeared for the respondent.
Perused the record. Though the complainants put forth several claims in the text of the complaint, as it came to formulating their prayer, they confined themselves to four counts of claim dealing respectively with damages for delay, market value of pent house, compensation for unauthorized withholding of the sale proceeds of flat No.306 and provision of shops as per the agreement. It is in fitness of things to accordingly formulate points for determination. This Commission itself restricted to those four counts as the others points are consequential in the realm of redressal of the grievance as after all the prayer punctuates the scope and ambit of the enquiry in as much as it calls upon the opposite party to meet those substantial claims. In this view of the matter, the following points are framed for determination in this appeal.
1. Whether the complainants are entitled to damages to a tune of Rs.16,14,900/- as claimed?
2. Whether the complainants are entitled to an amount of Rs.24,70,000/- representing the market value of the pent house allegedly denied to them by the opposite party?
3. Whether the complainants are entitled to the compensation of Rs.50,000/- for the so called delay of the sale proceeds of flat No.306?
4. Whether the complainants are entitled to demand the provision of shops or in the alternative damages as per the market value?
5. Whether the complainants are entitled for removal of name Vishnu Homes?
6. Whether the complainants are entitled for demarcation and handing over parking area?
7. Whether the complainants are entitled to terrace rights?
8. Whether the complainants are entitled to lift up to terrance?
9. Whether there are any good grounds to interfere with the order of the District Forum, to what relief?
Before actually discussing point wise, the value of the complaint computed on the basis of value of each count subsumed as subject of each point supra, it will be more than Rs.40,00,000/-. Unfortunately, this knocks at the very bottom of the jurisdiction of the District Forum which could have been averted by the District Forum by first deciding the preliminary point, which it was obliged to address as per the order of this Commission dated 14-8-2003. Now at this distance of time, we cannot but live with the omission by drawing inference that the District Forum had come to a conclusion by implication that the claim was exaggerated and was liable to be condensed to bring it within the limits of its pecuniary jurisdiction. We are therefore obliged to proceed on such a presumption and accordingly we proceed to decide the points for determination.
1. It is firstly claimed by the complainants that the opposite party was liable to pay them damages in a sum of Rs.16,14,900/- for the delay of 28 months reckoned from the date of handing over possession on 27-7-1997 at the rate of Rs.3/- per sq. ft. per month. In order to substantiate this claim, the complainants relied upon clause 12 of construction agreement. Clause 12 postulates a free time of 20 months being used by the opposite party for constructing the building and the time was stipulated to be reckoned from the date of obtaining sanctioned plan or after taking over vacant possession of the schedule property whichever is later. Clearly in this case the date of obtaining sanctioned plan was later. So the delay has to be reckoned from the date of obtained sanctioned plan i.e. 01-10-1999 but they conveniently reckoned from the date of handing over premises on 27-7-1997. As the starting point elected by the complainants is totally misleading, as between those dates, the later is stipulated as the starting point for computing 20 months period. Accordingly the construction ought to have been completed by 01-6-2001 but it was completed by 20-12-2001. So the delay was only 6 months and odd. The rate of penalty was only Rs.3/- per sq. ft. per month. The completed months have to be taken into reckoning. So the District Forums view of taking six months cannot be faulted. However, the complainants made an endeavor to persist that the handing over has to be taken into account as it was the opposite party that delayed submitting the plan and therefore he was responsible for that.
Such kind of contingency is not available in the agreement and there was no provision penalizing him for the delay in submitting the plan but there was a provision only in respect of delay in construction. So this kind of freewheeling in substantiating at their will cannot be countenanced. However, the District Forum computed the compensation in this regard erroneously by taking into consideration the rental value of Rs.5,000/- per month as there is absolutely no prayer for realizing the rental value which is clearly distinct and separate from the penal provision of extra price per sq. ft. So an amount of Rs.50,000/- arrived at by the District Forum is an arbitrary figure which does not belong to the category of compensation calculated on the basis of sq. ft. additional rate nor to the month rental value at the rate of Rs.5,000/-. In fact the District Forum is not entitled to take into reckoning this rental value as there is no corresponding prayer and it belongs to a different claim. In these circumstances, it is not necessary to quantify under point No.1 strictly in accordance with clause 12 of the Development Agreement, Ex.A1, which reads as follows:
12. The second party shall complete the construction of 50% of built up area pertaining to the share of First Party within 20 months from the date of obtaining sanctioned plan or after taking over vacant possession of the schedule property whichever is later. If the second party is unable to complete the construction beyond the said period, the second party shall pay a sum of Rs.3/- per sq. ft. for the area entitled by the first party for the delay cost till such time the First party shall of built up area to be handed over.
Further the second party agreed to pay a sum of Rs.5,000/- to the First Party towards rent from the date of handing over vacant possession of schedule property till such time the built up area of the First Party share is handed over.
A close look at the provisions of clause 12 makes it clear that the rate is only Rs.3/- per sq. ft. It did not say anywhere that the said Rs.3/- was per each month of delay, therefore, the complainant is entitled to get 19,25 x 3 =Rs.57,675/-. This per month concept is unauthorizedly introduced into the formula. None of the Supplementary Agreements, namely, Exs.A2 and A3, likewise B1, B4 and B7 contribute to any such amendment. In any view of the matter, no such improvising material was brought to the notice of either the District Forum or this Commission.
This point is decided accordingly.
2. The second count of the complainants claim is market value of the pent house quantified at Rs.24,70,000/-. This claim is clearly based on a misrepresentation or suppression of one of the Supplementary Agreement, Ex.A3, under which the complainants relinquished their demand for construction of pent house by virtue of the Supplementary Agreement. There is absolutely no force in this claim. The District Forum rightly ignored it.
3. The complainants sought compensation of Rs.50,000/- for the so called holding of sale proceeds of flat No.306. This is equally untenable as even on their own showing as per Ex.A4, they themselves sold this flat. In any view of the matter, they did not tender any evidence that the sale proceeds was withheld by the opposite party.
4. The fourth claim is about shops or in lieu thereof, damages. When the Municipal Corporation of Hyderabad turned down the proposal for commercial construction, it is rather untenable for the complainants to crave or to press for shops. Therefore, there is no force in this claim as well.
5. This complex is already named as Murali Krishna Enclave and what all they wanted was only removal of Vishnu Homes.
This is rather a trivial demand and it is deserves no consideration.
6. This is a very vague plea and when the flats were sold individually, the parking place will be adjunct to such sales and in any view of the matter, the complainants did not properly articulate what they wanted under this relief.
7. This is also very vague and devoid of any specific evidence.
8.Basically the pent house with a lesser sq. ft. came to be adjusted between the parties but the Development Agreement provided for lift upto 5th floor only as a new provision cannot be read in the development agreement without a supplementary agreement in that regard.
The extent to which the order of the District Forum is liable to be modified is already articulated in the foregoing discussion and except to that extent the order of the District Forum does not call for any interference.
Accordingly the appeal is allowed in part modifying the order of the District Forum having the effect of directing the opposite party to pay to the complainants Rs.57,675/- instead of Rs.50,000/- as also costs of Rs.2,000/- representing the costs awarded by the District Forum as also another Rs.2000/- representing the costs of this appeal payable with two months from the date of receipt of this order.
PRESIDENT MEMBER MEMBER Dated 27.05.2009