State Consumer Disputes Redressal Commission
Shri S. H. Ashraf, vs 1. Ece Industries Ltd., on 25 February, 2009
THE STATE CONSUMER DISPUTES REDRESSAL THE STATE CONSUMER DISPUTES REDRESSAL COMMMISION, PANAJI - GOA. Present: Smt. Sandra Vaz e Correia. . . Presiding Member. Smt. Caroline Collasso . . . Member Appeal No.3/2008 Shri S. H. Ashraf, M/s International Marine Services, F. De Figueiredo Complex, Next to Bank of Baroda, Swantantra Path, Vasco da Gama. Appellant (Original Complainant) v/s 1. ECE Industries Ltd., Shoukat Building, Silver Jubilee, Park Road, Bangalore 560 002. 2. ECE Industries Ltd., Elevator Division, S-1, Yashodhana Apartments, Aquem Alto, Margao, Goa. Respondent (Original Opposite Party) For the Appellant Shri A Shetye, Advocate For the Respondents Shri Vinod Halarnkar,Advocate Dated: 25-02-2009 ORDER
[Per Smt Sandra Vaz e Correia, Presiding Member]
1. The appellant is the original complainant;
he is aggrieved by the dismissal of his complaint by the Consumer Disputes Redressal Forum (District Forum) South Goa Margao by order dated 22-11-2007 in Complaint no. 23/2005. The respondents are the original opposite parties.
2. In a nutshell, it is the appellant/complainants case that the respondents/opposite parties offered to design, manufacture, supply etc passenger elevator in his bungalow at Chicalim for cost of Rs.3,50,000/- which offer was accepted by letter dated 18-03-1999 by paying advance of Rs.25,000/-. The construction of the bungalow had just started; it was agreed that the elevator would be delivered, installed and commissioned only on the bungalow being ready for occupation. The representative of the respondents/opposite parties visited the site on several occasions to verify the installation site and suggested changes from time to time which the appellant/complainant carried out. The appellant/ complainant also agreed to certain additional features proposed by the respondents/opposite parties. When the bungalow was completed in early-2004, the appellant/ complainant called upon the respondents/ opposite parties by letter dated 26-06-2004 to depute their representative at the site. The respondents/opposite parties informed the appellant/complainant by letter dated 06-07-2004 that they had closed the contract since it was valid for 52 weeks and had expired on 15-02-2000. The respondents/opposite parties however agreed to perform the contract at revised rate of Rs.4,45,000/- and auto door arrangement at Rs.5,80,000/-. The appellant/complainant then issued notice dated 23-08-2004 calling upon the respondents/ opposite parties to install the elevator within six weeks, which was not complied. The appellant/complainant sought direction to the opposite parties to execute the contract at the agreed price or alternatively to refund the sum of Rs.25,000/- paid by the complainant alongwith interest.
3. Per contra, succinctly, it is the respondents/opposite parties case that the forum had no jurisdiction to entertain and try the complaint in view of the arbitration clause. The complaint was barred by limitation and that the contract had automatically lapsed and/or got cancelled in view of the conditions contained in the contract. As per the contract execution schedule, the contract commences on the date of signing and completion time was fixed as 52 weeks from that date. The letter dated 26-06-2004 was issued maliciously by the appellant/complainant; however the respondents/opposite parties had replied that the period of 52 weeks had expired on 15-02-2000. The averment that their representative regularly visited the site was denied. The respondents/opposite parties offer to execute the work at revised price was not accepted by the appellant/complainant. There was no deficiency in services rendered by them.
4. The District Forum considered the case of the parties, the evidence on record and the provisions of the Contract Act at length and found that there was no deficiency-in-service whatsoever on the part of the opposite parties and dismissed the complaint. However, the advance amount of Rs.25,000/- was directed to be refunded with interest @ 9% p.a.
5. We heard Ld Adv A Shetye on behalf of the appellant and Ld Adv Shri Vinod Halarnkar for the respondents for some time. Records and proceedings of the trial forum were called and perused.
6. The issues that arise for our consideration in this appeal are whether the contract dated 16-02-1999 concluded between the parties was subsisting as on 26-06-2004, and whether appellant/complainant is entitled to a direction to the respondents/opposite parties to design etc. and install the elevator at the agreed price of Rs.3,50,000/-.
7. The respondents/opposite parties offer made in its letter dated 16-02-1999 was accepted by the appellant/ complainant on 18-03-1999 upon execution of the document at page C/16 of the trial forum file and payment of the advance amount of Rs.25,000/-. The offer letter in Annexure III at page C/12 stipulates that the estimated completion time shall be 52 weeks which was broadly categorized into four stages. Annexure II of the offer letter sets out the terms of payment. Annexure IV sets out the terms and conditions of the offer. The correspondence between the parties is on record. The performance of the contract was refused by the respondents/opposite parties by letter dated 06-07-2004 on the grounds that a total time of 52 weeks was allowed for performance and that this period expired on 15-02-2000. Under the terms and conditions of the contract, the factory removed the order from the pending executable order list.
8. We are unable to agree with the District Forum that the contract was not subsisting as on 26-06-2004. Although the contract fixed a time period of 52 weeks, it also stipulated that this period was the estimated completion time (emphasis added). In other words, the time limit was approximate and the period specified therein was not sacrosanct. This is also evident from the conduct of the parties. The respondents/opposite parties entertained a request from the appellant/complainant for some additional features in the letter dated 23-12-2001 wherein the job order was referred to. There was not a whisper about the alleged termination of the contract. Annexure II stipulated the terms of payment at para (iii) thereof. At sub-para (a), 30% of the contract value was to be paid as interest-free mobilization advance; however it appears that the respondents/opposite parties were content with an amount of Rs.25,000/- against this installment as can be seen from the document at page C/16 of the trial forum file which indicates balance receivable as nil. At sub-para (b), 60% of the contract value alongwith other amounts was payable against intimation of material readiness at our works for dispatch. No such intimation was issued by the respondents/opposite parties to the appellants/ complainants. At Annexure III sub-para (2), it is stipulated that any delay in the completion of the site shall cause deferment of manufacturing schedule so as to synchronize with the site completion. Even the closure/termination clause speaks of failure/neglect of client to take delivery of material and/or offer the site for erection of the elevator within the agreed time which, in our view, would presuppose prior written intimation by the respondent/opposite party to the appellant/ complainant of the alleged breach. The terms of the contract and the conduct of the parties makes it amply clear that the completion time was not sacrosanct and time was not the essence of the contract. In these circumstances, to our mind, the purported termination of the contract conveyed by the respondents/opposite party was uncalled for.
9. That brings us to the next issue of whether the respondents/opposite parties are liable to install the elevator at the agreed price of Rs.3,50,000/-. The contract/offer letter at Annexure V provides for escalation (price variation) clause governing the quoted price. The parties had agreed that the contracted price would be subject to escalation in cost of certain materials/components and labor cost, and the formula to be employed for calculation of escalation is laid down therein. The contract speaks for itself. In this backdrop, the respondents/opposite parties could not have declined performance of the contract and impelled the appellant/complainant to enter into a fresh deal. They were bound to perform the contract at the agreed price plus price variation if any in terms of Annexure V. Their omission to do so amounted to deficiency in services rendered to the appellant/complainant. The complainant consumer would be saddled with installing another elevator at current prices, which cannot be permitted.
10. In our considered view, in the facts and under the circumstances of the case, the interest of justice would be served by directing the respondents/opposite parties to perform the contracted job of elevator design, manufacture, supply and installation within 12 weeks at the agreed price of Rs.3,50,000/- plus escalation in terms of Annexure V as on 26-04-2004 if any.
11. In the result, this appeal is allowed. The impugned order dated 22-11-2007 is hereby set-aside. Complaint no. 23/2005 is partly allowed. The respondents/opposite parties are directed to perform and complete the contracted job of elevator design, manufacture, supply and installation in all respects within ninety days from today at the agreed price of Rs.3,50,000/- as per agreed terms of payment plus escalation in terms of Annexure V of the contract as on 26-04-2004 if any. The respondents/ opposite parties shall pay the appellant/complainant a sum of Rs.5,000/- as costs of the litigation throughout. Order accordingly.
Pronounced.
[Sandra Vaz e Correia] Member [Caroline Collasso] Member