State Consumer Disputes Redressal Commission
Smt.P.Ratnakumari Hyderabad-502 032, ... vs Mr.Y.Kiran Kumar S/O.Late ... on 21 November, 2013
BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD C.C.NO.27 OF 2013 Between Smt.P.Ratnakumari Aged about 58 years, Occ:Housewife, C/o.Shri P.Ramesh Babu, House No.24-51, Ashoknagar, Kakatiyanagar, Road No.1, Ramachandrapuram, Hyderabad-502 032, A.P. Complainant A N D Mr.Y.Kiran Kumar S/o.late Y.Venkateswarlu Chief Executive Officer, M/s Suchir India Developers (P) Limited, 50-B, Journalist Colony, Jubilee Hills, Hyderabad-AP. Opposite party For the Complainant : Smt.P.Ratnakumari, Party in person Counsel for the Opposite party M/s Gopi Rajesh & Associates QUORUM: SRI R.LAKSHMINARSIMHA RAO, HONBLE I/C PRESIDENT & SRI S.BHUJANGA RAO, HONBLE MEMBER
THURSDAY, THE TWENTY FIRST DAY OF NOVEMBER TWO THOUSAND THIRTEEN Order ( As per R.Lakshminarsimha Rao, Honble I/c.President) *** The complaint is filed seeking direction to the opposite party to refund Rs.12,60,000/-
paid towards sale consideration of plot No.28 along with interest at 24% p.a. i.e. Rs.10,58,400/- together with Rs.3,00,000/- towards damages, Rs.2,00,000/- towards mental agony and costs.
The averments of the complaint are that during the year 2008-2009, the opposite party started a venture viz Le Colossal French style gated community at Elwarty village, Shankarpally Mandal, R.R.District and gave vide publicity in papers inviting the public to purchase plots and buildings and also mentioned that HMDA layout was approved. The complainant submitted that the opposite party assured fast development of the venture with compound wall, overhead water tank, BT roads, underground sewerage lines, children square, landscape public place, street lights, footpaths with paved tiles etc. and that the committed target of completing the layout development works in all respects by March/April, 2010.
The complainant submitted that she entered into an Agreement of sale with the opposite party on 12th August, 2009 for purchase of 450 sq. yds. in Sy. Nos.330,331, 332, 337, 338, 339, 340 part, 341, 342, 343, 345 & 347 situated at Elwarty village, Shankarpally Mandal, Ranga Reddy District stated to be free from all encumbrances for a sale consideration of Rs.12,60,000/- which was paid through cheque No.198422 dated 09-7-2009 drawn on SBI Ramachandrapuram. The opposite party issued receipt Nos.196, 357, 197 and 358 dt.9th July and 5th August, 2009. The complainant submitted that the opposite party issued Pass Books bearing Nos.559 and 560 and assured the complainant that it would get the necessary approvals from the authorities concerned and develop layout by dividing the land into residential plots duly approved by the competent authority.
The complainant submitted that the opposite party assured that on completion of the scheme period, they will register the plot in the name of the complainant on payment of registration charges without committing duration of specific period. The complainant submitted that she requested for copy of document to show the scheme period and four other documents. The opposite party did not respond. The complainant submitted that the venture remained undeveloped even after one year and the opposite party mislead the complainant stating that the construction of model house and development works were going on and the complainant visited the site more than four times since 2010 and submitted that there was zero progress as far as development works except model building nearing completion. The complainant submitted that she made several personal, telephonic and written requests to the opposite party either to complete the development and register the plot or alternatively pay back the entire amount with interest. The opposite party failed to reply.
The complainant submitted that on constant follow up, the opposite party deputed its employee Syed who visited the complainant and suggested to go for an alternate plot which they will register immediately and the proposed plots bearing Nos.504 and 555 were not suitable to meet her requirement and hence she refused to accept the proposal. The complainant submitted that thereafter also she was in regular touch with the opposite party and submitted that the development of the layout is not commenced and the opposite party is not interested in developing the venture in near future. The complainant submitted that she addressed several letters calling upon the opposite party to refund the amount paid by her with interest or without interest to enable her reinvest the amount but there was no response. The complainant submitted that she addressed a letter dated 01-9-2010 to the opposite party stating that they betrayed the complainant by violating condition Nos. 8, 9 (b) and 11 of the Sale agreement by not developing the venture.
The complainant submitted that the opposite party contravened the stipulated condition 4(ii) of the Agreement of sale vide letter dated 1st September, 2010 and Plot No.28 purchased by the complainant was mortgaged to HMDA which fact was concealed by the opposite party in the Agreement of sale and the opposite party failed to fulfill the condition Nos.8, 9 (b) of the agreement and also violated condition No.11 which amounts to deficiency in service. Hence the complaint.
The opposite party resisted the case contending that the complainant made Sri Y.Kiran Kumar CEO M/s Suchir India Developers India Ltd. as opposite party in personal capacity instead of filing the complaint against the company whereas the complainant paid the amounts to the company and the agreement was executed by the company in favour of the complainant and as such the complaint is not maintainable. The opposite party submitted that the complainant paid an amount of Rs.12,60,000/- to Suchir India Developers Pvt. Ltd., and hence the State Commission is not having pecuniary jurisdiction to try the complaint and the complainant ought to have filed the complaint before the District Forum. The opposite party also submitted that the complainant paid the last instalment i.e. entire amount on 12-8-2009 and kept quiet for 4 years and created some letters and filed the complaint for refund of the amount and hence the complaint is barred by law of limitation and she has not filed any application to condone the delay in filing the complaint.
The opposite party submitted that both parties agreed that in case of any dispute or difference arising out and in respect of any terms of the agreement, the matter shall be referred initially to conciliation panel board which consists two persons, one representative of the vendor and vendee. The award of the arbitration is binding on the parties as per clause 9 of the agreement of sale and the complainant is a party to the agreement of sale and as such the complaint is not maintainable. The opposite party submitted that they floated several schemes and LE COLLOSSOAL is one of the prestigious ventures situated at Shankarpally in Ac.70.00 at Ranga Reddy District and the opposite party obtained permission from the HMDA authorities and the HMDA approved all layouts vide letter dated 23-5-2009 and as per procedure some plots have to be mortgaged for the purpose of developing the entire venture and it is not aware about which plot will be mortgaged.
The opposite party submitted that the complainant approached them and after detailed enquiry entered into agreement of sale with it on 12-8-2009 and she paid the entire amount and it issued pass books bearing Nos.559 and 560 to the complainant and the opposite party was always ready to register the plot in favour of the complainant. The opposite party submitted that it tentatively allotted plot bearing No.28 and entered into an agreement of sale on 12-8-2009 and mentioned that after obtaining necessary approvals from the concerned authorities, final plot number would be allotted at the time of registration of sale deed and both parties agreed for the same and signed the Agreement of sale which is binding on both parties.
The opposite party submitted that on 3-5-2009 after obtaining layout from HMDA authorities on 23-5-2009 it had to mortgage some plots with HMDA authorities and had mortgaged some plots and it does not know which plots will be mortgaged and it is not within their hands and the plot initially allotted to the complainant was mortgaged. The opposite party immediately informed the complainant about mortgage of the plot to HMDA and requested her to choose an alternate plot. The complainant did not come forward for registration without assigning any reason.
The opposite party further submitted that as per clause 17 of the terms and conditions of the agreement of sale, it is entitled to deduct 25% of paid amount towards administration expenses and enrolment membership fee and site expenses and the complainant agreed for the same and she filed the complaint claiming the entire amount along with interest on interest. The opposite party further submitted that they are ready to execute the sale deed for alternate plot and submitted that there is no deficiency in service on its behalf and prayed for dismissal of the complaint with costs.
The complainant filed her affidavit and relied on the documents, Exs.A1 to A7. The CEO of the opposite party filed his affidavit and filed the documents, Exs.B1 to B6 in support of their case.
The learned counsels for the complainant and the opposite party have filed written arguments.
The point for consideration is whether the opposite party has rendered any deficiency in service?
The counsel for the opposite party has contended that the complaint is filed against the Chief Executive Officer of M/s Suchir India Developers Pvt. Ltd and as the complaint is not filed against the Company and it is filed in personal capacity of the CEO of the company, the complaint is not maintainable. It is an admitted fact that the CEO would represent the Company in all its day to day affairs and the complaint is filed not in personal capacity of its CEO.
The complainant has submitted that the opposite party represented himself as the authorised signatory of the Company and signed the agreement on behalf of the company. The complaint filed under the provisions of the Consumer Protection Act cannot be construed to have all the niceties of technicality of Code of Civil Procedure and Civil Rules of Practice.
The learned counsel for the opposite party has contended that the complaint is not maintainable in view of the amount paid by the complainant is a sum of Rs.12,60,000/-. The complainant has claimed interest on the amount to the tune of Rs.10,58,400/- and she had sought for relief of Rs.3,00,000/- towards damages and an amount of Rs.2,00,000/- towards compensation. Section 17 of the Consumer Protection Act prescribes pecuniary jurisdiction of the State Commission which reads as follows:
17.Jurisdiction of the State Commission:[(1)] Subject to the other provisions of this Act, the State Commission shall have jurisdiction.
(a) to entertain:
(i) complaints where the value of the goods or service and compensation, if any, claimed (exceeds rupees twenty lakhs but does not exceed rupees one crore); and The claim for compensation and damages would reflect the genuineness of the claim of the complainant. She has not sought for compensation or damages exaggerating the amount with an intention of clutching the jurisdiction of this Commission. The complainants claim is within the pecuniary jurisdiction of this Commission.
The complainant entered into Agreement of sale with the opposite party on 12/8/2009 for purchase of plot admeasuring 450 sq. yards in the land comprised in survey numbers 330,331, 332, 337, 338, 339, 340 part, 341, 342, 343, 345 & 347 situated at Elwarty village, Shankarpally Mandal, Ranga Reddy District for consideration of Rs.12,60,000/-. The complainant paid the amount through cheque dated 9.07.2009. The opposite party had issued pass book bearing number 559 and 560 in favour of the complainant.
The complainant opted for refund of the amount on the premise that the opposite party had not developed the venture as promised and the opposite party neglected to give reply to the letter dated 19.10.2011 of the complainant as to period of completion of the project. The complainant has stated that she visited the site for four times and she had not found any development activity at the site. It is not disputed that the complainant on finding no development of the venture resorted to arbitration process whereon the opposite party offered plot bearing nos. 504 and 555 which were not acceptable to the complainant.
The learned counsel for the opposite party has contended that the complaint is not filed within the period of limitation. He has relied upon the decision of the Honble National Commission in Punjab Urban Planning and development authority and another vs Krishnan Pal chander I (2010) CPJ 99. The facts of the case are that the complainant applied for allotment of plot on 9.11.1971 and left for Canada in 1974 and remained silent for 21 years and did not deposit the balance amount. The cause of action arose on 03-5-1994 when offer was made to the complainant and complainant did not agitate his rights till filing of the complaint on 20-9-1996 It was held by the National Commission that the plea of limitation even if is not taken, the Court or Tribunal is bound to dismiss the lis in case it is exfacie time barred. The National Commission applied the ratio laid in V.M.Salgaocar and Bros. Vs. Board of Trustee of Port of Mormugao & Anr. Reported in IV (2005) SLT 410=II (2005) CLT 255 (SC)=(2005) 4 SCC 613 wherein the Supreme Court held as under:
20.The mandate of Section 3 of Limitation Act is that it is the duty of the court to dismiss any suit instituted after the prescribed period of limitation irrespective of the fact that limitation has not been set up as a defence. If a suit is ex facie barred by the Law of Limitation, a court has no choice but to dismiss the same even if the defendant intentionally has not raised the plea of limitation.
In Surya Estates and Anr. Vs. Venkateshwara Sharma & Ors. reported in III(2013)CPJ 170 (NC) is a case where the respondent entered into agreement for sale of flats with the developer in the year, 2002 and sale deeds were executed in 2003. The complaint was filed after two years from the date of execution of the sale deeds. The District Forum dismissed the complaint as barred by law of limitation. The State Commission allowed the appeal whereas the National Commission allowed the revision filed by the opposite party and held in para 17 as follows:
17. It is well settled that by serving the legal notice or by making representation, the period of limitation cannot be extended by the petitioner. In this context, reference can be made to Kandimalla Raghavaiah & Co. in which it has been held:
By no stretch of imagination, it can be said that Insurance Companys reply dated 21st March, 1996 to the legal notice dated 4th January, 1996 declining to issue the forms for preferring a claim after a lapse of more than four years of the date of fire, resulted in extending the period of limitation for the purpose of Section 24A of the Act. We have no hesitation in holding that the complaint filed on 24th October, 1997 and that too without an application for condonation of delay was manifestly barred by limitation and the Commission was justified in dismissing it on that short ground.
There is no dispute of the fact that in case the complaint is not filed within the period of limitation, it is liable to be dismissed irrespective of any objection on the aspect raised by the opposite party. In the instant case, the complainant entered into agreement of sale with the opposite party on 12.08.2009 and she addressed letter dated 19.10.2011 requesting the opposite party to inform her the scheme period and furnish copy of the documents. The opposite party offered alternative plot, viz plot numbers 504 and 555 to the complainant on 01/5/2010 and the complainant not accepting the alternative plots requested the Branch Head of the opposite party, MRM Raju to know about the completion of development work of the project since 2010. As such the complaint cannot be said to be filed beyond the period of limitation.
The opposite party during pendency of the complaint has filed the copy of the lay out approval dated 23.05.2009 issued by HMDA and copy of sale deed dated 26-9-2011 executed in favour of Bachhu Bhujender. The copy of layout appears to have been filed in order to show that the plea of the complainant that the opposite party has not obtained layout approval is incorrect and the copy of sale deed appears to have been filed to show that the venture is completed in the matter of carrying out the development work. The learned counsel for the opposite party has submitted that the opposite party has always been ready to execute sale deed in favour of the complainant.
This Commission has sought for the opinion of the complainant who stated that the opposite party has not responded to her request whether lay out was approved and development of the project was completed and she had paid the amount towards sale consideration of the plot by selling her property in Nagpur and she has submitted that she paid the entire sale consideration in lump sum which fact was not considered by the opposite party. The complainant has stated It is further submitted that when the complainant visited the venture on more than four occasions there was absolutely no development except progress in model building and that even today the development of the layout in question is zero and it appears that the respondent is not interested in developing this venture.
The complainant has complained of that the opposite party has not informed her that the opposite party has mortgaged the Plot no.28 with HMDA and violated clause 4(ii) of the Agreement of sale and the opposite party has violated clause no.8.9(b) and 11 of the Agreement of sale. The complainant has stated:
I further submit that the opposite party has hidden the fact that complainants plot No.28 is mortgaged with HMDA seriously violating clause 4(ii) of Agreement of sale and confirming this fact vide their letter dt.01-9-2010 i.e. after 13 months of complainant signing the agreement. It is further submitted that the opposite party failed to adhere to clause nos.8, 9(b) & 11 of Agreement of Sale which amounts to deficiency of services on the part of the opposite party.
Clauses 4, 8 and 9(b) of the Agreement of sale deal with Vendors representation, waiver/forbearance and Arbitration and they read as under:
4. VENDORS REPRESENTATION:
i) The Vendor herein represents that it is the absolute owner of the said schedule property, having marketable title over it and as on the date of execution of this Agreement of sale, no other person has any interest, claim or title whatsoever in the said property and there are no sale transactions done or will be done as on the date of this Agreement for the below schedule property.
ii) The Vendor declares that the schedule property is free from all encumbrances, charges, sale, gift, mortgages, liens, court attachment as on the date of this Agreement and further there are no protective tenants and the property is not any assigned land.
iii) The Vendor shall obtain the necessary layout approved from the concerned authority and the final plot number shall be allotted at the time of registration which shall be as per the approved layout, sanctioned by the concerned authority.
8. WAIVER/FORBEARANCE:
The parties hereto agree that in the event of there being any delay or in indulgence shown by either of the PARTIES with regard to the enforcement of any of the terms of this Agreement, the same shall not be construed as a waiver on the part of the party showing such indulgence or tolerance and any such indulgence or forbearance shall not be deemed to be a waiver of the rights and the parties shall be entitled to enforce such right without prejudice to such indulgence or tolerance shown.
9. ARBITRATION:
b) Appointment of Arbitrator:
In case if the dispute remains unresolved, even before conciliation proceedings, then the same shall be referred to arbitration before a Sole Arbitrator, who shall be, of the standing of not less than the rank of retired High Court Judge or above. The Arbitration shall be as per the provisions of the Indian Arbitration and Conciliation Act 1996 ( as may be mended from time to time) The complainant entered into Agreement of sale which provides reference to arbitration. The learned counsel for the opposite parties has contended that in view of the arbitration clause in the agreement, the complainant cannot maintain the complaint before this Commission. Clause 9(b) of the Agreement of Sale provides for deciding the disputes arising under the agreement by arbitration process reads as under:
9.
ARBITRATION:
b) Appointment of Arbitrator:
In case if the dispute remains unresolved, even before conciliation proceedings, then the same shall be referred to arbitration before a Sole Arbitrator, who shall be, of the standing of not less than the rank of retired High Court Judge or above. The Arbitration shall be as per the provisions of the Indian Arbitration and Conciliation Act 1996 ( as may be mended from time to time) In terms of the agreement of sale, the dispute has to be decided by means of arbitration. However, remedy provided under the provisos of Consumer Protection Act is an additional remedy and in the light of law laid in National Seeds Corporation Ltd. Vs. M. MadhusudhanReddy reported in (2012) 2 SCC 506 wherein the maintainability of the complaint before consumer forum prior to the complainant having exhausted the other remedy was considered as under:
The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996 Act. Moreover, the plain language of Section 3 of the Consumer Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force.
The learned counsel for the opposite party has submitted that the opposite party is ready to offer alternate flat in its other venture for which proposal the complainant has not expressed her acceptance. The learned counsel has submitted that in the event the complainant insisted on the opposite party to refund the amount, clause 17 of terms and conditions of the Membership Form comes into operation. The learned counsel has placed reliance on the following decisions of the National Commission and this Commission.
i) Khandrika Aruna, P.K.S.Kumar and another vs. Janachaitanya Housing Ltd and another, II(2013) CPJ 41 (NC).
ii) M/s Suchir India Properties Pvt Ltd vs. Mulasani Sreenivasa Reddy in F.A.No. 415 of 2010 decided on 28.02.2012.
In Khandrika Arunas decision, the National Commission confirmed the order of this Commission. The facts of the case are that the complainants paid the consideration of the plots to the employee of the Company and the employee had misappropriated the amount. The opposite party treating the case of the complainants as case of default in payment of instalments of the sale consideration of the plots, cancelled the allotment. This Commission held that the complainants can be given opportunity to purchase plots in other venture of the opposite party. Applauding the decision of this Commission, the Honble National Commission held:
10.Again, the letter issued by Dr.V.Subba Reddy/OP does not come to the rescue of the complainants. It does not show that he is an employee of the said company. Secondly, the agreement pertains to the employee restraining them from any promises to customers beyond or contrary to the terms and conditions settled between the parties. The concluding portion of the judgement passed by the State Commission is reasonable and justified. This appears to be the true exercise of benevolent legislation. It appears that the State Commission had its heart in its right place. The complainants have been given plots in other ventures of the OP subject to the application of the terms and conditions thereof. We see no illegality or infirmity with the order passed by the learned State Commission. The same is the position with the other revision petition.
Consequently, the same order is passed. The revision petitions are without any merit and, therefore, the same are dismissed.
The complainant has not accepted the proposal for allotment of plot in other venture of the opposite party. The complainant is not a defaulter as she paid the entire amount to the opposite party. As such, the decision is of no help to the case of the opposite party.
As the complainant has opted for cancellation of the agreement of sale and the opposite party has invoked application of Clause 17 of the terms and conditions of the Membership form which entitled the opposite party to deduct 25% of the amount paid towards administrative charges, enrolment fee and membership fee etc., This Commission observed in Sreenivasa Reddys decision (supra) as under:
Clause 16 of Ex.B4 stipulates that in case any member intends to withdraw from the venture the company is entitled to deduct 25% of the amount paid towards administrative expenses, enrolment and membership fee and also incentives and site expenses incurred by the opposite parties. The opposite parties did not file any document to show the amount spent by them towards site expenses. Therefore, they are entitled to deduct only 25% of the amount paid by the complainant as per clause 16 of Ex.B4. If 25% is deducted from Rs.8,41,467/- it would come to Rs.2,10,366/-. However, the appellants deducted an amount of Rs.4,65,412/-. Therefore the appellants are liable to pay the difference amount of Rs.2,55,046/-.
The complainant paid a sum of Rs.12,60,000/- to the opposite party. After deducting 25% from the amount of Rs.12,60,000/- the amount payable to the complainant comes to Rs.9,45,000/- and the complainant is entitled to interest @9% p.a. from the date of notice viz. 16.04.2011 and a sum of Rs.20,000/-towards compensation.
In the result, the complaint is allowed directing the opposite party to pay an amount of Rs.9,45,000/- with interest @ 9% p.a. from the date of notice, 16.04.2011 till payment together with a sum of Rs.20,000/- towards compensation. Costs of the proceedings quantified at Rs.5,000/-.Time for compliance four weeks.
Sd/INCHARGE PRESIDENT.
Sd/-MEMBER.
JM Dt.21 -11-2013 //APPENDIX OF EVIDENCE// Witnesses examined for For complainant For Opp.party Affidavit of the complainant filed. Affidavit of the CEO & Auth.Signatory of OP filed.
Exhibits marked on behalf of the Complainant:
Ex.A1-Agreement of sale dated 12-8-2009.
Ex.A2-Pass Book Nos.559 and 560.
Ex.A3-Letter addressed to complainant by opposite party.
Ex.A4-Notice of complainant to opp.party dated 16-4-2011.
Ex.A5-Letter addressed to opp.party by complainant dated 04-5-2011.
Ex.A6-Notice of complainant to Opp.party dated 19-10-2011 Ex.A7-Final notice of complainant to Opp.party dated 04-2-2012.
Exhibits marked on behalf of the Opp.parties:
Ex.B1-Terms and conditions of Membership form dated 09-7-2009 Ex.B2-Ledger copy dated 09-7-2009 Ex.B3-Approved layout dt.23-5-2009 Ex.B4-Approved plan Ex.B5-Regd sale deed of third party dt. 26/9/2011 Ex.B6- Regd sale deed of third party dt. 31/10/2011 Sd/INCHARGE PRESIDENT.
Sd/-MEMBER.
JM Dt.21 -11-2013