State Consumer Disputes Redressal Commission
Nirupma Singh vs L D A on 2 November, 2023
Cause Title/Judgement-Entry STATE CONSUMER DISPUTES REDRESSAL COMMISSION, UP C-1 Vikrant Khand 1 (Near Shaheed Path), Gomti Nagar Lucknow-226010 Complaint Case No. C/2008/14 ( Date of Filing : 28 Mar 2008 ) 1. Nirupma Singh A ...........Complainant(s) Versus 1. L D A A ............Opp.Party(s) BEFORE: HON'BLE MR. JUSTICE ASHOK KUMAR PRESIDENT HON'BLE MR. Rajendra Singh JUDICIAL MEMBER PRESENT: Dated : 02 Nov 2023 Final Order / Judgement Reserved State Consumer Disputes Redressal Commission U.P. Lucknow. Complaint Case No.14 of 2008 Mrs. Nirupama Singh D/o Smt. Vimla Singh, R/o D-3, Vigyan Puri, Mahanagar Extension, Lucknow. ...Complainant. Versus 1- Lucknow Development Authority, Naveen Bhawan, Vipin Khand, Gomti Nagar, Lucknow. 2- M/s Yug Nirman Sahkari Awas Samiti Ltd., Registration no.660, Registered Office Situated at New Colony Jiyamau, Lucknow through its Secretary. ...Opposite parties. Present:- 1- Hon'ble Mr. Justice Ashok Kumar, President. 2- Hon'ble Mr. Rajendra Singh, Member. None for complainant. Sri Dilip Kumar Shukla, Advocate for the opposite parties. Date: 23.11.2023 JUDGMENT
Per Sri Rajendra Singh, Member- The brief facts of the complaint case are that, that M/s Yug Nirman Sahkari Awas Samiti, opposite party-2 is a registered society having its registration number 660, office of which is situated at New Colony Jiyamau, Lucknow. The complainant, a bona fide member of the said M/s Yug Nirman Sahkari Awas Samiti's, has purchased a plot measuring about 2975 ft² bearing no 9-C under the scheme situated in village Jiyamau "A", Pargana, Tehsil and District Lucknow through registered sale deed duly registered on 29.06.1991 at Book no.1, Jild no.1021 at pages 135/148 and serial no.17382 in the office of Chief Sub Registrar, Lucknow and the said sale deed was executed by M/s Yug Nirman Sahkari Awas Samiti Ltd., Lucknow through its Secretary Mr. B.L. Yadav in favour of the complainant as the complainant has made the entire deposit of the value of the plot as was fixed by the said society. That said plot no 9C was bounded as under :
EAST - Plot no 10C WEST -Plot no 8C NORTH- Rasta 28 Ft wide SOUTH - Plot no 25C When the complainant of has been given to understand that the plot owned by her has been acquired by the Lucknow Development Authority, opposite party no.1, and sold the entire area in which the plot of the complainant was situated to M/S Sahara India Ltd and in view of that the owners of the various blocks of duly registered in favour of them by M/s Yug Nirman Sahkari Awas Samiti Ltd., Lucknow, opposite party no.2, have been given others plot in the Gomti Nagar or in other schemes of the Lucknow Development Authority but the complainant was not allotted any plot in lieu of the said plot owned by her which was acquired by the Lucknow Development Authority. The complainant with a request to allot another plot approached the various authorities including the Vice-Chairman and the Secretary of the Lucknow Development Authority from time to time and giving them written applications regarding the grievance that the plot of the complainant which was allotted/sold to her by M/s Yug Nirman Sahkari Awas Samiti Ltd., Lucknow in favour of her being in the capacity of its member in the scheme duly launched in the said village has been acquired by LDA and in lieu thereof she has not been allotted any plot by LDA.
When the officials of Lucknow Development Authority did not pay any heed to the legitimate demand of the complainant, the complainant has written a letter to the Hon'ble Chief Minister and apprised him of the harassment and mental agony faced by her because of the deficiency in providing the proper service at the end of the officials of the Lucknow Development Authority to the citizens of the state of UP and as such the complainant has been given to understand that the instructions are in this regard perhaps it has been issued and in pursuant to which a letter C-5-138133/Lo 0 Shi 0-2/2002 dated 15.07.2002 which was duly addressed to the Vice-Chairman regarding the allotment of the plot in favour of the complainant. In reply of the letter, the then Vice Chairman of the Lucknow Development Authority vide its letter no.T-878/Sachiv-Vikas Pradhikaran/02 dated 02.11.2002 which was duly addressed to Shri Srikishan, IAS Sachiv Mukhyamantri Uttar Pradesh Shashan, in which it was informed by the then Vice Chairman in response to the letter dated 15.07.2002 as indicated in detail in para-2 of this complaint case, that the plot of 200 m² bearing no 4/55-A situated at Viraj Khand, Gomti Nagar Lucknow has been reserved for the allotment in favour of the complainant and the allotment letter would be released after getting the registration amount deposited in favour of the complainant, the information to this effect was also to be sent to the complainant. The said letter further speaks that the Hon'ble Chief Minister may be informed accordingly.
The complainant in response to this letter again visited the office of the Lucknow Development Authority on several occasions and tried her best to bring home her point to them but they were not agree to hear to the genuine grievance of the complainant while she ran from pillar to post and as such the complainant was being harassed without any logic and rhyme at the end of the officials of the Lucknow Development Authority. Ultimately the complainant through it proper to get the letter again received at the dispatch/ receiving counter and sent the letter by the registered post as such, the complainant vide letter dated 17.03.2004 again reduced her all the grievances in the said letter which was duly addressed to Ms. Rekha Gupta the then secretary of the Lucknow Development Authority under copy to Mr. Manoj Kumar Singh, the then Vice Chairman. The said letter was got received by dispatch clerk and the copy of this letter was also sent by the registered post. In the said letter the complainant has raised several vital issues pertaining to the legal position and exposition keeping the facts and circumstances germane to the matter in controversy in the given circumstances and also drawn kind attention of the officials of the Lucknow Development Authority in regard to the delay being caused by them by not solving the redress of her grievances. Even after the sufficient service of this letter; the Lucknow Development Authority did not think it proper to give the reply of it.
The complainant again wrote a letter dated 05.07.2004 duly addressed to Secretary, LDA under copy to Vice Chairman and the secretary Awas Vikas Parishad and sent under the registered cover to all of them reiterating her grievances indicating in the crystal clear manner that since the land was of a registered society and that the said society, was constituted under the provisions of the Cooperatives Societies Act, 1965 and since it falls within the ambit of schedule 6 and along with it the said society is a statutory member of the UP Awasiya Sangh Ltd., Lucknow which is an apex society. The said society from which the complainant has purchased the said plot of land since being exempted from the provisions of the Urban Land Acquisition Act, 1976 and as such it was fully competent and legally authorised to acquire land and get the same allotted/sold to the members. The complainant after having no alternate option as such she thought it proper to contact the lawyer so that the legal notice could be sent to the LDA in regard to the atrocities being caused to her as a result of non-cooperative attitude of the officials of the LDA. As such registered notice dtd 05.09.2005 was sent by Dr. Seema Nehru Dubey, advocate to the vice-chairman of LDA and which was duly served but the sad state of affairs remain as such and the LDA did not bother to respond the legal notice duly sent to him. The LDA at the outset does not have any right to cut short the area of the plot as the plot which has been purchased by the complainant as indicated in the foregoing Paras was having an area of 2975 square ft but the LDA vide its letter dated 02.11.2002 has offered a plot having the area of 2000 square ft which is arbitrary in nature and cannot be justified on any count whatsoever the area of the plot shall remain static and shall not be decreased. It will not be out of place to mention here that the LDA is a statutory body and as per the rules the work of it is to provide the plot/house as to the citizens of India and it is to be done by it on 'No Profit No Loss'.
It is also worth mention that the acquisition was made by the LDA at which rate and the compensation was paid to whom as per the normal procedure when the land is being acquired by the LDA, the compensation is being fixed and the same was being paid to the owners of the land suo motu and the additional composition was also being paid to the actual owners are/landlord of the said act acquired land if the compensation part is being increased by any way of the acquired land and since the complainant was the registered owner of the plot by way of the registered sale deed and since it is being acquired by the LDA as such, she is entitled get the same plot of land in the Gomti Nagar, Lucknow. The decreased size of the plot is very arbitrary and illegal action on the part of the LDA which is not supposed to act as individual or builder. The complainant submits that on one hand the LDA has a privilege of acquisition of land for providing the housing facility to the citizens then how on the other hand it can snatch the shelter of others who are the legitimate owner of the land under the statute, that they could not claim to be an agency to our money by misusing its constitutional rights and when the scheme for providing the houses/plot is based on the principle of no profit no loss. This act of LDA is wholly unjustified and arbitrarily.
In view of the flat, circumstances and legal possession as stated in the foregoing Paras it is established beyond any doubt that the deficiency of the highest degree is reflected on the acts and conduct of the LDA and because of this the innocent complainant is becoming the victim of the harassment and mental agony having no fault at her hand and is being put to run from pillar to post having no redress visible in near future as such the complainant having no other efficacious remedy than to approach this Hon'ble Commission for the efficient disposal of her grievances. The complainant prays for the following reliefs;
to command/direct the Lucknow Development Authority to refund the amount equal to the amount of the land measuring 2975 square ft prevailing as on rate after calculating the same keeping the main ingredient in mind that which of the Khand has been developed by the Lucknow Development Authority on the land where the land of the complainant was admitted. The cost of the land is no point of time can be less then ₹25 lakhs.
To command/direct the Lucknow Development Authority to allot the plot in the Viraj Khand Gomti Nagar Lucknow, as offered by it in its letter dtd 02.11.2002 having an area of 2925 ft² and the sale deed of the same be executed at the earliest and if the Lucknow Development Authority is not at all in a position to allot the plot having an area of 2975 square ft and only in a position to allot another plot no.4/55-A as has been offered vide letter number T-878 dated 02.11.2002 in that case the Lucknow Development Authority be directed to refund the amount eaual to the present rate of the land measuring 2975 square ft.
To command/direct the Lucknow Development Authority that without charging anything under any head forthwith execute the sale deed in the office of the Sub- Registrar Lucknow.
To command/direct the Lucknow Development Authority to make the payment to the tune of ₹50,000/- for the mental agony and the harassment.
To command/direct the Lucknow development authority to make the payment to the tune of ₹11,000/- for the cost of the complaint including the counsel fees.
We have heard the learned counsel of the opposite party Mr. Dilip Kumar Shukla. The counsel of the complainant did not appear to argue. We have perused the pleadings, evidences and documents are present on record. The counsel of the complainant has stated on 23 July 2019 that he will not proceed against opposite party no.2.
Before discussing further we perused the order of this Court dated 10.04.2013 which is scanned below.
Here it is clear that the written statement has not been filed in time and inspite of it this Commission has passed an order dated 01.08.2018 which is scanned below.
The Consumer Protection Act 1986 was enacted to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of Consumers Councils and other authorities for the settlement of consumers' disputes and for matters connected therewith (Preamble).
The Act Inter alia, seeks to promote and protect the rights of consumers such as --
(1) right to be protected against marketing of goods which are hazardous to life and property;
(2) right to be informed about the quality, quantity, potency, purity, standard and price of goods to protect the consumer against unfair trade practices;
(3) right to be assured, wherever possible, access to variety of goods at competitive prices;
(4) right to be heard and to assured that customers' interests will receive due consideration at appropriate forums.
(5) Right to seek redressal against unfair practices or unscrupulous exploitation of consumers; and (6) Right to consumer education The objects are sought to be promoted and protected by the Consumer Protection Councils to be established at the Central and State levels.
The Act applies to all goods and services, except if otherwise provided by the Central Government by Notification. To provide speedy and simple redressal of consumer disputes, a quasi judicial machinery is set up at the District, State and Central levels. The three tier system of quasi judicial bodies will observe the principle of natural justice and are empowered to give relief of a specific nature and to award, wherever appropriate, compensation to consumers. Penalties for non-compliance of the orders given by the quasi judicial bodies have also been provided.
Thus the Consumer Protection Act is to serve the interests of the consumers. Consumer education and redressal of consumers' grievances are the two aspects of the Act. It makes good the loss a consumer suffers and increases the feeling of responsibility of the manufacturer, trader, supplier or businessman.
The provisions of the Act have to be construed in favor of the consumer to achieve the purpose of enactment as it is social benefit oriented legislation. The primary duty of the Court while construing the provisions of such an Act is to adopt a constructive approach subject to that it should not do violence to the language of the provisions and not contrary to attempted objective of the enactment.
Extent of Consumer Protection:
While other legislations may be either punitive or preventive, the Consumer Protection Act compensates the consumer. The provisions of the Act are in addition to and not in derogation of the provisions of any law at the time being in force (Sec 3). In Maine Container Services South Pvt Ltd v Go Garments 1998 (3) SCC 247 it has been held that the Contract Act applies to all litigants before the Commissioner under the Consumers Protection Act. Passengers traveling in train suffering injuries and loss of Jewelry as a result of assault by unruly crowd are eligible for filing of complaint before State Commission is maintainable notwithstanding the provisions of sections 100 and 103 of Railways Act, 1889. The Consumer Protection Act therefore gives the consumer an additional remedy besides those which may be available under other existing laws. Existence of an arbitration clause in the agreement is no bar to the entertainment of complaint by the Redressal Agency as the remedy under the Act is in addition to the provisions of any other law. However, the Consumer Forums under the Act have not taken over the jurisdiction of civil Courts. If the dispute between the parties is pending in Civil Court no Consumer Forum will adjudicate the dispute. Similarly if evidence be laid by the parties to the dispute is voluminous or complicated the parties will be referred to the appropriate Civil Court.
Consumers Protection Act, thus enshrines the rights of a consumer to be informed about the quality, quantity, potency, price etc., of the goods to be protected against unfair trade practices, to seek inexpensive and expeditious redressal of grievances before the Consumer Forums. Consumer Protection Act is a benevolent piece of legislation to protect a large body of consumers from exploitation.
A Constitutional Bench ( 5 JJ ) of the Hon'ble Supreme Court In the Case of New India Assurance Complainant Vs Hilli Multipurpose Cold Storage Private Limited, Civil Appeal no.10941-10942 of 2013 along with other many related Civil Appeals (judgment 04.03.2020) held ;
"The reference made to this Constitution Bench relates to the grant of time for filing response to a complaint under the provisions of the Consumer Protection Act 1986 (for short the Act').
The first question referred is as to whether Section 13(2) (a) of the Consumer Protection Act, which provides for the respondent/opposite party filing its response to the complainant within 30 days or such extended period, not exceeding 15 days should be read as mandatory or directory ; i.e, , whether the District Forum has power to extend the time for filing the response beyond the period of 15 days, in addition to 30 days.
The second question which is referred is as to what would be the commencing point of limitation of 30 days stipulated stipulated under the aforesaid Section.
The first question was referred by a two Judges bench of this Court vide an order dated 11.02.2016 passed in Civil Appeal No (s) 10831084 of 2016 , M/S Bhasin Infotech and Infrastructure Pvt Ltd Vs M/S Grand Venezia Buyers Association ( Reg), the relevant portion of which is as under :
"there is an apparent conflict between the decision of this Court in Topline Shoes Limited vs Corporation Bank [(2002)6 SCC 33], Kailash vs. Nankhu [(2005)4 SCC 480] , Salem advocate Bar Association VS Union of India [(2005) 6 SCC 344] on the one hand and J J Merchan & Ors vs Shrinath Chaturvedi [(2002) 6 SCC 635)] and NIA Vs Hilli Multipurpose Cold Storage [ 2014 AIOL 4615] on the other in so far as the power of the courts to extend time for filing of Written Statement/reply to a complaint is concerned. The earlier mentioned line of decision take the view that the relevant provisions including those of Order 8 Rule 1 of the Civil Procedure Code 1908 are directory in nature and the Courts concerned have the power to extend time for filing the written statement. The second line of decisions which are also of coordinate Benches however takes a contrary view and hold that when it comes to power of the Consumer Fora to extend the time for filing a reply there is no such power. Since the question that falls for determination here often arises before the Consumer Fora and Commissions all over the country it will be more appropriate if the conflict is resolved by an authoritative judgment. Further since the conflict is between Benches comprising three Judges we deem it fit to refer these appeals to a five - Judge Bench to resolve the conflict once and for all. While we do so we are mindful of the fact that in the ordinary course a two - Judge Bench ought to make a reference to a three - Judge Bench in the first place but in the facts and circumstances of the case and keeping in view the fact that the conflict is between coordinate benches That comprising three Judges a reference to 3 Judges may not suffice".
The Hon'ble Supreme Court in para 41 of the judgment has held "To conclude, we hold that our answer to the first question is that The District Forum has no power to extend the time for filing the response to the complainant beyond the period of 15 days in addition to 30 days as envisaged under section 13 of the Consumer Protection Act ; and the answer to the second question is that the commencing point of limitation of 30 days under Section 13 of the Consumer Protection Act would be from the date of receipt of the notice accompanied with the complainant by the opposite party and not mere receipt of the notice of the complainant."
The Hon'ble Supreme Court in para 40 of the judgment has held ".............. we may, however, clarified that the objection of not having received a copy of the complaint along with the notice should be raised on the first date itself and not thereafter, otherwise permitted to be raised at any point later on defeat the very purpose of the Act, which is to provide simple and speedy Redressal of consumer disputes."
[Section 38 of the Consumer Protection Act 2019 has also the same time limit to file written statement. It is quoted hereinbelow;
38. Procedure on admission of complaint -(1) the District Commission shall , on admission of a complaint, or in respect of cases referred for mediation on failure of the agreement by mediation proceed with such complaint.
(2) were the complainant relates to any goods, the discussion That shall -
(a) referral copy of the admitted complaint, within 21 days from the date of its admission to the opposite party mentioned in the complaint directing him to give his version of the case within a period of 30 days or such extended period not exceeding 15 days as may be granted by it ; ] According to section 49 of The Consumer Protection Act 2019, the provisions relating to complainants under section 35, 36, 37, 38 and 39 shall, with such modifications as may be necessary, be applicable to the disposal of complaint by the State Commission.
So in this case the written statement has been filed beyond the prescribed period as mentioned in section 49 of the Consumer Protection Act 2019. As per the Act and as per the judgment of the Hon'ble Supreme Court (Constitutional Bench) this written statement is not liable to be taken on record so it will be not the part of the record.
We have seen that as per order dated 01.08.2018 This State Commission has admitted the written statement at the cost of ₹1000/-. Whether a court can do an act which is expressly barred by the Act. When there is a specific bar by the Act that written statement cannot file beyond 30 days or if extended, further 15 days may be granted so in all the maximum time limit to file written statement is 45 days and it will count from the date of service of the notice/summons on the opposite party. If any order is passed violating the express provision of an act it shall be ignored and shall not be taken cognizance. So in this case the order dated 01.08.2018 allowing written statement and evidence of the opposite party is ignored as it is violative of the specific provision Of the Consumer Protection Act 1986 and Hon'ble Supreme Court has also stated that no time can be extended beyond 45 days.
Now if we ignore the written statement and the evidence of the opposite party, the only remedy for the opposite party is that he may argue at the time of argument. Hon'ble Supreme Court in a latest judgment has said it which is quoted below.
In the case of Arn Infrastructure India Ltd. Vs. Hara Prasad Ghosh, Civil Appeal Nos. /2023, (@ Civil Appeal Diary No(s). 31182/2023) ; (Judgment September 4, 2023), Hon'ble Supreme Court has held:
"On perusal of the impugned order, we note that a proxy counsel appeared for the counsel for the appellant/Opposite party herein before the NCDRC, seeking an adjournment of the case. Although the opposite party had not filed its version and may not have participated in the proceedings before the NCDRC, nevertheless, had the right to address final arguments before the NCDRC. In order to do so a short adjournment was sought by the appellant/opposite party before the NCDRC. However, the NCDRC refused to grant the adjournment for the reasons that no written version had been filed by the appellant/opposite party before the NCDRC. In fact learned counsel for the respondent brings to our notice that even Vakalatnama was not filed on behalf of the appellant/opposite party before the NCDRC. However, the fact remains that the counsel was engaged to seek an adjournment in order to address arguments on merits. The opposite party had the right to do so even in the absence of filing its written version against the complaint. Since the request for adjournment was refused and only the complainant was heard on merits, we find that there has been a violation of the principles of natural justice. On that short ground alone the impugned orders are set aside. The matter is remanded to the NCDRC in order to grant a reasonable opportunity to both sides to address arguments on merits in the said complaint."
So in this case the opposite party has a right to argue only and we have heard his argument. First of all we would like to court the letter of the LDA written to Secretary, Chief Minister, Uttar Pradesh.
Needless to say that in this letter the Vice-Chairman of the LDA has informed the Hon'ble Chief Minister through his secretary that a plot had been reserved for Smt. Nirupama Singh, 4/55-A,Viraj Khand, Gomti Nagar, Lucknow. So it is clear that the LDA has earmarked a plot in favour of the complainant. Now the question arises as to whether LDA has proposed a plot in lieu to the plot of the complainant? The complainant has been allotted a plot of 2975 square ft and in its place only a plot of 2000 square ft has been reserved for the complainant. Is it natural justice? The LDA is not ready to pay the price of the excess area that is 975 square ft to the complainant. You have taken her plot measuring 2975 square ft and allotted her a plot measuring 2000 square ft. It is not the principle of equity, good conscience and natural justice.
S/7 of "The Uttar Pradesh Urban Planning and Development Act, 1973" - about the object of the Authority as .-
"The objects of the Authority shall be to promote and secure the development of the development area according to plan and for that purpose the Authority shall have the Power to acquire, hold, manage and dispose of land and other property, to carry out building, engineering, mining and other operations, to execute works in connection with the supply of water and electricity to dispose of sewage and to provide and maintain other services and amenities and generally to do anything necessary or expedient for purposes of such development and for purposes incidental thereto: Provided that save as provided in this Act nothing contained in this Act shall be construed as authorising the disregard by the Authority of any law for the time being in force."
Now we see that the LDA has so many departments in it and they are meant to do work for the benefit of the citizens of District were they situate. The argument placed by the opposite parties counsel is related only one point that they have offered a plot of 2000 square ft to the complainant and she should take it but she is denying to take the possession of this plot therefore there is no fault on the part of the LDA. Whether LDA is doing business with the complainant? Even a man of common prudence say that whatever you have taken from a person, you must return the same to that person. There is decrease of the area of the plot. She has invested her hard earned money in registering a plot at a time when society was registered and she was a member of the society. To oblige the big builders you cannot put the common man in peril. Why this case is pending for such a long time is beyond our imagination.
The complainant has written a letter to the Secretary of the Lucknow Development Authority on 17.03.2004 specifically mentioning that she has been allotted a plot of 2925 square ft which was acquired by Lucknow Development Authority and handed over to Sahara India but in lieu of it she has been offered a plot measuring only 2000 square ft . 13 years have passed and her matter is still pending which is very pathetic and disappointing experience for the complainant. She requested to take early decision on her grievance and she be allotted a plot of 2925 square ft . No attention was paid by the Lucknow Development Authority and the Lucknow Development Authority only writing letters and letter to the government and the complainant. To oblige Sahara India the Lucknow Development Authority cannot put any person in great trouble and also in depression. So many letters have been written by the complainant to the vice-chairman and other authorities of the Lucknow Development Authority. The letter written by her is scanned hereinbelow for ready reference.
The vice-chairman of Lucknow development authority has written a letter to Principal Secretary, Urban Planning Department UP State on18.03.2009. He has categorically stated that the vice-chairman has no authority to allot directly a plot in favour of the complainant therefore proper direction is needed from your end. What happened thereafter has not been disclosed by the Counsel of the opposite party. The letter sent by vice-chairman to the Principal Secretary is scanned hereinbelow.
Now one thing has become clear that the complainant has applied for a plot from her society which has been allotted to her and registration has also been done in her favour and she was in possession of that plot measuring 2975 square ft. Thereafter on a fateful day The Lucknow Development Authority acquired all the plots of the society including the complainant's plot and handed over it to a big business builder magnate Sahara India. In lieu of plot measuring 2975 square ft, she was offered a plot of only 2000 square ft that too after she has written a letter to the Hon'ble Chief Minister, Uttar Pradesh. Now the question arises whether the Lucknow Development Authority and also the state of UP can do such a thing with its citizen who is a lady. She had deposited her money to get a plot from her society which was duly registered on 29.06.1991. If LDA has acquired the property, it was the duty of LDA to provide her a plot of same measurement in the same locality or nearby locality but the Lucknow Development Authority did not perform his duty properly and honestly.
We are of the opinion that the complainant is entitled for all the genuine reliefs which she claimed in her complaint. Before discussing this aspect as to for what relief she is entitled at present, it would be better to discuss some case laws of the Hon'ble Supreme Court and Hon'ble NCDRC regarding payment of compensation or interest or damages to a party suffered by a builder.
Hon'ble Supreme Court has held in Ghaziabad Development Authority Vs. Balbir Singh (2004) 4 SCC 65-"The Supreme Court, at the outset, reiterated the position taken in the case of Lucknow Development Authority v. M.K. Gupta, and held that "the Consumer Protection Act has a wide reach and the Commission has jurisdiction even in cases of service rendered by statutory and public authorities". It further held that the power of the NCDRC extends to awarding compensation to consumers for misfeasance in the public office i.e. an act which is oppressive or capricious or arbitrary or negligent provided loss or injury is suffered by a citizen. Therefore, it upheld the appeals filed before it to the extent that it confirmed the jurisdiction of the NCDRC to award compensation in cases of service rendered by statutory & public authorities (the land development authorities in the present case).
As to the issue of whether the grant of interest at the rate of 18% per annum by the NCDRC in all cases is justifiable, the Supreme Court held in the negative. It stated that "the power to and duty to award compensation does not mean that irrespective of facts of the case compensation can be awarded in all matters at a uniform rate of 18% per annum." It held it to be unsustainable. The Court further stated that the "Award of compensation must be under different separate heads and must vary from case to case depending on the facts of each case." The purpose of awarding compensation is to recompense for a loss or injury suffered and such compensation would therefore be proportional to the amount of loss and injury.
While considering the compensation to be awarded to the consumers in cases of deficiency of service by Development Authorities, the Court laid down a range of principles for the determination of the amount of compensation, summarised below:
To award compensation, the Forum or the Commission must determine that service has been deficient and/or misfeasance in public office which has resulted in loss or injury. While no hard and fast rule can be laid down, the Court gave a few instances where the award of compensation would be justifiable, including where possession is not handed over within the intimated period even though allotment is made and the price is paid. In such cases, the loss could be determined based on loss of rent which could have been earned if possession was given. Compensation could also be the scheme has been canceled without any justifiable cause, after the allotment.
Compensation cannot be uniform and to illustrate this, the Court lays down the principle to be followed for the determination of compensation in two cases- (a) where the delivery of possession is being directed, and (b) where only the monies are directed to be returned or refunded by the Court. In case (a), the compensation for harassment will necessarily have to be less since in a way the aggrieved party is being compensated by an increase in the value of the property he is getting. In case (b) however, the party is suffering a greater loss since he has been deprived of the flat/plot, and his expectation of delivery of possession. He would also be denied the benefit of an increase in the value of land and the compensation thereof. Therefore, the compensation to be awarded in such cases would have to be higher than in case (a).
The Court held that "such compensation has to be worked out after looking into the facts of each case and after determining what is the amount of harassment/loss which has been caused to the consumer."
Compensation would include compensation for physical, mental, or even emotional suffering, insult, or injury or loss."
"The consumer protection laws have a wide reach and the consumers are entitled to receive compensation for deficiency in services rendered by statutory and public authorities. The Consumer Commissions have been vested with the jurisdiction to award the value of goods or services and compensation. On being satisfied that a complainant is entitled to compensation for loss or injury or harassment or mental agony or oppression, it must direct the authority to pay compensation. A wide discretion has been given to determine the quantum of compensation for any loss or damage suffered by a consumer, to redress any injustice. However, it is a well-established principle that the computation of compensation has to be fair, reasonable, and must reconcile with the loss or injury suffered. The Consumer Forum is cast with the duty to take into account all relevant factors for arriving at the compensation to be paid.
This landmark decision has set a precedent on the matter of compensation to be awarded in matters relating to allotment of land by development authorities and has been relied upon in many subsequent cases of the Supreme Court. In the case of H. P. Housing Board v. Varinder Kumar Garg[(2005) 9 SCC 430] and Haryana Urban Development Authority vs. Darsh Kumar[(2005) 9 SCC 449], the Supreme Court directed the Commission to follow the principles laid down in the case of Ghaziabad Development Authority vs. Balbir Singh in future cases."
Hon'ble Supreme Court in the case of Haryana Urban Development ..... vs. Darsh Kumar, Etc., Civil Appeal no 5796 of 2002 decided on 28 July, 2004 has held ;
"This Court has, in the case of Ghaziabad Development Authority vs. Balbir Singh reported in (2004) 5 SCC 65, deprecated this practice. This Court has held that interest at the rate of 18% cannot be granted in all cases irrespective of the facts of the case. This Court has held that the Consumer Forums could grant damages/compensation for mental agony/ harassment where it finds misfeasance in public office. This Court has held that such compensation is a recompense for the loss or injury and it necessarily has to be based on a finding of loss or injury and must co-relate with the amount of loss or injury. This Court has held that the Forum or the Commission thus had to determine that there was deficiency in service and/or misfeasance in public office and that it has resulted in loss or injury. This Court has also laid down certain other guidelines which the Forum or the Commission has to follow in future cases.
We are informed that in spite of there being no stay, to payment of interest beyond 12% and in spite of clarification given by this Court's order (reported in (2004) 5 SCC 65), the amounts have still not been paid. We feel that for the lapse Appellants must pay interest at the rate of 15% from 17th March, 2004 till payment. Appellants shall also pay costs fixed at Rs.500/- in each case to the Legal Aid Society of the Supreme Court. TheAppellants must recover the amount paid towards costs personally from the officer/s, who were responsible for not paying even after clarification by this Court. We clarify that this Order shall not be taken as a precedent in any other matter as the order has been passed taking special features of the case into account. The Forum/Commission will follow the principles laid down by this Court in the case of Ghaziabad Development Authority vs. Balbir Singh (supra) in future cases. The Appeals are disposed off in above terms. There will be no order as to costs."
So it is clear that the compensation and rate of interest shall depend on the facts and circumstances of each case and no hard and fast rule can be framed. In this connection some of the judgment of the Supreme Court and Hon'ble NCDRC should be taken into account.
In the case of PRIYANKA MITTAL & ANR. V. PARSVNATH DEVELOPERS LTD. & ANR. (NCDRC).These appeals arise out of single order of State Commission, hence, decided by common order. These appeals have been filed against the order dated 25.2.2015 in Complaint Nos. 18 of 2013- Nalin Bhargava &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 34 of 2013- Jasleen Viswanathan &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 58 of 2011- Janmejai Mani Tiwari Vs. Parsvnath Developers Ltd. &Anr.; 68 of 2013- Indu Singh Vs. Parsvnath Developers Ltd. &Anr.; 69 of 2013- Poonam Sagar Vs. Parsvnath Developers Ltd. &Anr.; 86 of 2010- Priyanka Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 101 of 2011- Mohd. Aslam Khan &Anr. Vs. Parsvnath DevelopersLtd. &Anr.; 130 of 2012- Dr. Sunil Kr. Singh &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 49 of 2012- Neera Mittal &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 74 of 2011- Deepak Bhalla Vs. Parsvnath Developers Ltd. &Anr.; 87 of 2010- Syed Gufran Ali Alvi&Anr. Vs. Parsvnath Developers Ltd. &Anr.; 96 of 2011- Uppasana Malik Vs. Parsvnath Developers Ltd. &Anr.; 175 of 20130- Umesh Chandra Dixit &Anr. Vs. Parsvnath Developers Ltd. &Anr.; 97 of 2011- Pravin Kumar Goel &Anr. Vs. Parsvnath Developers Ltd. &Anr. which complaints were partly allowed.
The Hon'ble NCDRC held that:
"Brief facts of the cases are that opposite parties/respondents are engaged in the activity of housing construction and accordingly they have launched a project named as Parsvnath Planet situated in Gomti Nagar, Lucknow. The project was demonstrated to be very lucrative and made attractive to the vendees, in order to procure/collect money from the needy persons demonstrating themselves to be excellence in the field of construction activity as compared to other builders and assured the buyers/complainants that it has been duly approved by the Lucknow Development Authority and necessary permission has also been obtained from them. The emphasis was made by the opposite parties that the possession of the Unit shall be given within a scheduled period of 36+6=42 months stipulated in agreements executed in between the parties for the project launched in the year 2006. The complainants/appellants attracted by the promise and assurance of the opposite parties, somehow managed and arranged the money from their personal sources as well as on loan at attractive rate of interest and the hard earned money was paid by them to the opposite parties in a hope that the possession of the units shall be provided to them in the year 2009 and they can leave peacefully in their own houses, since the complainants are living in rented houses.
The complainants visited the construction site of the opposite parties after depositing the entire amount, where it was revealed that the construction activities were on halt and the persons available on the site told the complainants that the apartments are likely to be completed till 2015. Even the partial construction done by the opposite parties was defective and did not match the specifications provided in the agreement. The complainants were shocked on hearing it and observing the site. The complainants immediately contacted the Area Manager, who told the complainants that there is some delay in the construction of the apartment and the apartments shall be ready till June, 2010. The complainants have to repay the amount taken on loan alongwith interest without getting the possession of the allotted units causing irreparable loss and injury to them. The complainants have come to know that the opposite parties have invested the funds earmarked for this project into their other projects in other city due to which they have not been able to complete the project in time. Besides this, it has also come to the light that although the opposite parties had collected huge funds from the buyers but in spite of that the opposite parties have miserably failed to pay the dues of Lucknow Development Authority which forced the Lucknow Development Authority to issue coercive measures against the opposite parties for therecovery of their dues. Alleging deficiency on the part of opposite parties/ respondents, complainants filed separate complaints before State Commission. Aggrieved by the order of Hon'ble State Commission, these appeals preferred before Hon'ble National Consumer Disputes Redressal Commission.
Hon'ble NCDRC discussed various case laws and after hearing the parties held, "Learned Counsel for appellants submitted that as complainants have been deprived of possession for a long period beyond agreed period, it amounts to restrictive trade practice under Section 2 (nnn) of Consumer Protection Act and complainants are entitled to get compensation. Section 2 (nnn) runs as under:- means a trade practice which tends to bring about restrictive trade practice manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include- Delay beyond the period agreed to by a trader in supply of such goods or in providing the services which has led or is likely to lead to rise in the price; Any trade practice which requires a consumer to buy, hire or avail of any goods, or, as the case may be, services as condition precedent to buying, hiring or availing of other goods or services; Perusal of aforesaid provision reveals that when opposite party delays in delivery of goods which leads to rise in the price of goods meaning thereby, more price is charged from complainant, it amounts to restrictive trade practice. In the case in hand, opposite party on account of delayed delivery of possession is not charging higher rate than the agreed rate for delivery of possession of flat, so, it does not fall within the purview of restrictive trade practice under Section 2(nnn) of Consumer Protection Act."
"Admittedly, agreements were executed in 2006 and as per agreements, possession of flats was to be delivered within 42 months, meaning thereby, possession was to be given in the year 2009-2010 and possession has not been handed over so far though year 2016 has started. No doubt, complainants are entitled to get penalty amount for delayed delivery of possession as per clause 10(c) of the agreement but opposite party cannot be permitted to avail benefit of aforesaid clause for indefinite period. This penalty clause should be allowed for the benefit of parties for a limited period and in the cases in hand, I deem it appropriate to extend applicability of aforesaid clause for a period of one year beyond 42 months and after that, complainants are certainly entitled to compensation. Opposite party cannot be allowed to avail huge funds of complainants by paying merely Rs. 5/- per sq. ft. for example, complainants who have purchased flat measuring 164.901 sq. mtr., they have made payment of about Rs. 31.00 to 32 lakhs and in the garb of clause 10 (c), opposite party is paying penalty @ approximately Rs. 9,000/- per month against enjoying funds more than Rs. 30.00 lakhs. As complainants have been deprived to shift to their flats for a long period which would not only have given them satisfaction of living in their own house but also have raised their social status and opposite party has enjoyed funds of complainants for a long period, I deem it appropriate to allow compensation @ Rs. 15,000/- p.m. to the complainants who have applied for flats upto 175 sq. mtr and Rs. 20,000/- per month to complainants who have applied for flats above 175 sq. after 54 months of execution of agreement till delivery of possession."
Against this judgment, parties went to Hon'ble Supreme Court. The judgment of Hon'ble Supreme Court is:-
In Nalin Bhargava vs. Parsvnath Developers Ltd. CA 6662/2018 @ SLP(C) 7596/2016 etc and other related civil appeals on 13 July, 2018, Hon'ble Supreme Court held:-
"Leave granted in all the special leave petitions.CA 6662/2018 @ SLP(C) 7596/2016 etc. It is submitted by Mr. M.L. Lahoty, learned counsel appearing for the appellants in all the appeals that the possession has been handed over and the deficiencies have been removed and, therefore, he has no grievance. However, Mr. Lahoty would insist that there should be imposition of costs as compensation.
Mr. Sachin Datta, learned senior counsel appearing for the developer has raised objections with regard to imposition of costs.
Having heard learned counsel for the parties, we are of the considered opinion that the cause of justice would be best subserved if each of the appellants in the present appeals are given Rs.1,50,000/- (Rupees one lakh fifty thousand only) per flat, towards costs. When we say "cost", we mean costs alone and nothing else."
In the case of Meerut Development Authority Vs. Suresh Chandra Garg, Special Leave to Appeal (C) No(s). 24059/2022, Judgment dated 05.01.2023 Hon'ble Supreme Court has held, "consequently, the present petition is disposed of with a direction, to sum up of the litigation which is pending for a long time. Let the order of the District Consumer Commission 06.09.2019 shall be complied with and the respondent be refunded the entire deposited amount with simple interest at the rate of 12% per annum within a further period of 60 days from today failing which it shall carry interest at the rate of 15% per annum until actual payment."
So as far as this case is concerned it is really very sad affair of state that an autonomous government agency has denied to allot a plot of the same measurement which has been acquired by them. The complainant got her plot registered on 29.06.1991 so we are of the opinion that whatever relief she will get, will be calculated and counted from 01.07.1991. In the light of the present circumstances we have perused all the facts and evidences and documents of the case and ultimately come to the final conclusion as follows ;
(a) The complainant is entitled to get a plot from the opposite party in Viraj Khand, Gomti Nagar having an area of 2975 square ft with execution of sale deed and delivery of possession within 30 days from the date of judgment of this complaint case otherwise the opposite party shall pay ₹ 1 lakh per month after 30 days from 01.07.1991 till the allotment and execution of the sale deed and delivery of possession of the plot to the complainant. OR
(b) The complainant is entitled to get the refund of the amount of the land measuring 2975 square ft and the present market rate prevailing in Viraj Khand, Gomti Nagar, Lucknow along with the stamp duty paid by the complainant in the registration of the sale deed by the complainant on 29.06.1991 with interest at a rate of 12% per annum from 1.7.1991 if paid within 30 days from the date of judgment of this complaint case otherwise the rate of interest shall be 15% per annum from 01.07.1991 till the date of actual payment.
(c) If Lucknow Development Authority allot the said plot no.4/55-A ((2000 sq. ft. only) situated in Viraj Khand as mentioned in the letter of the Authority dated 02.11.2002, the Lucknow Development Authority shall pay the present cost of 975 square ft. (the difference of area) of land situated in Viraj Khand to the complainant within 30 days from the date of judgment of this complaint case otherwise the Lucknow Development Authority shall pay a compensation of ₹30 lakhs to the complainant.
(d) The complainant is entitled to get ₹50,000/- for mental agony and harassment with interest at a rate of 12% per annum from 01.07.1991 if paid within 30 days from the date of judgment of this complaint case otherwise the rate of interest shall be 15% per annum from 01.07.1991 till the date of actual payment.
(e) The complainant is entitled to get ₹11,000/- towards cost of the case along with counsel fee with interest at a rate of 12% per annum from 01.07.1991 if paid within 30 days from the date of judgment of this complaint case otherwise the rate of interest shall be 15% per annum from 01.07.1991 till the date of actual payment.
The complaint case is decided accordingly.
1- The opposite party no.1 is directed to pay the present market value of land measuring 2975 square ft in Viraj Khand, Gomti Nagar, Lucknow along with the stamp duty paid in the registration of land by the complainant on 29.06.1991 with interest at a rate of 12% per annum if paid within 30 days from the date of judgment of this complaint case otherwise the rate of interest shall be 15% per annum from 01.07.1991 till the date of actual payment.
2- The opposite party no.1 is directed to allot the said plot no 4/55-A (2000 sq. ft. only) situated in Viraj Khand as mentioned in the letter of the Authority dated 02.11.2002 within 30 days from the date of judgment of this complaint case and is also directed to pay the present market value of 975 square ft. (the difference of area) of land in Viraj Khand to the complainant within 30 days from the date of judgment of this complaint case otherwise the Lucknow Development Authority shall pay a compensation of ₹30 lakhs to the complainant.
3- The opposite party no.1 is directed to pay to the complainant ₹50,000/- for mental agony and harassment with interest at a rate of 12% per annum from 01.07.1991 if paid within 30 days from the date of judgment of this complaint case otherwise the rate of interest shall be 15% per annum from 01.07.1991 till the date of actual payment.
4- The opposite party no.1 is directed to pay to the complainant ₹11,000/- towards the cost of the case along with counsel fee with interest at a rate of 12% per annum from 01.07.1991 if paid within 30 days from the date of judgment of this complaint case otherwise the rate of interest shall be 15% per annum from 01.07.1991 till the date of actual payment.
5- If the opposite party no1 fails to comply the judgment of this complaint case within 30 days, the complainant may file as a case in this court at the cost of the opposite party no.1.
The stenographer is requested to upload this order on the Website of this Commission today itself.
Certified copy of this judgment be provided to the parties as per rules.
(Justice Ashok Kumar) (Rajendra Singh) President Member Judgment dated/typed signed by us and pronounced in the open court. Consign to the Record-room. (Justice Ashok Kumar) (Rajendra Singh) President Member Dated 23.11.2023 JafRi, PA I C-1 [HON'BLE MR. JUSTICE ASHOK KUMAR] PRESIDENT [HON'BLE MR. Rajendra Singh] JUDICIAL MEMBER