State Consumer Disputes Redressal Commission
Mrs. Desley Sequeira, vs Mr. Anilkumar P Walavalkar on 3 August, 2012
BEFORE THE
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PANJIM, GOA
Quorum : 1. Shri
Jagdish Prabhudesai, Honble Member
2.
Smt. Vidhya Gurav, Honble Member
Appeal No. 27/2010
Mrs. Desley Sequeira,
through her constituted Attorney
Mr. Charles F. De Lima
6 Cest Mo,
128, St. Cyril Road,
Bandra West,
Mumbai 400050. ....
Appellant
v/s.
1.
Mr. Anilkumar P
Walavalkar
No 14/2/7, Beach Pebbles,
Nomxin, C-14,
Caranzalem, Goa
2.
Mr. Avinash
Vishnu Virkar
90/2, Mahalaxmi Building No. 1,
Sir Bhalchandra Road,
Dadar, Mumbai 400014.
. Respondents
Ld. Adv. A.
Fernandes for the Appellant.
Respondent No.
1 present in person.
Respondent No.
2 absent.
Appeal No. 27/10A/2010
Mrs. Desley Sequeira,
through her constituted Attorney
Mr. Charles F. De Lima
6 Cest Mo,
128, St. Cyril Road,
Bandra West,
Mumbai 400050.
.... Appellant
v/s.
1.
Mr. Anilkumar P
Walavalkar
No 14/2/7, Beach Pebbles,
Nomxin, C-14,
Caranzalem, Goa
2.
Mr. Avinash
Vishnu Virkar
90/2, Mahalaxmi Building No. 1,
Sir Bhalchandra Road,
Dadar, Mumbai 400014.
.
Respondents
Ld. Adv. A.
Fernandes for the Appellant.
Respondent No.
1 present in person.
Respondent No.
2 absent.
Appeal No. 28/2010
Mr. John Dias
Mrs. Juliet Dias
(both since deceased)
Legal Heir
Mrs. Celine Priscilla Xavier
Mr. Kindsley Xavier (deceased)
r/o 9/10, Blossom Society,
Marol, Andheri (E), Mumbai, 59.
Presently residing at
P.O. Box 115349
Dubai, U.A.E. .... Appellant
v/s.
1.
Mr. Anilkumar P
Walavalkar
No 14/2/7, Beach Pebbles,
Nomxin, C-14,
Caranzalem, Goa
2.
Mr. Avinash
Vishnu Virkar
90/2, Mahalaxmi Building No. 1,
Sir Bhalchandra Road,
Dadar, Mumbai 400014.
.
Respondents
Ld. Adv. A.
Fernandes for the Appellant.
Respondent No.
1 present in person.
Respondent No.
2 absent.
Appeal No.
29/2010
Mrs. Juliet Dias
Mr. John Dias
(both since deceased)
Legal Heir
Mrs. Celine Priscilla Xavier
Mr. Kindsley Xavier (deceased)
r/o 9/10, Blossom Society,
Marol, Andheri (E), Mumbai, 59.
Presently residing at
P.O. Box 115349
Dubai, U.A.E. .... Appellant
v/s.
1.
Mr. Anilkumar P
Walavalkar
No 14/2/7, Beach Pebbles,
Nomxin, C-14,
Caranzalem, Goa
2.
Mr. Avinash
Vishnu Virkar
90/2, Mahalaxmi Building No. 1,
Sir Bhalchandra Road,
Dadar, Mumbai 400014.
.
Respondents
Ld. Adv. A.
Fernandes for the Appellant.
Respondent No.
1 present in person.
Respondent No.
2 absent.
Appeal
No. 32/2010
Mr. Denis Mathias
Tara Kunj, 4th Road
Santa Cruz East
Mumbai 55 .... Appellant
v/s.
1.
Mr. Anilkumar P
Walavalkar
No 14/2/7, Beach Pebbles,
Nomxin, C-14,
Caranzalem, Goa
2.
Mr. Avinash
Vishnu Virkar
90/2, Mahalaxmi Building No. 1,
Sir Bhalchandra Road,
Dadar, Mumbai 400014.
.
Respondents
Ld. Adv. A. Fernandes
for the Appellant.
Respondent No.
1 present in person.
Respondent No.
2 absent.
COMMON ORDER
Date : 03/08/2012 (Per Shri. Jagdish Prabhudesai, Member)
1. By this Common Order, we shall dispose off all the above appeals filed by the above Appellants against the aforesaid Respondents. We deem it fit and proper to pass the Common Order/Judgment inter alia deciding the fate of all the aforementioned appeals in as much as common questions of law and facts and common issues are raised by the respective parties in all the appeals for efficacious determination by this Commission.
2. Though the Appellants in these Appeals are different, the Respondents are the same. Vide the present Appeals, the Appellants seek to challenge the following Orders passed by the Ld. North Goa District Forum, on various dates, recording inter alia similar observations and findings with similar reliefs:
i) By Appeal No. 27/2010, the Impugned Order dated 24/11/2006 in Complaint No. 5/2000.
ii) By Appeal No. 27/10A/2010, the Impugned Order dated 13/12/2006 in Complaint No. 4/2000.
iii) By Appeal No. 28/2010, the Impugned Order dated 11/09/2006 in Complaint No. 45/2000.
iv) By Appeal No. 29/2010, the Impugned Order dated 11/09/2006 in Complaint No. 46/2000.
v) By Appeal No. 32/2010, the Impugned Order dated 13/09/2006 in Complaint No. 202/2000.
3. There are three common questions for the determination by this Commission in all the aforesaid Appeals namely:
i) Whether the original Complaints filed before the Ld. Forum in these Appeals, were in themselves barred by limitation as against Respondent No. 1 herein.
ii) Whether and to what extent Respondent No. 2 herein is liable at law to the Appellants herein.
iii) Whether and to what extent the Principle of Novation of Contract holds good in the facts and circumstances of the present Appeals.
4. The case of each of the Appellant is that they purchased a Holiday Home from the Respondents herein in the project known as Ocean Park situated at Anjuna, Bardez, Goa by entering into respective Agreements in the year 1988, though on different dates, for a fixed sum by way of consideration for respective Units in the said project.
5. For the sake of brevity and to avoid repetition, we are citing the facts and circumstances only from Appeal No. 27/2010 as an illustrative case for our thoughtful consideration.
i) We begin with Appeal No. 27/2010 in reference to the relevant facts in the original Complaint No. 5/2010. In this Appeal, the Appellant herein i.e. the Complainant therein entered into the agreement with the Opposite Party 1 i.e. the Respondent No. 1 herein on 07/12/1988 whereunder the Complainants agreed to finance construction of 2 shops No. CS-8 and CS-9 on the Ground Floor of the scheme of Ocean Park at Anjuna, Bardez, Goa, promoted by O.P. No. 1 for the total cost of the complainants unit of Rs. 1,20,000/-.
ii) The case of the appellant is that there are about 150 persons having booked holiday Units in the said project in a hope to own a Holiday Home at Goa.
iii) According to the Appellant, the Respondent No. 1 entered into a deal with Respondent No. 2, somewhere in the year 1993, and the Respondent No. 1 informed the Appellant that he had given the project to the Respondent No. 2 and that the latter would complete the project 30/09/1994.
iv) The Appellant, vide para no. 18 of the Memorandum of Appeal stated that on 30/03/1994, the Respondent No. 2 suo motu claimed to have transferred the rights allegedly from Walbro Hotels Pvt. Ltd. to Woods Beach Hotels Ltd. A resolution dated 24/06/1997 was given to the association signed by the Respondent No. 2 stating that he would settle all the outstanding dues by December 1997, and would give the possession of the units to the members not joining the Rent Back Scheme by December 1998.
v) However, both the Respondents allegedly made a false representation to the Appellant vide letter dated 31/03/1999 stating that they were intending to sell the project to Australian Investors Group. This was done mainly with mala fide intention to deny the rights to the Appellants by oblique means.
vi) The Complainants, based on the said cause of action filed the Complaint before the Ld. Lower Forum and claimed from both the O.Ps. Rs. 1,20,000/- with 18 % interest, Rs.
24,000/- towards the expenses and Rs. 10,000/- towards the cost.
vii) On receiving the notices from the Forum, O.P. No. 1 objected the Complaint in his written version on the ground that the Complaint is hopelessly barred by limitation, that the Complainant was very much aware of the Agreement entered into by and between M/s. Walbro Hotels Pvt. Ltd and O.P. No. 2 and that he should be discharged in view of Novation of Contract and complete assignment of rights in favour of O.P. No. 2 who has to be held liable to fulfill the obligations under the said contract.
viii) The Ld. Forum framed two issues namely:
a) Whether the Complainant is entitled to claim from O.P. No. 1 and O.P. No. 2 jointly and severally the amounts as prayed for in the complaint and
b) Whether O.P. No. 1 is liable to pay the amount claimed by the Complainant in view of Novation of the contract.
By the Impugned Order dated 24/11/2006, the Ld. Forum answered issue no. answered issue no. (a) partly in the affirmative and partly in the negative and issue No. (b) in the affirmative with the following directions:
Opposite Party I is hereby directed to pay a sum of Rs. 1,20,000/- to the Complainants along with simple interest @ 12% thereon from 07/12/1988 till 02/11/1993 (i.e. on date when Complainants were informed by Opposite Party I of handing over project to Opposite Party
2).
Opposite Party No. 2 is directed to pay expenses of Rs 24,000/- and cost of Rs. 10,000/- to the Complainants.
ix) It is this impugned Order passed by the Ld. Forum which is sought to be challenged under the present appeal by the Appellants.
6. The Ld. Forum has also passed respective Impugned Orders which have been challenged by the Appellants under the rest of the aforesaid Appeals wherein the issues involved are same and observations and findings of the Ld. Forum are similar.
7. These Appellants are challenging the respective Impugned Orders passed by the Lower Forum on the grounds that the District Forum wrongly interpreted the extent of liability of Respondent No. 1, that there is not a single document of transfer placed on record of Respondent No. 1 and 2 and hence, the District Forum could not have come to the conclusions as reflected in the Impugned Order and that the District Forum did not apply its mind correctly in holding that there is no Novation of Contract and yet restricting the interest to be paid on specified amounts by the Respondent No. 1 upto 02/11/1993, which has resulted in miscarriage of justice.
(i) On the other hand, the Respondent No. 1 in his reply, has objected the aforesaid appeal stating that the Appellant is not entitled to succeed as the Appeal is bad in law and devoid of any substance on merits of the case.
(ii) After this Commission admitted this Appeal, Respondent No. 2 kept himself away from the process of law prompting the Appellants to move the application dated 30/03/2012 for substituted service of summons by way of publication of the notice in the newspapers and accordingly, the notice published in Navshakti in its issue dated 02/03/2012 at page 8 is placed on record.
(iii) This Commission is duty-bound to observe that since despite the publication of notice, the Respondent No. 2 has failed to appear and participate in the ongoing proceedings, we hold that the said Respondent has no interest in contesting the issues and is deemed to have admitted the evidence on record.
9. At this point of time, we are duty bound to observe that after admitting the aforesaid Appeals, we have called for all relevant records/files from the Lower Forum since both the Appellants and the Respondents in all these Appeals have made certain confusing statements/allegations in the Memorandum of Appeals as well as in their replies respectively and the parties were unable to satisfy this Commission on certain related queries.
10. We have perused the entire records and gone through the written arguments advanced by all the parties in the present Appeal. We now proceed to record our Observations and Findings in all the aforesaid Appeals under this Common Order.
Our observations on the findings of Ld. Forum are as follows:
At the outset it is observed that the Complainant had produced various details and minutes of the meetings held between Unit Holders Association as well as the O.P. No. 2 and its bare reading indicate that Complainant as well as other Unit Holders were desirous of having a different arrangement with O.P. No. 2. In our opinion, the District Forum ought to have seriously applied its mind to the contention of the complainant that O.P. No. 2 had entered into an agreement dated 04/08/1993 with O.P. No. 1 as well M/s. Walbro Hotels Pvt. Ltd, by virtue of which the O.P. No. 2 had undertaken to complete the Ocean Park project and to hand over the possession of the respective Units to the respective parties. The Ld. Forum also has not seriously considered the contention of O.P. No. 1 that O.P. No. 2, by virtue of the said Agreement had taken the overall assets and liabilities and that the balance amount which was payable under the respective agreements was to be paid in the hands of O.P. No. 2.
The Impugned Order passed by the Lower Forum could not take any decisive stand based on evidence on record on the well contested issue that the Agreement dated 21/12/1988 came to an end for all legal purposes and whereas the Agreement dated 04/08/1993 was still in force.
We observe that though O.P. No. 2 did not participate in the proceedings before the Forum, however, without filing the written version, has filed the affidavit in evidence dated 30/04/2000. Interestingly, O.P. No. 2 in the said affidavit vide para 1 has categorically deposed that I undertake to pay the amount claimed in this complaint to the complainant in view of having taken over the entire project Ocean Park at Anjuna from O.P. No. 1 by virtue of agreement dated 04/08/1993. O.P. No. 2 vide para 2 of the said affidavit has categorically admitted that I admit that the O.P. No. 1 is not liable to pay to the complainant the amount claimed in this complaint and again at para 3 containing another admission that I undertake to pay to the complainant the amount claimed in the complaint, with interest accrued thereon, within 24 months from the date of the decree. We further observe that the Lower Forum, at page 6 of the Impugned Order observes on the aforesaid Affidavit of op. No. 2 that This same affidavit has gone unchallenged, yet in the same breath, further observes that Subsequently assigning of neither project nor any transfer document in favour if O.P. No. 2 is existing to hold O.P. No. 2 entirely responsible. Also, what is not clear is the finding of the Lower Forum that no weightage can be given to the argument that affidavit in evidence filed by O.P. No. 2 is shifting responsibility of payment only on O.P. No. 2 having admitted and having taken over the project. So also, there is neither evidence nor authority to support the finding of the Lower Forum that in the absence of previous termination of Agreement between O.P. No. 1 and Complainant, the Principle of Novation, will not be applied in the present case as the substituted contract should rescind or alter the previous contract.
Our findings in these Appeals on :
(i) Plea of limitation
(ii) Plea of Novation of Contract
(iii) Liability of Respondent No. 1 to the Appellants and
(iv) Liability of Respondent No. 2 to the Appellants.
(i) Finding on plea of limitation:
The Respondent No. 1, in his defence, has rightly contended that the Agreement in question was signed on 07/12/1988, which agreement mandated the premises to be ready for use and occupation not later than 24 months from the date of commencement provided all the amounts due or payable are paid by the purchaser to the builder and in case the same is not completed within the aforesaid period owing to unforeseen circumstances, the builder shall be entitled to an extension of time of further six months. Thus, the cause of action accrues in 1990. However, the original complaint was filed only in the year 2000, after a delay of 10 years, which was neither explained by the Appellant before the District Forum nor was it condoned by the Forum, nor was any application for condonation of delay filed by the Complainants under section 24A of The Consumer Protection Act, 1986 and hence, the complaint itself was barred under The C.P.A, 1986 as against Respondent No. 1.
While holding that the original Complaints in all these Appeals, were, in themselves barred by limitation as against Respondent No. 1, we go by the ruling of Honble National Consumer Disputes Redressal Commission, since the same is applicable to the facts and circumstances of the present Appeal in Delhi Development Authority, Appellant v/s. V. P. Narayanan, Respondent reported in 2012(1) CCC 20(NS), where it was held as under:
It would be seen from the aforesaid provision that it is peremptory in nature and requires the Consumer Forum to see before it admits the complaint that it has been filed within two years from the date of accrual of cause of action. The Consumer Forum, however, for the reasons to be recorded in writing may condone the delay in filing the complaint if sufficient cause is shown. The expression, shall not admit a complaint occurring in section 24A is sort of legislative command to the Consumer Forum to examine on its own whether the complaint has been filed within limitation period prescribed thereunder.
Even otherwise, in Union of India and Another v/s. British India Corporation Ltd. and Others. (2003) 9 SCC 50, while dealing with an aspect of limitation for an application for refund prescribed in Business Profits Tax Act, 1947, Honble Supreme Court held that the question of limitation was a mandate to the forum and, irrespective of the fact whether it was raised or not, the Forum must consider and apply it.
However, we do make it amply clear that all Complaints under the present Appeals have been filed before the Lower Forum well within time as against Respondent No. 2. They are not time barred since the cause of action against Respondent No. 2 was of continuous nature.
(ii) Finding on plea of Novation of Contract:
We have to observe that the Respondent No. 1 has specifically pleaded that he has received the payments under receipts from the Appellants not in his individual capacity but jointly for himself and on behalf of Respondent No. 2 and that the Appellants themselves are guilty of contributory negligence of non-payment of the dues as per mode of payment under Schedule 2 of the Agreement and further that though the project was not completed for certain reasons like lack of finance, lack of certain approvals etc, the Complainants/Appellants could have exercised option of termination Also, the Respondent No. 1, in each of the above appeals, has specifically pleaded his defence to the effect that since the Complainants were aware of agreement into/between M/s. Walbro Hotels Pvt. Ltd. and O.P. No. 2, it was the bounden duty of O.P. No. 2 to fulfill all obligations under the newly entered agreement and therefore O.P. No. 1 is not liable to pay any amount to the Complainant as they have come out of the project.
It is at the backdrop of these submissions that we have to examine the principle of the Novation of contract in relation to the finding of the Ld. Forum that the question of the application of the principle of novation of contract could not be attracted in the present case since the old/original contract is not altered or rescinded.
22.
It is pertinent to note that The Indian Contract Act, 1872, under the title Contracts which need not be performed incorporates Section 62 which reads as under: Effect of novation, rescission and alteration of contract - If the parties to a contract agree to substitute a new contract for it, or to rescind or alter it, the original contract need not be performed.
23. In the present Appeals, the Appellants plead that both the Respondents, in collision, have been playing the delaying tactics and shifting the blame to one another on account of the signing of the Agreement by Respondent No. 1 with Respondent No. 2 whereunder the project of Ocean Park has been taken over by the Respondent No. 2. On the contrary, the Respondent No. 1 has specifically pleaded that since the Respondent No. 2 has taken over the entire project and has accepted the liability as to the payment to the Appellant in total, the previous Agreement entered in the year 1988 by and between the Appellant herein and the Respondent No. 1 herein, stands automatically terminated and therefore, the Respondent No. 1 is not liable to pay any amounts to the Appellants. However, the Appellants argue that the Novation of Contract does not exonerate Respondent No. 1 from any liability at law in terms of the previous Agreement.
24. As stated earlier, the Ld. Forum has framed an issue on this aspect namely whether O.P. No. 1 is liable to pay the amount claimed by the Complainants in view of Novation of Contract and answered it in the affirmative by observing that the arrangement between M/s. Walbro Constructions and M/s. Walbro Hotels Pvt. Ltd as their internal agreement and the same does not carry any relevance vis--vis liability of O.P. No. 1 to the Complainant in as much as the Complainants agreements and commitments are not in any way connected to the said taking over.
In this respect, we cite and follow the following decisions which miss the attention of the Ld. Forum:
(i) In Lingham Narayan Das v/s. Punia Das, AIR 1959, Orissa, 176, The Orissa High Court held as under The Novation contemplated in section 62 of the Indian Contract Act, 1872, therefore, involves an annulment of one debt and the creation of another. In every case of this nature, the Court has to consider not only whether the new debtor has consented to assume liability but also whether the creditor has agreed to accept the liability of the new debtor, in substitution of the original debtor. In other words, novation is not consistent with the original debtor remaining liable in any form, since the essential element of novation is that the rights against the original contractor shall be relinquished and the liability of the new contracting party accepting in its place. Under law therefore, one of the requisites of novation is the agreement of the parties to the contract.
(ii) In K. A. Panicker v/s. S. K. R. Chettiar, AIR 1966, Kerala, Page 303, the Kerala High Court explained novation meaning the extinguishment of the terms of an earlier contract and the creation of another between new persons atleast one of whom was a stranger to the original contract and it is essential for the principle of novation to apply that there must be the mutual consent of all parties concerned. The true proposition of law that springs from the aforesaid two citations is that novation takes place when an earlier contract is extinguished and in its place a new contract is signed to which all parties must be in agreement with. All that is necessary therefore is the mutual consent and knowledge of all the parties concerned about the formation of the new contract.
(iii) In Union of India v/s. Kishori Lal Gupta and bros, AIR 1959 S.C. 1362, the Supreme Court observed that the substituted Agreement gave a new cause of action and obliterated the earlier ones. Ordinarily, under the common law, novation is brought about by introduction of new parties or alteration between the same parties by introduction of new terms.
(iv) In State v/s. Ram Ballabh Das, AIR 1960, PAT 400, the Patna High Court held that the Principle of Novation is not consistent with the original debtor remaining liable in any form on the terms of the old contract. The right against the original debtor on such contract must be extinguished and there must be present substitution of another contract for the original contract.
(v) In Jethmal v/s. Hiralal, AIR 1972, RAJ 220, the Rajasthan High Court held that whether the facts found resulted in novation of contract is not a pure question of fact but a mixed question of law and fact. There is nothing to prevent the Ld. single judge from examining this question in second Appeal and reaching his own conclusion.
(vi) In Centuries Spinning and Manufacturing Co.
Ltd., Bombay v/s. Motilal Dhariwal, AIR 1966, MP 313, it was held that when the subsequent contract deals with the same subject matter as the original contract and contains terms and conditions which enable the parties to sue upon the second arrangement alone even if the original contract did not exist, rescission of the original contract may be properly inferred.
Now, the question is: Whether the Appellants herein were aware of the fresh agreement between the Respondent No. 1 and Respondent No. 2 so as to attract the Principle of Novation. In this connection, it is worth going through the correspondence entered by and between the Appellants and both the Respondents.
To begin with the bare perusal of the relevant clauses of the 1988 Agreement which stipulates the rights and liabilities of the parties thereto indicates that both the parties could exercise their option of terminating the Agreement from either side subject to the compliance of certain conditions mentioned thereunder, that is to say:
(i) The Builder i.e. Respondent No. 1 herein could invoke clause 4 of the Original Agreement, which clause provided as under:
Cl 4: That on failure of payment of any of the installments as agreed by the Purchaser, the Builder shall give a notice in writing to the Purchaser to make the payment within 15 days from the date of notice and if no payment is made within these 15 days, then this Agreement shall at the option of the Builder, and without prejudice to his other rights and claims, come to an end and the allotment of the aforesaid premises made to the Purchaser shall stand cancelled and the Builder shall be empowered to allot the same to any person thereupon the Purchaser shall be refunded the amounts paid by him subject to the terms and conditions hereunder mentioned and the Purchaser shall have no claim whatsoever against the Builder or against the premises provided however should the Builder not terminate the Agreement, the Purchaser shall be liable to pay the interest @ 2% above the Bank Interest on Loans on the amount standing unpaid by the Purchaser to the Builder.
(ii) However, Clause 5 further provided that in the event of termination of the agreement by the Purchaser by a valid notice in writing, the Builder is liable to refund the amount within six months from the date of notice and is entitled to deduct the overhead charges referred to above and on receipt of the abovementioned notice issued by the Builder, the claim of the Purchaser is liquidated in terms of money as stipulated above and his claim to the abovementioned premises is waived.
(iii) As per Clause 7 of the Agreement, the possession of the premises was to be delivered to the Purchaser within 24 months or if the building was not completed due to unforeseen circumstances, then within the extension period of next six months.
(iv) Now, when looked from the point of view of the Purchaser, Clause 16 of the said Agreement provided that if the premises is not completed within the aforesaid period, the Purchaser is at liberty to exercise his option to cancel this Agreement and claim the refund of the money paid by him to the Builder, without interest.
(v) At this point of time, we have no answer to the question which we ask to ourselves. When the suit premises in the present complaint were not completed by the Builder i.e. Respondent No. 1 herein, within the prescribed period of two years, and further extension of six months, then why did the Appellants herein i.e. the original Complainants not exercise their option by invoking the aforesaid Clause 16 to cancel the said Agreement and claim the refund of the money paid by them to the Builder. Perhaps, part of the answer to the aforesaid question is left to be found in Clause 18 and Clause 19 of the Agreement itself. This Clause 18 states that the buyer is aware that an Agreement has been executed by and between Walbro Constructions and Walbro Hotels Pvt. Ltd. in respect of the premises to be known as Walbro Club (proposed) in which Agreement Walbro Hotels Pvt. Ltd. have agreed to purchase the said Walbro Club premises on ownership basis. Further, Clause 19 states that save and except in respect of the said premises to be acquired by the buyer, the buyer shall have no claim whatsoever on all open spaces, lobbies etc.
(vi) Thus, the fact remains that each Complainant, before the Lower Forum was never interested in terminating the Agreement but was interested in getting back the possession of the premises, if not from O.P. No. 1 under the original Agreement of the year 1988, then alternatively from O.P. No. 2. This appears to be the reason why the Appellants kept on inconclusively corresponding with Respondent No. 1 and particularly with Respondent No. 2.
(vii) We observe from the evidence on record that the Appellants had full knowledge of the fact that the Respondent No. 2 vide subsequent agreement has taken over the project Ocean Park and had no objections to such taking over considering the following correspondence exclusively by and between the Appellants and Respondent No. 2.
We now advert to the correspondence which will explain the prevailing compulsions of both the Complainants as well as O.P. No. 2 and will also throw light on the agreeing of all parties to the novation of contract:
(a) In order to vindicate the mutual grievances of the Unit Holders such as the Appellants herein, The Ocean Park Unit Holders Association came to be formed and this allegedly unregistered Association entered into series of correspondence with Respondent No. 2. In fact the said Association exchanged more correspondence with Respondent No. 2, than with Respondent No. 1.
(b) Put on record is the invitation card sent by Respondent No. 2 as Managing Director of Walbro Hotels Pvt. Ltd. inviting the Complainant for the Pooja Ceremony of Ocean Park Project at Anjuna Beach, Goa on 19th November 1993. There is no doubt that Respondent No. 2 had a definite interest in the said Ocean Park Project way back in the year 1993 i.e. 5 years after the original Agreement was entered in the year 1988 between the Complainant and O.P. No. 1.
Interestingly, the said Invitation Card signed by Respondent No. 2 contains the P.S. to the effect We would like to inform you that the work in the project will resume in full swing towards the end of November 1993. Every endeavour will be made to complete the project on target.
(c) The Letter dated 28th December 1993 addressed to the Complainant Ms. Desley Sequeira by Respondent No. 2 as the Managing Director of M/s. Walbro Hotels Pvt. Ltd. categorically admits the following fact vide its very first paragraph We wish to inform you that by the Agreement dated 4th August 1993, Walbro Hotels Pvt. Ltd. have terminated the Development Agreement with M/s. Walbro Constructions and have taken the possession of the project Ocean Park alongwith assets and liabilities related to the project. Vide Para no. 2 of the said letter, Respondent No. 2 further admits when he states as under: Since you have booked your unit/shop/bungalow with M/s. Walbro Constructions by making payment you were supposed to receive the possession within 24 months as per your agreement entered with them. However, due to the non-compliance of the Agreement by Walbro Constructions you are disturbed and concerned. This letter further admits that M/s. Walbro Hotels Pvt. Ltd. share your concern and hence promise you to give the possession of your unit/shop/bungalow by January 1995 as per the specification of your Agreement with Walbro Constructions. The interest of Respondent No. 2 is also reflected further when the letter ends with these lines Walbro Hotels Pvt. Ltd. are building a hotel in the complex and hence can manage your property for mutual benefit. This proposal was offered to Ocean Park Unit Holders Association.
(d) The Letter dated 21st February 1994 addressed by Mr. Kotian, The President of Ocean Park Unit Holders Association to Respondent No. 2 is also aimed at binding the Respondent No. 2 by reminding him of his commitment to his promise with words You have consistently and categorically stated that if and when the Units are leased to you on Rent-Back-Scheme, the total furnishings and maintenance shall be borne by you.
(e) Once again vide letter dated 24th February 1994, Respondent No. 2 writes back to The Ocean Park Unit Holders Association informing that they have started the construction work in full swing and trying to complete the Units before January 1995.
(f) Respondent No. 2 vide letter dated 8th March 1994 addressed to the Complainant Ms. Desley Sequeira goes one step ahead when it enquires with her In case you are not interested to start your shop immediately, we will be interested in running the same on your behalf by making compensation.
(g) How deeply the Respondent No. 2 was concerned with and involved in the Ocean Park Project, is illustrated by the notice circulated by the said Association to its member i.e. the Complainant. Following is the extract:
The Association is yet to formulate a firm strategy to interact with Mr. Virkar, especially with regard to the Rent-Back-Scheme. Ms. Funde, Bhende, Pinto and D. Almeida, members of the Managing Committee, made an official visit to Goa to check the progress of the work at Ocean Park site, study the Hotel Tariffs in Goa and check on the local laws to protect our rights of ownership of our Units if we hand them over to Mr. Virkar on lease. Another General Body Meeting is being planned when it is hoped that we will be able to enter into a final agreement with Mr. Virkar so that the work on the site proceeds without any hurdles.
(h) Then, by the letter dated 30th March 1994, the Respondent No. 2 informs the Complainant Ms. Desley Sequeira that Our company Walbro Hotels Pvt. Ltd. has now become Woods Beach Hotels Ltd. from 8th March 1994 and the Certificate of Registration is received by us. Vide the 2nd para, the said letter further informs With this change in constitution, we wish to inform you that your agreement with Walbro Constructions will now be honoured by Woods beach Hotels Ltd..
(i) Vide letter dated 6th June 1994 addressed to the Unit Holders, the Respondent No. 2 promised to provide certain additional amenities in Ocean Park for additional cost informing the Unit Holders that nearly 80 % of the members have consented for availing those facilities.
(j) The active interest and involvement of Respondent No. 2 in the said project is very much reflected in his letter dated 9th August 1994 whereunder Respondent No. 2 categorically admits that I strongly feel that you should have called me to attend the said meeting so that there could have been face to face dialogue between the Unit Holders and me as it took place on 5th September 1993 after I took over the Ocean Park project. In the same letter Respondent No. 2 assures the Unit Holders that the progress of Ocean Park is in full swing and they would try their best to maintain the completion date of December 1994 hoping that there will not be any unforeseen difficulties.
(k) There is also a series of correspondence in the subsequent years from 1995 onwards.
Respondent No. 2 has addressed series of letters to the Unit Holders which letters are put on record of this case and include the letters dated 20-02-1995, 17-03-1995, 27-11-1995, 31-12-1995, 28-02-1996, 30-07-1996, 12-05-1997, 18-07-1998.
(l) In fact the last mentioned letter dated 18-07-1998 addressed by Respondent No. 2 to the President of The Unit Holders Association informs the Unit Holders that the construction work of Ocean Park will be restarted after monsoon is over and that the advance for shops will be paid/returned depending on shops area and payment received.
(m) The President of The Unit Holders Association serves the notice by Registered A.D. on 12-10-1998 on Respondent No. 2 bringing to his notice the fact that the Association held its last meeting with him on 25-07-1998 where it was agreed by him that he would start the project aimed at completing the units and shops and hand over possession by December 1998. The said notice also required Respondent No. 2 to inform the Association whether or not suitable steps have been taken to ensure possession of the units and shops by 31-12-1998 in Ocean Park project.
(iii) & (iv) Findings on Liability of Respondent No. 1 to the Appellants and that of Respondent No. 2 to the Appellants:
Finally, as regards the above aspects, our irresistible conclusions are:
(i) Considering all aforesaid events, it can safely be held that the cause of action in the present Complaint which is filed in the year 2000, ceases to exist against Respondent No. 1 after the project is taken over from him by Respondent No. 2. In other words, Respondent No. 1 cannot be legally held liable thereafter to any of the Appellants herein. On the contrary, as stated earlier, the cause of action continues to exist against Respondent No. 2 from the year 1993 till the year 1999 and being continuous in nature, it also means that the present complaint is not barred by limitation so far as Respondent No. 2 is concerned, though it is barred by limitation as against Respondent No. 1 for the reasons cited herein above.
(ii) It is also held that the Appellants herein were very much aware and had full knowledge of what was happening around in terms of the subsequent agreements, understandings and exchange of correspondence between them and Respondent No. 2. The Appellants have had ample opportunities to terminate the original agreement entered between them and Respondent No. 1 and thereafter between them and Respondent No. 2. Respondent No. 2 went on assuring the Appellants till the end of the year 1999 that he would perform his part of the contract. Therefore the liability on the part of Respondent No. 2 is not vicarious or co-extensive but the same is absolute and distinctly independent even as we hold that the complaints are barred by limitation as against Respondent No. 1.
(iii) It is further held that the Appellants by their own conduct are deemed to have waived their remedies at law against Respondent No. 1 as their agreement with Respondent No. 1 entered in 1988 is rendered redundant, infructuous and therefore unenforceable at law by reason of time-barred action with the result that the Appellants herein do have their remedies only as against Respondent No. 2.
In view of our aforesaid observations and findings, we are inclined to hold that the Impugned Orders passed by the Lower Forum under challenge in the above Appeals suffer from illegality and manifest absurdity as against Respondent No. 1 herein and the same need to be modified as against Respondent No. 2. The Impugned Orders therefore warrant our interference to the following effect:
The Impugned Orders passed by the Lower Forum in the aforesaid Appeals, as referred to at para 2 of this Common Order, deserve to be set aside as against Respondent No. 1 herein. However the aforesaid Impugned Orders fixing the liability as to payments on Respondent No. 2 herein are hereby maintained subject to modification as to the period of specified interest extended till actual payment.
We, therefore, pass the following COMMON ORDER It is hereby ordered that all aforesaid Appeals are hereby dismissed as against Respondent No. 1 and consequently, all Impugned Orders passed by the Ld. North Forum challenged under the aforesaid Appeals as referred to at para 2 of this Common Order are hereby set aside as against Respondent No. 1 and the said original Complaints, Complaint No. 5/2000, Complaint No. 4/2000, Complaint No. 45/2000, Complaint No. 46/2000 and Complaint No. 202/2000 on the files of the North Forum are also dismissed as against Respondent No. 1 herein.
However it is hereby further ordered that we uphold all the Impugned Orders under the present Appeals passed by the Ld. North Forum as against Respondent No. 2 herein as we maintain the directions of the Lower Forum to Respondent No. 2 to pay to the Appellants herein the specified amount in the respective Impugned Orders alongwith simple interest @ 12 % thereon from the dates specified in the Impugned Orders till actual payment. Also, the Lower Forums directions to Respondent No. 2 to pay to the concerned Appellants, the specified amount without any interest and the amount as to the cost granted under the Impugned Orders are also hereby maintained.
The aforesaid directions shall be complied with by Respondent No. 2, within 30 days from the date of the receipt of this Order. There shall be no Order as to cost.
(Shri Jagdish Prabhudesai) Honble Member (Smt. Vidhya Gurav) Honble Member