National Consumer Disputes Redressal
Ramkrishna Gangadhar Shanbhag vs Nirmal Devraj Punmiya & Ors. on 12 May, 2015
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 212 OF 2009 (Against the Order dated 18/04/2009 in Complaint No. 9/2006 of the State Commission Maharastra) 1. RAMKRISHNA GANGADHAR SHANBHAG C/o Mr. L.V.S. Hegdekar, B-3, Antarix CHS Ltd., Gunsagar Nagar, Kalwa (W) Thane - 400 605 ...........Appellant(s) Versus 1. NIRMAL DEVRAJ PUNMIYA & ORS. Partner of M/s. Manibhadra Enterprises & Developers, 284, Nirmal Jewllers, Near Brahmin Sabha, Station Road Thane (W) - 400 601 Maharashtra 2. LALA SHAIKH Partner of M/s. Manibhadra Enterprises & Developers, Varsha Apartment, Block No. 101, Shastri Nagar, Kalwa (W) Thane - 400 605 Maharashtra 3. MOHAN TELI Partner of M/s. Manibhadra Enterprises & Developers, Teli House, Kharkar Aali, Jambali Naka Thane (W) - 400 601 Maharashtra ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE D.K. JAIN, PRESIDENT HON'BLE MR. VINAY KUMAR, MEMBER HON'BLE MRS. M. SHREESHA, MEMBER For the Appellant : For the Appellant: Mr. Laxman D. Thorat, Advocate with Appellant in person For the Respondent : For Respondents : NEMO for R-1,.
Ms. Alka Singh, Advocate with
Mr. Vaibhav Tomar, Advocate for
Respondents No.2 &3
Dated : 12 May 2015 ORDER O R D E R
(Pronounced on 12th day of May, 2015)
D.K. JAIN, J. PRESIDENT
Challenge in this Appeal, under Section 19 of the Consumer Protection Act, 1986 (for short, "the Act"), by the Complainant, is to the order, dated 18.04.2009, passed by the State Consumer Disputes Redressal Commission, Maharashtra, at Mumbai (for short "the State Commission") in CC NO.09/06. By the impugned order, the State Commission while granting a part of the reliefs prayed for by the Appellant in his complaint, has observed that grant of other reliefs would involve adjudication on complex issues, which are not within the domain of its jurisdiction.
2. Succinctly put, the material facts giving rise to the Appeal are as follow:-
The Complainant was tenant of one, Late Laxman Dhondo Phadake, owner of the land and building, bearing Tika No.3, C.T.S. No. 276-B/2, situated at Mohammed Ali Road, Jawahar Baug, Thane-400 601. A room admeasuring approx. 324 sq. ft carpet area on the ground floor of the said building was in his occupation. On 03.03.1995, the said Laxman Dhondo Phadake entered into an "Agreement to Sale-Cum-Development" of the said property with one Manibhadra Enterprises and Developers through its partner, Nirmal Devraj Punmiya, Respondent No.1 in this appeal. On 15.12.1995, the said Laxman Dhondo Phadake executed an Irrevocable Power of Attorney in favour of Respondent No.1, vesting onto him several rights, including the right to deal with the tenants residing in the said building. It is the case of the Appellant that Respondent No.1, had agreed to sell to the Appellant one flat on the second floor, admeasuring approx. 516 sq. ft build up area, in the new building to be constructed on the said plot, on ownership basis, for a concessional consideration of ₹1,00,000/-. The said amount was to be paid as consideration for the additional area i.e. area over and above the tenanted premises, as the existing built up area admeasuring 324 sq. ft. was to be given to the Appellant free of cost, in lieu of his surrendering the tenancy rights. Accordingly, on 12.08.1995, a Purchase Agreement was executed between the Appellant and the Respondents, who are the partners of the Developer Firm.
3. As per the terms of the Agreement, possession of the new flat was to be delivered to the Appellant within 24 months from the date of taking over of the possession of old tenanted premises but in the event of delay in handing over of the possession of the flat, the Respondents were to pay to the Appellant a sum of ₹50,000/- per month towards the monthly compensation for loss and damages likely to be caused to him.
4. On 07.07.1996, the Respondents entered into a Development Agreement with the owners of neighbouring plot belonging to Mrs. Vijaya Ramachandra Phadake, the Sister-in- Law of the said Laxman Dhondo Phadake, for development of the property in question by amalgamating the property belonging to Mrs. Phadake. It appears that after the plans were sanctioned by the Municipal Corporation, the Respondents started construction work. However, the construction work above the plinth level had to be suspended as the Municipal Corporation refused to take cognizance of the unregistered Power of Attorney executed by the owner of the neighbouring plot i.e. Mrs. Phadke. They were advised to have the Power of Attorney registered, but before the needful could be done, Smt. Vijaya Ramchandra Phadake passed away, giving rise to litigation between her legal heirs.
5. It is also the case of the Appellant that on 20.12.1996, the Respondents entered into another Agreement with him, titled as "Further Agreement between the Developers and the Tenant", whereunder they agreed to pay to the Appellant a sum of ₹30,000/- as a security deposit for acquiring an alternate temporary accommodation in addition to a sum of ₹3,000/- per month towards the rent/compensation for the alternate temporary accommodation from the date of vacation of old tenanted premises till handing over possession of the new flat to the Appellant. It appears that on 10.01.1997, Respondent No.1, executed an "Indemnity Bond-Cum-Undertaking" in favour of the Appellant to indemnify him in case the Respondents were to fail in complying with the terms and conditions as agreed upon. The aforesaid Agreements and the said Further Agreement dated 20.12.1996 were reiterated by execution of a deed of registration/confirmation, dated 30.01.1997, with the Sub-Registrar of Assurance. It seems that the monthly rent @ ₹3,000/- per month was paid to the Appellant by the Respondents from April, 1997 to February, 1999 whereafter, it was stopped. The Appellant was asked to adjust the deposit of the aforesaid sum of ₹30,000/- for making payment of monthly rents. A further sum of ₹25,000/- was paid to the Appellant towards the rent for temporary accommodation, which stood adjusted upto the month of September, 2000. Thereafter, the Appellant did not receive any amount from the Respondents.
6. Since the Respondents had failed to deliver possession of the flat within the stipulated time and had also not paid compensation @ ₹50,000/- per month, as well as rent @ ₹3000/- p.m. for the alternate accommodation after September 2000, the Appellant filed Complaint in the State Commission praying for directions to the Respondents to: deliver possession of the allotted flat within fixed limited time; pay compensation as agreed, under the Sale/Purchase Agreements, towards the damages along with arrears towards the agreed rent for temporary accommodation, shifting charges, cost of litigation or in the alternative, compensation @ ₹3,500/- per sq. ft. in lieu of the said flat, along with arrears and dues of agreed rent for the temporary accommodation along with compensation for failure to complete the construction within the stipulated period, was prayed for.
7. On consideration of the pleadings and other material placed before it and relying on the decision of this Commission in Synco Textiles Pvt. Ltd. Vs. Economic Transport Organization (1991) 1 CPJ 40, the State Commission has come to the conclusion that since the claim for compensation equivalent to the price of the flat relates and is based upon alleged breach of the terms of the agreement, it has to be adjudicated before a regular Civil Court and only the grievances relating to loss and injury on account of negligence and deficiency in performing the services, which are hired for consideration are to be classified for special protection under the Act and can be examined. The State Commission also observed that in so far as the claim of ₹40,50,000/- towards arrears of compensation @ ₹50,000/- per month in terms of agreement dated 12.08.1995 is concerned, since again, the agreement is disputed and allegation of fraud, etc. has been levelled by the Respondents, the issue is complex and hence cannot be settled by the Consumer Fora. Finally, the State Commission awarded to the Appellant: (i) a sum of ₹3,06,000/- as arrears of rent @ ₹3000/- from November 2000; (ii) ₹25,000/- as compensation for mental agony and (iii) ₹10,000/- towards costs, with a direction that if the amount noted at no. (i) was not paid within 45 days, it shall carry interest @ 18% p.a. till its realization. Hence the present Appeal.
8. We have heard Mr. Laxman D. Thorat, Ld. Counsel for the Appellant and Ms. Alka Singh on behalf of the Respondents.
9. Ld. Counsel appearing for the Appellant vehemently submitted that the State Commission grossly erred in relegating the Appellant to a civil remedy for redressal of his grievance relating to award of compensation for non-delivery of the flat, on the ground that in view of the allegation of fabrication of certain documents, the matter could not be decided in summary proceedings under the Act and it required adjudication by a Civil Court. According to the Ld. Counsel except for the dispute with regard to the quantum of compensation under Agreement dated 12.08.1995, whereunder the monthly compensation for loss and damages on account of delay in delivery of possession was to be paid by the Respondents @ ₹50,000/- per month, as claimed by the Appellant or @ ₹5000/- per month of delay, as pleaded by the Respondents, the veracity of any of the agreements was not in dispute and therefore, no complicated question of fact or law was required to be adjudicated in proceedings under the Act. It was asserted that non-sanction of the building plans by the Corporation was Respondents' own making as they wanted to have larger number of flats to earn higher profits, by amalgamating the neighbouring plot, for which, the Appellant could not be held responsible. It was contended that non-delivery of possession of the flat as also non-payment of compensation and monthly rent, as stipulated in the agreements, was per se negligence and deficiency in service on the part of the Respondents in fulfilling their commitments and, therefore, the State Commission ought to have granted the relief claimed in the Complaint.
10. Per contra Ld. Counsel appearing for the Respondents submitted that: (i) the Complaint was barred by limitation as the cause of action arose on 08.04.99, when the period of 24 months in completing the construction and delivering it to the Appellant had expired but the possession was not delivered to the Appellant; (ii) Having withdrawn his earlier suit filed for Specific Performance of Agreement dated 12.08.95, the Appellant was estopped from filing a Complaint under the Act on the same cause of action; (iii) On the demise of Late Laxman Phadake, the landlord of Appellant, his legal heirs were necessary parties and therefore, the Complaint should have been dismissed on account of non-impleadment of necessary party and (iv) an injunction order in respect of the said property having been passed by a Court, in litigation between the legal heirs of late Phadake, agreement between the Appellant and the Respondents is incapable of being performed and it has frustrated and therefore, in terms of Section 56 of the Indian Contract Act, the Agreement itself is rendered void.
11. Having given our anxious consideration to the pleadings and documents on record, we are of the opinion that the State Commission was not justified in relegating the Appellant to Civil Court for ventilating his grievance regarding compensation on account of non-delivery of the flat in question on the ground that complicated questions of fact were required to be adjudicated in the Complaint.
12. As noted above, except for raising a dispute on the quantum of compensation for delay in delivery of possession, the genuineness or authenticity of none of the afore-noted agreements was contested by the Respondents before the State Commission. Even in opposition to the present Appeal, except for raising the afore-noted technical objections, the Respondents have not questioned the veracity of the said agreements. It is well-settled by a catena of decisions of the Hon'ble Supreme Court that while dealing with the Complaint under the Act, the decisive test is not the complicated nature of fact and law arising for decision, the anvil of the entertainability of a Complaint by a Forum under the Act has to be determined on whether the questions, though complicated they may be, are capable of being determined by way of a summary enquiry i.e. by doing away with the need of a detailed and complicated method of recording evidence. The mere fact that a Forum under the Act is required to have a summary trial, is hardly a ground for directing a consumer to approach the Civil Court and subject him to a long drawn delayed procedure, giving ample opportunity to the Opposite Party to continue to harass the aggrieved side. The Act duly provides for an exhaustive procedure for deciding the Complaints in summary proceedings in conformity with the principles of natural justice. In the instant case, the veracity of the Agreements not being in dispute and further execution of deed of registration/confirmation dated 30.01.1997 with the Registrar of Assurance by the Respondents, the onus to prove the execution of the said agreements, which lay on the Appellant, stood proved and both the parties were bound by the terms of the contract. An Adjudicating Authority is required to construe a contract on its plain terms without any addition or subtraction therein. In the present case, as the stand of the Respondent was that the agreed compensation for delay in delivery of the flat was ₹5,000/- and not ₹50,000/-, as reflected in the agreement, it could be proved by them before the State Commission. Therefore, it cannot be said that the question of difference in the quantum of compensation involved a complicated question of fact or law.
13. The plea that having withdrawn the Suit, filed in Civil Court for specific performance of agreement, the Appellant is estopped from filing the Complaint, is also without any substance. It is plain from the language of Section 3 of the Act, which provides that remedy under the Act is in addition to the provisions of any of the law for the time being in force. Therefore, mere filing of the suit did not extinguish the right of the Appellants to file Complaint under the Act. As regards the question of limitation, it is again trite that till the possession of the property in terms of a sale agreement is delivered to an allottee, the cause of action continues. In our opinion, the breach of contract by the Respondents is per se deficiency in service on their part and therefore, the Appellant was justified in filing the Complaint for award of compensation for the alleged loss and mental agony suffered by him on account of non-delivery of possession of the flat, which he was to get in lieu of flat in his occupation in the old building.
14. Having come to the conclusion that there was deficiency in service on the part of the Respondents, the next question for consideration is how to compensate the Appellant on account of his being deprived of the flat under the Agreement, which is not likely to see the light of the day, because of litigation between the land owners and the Respondents, which is their own creation because of amalgamation of the neighbouring property.
15. The word 'Compensation' is of a very wide connotation. It may constitute actual loss or expected loss and may extend to compensation for physical, mental or even emotional suffering, insult or injury or loss. Explaining the general meaning and amplitude of the word 'Compensation' in the context of the Act, in Lucknow Development Authority Vs. M.K. Gupta - (1994) 1 SCC 243, the Hon'ble Supreme Court observed as follows:-
" The word 'compensation' is again of very wide connotation. It has not been defined in the Act. According to dictionary, it means, 'compensating or being compensated; thing given as recompense;'. In legal sense it may constitute actual loss or expected loss and may extend to physical, mental or even emotional suffering, insult or injury or loss. Therefore, when the Commission has been vested with the jurisdiction to award value of goods or services and compensation it has to be construed widely enabling the Commission to determine compensation for any loss or damage suffered by a consumer which in law is otherwise included in wide meaning of compensation. The provision in our opinion enables a consumer to claim and empowers the Commission to redress any injustice done to him. Any other construction would defeat the very purpose of the Act. The Commission or the Forum in the Act is thus entitled to award not only value of the goods or services but also to compensate a consumer for injustice suffered by him." (Emphasis supplied)
16. Endorsing the said observations, in Ghaziabad Development Authority Vs. Balbir Singh - (2004) 5 SCC 65, the Hon'ble Supreme Court held that the provisions of the Act enable a Consumer to claim and empower the Commission to redress any injustice done. A Consumer Fora is entitled to award not only value of goods or services but also to compensate a consumer to injustice suffered by him. In our view, bearing in mind the uncertainty about the completion of the building, because of pending litigation between the Respondents and the Legal heirs of the owner of the adjacent property, without going into the question of the alleged interpolation on the agreed rate of compensation, it would be just and fair to award compensation to the Appellant, in lieu of the flat, on the basis of the market price of flat as on 08.04.1999, the date on which, according to the Respondents, the possession of the flat was to be delivered, by enhancing the said amount by Comparative Housing Price Index, issued by the National Housing Board, as on the date of filing of the Complaint with simple interest @ 9% p.a. from the date of filing of the complaint till realization. The amount so arrived and payable to the Appellant, would be in addition to the amount already awarded by the State Commission.
17. Consequently, we allow the appeal, set aside the impugned order and remand the case back to the State Commission for computing the total amount of compensation on the basis indicated above. The Appellant shall also be entitled to costs, quantified at ₹20,000/-.
18. Since the Complaint was filed as far back as in the year 2006, we request the State Commission to complete the aforesaid exercise as expeditiously as practicable, after affording adequate opportunity to the parties to lead evidence regarding the market value of the flat as also the price index.
19. The parties/their counsel are directed to appear before the State Commission on 29.05.2015 for further proceedings.
......................J D.K. JAIN PRESIDENT ...................... VINAY KUMAR MEMBER ...................... M. SHREESHA MEMBER