State Consumer Disputes Redressal Commission
Mr.Rentachintala Chandrasekhar ... vs M/S Aliens Developers Private Limited, ... on 15 April, 2014
BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION: HYDERABAD. C.C.No.28/2013 Between: 1. Mr.Rentachintala Chandrasekhar S/o.R.V.Subbaiah, aged 3 8 years, Occ:Managing Director. 2. Mrs.Divakaruni Neeraja W/o.R.Chandrasekhar Age , Occ: Both residing presently at 756 Bounty Drive #5608, Foster city, CA 94404 USA. Both represented by GPa holder Raveendra Nath Rentachintala, S/o.R.V.Subbaiah B/o.R.Chandrasekhar, age 39 years, Occ:Assistant Professor. All are permanent native residents of H.No.78-63 A, Krishna Nagar, Kurnool 518 002, Andhra Pradesh. Complainants And 1. M/s Aliens Developers Private Limited, Rep. by its M.D. Mr.Hari challa Regd. Office at Flat No.911, Teja Block, My Home Navadweep Apartments Madhapur, Hyderabad-500 081. 2. Mr.Hari challa Managing Director M/s Aliens Developers Private Limited, Regd. Office at Flat No.911, Teja Block, My Home Navadweep Apartments Madhapur, Hyderabad-500 081. 3. Mr.Venkata Prasanna Challa Joint Managing Director M/s Aliens Developers Private Limited, Rep. by its M.D. Mr.Hari challa Regd. Office at Flat No.911, Teja Block, My Home Navadweep Apartments Madhapur, Hyderabad-500 081. ..Opposite parties. Counsel for the complainants: Mr.B.Rajendra Kumar. Counsel for the opposite parties:M/s A.Krishnam Raju. QUORUM: HONBLE SRI JUSTICE GOPALA KRISHNA TAMADA, PRESIDENT. AND SRI R.LAKSHMINARASIMHA RAO, HONBLE MEMBER.
TUESDAY, THE FIFTEENTH DAY OF APIRL, TWO THOUSAND FOURTEEN Oral Order (As per Honble Sri Justice GopalaKrishna Tamada, President) *** This complaint is filed through General Power of Attorney Holder U/s.17 of Consumer Protection Act, 1986 for a direction to the opposite parties to refund Rs.23,06,603/- paid by them together with interest at 18% p.a. from the date of respective payments till realization together with compensation of Rs.7,00,000/- totalling to Rs.48,54,857.25/-.
The case of the complainants is that they are currently residing at USA and believing the representations made by the opposite parties, they intended to purchase a residential flat and entered into an agreement of sale with the opposite parties on 26-3-2008 to purchase Flat No.942 Station -7 on 9th floor having super built up area of 1687 sq ft. together with 36.27 sq. yds. of undivided share and two car parking space and the said flat was booked on 16-10-2006 by paying an advance of Rs.1 lakh for a consideration of Rs.44,06,421/-.
The complainants submit that out of the total consideration of Rs.44,06,421/- they had paid an amount of Rs.23,06,604/- towards earnest money and the receipt of the said amount is admitted and acknowledged by the opposite party. The complainants submit that as per clause 8 of the agreement of sale, the opposite parties are liable to deliver possession of the flat to the complainants within three (3) years from the booking date with a grace period of six months and the complainants are supposed to make payment as per payment schedule mentioned in agreement of sale stipulating levels of constructive progress.
The complainants submit that the opposite parties made no progress in constructing the Space Station and there was reasonable delay and therefore they were compelled to cancel the flat on a condition of complete refund of the earnest money paid along with interest and the opposite party agreed for the same by document dated 25-12-2009. The complainants submit that after getting the cancellation document from them, the opposite parties have neither repaid the earnest money paid nor interest and in mutual negotiations informed that the opposite parties are in search of new customer and it would be intimating the complainants as soon as the deal materializes through mail trails dated 10-1-2010 and 03-7-2011 respectively. The complainants further submit that they came to know that the opposite party resold the flat of the complainant to a third party by name, Kadiri Narasimha Reddy but has not settled payments to the complainant and therefore they were constrained to approach this Commission by way of this complaint.
Opposite parties filed written version contending that the complainants filed the complaint to gain out of breach of contract and the complaint is not maintainable in view of there being no consumer dispute and the arbitration clause in the agreement of sale providing for arbitration. It is contended that the complaint is filed for recovery of money which is not a consumer dispute and that once the agreement is cancelled and account is settled there is no relationship between the parties.
The opposite parties have submitted that the agreement was mutually cancelled and in view of novation of the contract there exists no relationship of builder and consumer between the opposite parties and the complainant. The opposite parties submitted application for conversion of agricultural land into non-agricultural land on 23.10.2006 and FTL clearance was granted on 30.12.2006.
Permission was granted on 14.04.2007 for conversion of agricultural land into non-agricultural land and thereafter HUDA earmarked the land as agricultural zone and the opposite patties have filed application for change of use of the land as commercial use zone.
The Municipal Administration and Urban Development (I) Department notified the land in survey number 384 as residential use zone. The project could not be commenced in view of proposed road under Master Plan, until realignment of the proposed road without affecting the land in survey number 384 is made. Realignment of the proposed road was approved on 3.04.2008 and the permission was accorded approving the building plan on 11.04.2008.The opposite parties have obtained NOC from the AP Fire Services Department on 15.12.2007 and subsequently it was reduced from 91.40 meters to 90.40 meters. The opposite parties obtained NOC from Airport Authority on 10.07.2009.
The opposite parties have submitted that HUDA accorded technical approval on 14.10.2009 for ground +20 upper floors and release of building permission upto 29 floors is awaited. The opposite parties have taken all necessary steps to complete the project at the earliest and the project being massive and due to the reasons beyond the control of the opposite parties , the opposite parties could not complete the project within the time frame. The opposite parties informed the complainants about the delay in completion of the project due to delay in clearance from the authorities concerned. In view of arbitration clause the complaint is not maintainable before this Commission.
The opposite parties submitted that they agreed to pay Rs.3/- per sq ft per month to maintain the goodwill and that too after payment of dues payable by the complainants in terms of Clause VIII(g) of the Agreement and the project was delayed due to reasons beyond their control. The flat was resold to third parties at the request of the complainants only and the said party also could not pay the amount and therefore the amount could not be paid to the complainants. The opposite parties further submitted that once the parties agreed for cancellation of the agreement, the relationship between the parties is seized under the agreement and if the amount, if any, is to be paid cannot be resorted before this Commission as the complainants are not consumers and prayed for dismissal of the complaint.
The G.P.A holder of the complainants filed his affidavit and marked Exs.A1 to A34. The Managing Director of first opposite party filed his affidavit in support of their case.
The learned counsel for the complainants and opposite parties filed their written arguments. The learned counsel for the opposite parties, submitted that the complainant does not come within the meaning of consumer and his remedy is elsewhere but not before this Commission and as there is a clause of arbitration, this Commission has no jurisdiction to entertain the complaint.
It is his further submission that interest @ 18% p.a. claimed by the complainants is on the higher side.
Heard.
The points for consideration are:
i) Whether the compliant is maintainable in view of arbitration clause in the agreement of sale?
ii) Whether the complaint is not a consumer dispute?
iii) Whether there is any deficiency in service on the part of the opposite parties ?
iv) To what relief?
The complainants entered in to an Agreement for Sale, Ex.A19 with the opposite parties on 26.12.2008 for purchase of Flat bearing No.942 Station -7 on 9th floor having super built up area of 1687 sq ft. together with 36.27 sq. yds. of undivided share and two car parking space and the agreement of sale provides reference to arbitration. The learned counsel for the opposite parties has contended that in view of the arbitration clause in the agreement, the complainants cannot maintain the complaint before this Commission. In terms of the agreement of sale, the dispute has to be decided by means of arbitration. However, remedy provided under the provisions of Consumer Protection Act is an additional remedy and in the light of law laid in National Seeds Corporation Ltd.
Vs. M. Madhusudhan Reddy reported in (2012) 2 SCC 506 wherein the maintainability of the complaint before consumer forum prior to the complainant having exhausted the other remedy was considered as under:
The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996 Act. Moreover, the plain language of Section 3 of the Consumer Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force.
The complainant has submitted that owing to failure of the opposite parties in completing the construction of the Flat No.942 which amounts to deficiency in service, they opted for cancellation of the agreement of sale and the opposite parties contend that in order to maintain cordial relations with the complainant, they agreed to cancel the agreement of sale. In pursuance of the mutual agreement for cancellation of the agreement of sale, as the opposite parties have not refunded the amount paid, the complainants have filed the complaint claiming the amount paid. As the complainants are not asking for any declaration or specific performance of contract etc., and their very prayer as per the complaint is for refund of the money, they have parted with, we are of the view that this complaint is maintainable and this is a consumer dispute.
Apparently the complainants parted with an amount of Rs.23,06,603/- and the last payment was made on 19-7-2008. From a perusal of the documents which are marked as Exs.A5 to A34, there is no dispute with regard to the payment and the harassment faced by the complainant due to non-refund of the amount after cancellation during these five years.
The first payment was made on 16-10-2006 with a fond hope that they could live in the flat comfortably by the year 2008. Their dreams were shattered and in those circumstances they consented to resale and requested the opposite parties to refund the amount paid. We are of the view that the complainants are entitled for refund of the entire amount paid with interest at 12% p.a. from the date of last payment which was made on 19-7-2008 till the date of realization together with costs of Rs.10,000/-.
Accordingly this complaint is allowed in part and the opposite parties are directed to refund the amount of Rs.23,06,603/- with interest at 12% p.a. from the date of last payment i.e. 19-7-2008 till the date of realization together with costs of Rs.10,000/- to be paid within a period of four weeks from the date of receipt of this order.
Sd/-PRESIDENT.
Sd/-MEMBER.
JM Dt.15-4-2014.
//APPENDIX OF EVIDENCE// WITNESSES EXAMINED For complainants: For Opp.parties:
G.P.A.Holder of complainants filed his affidavit. Managing Director of OP.1 Filed his affidavit.
Exhibits marked on behalf of the complainants:
Ex. A1: Register General Power of Attorney, dated 21.12.2012 Ex.
A2: Corporation Description/Promotion literature,.
Ex.
A3: Incorporation of OP-1, Dt:21-3-2006.
EX.
A4: Form-32 of OP-1, Dt:21-3-2006 EX.
A5: Specifications for space station project ID-ADS.
Ex.
A6: Price List of space station-I (Project ID-ADS).
EX.
A7: Flat Reservation Agreement, Dt:16-10-2006.
Ex. A8: Plan Showing the Proposed Residential Flats in Tellapur,Dt:23-11-2006.
Ex. A9: Payment Receipt,Dt:16-10-2006.
Ex.A10: Payment Receipt, Dt 30-11-2006.
Ex.A11: Payment Receipt,Dt:08-01-2007.
Ex.A12: Online Payment Remittance Details E-mail,Dt:20-12-2007.
Ex.A13: Payment Receipt, Dt 02-07-2008.
Ex.A14: Payment Receipt, Dt: 07-07-2008.
Ex.A15: Payment Receipt, Dt: 19-07-2008.
Ex.A16: Consolidated Statement of Account.Dt:18-10-2008.
Ex.A17: Document Similar to Statement of Account, Improperly Dated with pen (19/08).
Ex.A18: HUDA Technical Approval, Dt:11-04-2008.
Ex.A19: Agreement of Sale Deed, Dt 26-12-2008.
Ex.A20: Discount Conformation letter along with revised calculation, Dt: 20-07-2009.
Ex.A21(A): 30 storeyed building in city soon (HINDU), Dt: 09-06-2008.
Ex.A21(B): 30 storeyed building (title translated in English (AP),Dt:13-06-2008.
Ex.A21(C): HUDA approves / Tall order (HINDU), Dt:14-06-2008.
Ex.A21(D): Live Out of this World.
Ex.A22: OP-I Quarterly Update, Dt: May 2009.
Ex.A23: Quarterly Update, Dt May 2009.
Ex.A24(A-I) Nine Photographs along with CD, Dt: 25-12-2009.
Ex.A25: Third Party Petition before Human Rights Commission, Dt:18-12-2009.
Ex.A26:
Flat Cancellation Request, Dt:25-12-2009.
Ex.A27:
Mail Trail, Dt:10-01-2010.
Ex.A28:
Mail Trail, Dt:03-07-2011.
Ex.A29:
Mail Trail, Dt:13-05-2012.
Ex.A30:
Mail Trail, Dt:06-02-2012.
Ex.A31: Mail Trail, Dt:19-02-2012.
Ex.A32:
Legal Notice, Dt. 03-07-2012.
Ex.A33:
Price List, Dt: 29-06-2013.
Ex.A34:
Payment and Receipts Details, Dt: July 2012.
Sd/-PRESIDENT.
Sd/-MEMBER.
JM Dt.15-4-2014.