National Consumer Disputes Redressal
Dr. Ramakrishna Velamati & Anr. vs M/S. Maruthi Corporation Ltd. & Anr. on 26 May, 2015
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER CASE NO. 37 OF 2011 1. DR. RAMAKRISHNA VELAMATI & ANR. Power OF Attorney Holder, Mr. Benerji Velamati,
2800. N. Lakeshore Drive. apt. 3710. Chicago IL - 60657, USA 2. Dr. Mrs. Sudha Velamati Power of Attorney Holder, Mr. Benerji Velamati, 2800. N. Lakeshore Drive. Apt. 9710. Chicago IL 60657 USA ...........Complainant(s) Versus 1. M/S. MARUTHI CORPORATION LTD. & ANR. Represented by Its Managing Director, Sri. Dr. K. Ram Reddy, Plot No. 382, Road No.82, Film Nagar, Jubilee Hills, Hyderabad - 500 033 2. DR. K, RAM REDDY Son Of Sri K. Vengal Reddy, managing Director, M/s. Maruthi Corporation, 501. Mayfair Gardens 8-2-682/3 Road 12, Banjara Hills Hyderabad - 500 033. ...........Opp.Party(s)
BEFORE: HON'BLE MR. JUSTICE J.M. MALIK, PRESIDING MEMBER HON'BLE MR. DR. S.M. KANTIKAR, MEMBER
For the Complainant : Mr. Rakesh Sawhney, Advocate
With Ms. Renu Verma, Advocate For the Opp.Party : : Mr. BKV Subrahmanyam, Advocate
With Mr. Judy James &
Mr. Pervinder, Advocates
Dated : 26 May 2015 ORDER PER JUSTICE J.M. MALIK
1.Dr. Ramakrishna Velamati and Dr. (Mrs.) Sudha Velamati, the complainants, are neutralized US citizens. They are Doctors (Physicians) working in the United States of America. M/s. Maruthi Corporation Ltd., OP1 and Dr. K. Ram Reddy, OP2, in USA, represented to the complainants that they had obtained a lay-out approval from the concerned authority for developing the entire land of 46 acres divided into 162 residential plots. They further claimed that they were the owners as well as developers of the said land. They also explained that they are dealing with US NRIs. The price of the said plot was stated to be Rs.2.00 crores. On 21.09.2006, the complainants paid USD 91,100, equivalent to Rs.41,65,000/- by way of cheque and another sum of USD 10,000, equivalent to Rs.4,56,000/-, on 23.09.2006, the total being, Rs.46,21,000/- in all.
2. The OPs executed the registered Sale Deed of plot measuring 1000 sq.yds bearing Plot No.113 in Sy. Nos. 585, 586, 587, 591 and 592, situated at Maruthi Green Fields, Chattanpally Village and Gram Panchayat, Faruqnagar Mandal, Mahboobnagar District, in favour of the complainants on 10.10.2006. As per the Sale Deed, the consideration for the land value is Rs.1,90,000/-.
3. The complainants further paid USD 90,000, equivalent to Rs.39,59,500/- on 15.10.2007 and on 18.10.2008, a sum of USD 50,000, equivalent to Rs.19,83,250/- and again on 27.03.2008, the complainants further paid a sum of USD 1,00,000, equivalent to Rs.39,66,500/- to the OPs. The receipts were duly issued. Thus the complainants paid a total sum of USD 341,000, equivalent to Rs.1,58,56,500/-. The complainants issued cheque in the sum of USD 30,000 in favour of the OPs, but since there was no progress, the complainants cancelled the said cheque. OP2 visited USA, met the complainants and there was a written contract in printed form, agreement for purchase of plot No.113 with the proposed residential house. The proposed house situated at Chattanpally Village, Shadnagar Mandal, Mahaboobnagar, measuring 5690 sq.ft, for a total consideration of Rs.2.00 crores which was dated by the OP No.2 as 03.10.2008, copies of the above said documents, receipts, etc., have been placed on record, as Annexures C-1 to C-5.
4. It is alleged that after receipt of such a huge amount, the OPs failed to develop the township with the amenities, as promised. The complainants visited India in the month of March, 2010 and were shocked to learn that there was no development. They took photographs of the spot in 13.11.2010 which are placed on record as Annexure C-6 (Colly). This was completely deserted with no activity of any kind. On the contrary, the spot was further deteriorated since last visit in March, 2010. There are 22 structures, out of 162 promised, all belonging to the US NRIs, abandoned, with no sign of activity in the recent past, except occasionally, hasty attempt to make it appear as progress to the pre-arranged visiting NRI. The complainant's proposed building was is far more worse, a skeleton of pillars and naked rusted iron with no roof greeted in place of dream home. The complainants were taken for a ride. They felt cheated. Legal notice and reply in response to the same have been placed on record as Annexures C-7 & 8.
5. Ultimately, this complaint was filed in this Commission on 03.03.2011, with the following prayers :-
"a) Allow the complaint and direct the opposite parties to pay a sum of USD 3,41,000 equivalent to Rs.1,58,56,500/- along with interest @ 24% p.a., from the date of receipt of sum periodically, till payment.
b) Another sum of Rs.50 lakhs with interest @ 24% from the date of filing of this complaint till realization and the particulars of which are, as follows :-
i) for mental agony Rs.25,00,000/- ii) for damages Rs. 25,00,000/- c) Award costs of the litigation.
d)Pass any other or further order which this Hon'ble Commission may deem fit and proper in the facts and circumstances of the case".
6. The present complaint was contested by both the OPs who have filed separate written versions. It is admitted that OP1 is a Public Ltd. Company incorporated with an aim to create and develop residential units to cater all segments of people with its areas of interest from Rural Housing to Luxury World Standard Villas. OP No.1 has invested in large land banks around HMDA (Hyderabad Metropolitan Authority Development) limits. OP1 has successfully completed several prestigious projects. It enjoys a very good reputation. It has already completed projects like Maruthi Nest, Maruthi Heights, Chaitanya Nagar, RTC colony Samrat Nagar. Residential plots are open in Maruthi Complex, Ram Enclave, RB Enclave, Hemanth Residency, Green Valley, etc. All the facts regarding Maruthi Green Valley are admitted. The Agreement dated 03.10.2008 is also admitted. In the written statement, the relevant extracts from the Agreement are quoted which are also reproduced here, as under :-
"12.That the Developer shall make all earnest attempts to complete the construction of residential houses township as early as possible. The parties mutually accept that the construction of residential houses township shall be completed stage by stage from the date of sanction of layout plan. The Developer hereby agrees that they shall complete the construction of the residential houses township within a period of 48 months from the date of sanction of house plan.
26.The Developer agrees that the entire construction of the residential house shall be completed within 48 months from the date of sanction of construction plan. If the Developer fails to complete the construction within 24 months from the date of sanction of construction plan, the Developer is liable to pay nominal rent at the rate of Rs.10,000/- per month as penalty".
It is also admitted that OP1 has already received a sum of Rs.1,46,16,217/-.
7. The most important fact of this case is about the period of construction, which OP1 submits that the plan could not be finalized till date due to the delay that has been caused by the complainants in finalizing the plan. The OPs obtained a sanction plan but the complainants made substantial changes to the sanction plan thereby making the sanction plan useless. The sanction plan dated 12.04.2008, Annexure R-2 has been placed on record. The complainant, vide emails dated 12.04.2008, 29.04.2008, 01.05.2008, 12.05.2008, 10.06.2008, 04.07.2008, 08.10.2008, 29.10.2008 and 30.10.2008 suggested several changes and modification to the original approved plans. It is averred that the type of Villa, i.e., booked by the complainants is a Mediterranean Villa and as the name itself denotes, the shape, design of the plan of the said Villa would be in such a manner that it would exactly look like a Mediterranean styled house. It is submitted that the OPs by putting in a lot of research and efforts prepare plans for each of the plots in their venture, each of the plots are designed and planned, in a particular manner and have been given names which are in consonance with the model and shape of the Villa. The complainants also sent various photographs so that their Villa may match with it. Moreover, when the work was in progress, with regard to the complainants' Villa, the complainants requested for a change/modification in the plan and the OPs were constrained to demolish certain part of the already constructed house of the complainants. It is explained that due to changes suggested at the behest of the complainants, the Villa does not have resemblance to a Mediterranean modeled Villa. The OPs did not have any kind of obligation under the agreement to make substantial changes to the original plans. It is contended that the OPs will hand over the Villa in 48 months from the date of sanction of the plan, but the plans regarding the complainants' Villa could not be finalized. It is contended that as a matter of fact the OPs postponed to hand-over the property from 36 months to 48 months, from the date of finalization of the plans. The OPs never contravened with the agreement. It is explained that other Villas whose plans were sanctioned are in progress.
8. It is further explained that the OPs had spent a whopping amount on this project. Till date, only 27 Villas were sold to NRI customers. Out of 27 Villas booked, 3 of the customers failed to make the initial amount. The total sale consideration for the remaining 24 Villas as per the agreement is Rs.45,65,98,961/-. The actual amount received from the complainants is only Rs.13,67,26,330/-. It is averred that the amount due to the OPs as per the agreement is Rs.31,98,72,631/- and as on date, the actual amount due to the OPs is Rs.53,40,14,625/-, including interest on the outstanding amount. It is explained that the OPs are supposed to receive as per the agreement, the consideration of 24 Villas is Rs.40,46,98,961/- and out of that amount, the OPs received only Rs.8,48,26,330/-. The construction of 22 Villas had also been completed. The OPs have incurred an amount of Rs.5,09,11,985/- for the development of the common area. Again, there is global recession. The real estate and construction business have severely affected due to global recession. The customers of the OP1 who booked their Villas are also affected by global recession. They have not paid substantial payments. The complainants are to abide by the terms and conditions of the plan.
9. Now, we advert to the defence set up by OP2. Its defence is similar to that of OP1's.
10. We have gone through the written synopses filed by both the parties. OPs 1 & 2 have joined hands in filing the written arguments, jointly. According to the OPs, it is contended that the construction of the plot has been completed by more than 85% and the same can be handed over to the complainants subject to the payment of dues in the sum of Rs.53,83,783/-, plus interest and other charges. It was further contended that as per Article 26 of the Agreement, the Villa was to be constructed within 48 months from the date of sanction of house plan. It was claimed that without prejudice, the construction was to be completed by April, 2012, after complete payment of upfront. The complainants sought many changes through emails, mentioned above. On 12.04.2008, a sanction premises for the construction of the house of the complainants was granted by the Office of the Grampanchayat, Chatanpally Village. The sanction plan has been placed on record marked as Annexure R1. Copy of the notification regarding sanction of this house has been placed on record as Annexure R-2. HMDA came into existence on 25.08.2008. Till April, 2007, the statutory authority was with the Gram Panchayat for forming the layout of the lands sanctioning the building permissions to the individual houses. The Gram Panchayat was empowered till 12.04.2008. It was also pointed out that on the one hand, the complainants contend that their signatures were obtained at USA, but the agreement itself mentions that it was executed at Hyderabad. It is contended that they will take six months more in completing the Villas.
11. For the following reasons, we are unable to clap much significance with this skimble scamble explanation given on behalf of the OPs. It is clear that until now the construction has not yet been completed. As per the agreement, the Ops are liable to pay Rs.10,000/- per month i.e. 1.2 lacs in a year and Rs.3.6 lacs till April 2015. It is quite fathomable as to why did the OPs adopt a Fabian policy (a dilatory policy). They have partly succeeded to feather their own nest i.e. to make profits for themselves at the expenses of others. The discussion regarding change of design came to an end in the year 2008, itself. No further e-mail by the complainants, saw the light of the day.
12. It was next argued on behalf of the OPs that the complainants waddled out in paying the remaining two installments in the sum of Rs.53,83,783/-. The amount was demanded vide emails dated 12.02.2009, 19.02.2009, 21.02.2009, 24.02.2009, 01.04.2009 which have been placed on record as Annexure 1 of IA No.3270/2015. The OPs vide email dated 21.04.2009, sent a notice to the complainants that the construction of the Villa on the property in question would be sought with immediate effect and interest would be levied on outstanding interest and also on extra amount regarding construction re-activation charges if the remaining payment was not made.
13. Since there is huge delay on the part of the OPs in constructing the Villa, therefore, all these arguments advanced by the counsel for the OPs, pale into insignificance. The complainants are not required to pay the said amount until or unless the possession of the premises in dispute is handed over to them. That amount will be payable at the time of the possession of the said premises. It is well said that Justice delayed is not only Justice denied, it is also Justice circumvented, Justice mocked and the system of Justice, undermined.
14. Counsel for the Complainants has pointed out that it is doubtful that the plan was properly sanctioned or not. He has invited our attention towards the para Nos. 8 & 11 of the Agreement dated 03.10.2008, which are reproduced here as under:-
"8. That the DEVELOPER shall obtain necessary permissions either from the Chattanpalli Panchayat or any other authority for the purpose of construction of residential house at their expenses.
11. That the entire financial investment required for the sanction of the plan and the construction and the completion of the residential house shall be arranged by DEVELOPER, The PURCHASER has no concern with said investment".
This agreement was entered into on 03.10.2008. On the other hand, counsel for the OPs has produced the site plan, which shows that the site plan was already sanctioned on 12.04.2008. This is just like putting the cart, before the horse. It smacks of malafide intention on the part of the OPs.
15. Keeping in view, the facts and circumstances of the case and huge delay, we direct the OPs to complete the construction, within three months and put the complainants in possession of the said premises, along with sanctioned site plan and completion certificate from the competent authority, otherwise complainants will be compensated by the OPs by paying penalty in the sum of Rs.5,000/- per day, till the complainants are put in possession of the Villa in dispute, as per agreement. It is further ordered that if the OPs are unable to give the Villa, within a period of 6 months from today, they will return the entire amount to the complainants, in the sum of Rs.1,46,16,217/- along with interest @18% p.a., from the date of receipt of the sum, periodically, till payment. OPs have left no stone unturned in leading the gullible persons, up the garden path. We therefore, impose compensation / costs on the OPs, in the sum of Rs.2,00,000/-, which will be paid to the complainants, within 90 days from the date of receipt of copy of this order, otherwise, it will carry interest @ 18% p.a., till realization.
......................J J.M. MALIK PRESIDING MEMBER ...................... DR. S.M. KANTIKAR MEMBER