National Consumer Disputes Redressal
I. Srinivas Rao vs R. Nagesh & Anr. on 1 July, 2022
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 678 OF 2021 (Against the Order dated 01/04/2021 in Complaint No. 627/2017 of the State Commission Karnataka) 1. I. SRINIVAS RAO S/O SRI I. BHASKAR RAO, PARTNER OF M/S ADHUNIK BUILDERS HAVING ITS REGD. OFFICE AT FLAT NO. 101, PLOT NO-617 PARIMALA PRIDA APARTMENTS A.E.C.S LAYOUT, IST MAIN OPP. BROOKFIELD, KUNDALAHALLI BENGALURU-560035, KARNATAKA ...........Appellant(s) Versus 1. R. NAGESH & ANR. S/O SRI RAMAIAH
RESIDING AT NO-140, IST CROSS SIDDAPURA, RAMAGONDANAHALLI BENGALURU NORTH BENGALURU-560066, KARNATAKA 2. PREM KUMARA N.(PROFORMA RESPONDENT) S/O N. SATYANARAYANA, PARTNER OF M/S ADHUNIK BUILDERS, HAVING ITS REGD. OFFICE AT FLAT NO. 101, PLOT NO-617 PARIMALA PRIDE APARTMENTS A.E.C.S. LAYOUT, IST MAIN .OPP BROOKFIELD, KUNDALAHALLI BENGALURU-560035 KARNATAKA ...........Respondent(s)
BEFORE: HON'BLE MR. C. VISWANATH,PRESIDING MEMBER HON'BLE MR. JUSTICE RAM SURAT RAM MAURYA,MEMBER
For the Appellant : Mr. N. Rajaraman, Advocate For the Respondent : Respondent No.2 : Mr. Satish Galla, Advocate
: Mr. Subrata Das, Advocate
For the Respondent-1 : Mr. Bikram Singh Patel, Advocate
: Mr. Aditya Raghav B., Advocate
Dated : 01 Jul 2022 ORDER
1. Heard Mr. N. Rajaraman, Advocate, for the appellant and Mr. Bikram Singh Patel, Advocate, for respondent-1.
2. I. Srinivas Rao, one of the partner of M/s. Adhunik Builders (the opposite party) has filed above appeal from the order of Karnataka State Consumer Disputes Redressal Commission, Bengaluru dated 01.04.2021, passed in Consumer Complaint No.627 of 2017, allowing the complaint with cost of Rs.50000/- and directing the opposite parties to complete the construction of the apartment and handover its possession to the complainant as per Joint Development Agreement dated 20.09.2010 and pay compensation of Rs.90/- lacs, for delay.
3. The office has reported 156 days delay in filing the appeal. Impugned order was passed on 01.04.2021 and the appeal was filed on 04.10.2021. During this period, the limitation was waived by Supreme Court in Suo Moto Writ Petition No.3 of 2020. As such, we treat the appeal, having been filed within limitation.
4. Mr. R. Nagesh (respondent-1) filed CC/627/2017 for directing M/s. Adhunik Builders and its partners (the opposite parties) (i) to complete the construction of the apartment and handover its possession to the complainant as per Joint Development Agreement dated 20.09.2010, (ii) to handover all original documents pertaining to the property, for which, Joint Development Agreement dated 20.09.2010 was executed, (iii) to pay compensation of Rs.90/- lacs, for delaying the construction of the apartment, (iv) to pay compensation of Rs.5/- lacs, for mental agony and harassment and (v) any other relief, which is deemed fit and proper in the circumstances of the case.
5. The complainant stated that M/s. Adhunik Builders and its partners Prem Kumar N. and I. Srinivas Rao (hereinafter referred to as the builder) was a partnership firm and engaged in the business of development and construction of building and selling its unit to the prospective buyers. The complainant and his family members were owner of BBMP Khata SI No.680, Old No.682/471/28/1, comprised in converted Sy. No.28/1 (area 36.5 Guntas of land) (an area of 7.5 Guntas of this plot was acquired vide registered Partition Deed dated 08.03.2002 as Document No.12856/2001-02, Block-1, Sub-Registrar Bangalore South, on which office of Special Deputy Commissioner Bangalore was constructed) (total area 1 acre 3.08 Guntas) situated at village Thubarahalli, Varthur Hobli, earlier Bengaluru South Taluk and presently Bengaluru East Taluk. Between the builder and all the co-sharers of aforesaid land a Development Agreement was executed on 20.09.2010, for construction of basement, ground floor and 4 upper floors. They agreed for 50% of super constructed area of the co-sharers of the land and remaining 50% of the builder. A Supplementary Agreement dated 20.09.2010 also was executed between the parties, in which, the details of flat numbers falling in the share of the parties were disclosed. The co-sharers of the land executed a General Power of Attorney and handed over the document of title of the land to the builder, for getting sanction of Layout Plan and other statutory approvals. Under the Agreement, construction of the apartment had to be completed within 36 months from 10.02.2011. Layout Plan of the building was sanctioned by the competent authority on 18.05.2011. The builder, thereafter, started construction not strictly according to sanction layout plan and did not take interest in completing it. On the basis of General Power of Attorney of the complainant and his family members, the builder started selling, the flats of the share of the complainant and his family members also. The complainant and his family members approached the local police but the police refused to take any action in the matter. R. Ravi, the brother of the complainant then filed a civil suit i.e. O.S. No.25145 of 2014, in which, initially interim injunction was granted, which was later on vacated vide order dated 05.03.2014.The complainant and his family member requested the builder to proceed with the development agreement dated 20.09.2010 but they were not giving any heed. The complainant gave a legal notice to the builder, in this respect. Although the notice was served upon the builder but they did not reply. Then the complaint was filed on 06.12.2017.
6. The builder avoided service of the notice of the complaint. State Commission, therefore, permitted service of notice through publication. The notices were published in two local newspapers on 01.08.2018. The opposite parties failed to file their reply within statutory period from service of notice as provided under Section 13 (2) of Consumer Protection Act, 1986 as such their right to file written reply was closed and they were proceeded ex-parte. Opposite party-2 later on put appearance through counsel on 25.09.2019 and filed written reply but did not make any effort for recall of the order, proceeding ex-parte.
7. The complainant filed Affidavit of Evidence of R. Nagesh and documentary evidence. State Commission, by judgment dated 01.04.2021, relying upon the judgment of Supreme Court in Faqir Chand Gulati Vs. Uppal Agencies Pvt. Ltd., (2008) 10 SCC 345, held that the complainant was 'consumer' within the meaning of Consumer Protection Act, 1986 and the complaint was maintainable. Under the Joint Development Agreement dated 20.09.2010, the construction had to be completed within 36 months from 10.02.2011, which period has expired on 10.02.2014 but the construction was not completed as such there was deficiency in service on the part of the builder. On these findings the complaint has been allowed and order as stated above has been passed. Hence this appeal has been filed.
8. We have considered the arguments of the counsel for the parties and examined the record.
9. The first ground raised by the counsel for the appellant is that the Joint Development Agreement dated 20.09.2010 contained an Arbitration Clause, therefore, the dispute between appellant and the respondent-1 has to be referred to the Arbitrator, but the State Commission has illegally failed to take notice of this Arbitration Clause. This argument has no substance inasmuch as it has been held by Supreme Court in EMAAR MGF Land Limited Vs. Aftab Singh, (2019) 12 SCC 951, the remedy under Consumer Protection Act, 1986 is an additional remedy and the Arbitration Clause does not bar the remedy. Therefore, State Commission has not committed any illegality in not referring the dispute to Arbitrator.
10. In Paragraph 3 of the judgment, State Commission has held that the notice has been served upon the opposite party through publication vide Hindu daily newspaper on 01.08.2018. Even after publication, the opposite party remained absent on the date fixed, Therefore, they were proceeded ex-parte. This finding has not been challenged by the appellant in the memorandum of appeal. It has been stated in paragraph 7 of memorandum of the appeal that opposite party-2 filed written statement on 05.07.2019. Section 13(2) of Consumer Protection Act, 1986 provides 30 days period after service of notice for filing the written reply. In the present case, the notice was served through publication in newspaper on 01.08.2018 and 30 days period expired on 31.08.2018, but no written reply has been filed. On the date fixed in the notice, the opposite party did not appear before the State Commission, therefore, the State Commission proceeded ex-parte again them. Filing of written statement on 05.07.2019 does not entitle the opposite party that it should be read in their defence. Firstly, the maximum period of 45 days for filing written reply has already expired and in view of judgment of Constitution Bench of Supreme Court in New India Assurance Company Limited Vs. Hilli Multipurpose Cold Storage Private Limited, (2020) 5 SCC 757, State Commission had no jurisdiction to extend the period of limitation beyond 45 days period after the date of service of notice.
11. So far as OS No.25145 of 2014 filed by R. Ravi brother of Respondent-1 is concerned, it has been stated that the builder was not constructing the building in accordance with sanctioned layout plan. Therefore, a notice has been issued to the builder to raise construction in accordance with sanction lay out plan. In spite of notice, the builder proceeded to raise construction, therefore, OS No.25145 of 2014 was filed in which initially interim injunction was granted, but when the builder had contested the application it was finally rejected on 05.03.2014. Therefore, the construction was not delayed for more than two months due to filing of OS No.25145 of 2014.
12. The execution of Joint Development Agreement dated 20.09.2010 had not been disputed by the appellant. The Clause 6.1 of the agreement dated 20.09.2010 is quoted below:-
"The Promoter shall commence construction immediately and the Owners shall hand over the vacant possession of the Schedule Property for the purpose of construction immediately. The Promoter hereby agrees to complete the construction in all respects the Apartment Building and the Owners' constructed Area within 33 (Thirty Three) months' time from the date of the commencement of the construction after obtaining plan approval from the concerned authority, with an extended period of 3 months. However, the Promoter shall not incur any liability for any delay in delivery of the Possession of the Owner's Constructed Area, by reason of non-availability of Cement and/or Steel and/or by Government Restrictions and/or by reasons of Civil Commotion, any act of God or due to any Injunction or Prohibitory order (not attributable to any action of the Promoter) or conditions of force majored. In any of the aforesaid events, which are beyond the control of the Promoter, the promoter shall be entitled to corresponding extensions of time, for delivery of the said Owner' constructed area."
13. Under Clause 6.1 the construction has to be completed in all respects within 33 months with grace period of three months from the date of the commencement of the construction. Admittedly layout plan was sanctioned on 18.05.2011 and 36 months period has expired in May, 2014, while the complaint was filed on 08.12.2017. Till the date of filing of the complaint, the appellant has not been able to complete the construction in all respects and hand over possession to the respondent-1 and his family members in accordance with Joint Development Agreement dated 20.09.2010 and supplementary agreement dated 20.09.2010. Thus, finding of the State Commission that there was deficiency in service on the part of the appellant does not suffer from any illegality. No other ground has been raised by the appellant.
ORDER
In view of the aforesaid discussions, the appeal has no merit and is dismissed.
...................... C. VISWANATH PRESIDING MEMBER ......................J RAM SURAT RAM MAURYA MEMBER