National Consumer Disputes Redressal
Delhi Development Authority vs Efficient Offset Printers on 10 January, 2014
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 12 OF 2008 (Against the order dated 07.09.2007 in Complaint Case No.C-135/1998 of the State Commission, Delhi) Delhi Development Authority Vikas Sadan, INA New Delhi ...... Appellant Vs. Efficient Offset Printers Prop. Shri Sanjay Arya, House No.479 Sector-14 Gurgaon, Haryana .....Respondent BEFORE: HONBLE MRS. VINEETA RAI, PRESIDING MEMBER HONBLE MR. VINAY KUMAR, MEMBER For the Appellant: Mrs. Girija Wadhwa, Advocate For the Respondent: Mr. Anoop K. Kaushal, Advocate PRONOUNCED ON: 10-01-2014 ORDER
PER MR. VINAY KUMAR, MEMBER Appellant Delhi Development Authority has challenged the decision of the Delhi State Consumer Disputes Redressal Commission in CC No.135 of 1998. The matter before the State Commission arose out of an auction of a plot of land on 18.9.1996 by the DDA in which the respondent /Complainant was the successful bidder.
2. Despite payment of the full amount of Rs.7,55,050/-, possession of the plot was not given to the Complainant. On the contrary, a letter of cancellation was issued on 21.8.1997. The DDA forfeited the earnest money and refunded the balance i.e. 75% of the paid amount. Therefore, a consumer complaint was filed before the State Commission with a prayer that either possession of the plot should be handed over to the Complainant or the entire amount paid by him should be refunded with interest, compensation and costs.
3. The State Commission rejected the contention of the DDA that they were entitled to forfeit 25% of the amount i.e. Rs.1,88,700/- as earnest money. The Commission allowed full refund together with 9% interest on the forfeited amount and Rs 10,000 as cost of litigation.
4. We have carefully perused the records and heard Mrs. Girija Wadhwa, advocate for the appellant/DDA and Mr. A.K.Kaushal, Advocate for the respondent/Complainant. The appeal has been filed with delay of 59 days which, considering the explanation of the appellant, is condoned.
5. For better appreciation of the case of the two sides, we find it necessary to refer to the following averments made on their behalf before the State Commission. As per the complaint petition :-
12. The complaint paid the following scheduled amounts in pursuance of the aforesaid transaction and Plot no.02 in Block CP, Pocket 3, Bindapur, Dwarka, Delhi admeasuring 100 sq. mts.
or thereabouts was allotted in its favour vide Demand letter dated 24.9.1996:
i) Demand Draft at the time of the bid Rs. 10,000.00
ii) Cash on account of Earnest Money Rs. 1,78,750.00
iii) Pay Order No.104180 dt.
22.10.1996 On account of instalment Rs.3,00,000.00
iv) Pay Order No.104244 dt.
26.11.1996 On account of instalment Rs.2,00,000.00
v) Pay Order No.154924 dt.
7.11.1997 On account of final instalment Rs.66,300.00 Paid, and acknowledged by DDA After illegal cancellation of allotment
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Total Rs. 7,55,050.00
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(Rupees Seven Lakhs Fifty Five Thousand Fifty only)
6. In response, the Written Submission of Appellant/DDA before the State Commission states that :-
It is submitted that there was no question of installments in case of Auction as per Nazul Rule 1981 and DDA Act 1957. It is further denied that there was any provision of making the payment of premium in various installments. Moreover as per demand letter dated 24.9.96 no such condition existed. The complainant was to deposit Rs.5,66,300/- by 24.10.96, failing which bid would cancel and earnest money was to be forfeited. The clause 2 (VIII) is stated here below.
IN CASE THE PAYMENT IS NOT RECEIVED WITHIN STIPULATED PERIOD INDICATED IN THE DEMAND LETTER THE AUCTION BID SHALL AUTOMATICALLY STANDS CANCELLED AND 25%, EARNEST MONEY SHALL STAND FORFEITED WITHOUT ANY NOTICE.
It is pertinent to mention here that if the successful bidder wanted extension than under clause 2 (VI) he had to move an application accordingly.
The clause 2 (VI) is stated here below Provided that the Vice Chairman, DDA may extend the last date of payment, where he is satisfied that the sufficient reasons exist for doing so upto maximum of 180 days subject to payment of interest on the balance amount @ 18 % per annum where the delay is 30 days.
Provided that any such application for seeking extension of time should be submitted in person to the Deputy Director concerned at least 7 days before the last date of payment.
The respondent took a lenient view, as per the terms and condition of the Auction, if payment of premium is received within 180 days from the due date the competent authority can consider the request of successful bidder provided he made the request for extension in advance and that too subject to the payment of interest as per rules. The respondent considered the request of the complainant in granting the extension of time but there was a provision in Rule 29 of Nazul Land rules, the extension could be granted upto 180 days and beyond this limit the Ministry was requested vide this office letter dated 5.1.98 for relaxing the rules 29 whereas Ministry declined the request of Department vide their letter dated 28.7.98. The letter is annexed herewith as R2.
The respondent had no option but to comply with the orders of the ministry. Accordingly the complainant was informed and Rs.5,66,300/- was refunded after forfeiting the earnest money.
7. What comes out from the respective averments extracted above is that:-
(a) As per the demand letter of 24.9.1996, the Complainant was given time till 24.10.1996 only to pay the entire amount.
But, DDA accepted the payments well beyond 24.10.1996.
(b) The payment of total sum of Rs.7.55 lakhs was spread over the period from the date of auction on 18.9.1996 to 7.11.1997, when the last payment of Rs.66,300/- was made. These payments and their dates are not denied on behalf of the appellant/DDA.
(c) The position under the extant Rules notwithstanding, extension of time was not only sought by the Complainant but also recommended by the DDA. Admittedly, the letter of recommendation from the DDA was of 5.1.1998.
(d) This recommendation for extension of time was made by the DDA to the Government well after receiving the entire amount from the Complainant.
8. Learned counsel for the DDA argued that under the rules, the appellant had authority to deduct the earnest money but simultaneously agreed that It had no authority to accept any payment from the complainant beyond 180 days, without approval of government. However, the main ground urged by the learned counsel was that the State Commission had no jurisdiction in this matter, as the complainant, being a purchaser in auction, is not a consumer. She sought to rely on the decision of Hble Supreme Court of India in U T Chandigarh Administration Vs. Amarjit Singh & others. (2009) 4 SCC 660 and argued that in terms of the law as laid down in this decision, no purchaser of a site in open auction can be a consumer of the authority that conducted the auction. Her argument makes it necessary for us to go into the facts and the ratio decidendi of this decision.
9. Facts, as seen from the above decision, were that respondents, Amarjit Singh and 3 others were successful bidders for sites in an auction held on 18.12.1996. As per the advertisement issued for this auction, it was for grant of lease for 99 years to bidders of highest premium. In addition to the premium amount, the lessee had to pay annual rent at the rate of 2.5% of the premium for 33 years. This was to increase to 3.375% for the next 33 years and to 5% for the remaining 33 years. 25% of the premium amount was to be paid at the fall of the hammer and the remaining 75% within 30 days of the auction, without interest The lessee could also opt to pay this 75% in three equated annual instalments, with 10% interest. However delay, if any, in payment of the instalments was to carry interest liability at 24%. The successful bidder was given 3 years to complete construction on this plot. Acceptance/Confirmation of the bid was communicated to the respondents/complainants by the letter of 19.5.1997 offering possession. The letter also fixed 18.12. 1997, 1998 and 1999 as the dates for payment of three instalments of the 75% of the bid premium amounts. It required the respondents to sign the lease deeds within 6 months.
10. The respondents paid the first annual amount of 25% with delay and defaulted on the other two. Then, they filed a consumer complaint before the State Commission, UT of Chandigarh alleging that the appellant did not provide any amenities for these sites due to which they had suffered huge losses. They contended that until the basic amenities were provided, the appellants were not legally entitled to claim the balance of premium or the annual rent.
11. The appellant/UT of Chandigarh opposed the claim and contended that they had not made any representation to the public in general or the complainants in particular that the plots auctioned were fully developed, nor was payment of premium or rent subject to provision of any basic amenities. Therefore, the respondents could not link the issue of payment of instalments with the issue of basic amenities.
12. The State Commission allowed the complaint and directed that the payable instalments shall be rescheduled with effect from the date all the basic facilities are actually provided. It also directed that the amount deposited by the complainants shall earn interest at 18% from the date of deposit till the date of provision of the facilities. The National Commission partially allowed the appeal of the Chandigarh Administration but directed it to re-fix these instalments from 1.5.2005, 2006 and 2007 and reduced the interest payable until then by the complainant to 10%. The Apex Court allowed the appeal of the Chandigarh Administration, set aside the order of the National Commission and dismissed the complaints. The court has held that
20. Where there is a public auction without assuring any specific or particular amenities, and the prospective purchaser/lessee participates in the auction after having an opportunity of examining the site, the bid in the auction is made keeping in view the existing situation, position and condition of the site. If all amenities are available, he would offer a higher amount. If there are no amenities, or if the site suffers from any disadvantages, he would offer a lesser amount, or may not participate in the auction. Once with open eyes, a person participates in an auction, he cannot thereafter be heard to say that he would not pay the balance of the price/premium or the stipulated interest on the delayed payment, or the ground rent, on the ground that the site suffers from certain disadvantages or on the ground that amenities are not provided.
21. With reference to a public auction of existing sites (as contrasted from sites to be formed), the purchaser/lessee is not a consumer, the owner is not a trader or service provider and the grievance does not relate to any matter in regard to which a complaint can be filed. Therefore, any grievance by the purchaser/lessee will not give rise to a complaint or consumer dispute and the fora under the Act will not have jurisdiction to entertain or decide any complaint by the auction-purchaser/lessee against the owner holding the auction of sites.
13. From the above it is clear that the decision of the Apex Court was in the specific context of the demand for provision of basic amenities in relation to auction of existing sites. Learned counsel for the DDA has completely failed to explain how the above decision is applicable to a consumer complaint against forfeiture of the earnest money after acceptance of the full bid amount from the auction purchaser and failure to deliver possession to him. In our view, there is nothing in the above decision of the Apex Court which permits unqualified exclusion, from the purview of the Consumer Protection Act, 1986, of all those consumer complaints which arise from public auction of a plot or site. Therefore, we reject the contention of the appellant/DDA that the in terms of the decision in the above cited case, the complainant is not a consumer.
14. In our view the State Commission was very right in observing that if the DDA had authority to condone the delay of 180 days only, it should not have accepted the payment thereafter. The unquestioned facts remain that the appellant/DDA has accepted the full bid amount for the auctioned site and thereafter, failed to deliver its possession. In such a situation, the question of forfeiture of the earnest money does not arise.
15. In the light of the details discussed above, we find no merit in this appeal. The appeal of the DDA is consequently dismissed and the order of the Delhi State Consumer Disputes Redressal Commission in CC/135/1998 is confirmed. No orders as to costs.
...Sd/-.
(VINEETA RAI) PRESIDING MEMBER ..Sd/-..
(VINAY KUMAR) MEMBER S./-