State Consumer Disputes Redressal Commission
Veenus & S.V.Projects Hyderabad And ... vs A.Saida Reddy S/O.Late A.Kasi Reddy ... on 22 July, 2013
BEFORE THE A
BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD.
F.A.No.731/2012 against C.C.No.750/2011 District
Forum-I
Hyderabad.
Between
1.
Veenus & S.V.Projects
Having office at flat No.504,
Raghavendra Golden Heights
Door No.2-2-12/7, Durgabhai
Deshmukh Colony, Bagh Amberpet,
Hyderabad, represented by its
Managing Partner, P.Ravi Kumar.
2.
T.Venkat Reddy S/o.T.Ram Reddy
Aged 44 years, Occ:Business,
(Partner of Veenus
& S.V.Projects)
r/o. Flat No.302, Block-B,
Laxmi Meadows, Lakdi-ka-pul,
Saifabad, Hyderabad. ..Appellants/
Opp.parties
And
A.Saida
Reddy S/o.late A.Kasi Reddy
Aged
51 years, Occ:Journalist,
R/o.Flat
No.G-1, Rohit Tower,
Street
No.8, Vidyanagar, Hyderabad-044. Respondent/
Complainant
Counsel
for the Appellants : M/s B. Vijaysen Reddy
Counsel for the Respondent: M/s V.Gourisankara Rao.
F.A.No.733/2012 against C.C.No.752/2011 District
Forum-I
Hyderabad.
Between
1.
Veenus & S.V.Projects
Having office at flat No.504,
Raghavendra Golden Heights
Door No.2-2-12/7, Durgabhai
Deshmukh Colony, Bagh Amberpet,
Hyderabad, represented by its
Managing Partner, P.Ravi Kumar.
2.
T.Venkat Reddy S/o.T.Ram Reddy
Aged 44 years, Occ:Business,
(Partner of Veenus
& S.V.Projects)
r/o. Flat No.302, Block-B,
Laxmi Meadows, Lakdi-ka-pul,
Saifabad, Hyderabad. ..Appellants/
And Opp.parties
Jinka
Nagarajau S/o.J.Narayana Swamy
Aged
53 years, Occ:Journalist,
R/o.House
NO.301, Shyama Gayatri Nilayam
Soubhagyapuram,
Mohannagar Colony,
Kothapet,
Hyderabad-35. Respondent/
Complainant
Counsel
for the Appellants : M/s B. Vijaysen Reddy
Counsel for the Respondent: M/s V.Gourisankara Rao.
F.A.No.735/2012 against C.C.No.754/2011 District
Forum-I
Hyderabad.
Between
1.
Veenus & S.V.Projects
Having office at flat No.504,
Raghavendra Golden Heights
Door No.2-2-12/7, Durgabhai
Deshmukh Colony, Bagh Amberpet,
Hyderabad, represented by its
Managing Partner, P.Ravi Kumar.
2.
T.Venkat Reddy S/o.T.Ram Reddy
Aged 44 years, Occ:Business,
(Partner of Veenus
& S.V.Projects)
r/o. Flat No.302, Block-B,
Laxmi Meadows, Lakdi-ka-pul,
Saifabad, Hyderabad. ..Appellants/
Opp.parties
And
P.Sridhar
S/o.P.Koteswara rao,
Aged
47 years, Occ:Journalist,
C/o.V.Shankar
Prasad, Plot No.484,
Gayatrinagar,
Borabonda, Hyderabad-35. Respondent/
Complainant
Counsel
for the Appellants : M/s B. Vijaysen Reddy
Counsel for the Respondent: M/s V.Gourisankara Rao.
F.A.No.905/2012 against C.C.No.818/2011 District
Forum-I
Hyderabad.
Between
1.
Puttala Ravi Kumar S/o.P.Saidulu
Aged 45 years, Occ:Business,
Managing Partner of Veenus & S.V.Projects
at flat No.504,
H. No.2-2-12/7,
Raghavendra Golden Heights
Durgabhai Deshmukh Colony, Bagh Amberpet,
Hyderabad-13.
2.
T.Venkat Reddy S/o.T.Ram Reddy
Aged 44 years, Occ:Business,
(Executive Partner of Veenus & S.V.Projects)
r/o. Flat No.302, Block-B,
Laxmi Meadows, Lakdi-ka-pul,
Saifabad, Hyderabad. ..Appellants/
And Opp.parties
T.Laxminarayana
S/o.T.Kondaiah Chowdary,
Aged
53 years, Occ:Social Service,
R/o.Kanduravaripalli
Village,
Chitvel
Mandal, Cuddapah District. Respondent/
Complainant
Counsel
for the Appellants : M/s B. Vijaysen Reddy
Counsel for the Respondent: - Party in person.
QUORUM: SMT.M.SHREESHA, HONBLE Incharge President
AND
SRI S.BHUJANGA RAO, HONBLE MEMBER.
MONDAY THE TWENTY SECOND DAY OF JUlY TWO THOUSAND THIRTEEN Order (Per Smt.M.Shreesha, Honble Incharge President) *** These appeals are disposed of by a common order, since the facts are similar in all these C.Cs.
F.A.No.731/2012:
Aggrieved by the order in C.C.No.750/2011 on the file of District Forum-I, Hyderabad , the OPs preferred this appeal.
The brief facts as set out in the complaint are that the complainant is the owner of plot No.116 measuring 270.39 sq. yds. in Sy No.74 Gopanapalle Village, Serilingampally Mandal and the opposite parties approached the complainant for developing his plot submitting that the neighbouring owners also were offering their respective plots for development. Induced by such an offer, the complainant accepted the proposal and entered into a development agreement-cum-GPA on 14-3-2008 with the opposite parties. Opposite parties paid Rs.5 lakhs to the complainant towards interest free refundable security deposit amount which is to be refunded to the opposite parties at the time of handing over possession of the flats to the complainants. The opposite parties had to get the necessary approvals and construct the residential complex and hand over 50% of the built up area within 30 months from the date of development agreement. Clause 9 of the agreement allows a grace period of six months and if there is any further delay, the opposite parties have to pay Rs.10/- per sft. per month to the complainant till they hand over possession of the built up area.
The complainant submits that except for performing the foundation ceremony, the opposite parties have not yet commenced the construction of the apartments, even though the schedule time of 30 months plus grace period of 6 months expired on 13-3-2011. Inspite of repeated requests, the opposite parties did not commence the construction and the complainant submits that the opposite parties neither applied for municipal approval nor commenced the construction of the building and therefore the development agreement is construed to be cancelled. The complainant by legal notice dated 22-4-2011 reiterated that he revoked and cancelled the development agreement dated 14-3-2008 and also forfeited the security deposit amount. The complainant demanded the OPs to return the original sale deed and pay rental loss at Rs.10/- per sft from 15-9-2010 till the date of return of original sale deed together with compensation of Rs.5,00,000/-. The legal notice sent to OP 1 was served and the one sent to OP 2 was returned with a postal endorsement unclaimed. OP 1 did not choose to reply to the legal notice. Vexed with their attitude the complainant approached the District Forum seeking directions to the OPs to return the original sale deed, to pay rental loss, compensation of Rs.5,00,000/- and costs.
Opposite parties filed counter stating that the complainant is not a consumer and that the relief claimed can be granted only under the provisions of Specific Relief Act and that this Forum does not have jurisdiction to entertain the complaint. OPs admit that the complainants entered into a Development-agreement-cum GPA on 22-3-2008 and a sum of Rs.5,00,000/- was paid towards refundable deposit and another sum of Rs.7,00,000/- was paid towards non-refundable deposit as per MOU dated January, 2008. The OPs contended that because of non-consensus between the plot owners, they were made to change the proposed plans several times and ultimately on 11-9-2009, the proposed plan submitted by the opposite parties was approved by some of the joint owners and for reasons best known, the others did not approve the plan and therefore the allegation that they did not apply for municipal approval nor commence the construction of the building is baseless. The complainants are not evincing any interest in approving the proposed plans and are further demanding that the opposite parties alter the terms and conditions of the development agreement. They deny that there is any deficiency in service on their behalf and submit that there is no cause of action for the complainant to file this complaint.
The District Forum based on the evidence adduced i.e. Exs.A1 to A5 and B1 & B2 and the pleadings put forward, allowed the complaint in part directing OPs. 1 and 2 jointly and severally to return the original sale deeds pertaining to the complainants property, pay Rs.10/- per sft per month from 13-3-2011 i.e. expiry date of 36 months, till realization and pay Rs.50,000/- towards compensation and Rs.2,000/- towards costs.
Aggrieved by the said order, the OPs preferred this appeal.
The brief point that falls for consideration is whether there is any deficiency in service on behalf of the OPs and if the complainant is entitled for the relief sought for in the complaint?
The appellants/OPs filed their written arguments. Heard both sides. The facts not in dispute are that the respondent/complainant entered into a development agreement-cum-GPA on 14-3-2008 with the opposite parties for development of his plot No.116 admeasuring 270.39 sq. yds. for which the OPs paid Rs.5,00,000/- towards interest free refundable security deposit amount evidenced under Ex.A2.
Ex.A2 clause 8 and 9 reads as follows:
8. The developer of the second part shall complete the construction in all Respects i.e. Residential flats, elevation, common areas and amenities Conforming to the specifications in the annexure not later than Thirty Months (two and half years) from the date of execution of this Development Agreement-cum-General Power of Attorney and shall hand over physical possession of the 50% of constructed area out of the total constructed area that can be built on the schedule of Property to the LANDOWNER of the First part in the shape of residential flats in proportionate to their entitled constructed areas out of said 50% of the total constructed areas together with parking areas and undivided share of land to be allotted towards the LANDOWNERS share.
9. However the grace period of 6 (six) months is allowed for completion of construction over and above said 30 (Thirty) months. If there is any delay even after the expiry of stipulated period of grace, then the Developer of the Second part shall forego the entire interest free refundable security deposit amount of Rs.5,00,000/- (Rupees five lakhs only) paid to the LANDOWNER, the Developer shall also be liable to pay an amount of Rs.10/- per sq. ft per month to the LANDOWNER of the FIRST PART in respect of such undelivered areas till its completion in all aspects and handing over of same to the LANDOWNER of the First part.
It is the complainants case that even after the lapse of 30 months plus six months grace period on 13-3-2011, the opposite parties did not even get the plans approved or commence the construction. The complainant got issued a legal notice dated 07-4-2011 evidenced under Ex.A3, calling upon the OPs to return the sale deeds, pay rental loss and also compensation. The complainant also filed Ex.A5 which is the minutes book which details the minutes of the several meetings taken place between the complainants and the OPs. It is the further case of the complainant that OP 1 never replied to the legal notice and the notice sent to OP 2 returned with an endorsement unclaimed and that the development agreement was revoked and cancelled as stated in the legal notice and therefore he is entitled to the prayer he sought for.
The learned counsel for the appellants/ OPs. submitted that it is an integrated project where a common building is proposed to be constructed in 17 plots of land, out of which 8 owners have approached this Commission. Several proposals were given to the plot owners including the complainants and they were requested to jointly approve a common plan. A plan was prepared by the OPs. which was approved by 12 owners evidenced under Ex.B2 dated 11-09-2009 and this resulted in stalemate and the development agreement could not go ahead as planned. The learned counsel for the appellants/OPs. further contended that the judgement of the Apex court reported in (2008) (4) CPR 449 SC and 2008(4) ALT 17 (SC) (CPA) cannot be relied upon as in those cases, the developer had constructed the building and a portion which was earmarked and allotted to the land lord was delivered, but with defects and therefore the landlord sought for compensation for deficiency in service. He argued that in the instant case the commencement of the construction of the building itself, did not take place. The law laid down by the Apex court in Fakir chand Gulati v. Uppal Aqens laid down that dispute between land owner and builder falls within the ambit of the Consumer Protection Act as there is deficiency in service in regard to construction. While it is true that in that case the land owner was aggrieved by the deficient construction, equally in the instant case also there is deficiency in service on behalf of the appellants/OPs as admittedly a development agreement was entered into and the very construction itself has not begun.
The law laid down in Fakir Chand Gulati case is that there is a consideration for the construction flowing from the land owner to the builder in the form of sale of an undivided share in the land and permission to construct and own the upper floors and to adjust the value of the extent of the land to be transferred, there is also payment of cash consideration by the builder. Merely because there is no allegation with respect to deficiency in construction, it cannot be construed that the act of Ops is not even beginning the construction cannot be construed as deficiency. The moot point underlying in this judgement is that there is availment of services of the builder by the landowner for house construction for a consideration and therefore the land owner falls within the definition of a consumer.
The learned counsel for the appellants/OPs. further baldly contended in para 7 of his written arguments that the complainant has vaguely stated that the development agreement is deemed to have been cancelled as the builder did not construct the building within 36 months and therefore the question of payment of compensation and rental loss does not arise. We find this contention unsustainable as we observe from para 5 of Ex.A3 legal notice dated 07-4-2011 that the complainant has clearly stated as follows:
5. My client further states that since not only the schedule time for the construction of the complex but also the grace period was also expired and since you neither applied for Municipal Approval muchless commenced the construction of the building all these years, the Development Agreement is deemed to have been cancelled.
My client hereby once again categorically reiterates that he revoked and cancelled the Development Agreement Dt.14-3-2008 entered with you. My client also forfeited the Security Deposit Amount.
It is pertinent to note that the appellant/OP 1 inspite of receipt of this legal notice evidenced under Ex.A4, did not choose to reply. If the complainant had got issued a notice seeking for cancellation of the development agreement and the OPs did not choose to reply to that and now unilaterally raises the contention that the development agreement is deemed to have been cancelled and therefore payment of compensation does not arise is unsustainable. The learned counsel for the appellants/OPs submitted that there is an arbitration clause in the agreement under clause 45 and the complainant without invoking such an arbitration clause and without approaching competent civil court approached this Commission.
45. That in the event of any dispute arising with regard to the interpretation, scope and ambit if various clauses stipulated herein above and in respect of this contract, the parties hereto shall seek the Redressal of the same through arbitration by nominating sole Arbitrator. The disputes among the parties shall be settled through arbitrator under the provisions of the Arbitration and Conciliation Act, 1996, at Hyderabad and any such proceedings shall not interfere with the progress of construction and the decision of the said Arbitrator shall be conclusive and binding on both the parties.
In the instant case, neither the complainant nor the OPs. have invoked clause 45 of the agreement pertaining to arbitration and therefore as per the aforementioned judgments, if the complainant has chosen to clutch the jurisdiction of the consumer Fora first, it is not a bar for adjudicating the complaint. We rely on the judgement of the Apex court in National Seeds Corporation Ltd., V. M.Madhusudhan Reddy reported in (2012) 2 SCC 506 has discussed the jurisdiction of the Consumer Fora and Commissions while adjudicating matter wherein there is an arbitration clause in the contract and held as follows:
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.
In fact in Fair Air Engineers Pvt. Ltd. Vs. N.K. Modi (1996) 6 SCC 385 rejecting the contentions of the opposite party that the proceedings under the Consumer Protection Act, 1986 could not continue in view of the Arbitration Clause in the agreement entered into between the parties, Supreme Court observed as under:
It must be held that the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that Section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. It is true, as rightly contended by Shri Suri, that the words in derogation of the provisions of any other law for the time being in force would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act. Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well founded. Parliament is aware of the provisions of the Arbitration Act and the Contract Act, 1872 and the consequential remedy available under Section 9 of the Code of Civil Procedure, i.e., to avail of right of civil action in a competent Court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.
This judgment of the Supreme Court has been followed in a number of subsequent cases. Similarly, Supreme Court in Indochem Electronic and Another Vs. Additional Collector of Customs, A.P. reported in (2006) 3 SCC 721 , Secretary, Thirumurugan Cooperative Agricultural Credit Society reported in (2004) 1 SCC 305, CCI Chambers Coop. Hsg. Society Ltd. reported in (2003) 7 SCC 233 and State of Karnataka Vs. Vishwabharthi House Building Coop. Society and Others reported in (2003) 2 SCC 412, has held that Consumer Protection Act, 1986 seeks to provide remedy in addition to the remedy provided under other Acts.
The learned counsel for the Ops contended that the courts as well as consumer fora cannot resolve the dispute, where an arbitration clause is provided in the agreement, in such a case, necessarily it had to be referred to arbitration. We may mention herein that in Fair Air Engineers case which we have already referred to above their Lordships had categorically opined that consumer fora have jurisdiction despite an arbitration clause in the agreement.
In Hindustan Petroleum Corporation Ltd. Vs. Pinkcity Midway Petroleum reported in (2003) 6 SCC 503 the Supreme Court held that Section 8 of the 1996 Act in clear terms mandates that a judicial authority before which an action is brought in a matter which is subject matter of an arbitration agreement to refer such parties to arbitration, and that the language of the said Section is unambiguous. The Supreme Court also held that the Civil Court discharges administrative function and, therefore, it cannot go into the question whether the Arbitral Tribunal has jurisdiction to decide the said issue.
This conclusion is based on the Constitution Bench judgment of the Supreme Court in Konkan Railway Corporation Ltd. Vs. Rani Constructions Pvt. Ltd. (2002) 2 SCC 388. A seven Judge Bench of the Supreme Court in M/s. S.B.P. & Co. Vs. M/s. Patel Engineering Ltd. AIR 2006 SC 450 however, overruled the decision in Konkan Railway Corporation Ltd. by holding that the power exercised by the Chief Justice of the High Court or the Chief Justice of India under Section 11(6) of the 1996 Act is not an administrative power but it is a quasi judicial power and in case of designation of a judge of the High Court or of the Supreme Court, the power that is exercised by the designated judge would be that of the Chief Justice as conferred by the Statute.
In fact in W.P. No. 4205/2008 of the High Court of A.P. wherein his Lordship has considered all these decisions and opined that :
Having regard to the interpretation given by the Supreme Court in FAIR AIR ENGINEERS PVT. LTD with regard to Section 3 of the 1986 Act and the ratio in LUCKNOW DEVELOPMENT AUTHORITY, I am of the view that the 1986 Act, being a special enactment, which created an additional remedy in favour of the consumers by raising consumer disputes before the Fora constituted under the said Act, Section 8 of the 1996 Act does not have the effect of taking away such a remedy from the consumers as in the case of civil suits, which are in the nature of common law remedies. To my mind, the true purport of Section 3 of the 1986 Act is that if a party chooses to avail a remedy other than the consumer dispute, he shall be free to do so because the remedy under the 1986 Act is not in derogation of the other remedies available to such a party. But, conversely if he chooses to avail the remedy before the Consumer Fora, such a right cannot be denied to him on the ground of availability of an alternative remedy, such as arbitration. Put it briefly, Section 3 of the 1986 Act is intended to provide an additional remedy to a party and the same is not meant to deny such a remedy to him. In this view of the matter, in my opinion, the order passed by the District Forum does not suffer from any legal infirmity and it cannot be said that the District Forum has inherent lack of jurisdiction to entertain and adjudicate the complaint.
It upheld the order confirming the jurisdiction on the consumer fora despite arbitration clause in the agreement.
We may state that consistently the Honble Supreme Court is of the opinion that arbitration clause in the agreement would not debar the consumer fora from entertaining the complaint. Taking a sentence out of context and harping that it is perincurium would not justify for taking such a stance.
Coming to the question of jurisdiction, admittedly the petitioner/opposite party has been engaged in housing construction activity at Hyderabad. It comes under Service as defined u/s 2(1)(o) of the Consumer Protection Act which reads as follows :
(o) "service" means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;
By virtue of Section 2(1)(o) of the Consumer Protection Act the complainants are undoubtedly entitled to prosecute this case before this Commission in the light of housing activity taken upon by the petitioner. Importing the provisions of C.P.C to oust the jurisdiction of the Consumer Fora would not hold good.
It is pertinent to note that the complainant/respondent never approached or appointed an arbitrator on his behalf but instead chose to file a case before this Commission and it is also pertinent to note that no Arbitration Award has been passed. Therefore keeping in view the aforementioned judgements, we hold this Commission can adjudicate the matter.
Clauses 10, 11 and 12 of the development agreement reads as follows:
10. The Developer of the Second part shall construct Residential Apartment Complex at its own cost as per the approved plans of the Greater Hyderabad Municipal Corporation or/and any other concerned Authorities and deliver the 50% of the constructed areas in the shape of flats and two parking spaces, subject to the Final plans, to the LAND OWNER of First Part and the Developer of the Second part hall retain the remaining 50% of the constructed areas in the shape of flats and remaining parking areas together with 50% proportionate undivided share of the land out of the total schedule land as a consideration for developing the project at its own cost and delivering 50% of constructed area to the LANDOWNER of the first part at free of cost.
11. The entire cost of the development of the Schedule of Property, such as levelling, surveying, demarcation, making of plans, architectural designs and for securing approval of the Greater Hyderabad Municipal Corporation and concerned Authorities and all the expenditure for obtaining the necessary permission for the successful completion of the project shall be borne exclusively by the Developer of the Second Part only and the LANDOWNER of the First part shall bear no part of the expenditure.
12. It is hereby declared that the LANDOWNER of the First part shall be entitled to retain 50% undivided share of land out of the Schedule of Property and shall also be entitled to 50% of the constructed area in the shape of residential flats and two parking spaces, subject to the final plans, to each flat in the proposed complex to be constructed on an area, of which the scheduled of property is a part. The said 50% of constructed areas shall be in the shape of Residential Flats, two parking spaces to each flat, subject to the final Plans, common areas etc., The said 50% of constructed area shall at all times be treated to be the property of the LANDOWNER of First part for his/ her use and beneficial enjoyment and they are free to deal with the same in any manner as per their desire and choice. The 50% constructed area to be allotted to the LANDOWNER of first part shall be separately marked in the plan and shall be appended to as an Annexure to Allocation Agreement/MOU/Joint Declaration/ Supplemental Agreement, which will be entered into and executed among the First and Second Parties within 15 days from the date of obtaining permit and approval from the Greater Hyderabad Municipal Corporation and concerned Authorities, since the constructed areas become identifiable at such point of time.
Such Allocation Agreement/MOU/Joint Declaration/Supplemental Agreement has to be Registered mentioning the flats allotted to the respective land owners as per the Allocation Agreement and all the expenses for such registration shall be borne by the Developer.
The aforementioned clauses evidence that the developer alone is responsible for getting the approvals and if he has not done so till date, the landowner cannot be made to suffer. The opposite parties have committed an act of deficiency in service by not even commencing the construction as per the terms of the agreement even though the grace period of 36 months ended on 13-3-2011, and the learned counsel for the appellants/OPs submits that an amount of Rs.5,00,000/- was paid by the OPs to the complainant at the time of entering into development agreement towards refundable deposit through cheque and another sum of Rs.7,00,000/- was paid towards non-refundable deposit in cash as per Ex.B2, MOU entered into between the complainant and the appellants dated January, 2008.
Keeping in view the aforementioned reasons and the admitted fact that the terms of the development agreement have been violated and not adhered to and also that the respondent/complainant had sought for cancellation of the agreement vide Ex.A3, legal notice, which was not replied to and also taking into consideration that till date, the necessary sanctions and approvals have not been secured and the construction itself has not begun though the development agreement is dated 14-3-2008, we are of the considered opinion that there is deficiency in service on behalf of the opposite parties.
Now we address ourselves to the quantum of compensation prayed for by the respondent/complainant. We observe from Ex.A2 development agreement that clause 9 contemplates that if the developer does not complete the construction within 36 months then the developer shall forego the entire interest free refundable security deposit amount of Rs.5,00,000/- which has been paid to the land owner and is also liable to pay Rs.10/- per sft. to the land owner in respect of undelivered areas till its compliance. In the instant case, it is an admitted fact that the developer has not even taken up the construction and therefore has to adhere to clause 9 and it is also pertinent to note that the complainant got issued a legal notice with respect to forfeiture of this Rs.5,00,000/- but the developer did not choose to respond. Clause 4 of the same agreement also states that this security deposit of Rs.5,00,000/- is refundable by the land owner to the developer at the time of the developer handing over possession of the constructed areas to the land owner. To reiterate, this part of the contract has not been fulfilled by the developer and therefore this amount belongs to the landowner. Now we address ourselves to the amount of Rs.7,00,000/-. It is an admitted fact that it is a non refundable deposit. We observe from para 17 of the written arguments of the appellants that they sought that this amount be set off/adjusted towards compensation, if any, payable to the complainant. The development agreement is a contract entered into between the parties and both the parties are bound by the said terms and conditions.
Therefore, the contention of the appellants that he is not liable to pay rental loss is unsustainable in the light of clause 9 which clearly states that rental loss of Rs.10/- per sft. has to be paid.
Therefore, with respect to payment of rental loss the order of the District Forum stands confirmed as the complainant established that there was deficiency in service on behalf of the appellants/opposite parties.
Now we address ourselves to the return of the title deeds of the respondent/complainant. Clause 47 reads as follows:
47. The LANDOWNER hereby hands over all his/her original title deeds and link documents of the Schedule of Property into the custody of Developer and the Developer shall keep the documents in its safe custody only for the purpose of showing them to the Banks or financial institutions, which verifies the documents before sanctioning housing loans to any of the prospective Purchasers of the flats and the Developer shall not use such documents for obtaining any loans and shall not deposit or part with such documents and after completion of the project the Developer of the second part shall handover all the original title deeds along with original permit and sanction plans, NOC, Electricity and water and drainage sanctions to the Association formed among all owners of the residential apartment complex.
Keeping in view the aforementioned clause that the developer shall handover all the original title deeds once the project is completed, but in the instant case, admittedly, the project has not even taken off, the complainant is entitled for return of the title deeds and therefore we see no reason to interfere with the well considered order of the District Forum.
In the result this appeal fails and is accordingly dismissed. No costs. Time for compliance four weeks.
F.A.Nos.733/2012 and 735/2012:
For the same reasons as stated in F.A.No.731/2012, these appeals also fail and they are accordingly dismissed. No costs. Time for compliance four weeks.
F.A.No.905/2012:
We observe from the record that the facts in the instant case i.e. with respect to terms in the development agreement and the amount given towards interest free security deposit are all similar. The party in person/respondent submitted that he has not withdrawn any amount which was deposited by the appellants before this Commission whereas the complainants in FAs 731/12, 733/12 and 735/12 has withdrawn the amount deposited by the appellants. The development agreement in this case was entered into on 16-4-2008 and the construction was to be completed by 15-4-2011 including the grace period. The legal notice, Ex.A2, dated 29-4-2011 was issued to the opposite party demanding Rs.10/- per sft., and return of original documents for not even commencing construction though the stipulated time lapsed together with compensation and costs.
For the reasons aforementioned in F.A.No.731/12 as the clauses in the development agreement and facts are similar, we see no reason to interfere with the well considered order of the District Forum.
In the result this appeal also fails and is accordingly dismissed. No costs. Time for compliance four weeks.
The respondent/complainant is at liberty to withdraw the amount deposited by the appellants/O.Ps. by filing an appropriate application.
Sd/-INCHARGE PRESIDENT.
Sd/-MEMBER.
JM Dt.22-7-2013.