National Consumer Disputes Redressal
M/S Rajendra Properties & Industries vs Shri Om Parkash on 5 January, 2009
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI Revision Petition No. 1961 of 2004 (From the order dated 15th July, 2004 in Appeal No. A-1544 of 2000 of the Delhi State Consumer Disputes Redressal Commission, Delhi) M/s Rajendra Properties & Industries Petitioner N-52 A, Connaught Place New Delhi-110001 versus Shri Om Parkash Respondent A-272, Vikas Puri New Delhi BEFORE HONBLE MR. B.K. TAIMNI PRESIDING MEMBER HONBLE MR. ANUPAM DASGUPTA MEMBER For the Petitioner Mr. Rajesh Aggarwal, Advocate For the Respondent In person Dated the 5th January, 2009 ORDER
ANUPAM DASGUPTA This revision petition challenges the order dated 15.07.2004 of the Delhi State Consumer Disputes Redressal Commission, Delhi (hereafter, the State Commission) in appeal no. A-1544/2000. By this order, the State Commission confirmed the order of the District Forum directing the original opposite party (petitioner before us and referred to as such) to refund to the respondent (the original complainant, hereafter referred to as the complainant) the amount of Rs.65,081/- (which the complainant had deposited with the petitioner towards purchase of a shop in the commercial complex being then built by the petitioner) along with interest @ 18% p.a. on the said amount of Rs.65,081/- from the dates of the respective deposits till payment. In addition, the District Forum ordered the petitioner to pay to the complainant compensation of Rs.10,000/- and cost of Rs.3,000/-. However, the State Commission disallowed the compensation of Rs. 10,000/-.
2. The petitioner seeks to rely on three main grounds, viz., (i) the complainant was not a consumer under the Consumer Protection Act, 1986 (hereafter, the Act) because the shop he paid for was meant for commercial purpose; (ii) the delay in completion of construction of the shopping complex in question (in which the complainant had booked a shop) was on account of force majeure as well as restriction by the Delhi Development Authority (DDA); and (iii) the complainant failed to pay the full consideration for the shop with interest etc., in terms of the contract (licence deed between the parties).
3. The complaint arose in 1998 and was in respect of deficiency in service. The version of the Act then in force (i.e., prior to the amendments by Act 62 of 2002, effective from 15.03.20023) defined [vide section 2 (1) (c) (iii)] a complaint, in respect of a service, to mean any allegation in writing made by a complainant that ‑
(iii) the services mentioned in the complaint suffer from any deficiency in any respect;
Further, the Act then in force had the following definition of a consumer of service [vide section 2 (1) (d) (ii)]:
(d) consumer means any person, who
(ii) hires any services for a consideration which has been paid .. when such services are availed of with the approval of the first mentioned person.
Thus, in 1998, the hiring or availing of any service(s) on payment by a person for even a commercial purpose did not disqualify that person from being a consumer under the relevant provisions of the Act. The then applicable explanation below sub-clause (d) (i) of section 2 (1) of the Act regarding goods, excluding purchasers of goods for commercial purpose from the ambit of the definition of consumer, did not apply to purchasers of services in 1998. Clearly, therefore, the complainant/respondent was a consumer under the Act as applicable in 1998 and this much - emphasised ground has no leg to stand on.
4. In dealing with the other two principal grounds, a detailed discussion of the facts of the case and the findings of the District Forum concerned is necessary:
(i). The facts are that the complainant booked a small shop with the petitioner in J-Block, Shanti Nath Tower, Wazirpur Scheme in 1986 @ Rs.1,100/-
per sq. ft. and paid, in installments, the sum of Rs.65,081/-. This was done during April, 1996 - February, 1998.
(ii) According to the documents (including the application for registration of licence for the shop and the detailed licence deed), it is seen that the complainant booked a shop with approximate area of 61 sq. ft and paid Rs.6,710/- on 09.04.1986 as 10% of the total amount. Thus, the total cost fixed initially was Rs.67,100/-. As per the terms of payment, the second installment of 10% of the total amount was payable within 30 days of booking and another 10% within 60 days of the booking. The balance cost was stipulated and agreed to be paid by the licensee (complainant) in monthly installments of Rs.2013/-, up to 09.03.1988. It was also stipulated that failure to pay the installments due by the scheduled dates would lead to invocation of clauses of 29 and 37 of the licence deed. These two clauses are reproduced below:
TIME IS THE ESSENCE OF THIS CONTRACT
29. If the licensee neglects, omits or fails for any reason whatsoever to pay to the Builder any of the amounts due and payable by licensee under the terms and conditions of this agreement (whether before or after delivery of possession) on or before contract or if the licensee shall in any other way fail to perform or observe any of the covenants and conditions on his part herein contained or referred to the Builder shall be entitled to cancel the licence or re-enter upon (in case the possession has been given) and resume possession of the said space and everything whatsoever therein and this agreement shall cease and stand terminated and earnest money and all other amounts already paid by the licensee to the Builder shall be refunded after deducting 25% of the total settled deposit of the space involved (i.e.) the amount arising after (multiplying super area by rate) and the licensee hereby agrees to the same and the licensee shall also be liable to immediate ejectment as trespasser, but the right given by this clause to the Builder shall be without prejudice to any right, remedies and claim whatsoever at law under this Agreement of Builder against the licensee:
(i) Provided that before re-entering upon and resuming of the said space the Builder shall give a notice of a period of 15 days of his intention of re-entry upon and resumption of possession of the space to the licensee calling upon the latter to rectify his default before expiry of the said period.
(ii) Provided also that any infringement of terms and conditions of this Agreement by the licensee himself who hereby specifically binds himself for the acts of omission and commissioned by the occupier of his space in respect of covenants contained hereunder.
INTERST ON DELAYED PAYMENT
37. The company or their nominees will be entitled to charge interest at the rate of 24% per annum in the event of late payment in respects of the total deposit of the space agreed to be Licensed and other current or recurring dues, payable to the Builders, authorities/or nominees. It is clearly understood and agreed that the provision of interest doesnt in any way prejudice the right to the builder for forfeiture of earnest money and cancellation of the transactions as provided in the terms and conditions of the agreement.
(a) It is expressly agreed by and between the parties hereto that in respect of the above payments time is the essence of the contract. Failure to pay any installment in time will entail a further payment of Rs.500/- (Rupees five hundred only) per day upto a delay of 45 days as liquidated damages and not as penalty, and case the delay in payment of any installment exceeds 45 days then this Agreement for licence will automatically stand cancelled and all amounts previously paid there under shall stand forfeited to the Builder.
(b) If the Builder decided to get the entire building Air-conditioned / Air-cooled, which will mainly depend on the availability of electricity/power, the licensee will not object to it and has agreed and given consent to share all expenses/charges in the installing of the plant and the cost of the space under the plant. The entire estimate will be prepared by the Builder alone, which will not at all be objectionable/questionable by the licensee. The Builder will send in writing to the licensee his share of expenses (proportionately), which will be paid by the licensee, latest within 3 days of the receipt of the written demand, or else same procedure will apply as in the case of default of paying the installments in time, of clause no.29 hereinabove i.e. the allotment will stand automatically terminated and the entire amounts paid till then will stand automatically forfeited. No demand of any nature will be entertained.
(iii) We have quoted these two clauses verbatim mainly to notice their completely unilateral nature and content, entirely to the advantage of the resourceful builder the petitioner here. The unequal bargaining power of ordinary consumers vis a vis such powerful and resourceful contracting parties is a sad truth of the situation on the ground, which only some serious review of and amendments to the existing law of contract can rectify, as has been convincingly recommended by the Law Commission in one of its recent reports. Be that as it may. As already observed, the complainant duly paid Rs.65,081/-, i.e., just one instalment less than the total number of instalments due. It is quite clear, however, that possession of the shop was not offered to be handed over by the petitioner to the complainant anytime during 1988 or, as we shall see later, even much later. Time was not of the essence of the contract only for the licensee to pay the due instalments, etc., but also for the petitioner to give vacant and legally valid possession of the shop to the licensee soon after the last instalment was paid, i.e., some time in March April 1988. This was clear from the bold assurance in the pamphlet issued by the petitioner at the time of booking shop space speaking of . possession approx. 21/2 years, leaving unforeseen circumstances and force majeure, which, in the interest of substantive justice, has to be read along with the Licence Deed.
(iv) It is the case of the petitioner that the DDA (from which the petitioner received approval of the building plan of the shopping complex in question vide letter dated 18.12.1986) revoked the building permit by its letter dated 25.8.1989. It is thus clear that possession of the licensed shop was not given to the complainant even in 1989.
(v) The petitioner filed a writ petition before the High Court of Delhi some time soon thereafter in 1989. The High Court quashed the DDAs order dated 25.8.1989 by its order dated 21.03.1991, mainly because there was no rebuttal of the averment that show cause notice was not served on the petitioner by the DDA officer concerned. The Court, however, made it clear that it is open to the respondent to take such action against the petitioner as may be available to the respondents in accordance with law.
(vi) The DDA issued another order dated 10.02.1993 directing sealing of the premises of the petitioner if the petitioner failed to remove some unauthorised construction detailed in the said order of the DDA. The petitioner filed an appeal to the competent Appellate Tribunal against this order of the DDA. By its order dated 04.05.1993, the Appellate Tribunal allowed the appeal and set aside the order of the DDA sealing the said premises. The case was remanded by the Tribunal to the DDA for fresh decision subject to specific directions contained in the Appellate Tribunals order. It is useful to notice the operative part of the order of the Tribunal for better appreciation of the revision petition before us. This is reproduced below:
9. As a consequence the appeal is allowed. The impugned sealing order dated 10.2.93 bearing No. F.16 (3) 86/Bldg. made by the Director (B) of the respondent under section 31A of the Act, whereby he has directed the sealing of the premises No.JF-2, LSC, Ashok Vihar, Phase I, New Delhi, is set aside. The case is remanded to the Director (B) of the respondent for a fresh decision under section 31A of the Act in respect of the ground floor to the top floor of the building after:-
1) The Director (B) has disposed of the proposal of the appellant dated 12.4.91 by a clear direction to the appellant giving him a reasonable time for compliance with those directions.
2) After affording reasonable opportunity of hearing to the appellant.
10. In case the appellant has removed the offended structure of the staircase and the mumty on the terrace floor the appellant shall file an affidavit and a few photographs of the terrace floor giving complete view of the structure there before the Director (B) on 10.5.93 at 2.00 p.m. The Director (B) will decide the matter afresh within 2 months calculated from 11.5.93.
11. It is clarified that in case some construction is made by the appellant in the basement which is found to be in contravention of the sanctioned building plan or the building bye-laws it will be open to the respondent to take action as may be available against the appellant and the construction in question under section 31A of the Act after giving due notice thereof to the appellant and after providing reasonable opportunity of hearing to the appellant in accordance with law during the pendency of these proceedings or even thereafter. In the circumstances of the case the parties are left to bear their own costs.
(vii) While the writ petition was pending before the Delhi High Court, the petitioner offered to the complainant, by its letter dated 13.08.1989, an alternate shop in view of the ongoing litigation. It is the case of the petitioner that the respondent did not reply to this letter. To this, the say of the complainant (as noticed by the District Forum) was that the alternative shop offered to the complainant was in areas like Kalkaji, Janakpuri, Preet Vihar, etc., at the then current rates (Rs.2,500/- to Rs.3,000/- per sq. ft.) which were much higher than that (Rs. 1,100/- per sq. ft.) of the shop space registered by him at Wazirpur. The District Forum also recorded the finding that the complainant wrote to the petitioner under his registered letters dated 30.10.1992 and 14.12.1992 seeking possession of the shop, copies of which along with postal receipts had been filed before the District Forum by the complainant. By letter dated 31.12.1992, the petitioner denied receipt of the complainants letter dated 30.10.1992 and replied to the complainants second letter dated 14.12.1992 stating, inter alia, that possession was being offered by the complainant shortly after completion of statutory obligations. The District Forum, therefore, held that the petitioner did not affirm that the position of the building plan was now clear with the DDA and occupation certificate had been issued. On 23.03.1993, the petitioner wrote to the complainant to make balance payment, along with interest, etc., according to the original agreement and take possession. The petitioner also claimed that several more letters were issued to the complainant. However, the District Forum again recorded the finding that the petitioner did not file copy of any of these letters. We have already noticed that the building was once again a subject of dispute between the petitioner and the DDA because of alleged unauthorised construction.
(viii) The complainant wrote a letter dated 19.09.1994 to the petitioner pointing out several specific deficiencies in the construction and seeking justification of the much higher payment claimed to be due. He followed it up with a registered letter dated 07.12.1994 to the petitioner asking for the completion certificate and perpetual lease deed. The District Forum found that the petitioners response dated 04.10.1994 to the complainants letter of 19.09.1994 was not specific to the points in the complainants letter and the former failed to produce a copy of its claimed response to the letter of 07.12.1994.
(ix) On the basis of a copy of the approved plan of the building produced before it by the DDA official concerned (who had been summoned by it to do so), the District Forum further recorded that the actual construction was not wholly in accord with the approved plan and that the official further informed the Forum that the petitioner had neither obtained certain specific Forms nor the completion certificate. In order words, the District Forum, in view of its detailed and painstaking fact-finding, was fully justified in holding, by implication, that the restraint ordered by the DDA was not altogether unjustified because the petitioner had committed acts of violation of the building plan initially approved by the DDA.
5. The orders of the High Court and, particularly, the Appellate Tribunal leave no doubt that the petitioner committed several irregularities in the actual construction of the shopping complex where the complainant had booked his small shop. The proceedings initiated by the petitioner before the Delhi High Court and later the Appellate Tribunal and the consequent delay in obtaining the completion certificate and offering legally valid possession to the complainant could not thus be construed as factors entirely beyond the petitioners control or unjustified restraints by the DDA or force majeure. Further, the claim of a large sum of money as due from the complainant was mainly on account of interest charges over the period during which all these proceedings went on, not because of any deliberate delay on the part of the complainant who had, in any case, paid all but one small instalment of Rs. 2,013/- for the shop booked by him.
6. We also notice that after filing this revision petition, the petitioner itself challenged continuation of proceedings of this revision petition through a Special Leave Petition (SLP) before the Honble Apex Court. But this SLP was dismissed in limine. This is indication enough of the intent and conduct of the petitioner.
7. In view of this, we are unable to see any valid ground in this revision petition, which had not been agitated before the District Forum by the petitioner and not comprehensively dealt with by the Forum.
8. Moreover, the award of the District Forum in respect of compensation has been toned down by the State Commission in its impugned order, which is the most that the petitioner could have hoped for in the facts and circumstances of the case.
9. In conclusion, we find no merit in this revision petition and it is accordingly dismissed. The order of the State Commission is confirmed. The petitioner is directed to comply with the order within four weeks from today.
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[B. K. TAIMNI] PRESIDING MEMBER ....
[ANUPAM DASGUPTA] MEMBER