State Consumer Disputes Redressal Commission
Ravi Kanth Veda vs M/S. Maytas Properties P. Ltd, on 8 May, 2013
BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD CC 64 of 2012 Between: 1) Ravi Kanth Veda S/o. Rajendra Kumar Plot No. 14/1F, BHEL Enclave Akbar Road, Secunderabad-9 2) Srivani Veda W/o. Ravikanth Veda Plot No. 14/1F, BHEL Enclave Akbar Road, Secunderabad-9 *** Complainants And 1. M/s. Maytas Properties P. Ltd, (Formerly known as Hill County Pvt. Ltd) Rep. by its Nominee M. Theja Pratap Raju O/o. Customer Support Department Hill County, Bachupally Miyapur, Hyderabad- 500 072. *** O.P. No. 1 2) M. Teja Pratap Raju S/o. Hari Prasad Raju O/o. Customer Support Department Hill County, Bachupally Miyapur, Hyderabad- 500 072. 3) Arun Kumar Saha S/o. Brindavan Chandra Saha (Additional Director/Promoter) Maytas Properties Ltd. R/o. 601-602, Green Acres CHS Pali Hill, Bhandra (W) Mumbai-400 050 4) Vimal Kishore Kaushik S/o. Sadanand Shastry (Additional Director/Promoter) Maytas Properties Ltd. R/o. S-27/1-D, DLF Qutub Enclave Gurgaon-122 002 Haryana State. 5) Ramesh Chandra Bawa S/o. Saradanda Bawa (Additional Director/Promoter) Maytas Properties Ltd. R/o. W-78, Greater Khailash Part-I, New Delhi-110 048. 6) Ramachandra Karunakaran S/o. Kalapara Vedasseri Karunakaran (Additional Director/Promoter) Maytas Properties Ltd. R/o. 3rd Floor, Victoria Building E-23, Gajdhar Scheme S.D.Road, Santha Crutz Mumbai-400 054 7) The Branch Manager Axis Bank Ltd. P. M. Modi Complex 2nd Floor, 5-4-187/6 M. G. Road, Karbala Compound Secunderabad. *** Opposite Parties Counsel for the Complainants : M/s. V. Appa Rao Counsel for the Opposite Parties M/s K. Vishveshwara Reddy (MPL) M/s. S. Sainathan (Bank) CC 73 of 2010 Between: Smt. Kalidindi Jhansi Lakshmi W/o. K. K. Raju R/o. Flat No. 301, My Home Gardenia Apartments Ameerpet, Hyderabad-16. *** Complainant And 1. M/s. Maytas Properties Ltd, (Formerly known as Hill County Pvt. Ltd) Rep. by its Managing Director 6-3-1186/5/A, 3rd Floor Amoga Plaza, Begumpet, Hyderabad *** O.P. No. 1 2. Ing Vysya Bank Ltd. Himayathnagar, Hyderabad Rep. by its Manager. *** O.P. No. 2 Counsel for the Complainant : M/s. T. Balaji Counsel for the Opposite Parties M/s K. Vishveshwara Reddy (MPL) M/s. A. Raghavaiah (Bank) CC 79 of 2010 Between: Neravati Raja Sekhar S/o. Chandra Mohan Neravati Rep. by GPA Chandra Mohan Neravati Flat No. 405, Plot No. 26/28 & 30 Padmarekha Apartments Rajeevnagar, Hyderabad-18. *** Complainant And 1. M/s. Maytas Properties Ltd, (Formerly known as Hill County Pvt. Ltd) Rep. by its Managing Director 6-3-1186/5/A, 3rd Floor Amoga Plaza, Begumpet, Hyderabad *** O.P. No. 1 2) Deutsche Post Bank Home Finance Ltd. Rep. by its Branch Manager 3rd Floor, 6-1-73, Saeed Plaza, Lakdikapul, Beside Central Court Hotel Hyderabad. *** O.P. No. 2 Counsel for the Complainant : M/s. Srinivas Karra Counsel for the Opposite Parties M/s K. Vishveshwara Reddy (MPL) M/s. L.V. Vijaya Shankar & Associates (Bank) CORAM: SMT. M. SHREESHA, PRESIDING MEMBER & SRI S. BHUJANGA RAO, MEMBER WEDNESDAY, THE EIGTH DAY OF MAY TWO THOUSAND THIRTEEN ORAL ORDER:
(Per Smt. M. Shreesha, Member) ***
1) Since the facts and law involved in the above complaints are similar filed against the very same developer Maytas Properties Ltd (MPL) and the respective banks, we dispose of them by this Common order. CC No. 64 of 2012 is taken as representative case.
2) The brief facts as stated in the complaint in CC 64 of 2012 are that the complainants purchased a residential flat No. 3E in third floor, type 5 of Mussoorie apartment complex of 1579 sft with two covered car parking areas and an undivided share of land admeasuring 73 sq.yds in the Hill County in Ranga Reddy district for a sale consideration of Rs. 48,78,114/-. The complainants submit that Op1 is the developer and Op2 is its nominee who signed the construction agreement on 31.7.2008. Ops 3 to 6 are directors of Op1 and Op7 is the Axis Bank which has financed the home loan. Op1 received booking advance of Rs. 4,87,811/- and for the remaining amount of Rs. 39,02,492/- schedule of payment was given in the agreement of sale. Op7 financed for payment of balance of amount which was paid between 15.12.2006 and 15.3.2008. The complainants submit that as per the terms of the agreement Op1 should complete the construction of the flat on or before 6.3.2009 including three months grace period and register the flat and the complainants should take possession of the finished flat within 30 days of its registration or else Op1 has to pay penalty @ Rs. 5/- per sft . Op1 executed a sale deed on 31.7.2008 in respect of transfer of undivided share of land admeasuring 73 sq.yds for a consideration of Rs. 20,29,529/- and also executed registered construction agreement stating that the finished flat will be completed on or before 6.3.2009 and received sale consideration of Rs. 29,98,586/- prior to 31.7.2008.
3) The complainants further state that Op7 banker ought to have released the loan amount as per the Tripartite Agreement dt. 11.7.2007 depending on the progress of construction but the home loan banker charged interest and other charges amounting to Rs. 12,45,586/- from 7.3.2009 to 7.4.2012 though the flat remained unfinished. The complainant got issued a legal notice on 12.5.2010 to the developer and also to the banker but did not receive any reply.
4) Hence, this complaint seeking directions to Ops 1 to 6 to hand over the finished flat as mentioned in the construction agreement dt. 31.7.2008 or refund sale consideration of Rs. 29,98,586/- with interest, compensation of Rs. 5 lakhs, and to have consequential relief by directing Ops 1 to 6 to repay the amounts received from M/s. Axix Bank Ltd. (Op7) with interest and other charges levied into the home loan account of the petitioners out of the said amount of claim awarded Rs. 66,14,829/- alternatively direct Ops 1 to 6 to pay interest and other charges charged into the home loan account of the complainants w.e.f 7.3.2009 to 7.4.2012 amounting to Rs. 12,45,586/- and subsequent interest and charges thereon in case Op1 able to hand over the possession of the schedule flat forthwith besides payment of compensation of Rs 5 lakhs towards causing mental agony etc. together with costs.
5) Op1 developer filed written version adopted by Op Nos. 2,3 & 5. Op1 submits that the said project of Maytas Hill County commenced as per schedule but thereafter suffered acute shortage of funds as the private equity investors and the financial institutions recalled the financial assistance and the delay in completing the Hill County Project is because of force majeure which is beyond the control of Ops. Op1 further contends that various court orders had also delayed the project and that the case was referred to Company Law Board (CLB) which passed orders on 5.3.2009 appointing a director who is the nominee of the Central Government and accordingly Sri Ved Kumar Jain was appointed as Nominee Director by the Central Government.
6) SBI Capital Markets Ltd. was appointed as transaction advisor for identifying a suitable strategic investor and the process of selection of its strategic investors was entrusted to be supervised by Honble Justice A. R. Laxmanan under whose concurrence the Company Law Board on 13.1.2011 passed an order inducting M/s. IL&FS Financial Services and its two other concerns into the company as 80% shareholders by allotment of preferential shares. The IL&FS group have initiated steps of injecting funds into Op1 company and have started the process of paying off the liabilities.
7) Op1 submits that the complaint is liable to be dismissed for non-joinder of necessary parties i.e., land owners and further submits that it is liable to be dismissed for lack of jurisdiction as arbitration proceedings have already been laid down. Op1 admits that the complainant has entered into an agreement of sale on 22.1.2007 and that there is a delay in completion of the project and has now come up with a new schedule for completion of the apartment blocks.
S.No. CC 64/2012 1 Flat Details Instalment Due Date Rs.
Missouri Booking advance On Booking 10% 487811 Type-5 Allotment advance 15 days from booking (10%) 487811 Floor No. 3 1 15.12.2006 (12.5%) 609764 Flat No. 3E 2 15.03.2007 (12.5) 609764 Built up area 3 15.06.2007 (12.5) 609764 in sft - 1579 4 15.09.2007 (12.5) 609764 5 15.12.2007 (12.5) 609764 6 15.03.2008 (12.5) 609764 7 During hand over (5%) 243906 Total sale consideration 4878114 S.No. CC 73/2010 2 Flat Details Instalment Due Date Rs.
Dalhousie Booking advance On Booking 10% 817171 Type-4 Allotment advance 15 days from booking 10% 817171 Floor No.13 1 15.12.2007 (20%) 1634342 Flat No. 13C 2 15.03.2008 (20%) 1634342 Built up area 3 15.06.2008 (10%) 817171 in sft - 1511 4 15.09.2008 (10%) 817171 5 15.12.2008 (10%) 817171 6 15.03.2009 (5%) 408588 7 During hand over (5%) 408588 Total sale consideration 8171712 Op1 further submits that the complainant issued legal notice on 12.5.2010 and as per clause-14 of the agreement of sale an arbitrator was appointed and that most of the customers are entering into an Addendum agreement and SWAP agreement with Ops. Op1 further contends that new promoters are taking all necessary steps to complete the construction and to hand over the same and letters have been communicated to all the customers on 16.5.2012. As per the directions of CLB on 13.1.2011 the new management of the answering opposite party is entitled to an additional time for completing the project and submits that the complainant is not entitled for any amounts as the present complaint was filed subsequent to 13.1.2011 and submits that there is no deficiency in service on their behalf.
8) Ops 4 did not choose to file his written version.
9) Op7 bank filed its counter stating that they are not a party to the agreement of sale dt. 6.12.2006 and submit that sale deed executed between the complainant and Ops on 31.7.2008 in respect of undivided share of land for Rs. 20,29,529/- was deposited by the complainant and an equitable mortgage was created as per the construction agreement and the finished flat has to be handed over by 6.3.2009. A tripartite agreement was entered into between the complainant, Op1 and Op7 (bank) on 11.1.2007. The bank submits that it is not concerned with the progress of construction and as per the home loan agreement interest will be charged on the loan amount and therefore there is no deficiency of service or unfair trade practise as the loan disbursement was made in terms of Tripartite Agreement dt. 11.1.2007 executed between the complainant, Op1 and Op7. The complainant did not make the payments which are outstanding to Op7, and therefore there is no deficiency in service on its behalf and seek dismissal of the complaint with costs.
10) The complainants in proof of their case filed affidavit evidence and got Exs. A1 to A9 marked while the opposite parties filed their affidavit evidence and got Exs. B1 to B21 marked.
11) The points that arise for consideration are :
i. Whether there is deficiency of service on behalf of Ops 1 to 6 and whether the complainants are entitled to the reliefs sought for in the complaint.
ii. Whether the bank was justified in releasing the entire amount, contrary to the terms of agreement and whether there is deficiency of service on behalf of the bank?
12) The facts not in dispute are that the complainant had booked a residential flat No. 3E in third floor, type 5 of Mussoorie apartment complex of 1579 sft with two covered car parking areas and an undivided share of land admeasuring 73 sq.yds in the Hill County in Ranga Reddy district for a sale consideration of Rs. 48,78,114/- with Op1 evidenced under Ex. A1 agreement of sale dt. 6.12.2006 between the land owner and the developer and the complainant herein. Ex. A2 is the Tripartite Agreement entered into between Op1, complainant and the bank dt. 11.1.2007. Ex. A3 is the agreement for construction dt. 31.7.2008 entered into between Op1 and the complainant for a consideration of Rs. 29,98,586/- and the schedule shows that this amount has been paid. Construction Schedule which is part of Ex. A3 shows that the flat has to be completed and handed over by 6.3.2009. Ex. A4 is the legal notice got issued by complainant to Ops 1 & 2 calling upon them to hand over the flat as per the agreement and pay penalty amount or to refund the amounts paid by the complainant as per clause 5(a)(ii) of the agreement. Ex. A5 is the legal notice got issued by the complainant to Op7 stating that Rs.
36,75,000/- was sanctioned as home loan but as the flat has not been completed and the nature of disbursement of home loan should be in accordance with Clause 4.3(b) and 4.4(ii) of the said agreement but the loan instalments have been disbursed contrary to these terms and therefore the complainant sought for recovering the dues from the developer as notice was issued to the developer for termination of agreement. Ex. A6 is the home loan agreement entered into between the complainant, Op1 and Op7 bank on 11.1.2007.
13) The developer filed Exs. B1 to B21. Exs B1 & B2 are CLB orders dt. 5.3.2009 and 13.1.2011.
Exs. B3 & B4 are Form-32 in respect of resignation of directions and appointment of new directors. Ex. B5 is the letter dt. 25.2.2011 with respect to commencement of project. Ex. B6 is the letter dt. 8.4.2011 in regard to progress of construction. Ex. B7 & B8 are letters dt. 17.6.2011 and 28.7.2011 to Hill County Home Owners.
Exs. B9 to Ex. B15 are letters and photographs with regard to progress of construction addressed to customers.
Ex. B16 copy of letter dt. 20.7.2012 issued by Gram Panchayat, Bachupally. Ex. B17 is the Board Resolution dt. 2.4.2011. Ex. B18 is the A.P. High Court order dt. 5.12.2012. Ex. B19 is the letter dt. 12.12.2012 in regard to registration and progress of construction. Ex. B20 is the letter addressed by Ops to complainant to complete formalities to hand over possession and Ex. B21 is the proof of deliver of flats addressed to customers on various dates.
14) The developer raised another contention that by virtue of the orders of the Company Law Board (CLB for short) 05-3-2009 and 13-1-2011, the complainants cannot seek relief before this Commission and they have to approach the CLB for redressal. More over, it cannot be said to be guilty of rendering deficiency in service.
15) Despite the fact that developer company is the party, it did not bring it to the notice of the Company Law Board as to the various claims made by the complainants. Except stating that the Maytas Hill Owners Association was a party to such order, there is no proof that the complainants are parties to the said association or any notice was served on them individually in order to bind them. In all fairness, the developer company ought to have impleaded the complainants as parties to the above said proceedings.
16) The learned counsel for the complainants submitted that they learnt that the developer represented before the CLB that all efforts would be taken up for completion of the project. Evidently no construction activity has been taken up. Even otherwise it is admitted that they did not even start construction as per the orders of CLB and arbitration. These facts are not disputed. The complainants submitted that they have no hopes that the project would be completed within a reasonable time so that they could wait for the project to be completed and then take possession of the apartments. They insist that their amounts be refunded with interest, besides penalty @ Rs. 5/- per sft as agreed upon together with compensation and costs.
17) The learned counsel for the developer contended that the order of the Company Law Board is binding on the complainants and these complaints have to be necessarily dismissed with a direction to approach the CLB. When the developer company originally run by Satyam Computer Services Ltd. founded by Mr. B. Ramalinga Raju went into serious financial troubles and the allegation that funds of Satyam were diverted to Maytas Properties to bail out from liquidation, the Central Government filed Company Application No.4/2009 U/s.388 B, 397, 398, 402 and 403 of the Companies Act before the Principal Bench of Company Law Board, New Delhi. In the said company petition, directions were issued on 13-1-2011, directing Central Government to nominate a nominee director on behalf of the CLB. The order discloses that Shri Ved Kumar Jain was nominated as director on behalf of the CLB. The nominee director undertook various measures to put the project back on track basing on the recommendations of Honble Justice A.R. Laxmanan.
The CLB order dt. 13-1-2011 reads as follows:
(i) I permit the induction of IL & FS group (consisting of Infrastructure Leasing & Financial Services Limited (IL&FS). IL&FS Financial Services Limited (IFIN) and IL&FS Engineering & Construction Company Limited (IECL) as the new promoter of MPL and permit reconstitution of the Board of MPL as provided hereunder.
(ii) The IL &FS group shall invest Rs.20 lakhs in equity share capital of the MPL whereupon its shareholding in MPL would become 80%.
(iii) The IL &FS group on induction as the strategic investor shall take-over the management control of the MPL and reconstitute the Board of Directors of MPL as under:
a) There shall be 4 nominees of the IL &FS group as directors on the Board of MPL including the Chairman.
b) The existing Directors of MPL, i.e., Mr.Rama Raju, Mr.D.Gopla Krishnam Raju and Mr.D.Venkata Satya Subba Raju shall resign as Directors of MPL immediately on induction of IL&FS group as the strategic investor in MPL.
c) Mr. Ved Jain , the nominee Director, appointed by the Union of India, Pursuant to the directions contained in the order dt. 5.4.2009 shall continue as Director in MPL for a further period of 3 years.
(iv). The IL &FS group shall mobilize funds of Rs.150 crores in MPL within a period of 3 months from today.
(v) The IL&FS group shall complete the Maytas Hill Country Residential Project Phase-I within 18 months of its induction as promoter in MPL and shall arrange the required finances to complete the project.
The order required the above said group to complete the project within 18 months. Pursuant to it, the developer has been taken over by new inductives. It is not known as to the steps that are initiated in compliance of the orders.
18) The learned counsel for the developer relied on the following decisions for the proposition that this Commission cannot go ahead and adjudicate the dispute in view of the above orders:
The supreme Court in Sangramsinh P.Gaekwad v.Shantadevi P.Gaekwad, reported in (2005) 123 Comp. Cas 566, held that Section 402 of the Companies Act, 1956 is without prejudice to the generality of the powers of the Company Law Board under Section 397 & 398 and may provide for directions to achieve the objects for which the above sections are enacted. These statutory powers have been vested to administer justice and equity, giving broad discretion applying general standard of fairness to meet the ends of justice.
In Manish Mohan Sharma v. Ram Bahadur Thakur, reported in AIR 2006 SC 1690, the Supreme Court held that the powers under Section 402 are residuary in nature and in addition to the powers available to the Company Law Board under Sections 397(2) and Section 398(2) which permit the Company Law Board to make such order as it thinks fit with a view to bringing to an end the matters complained under 397(1) and 398(1).
In Ravi Kiran Agarwal & Anr. v. Moolchand Shah & Ors., reported in [2009] 152 Comp Case 637 (Bom), it was held that there is no reason to confine the words any other person under section 405 to those categories of persons who are elucidated in clause (e) of Section 402. Further, it was also held that the exercise of those wide powers, may in a given situation affect the interest of third parties. The court opined that Section 402 describes the nature of reliefs that can be granted in a petition under section 397 and 398. Clauses
(a) to (g) of Section 402 are not exhaustive of the reliefs that can be granted by the Board but are only illustrative of the wide powers that are granted upon the Board with a view to ameliorating the situation of mismanagement and oppression.
In MSDC Radharaman v.
MSD Chandrasekara Raja, reported in (2008) 6 SCC 750, the Supreme Court held that the jurisdiction of the Company Law Board having been couched in wide terms and as diverse reliefs can be granted by it to keep the company functioning, is it not desirable to pass an order which for all intent and purport would be beneficial to the company itself and the majority of the members? A court of law can hardly satisfy all the litigants before it. This however, by itself would not mean that the Company Law Board would refuse to exercise its jurisdiction, although the statute confers such a power on it.
In Starlinger & Co.
v. Lohia Starlinger Ltd, reported in 2007 (5) ADJ 744, it was held that Clause (g) of Section 402 has illustrated these extraordinary powers in which the Company Law Board may provide for any other matter, which in the opinion of the Company Law Board is just and equitable.
In Bennett Coleman & Co. v. Union of India, reported in (1997) 47 Comp Cas 92, it was held that instead of destroying the corporate existence of a company, the Company Law Board has been enabled to continue its corporate existence by passing such orders as it thinks fit in order to achieve the objective of removing the oppression to any member or members of a company or to prevent the companys affairs from being conducted in a manner prejudicial to public interest.
In India Household and Healthcare Ltd. v. LG Household and Healthcare Ltd., reported in (2007) 5 SCC 510, observed that the doctrine of comity or amity requires a court not to pass an order which would be in conflict with another order passed by a competent court of law.
In Swadeshi Cotton Mills v Union of India, reported in (1978) 4 SCC 295, it was held that the findings of CLB need to be respected by a Company Court and must not be interfered with unless there is a glaring anomaly.
In Takshila Hospital Ltd. v. Dr.Jaganmohan Mathur, reported in [2003] 115 Com Cas 343 Raj, it was held that an exercise of such option of instituting a proceedings under Section 397 & 398, an independent proceeding came to be instituted which had to be proceeded with independently and uninfluenced by other proceedings which have not even crossed the preliminary stage of admission. In the very nature of the order passed by the learned company judge, the company petition for winding up cannot now be proceeded with until proceedings under Section 397 are finally culminated, which includes the exercise of rights of appeal by any party aggrieved with the order passed by the CLB. Such appeal also lies to the High Court.
The decisions did not lay down any proposition that the proceedings before the consumer fora have to be shelved or the complainants have to approach the CLB only.
19) In fact the question whether the complainants have to approach the CLB or pursue their remedy before this Commission is covered by a decision of our Honble High Court in PRUDENTIAL CAPITAL MARKETS Limited, Calcutta v. State of A.P. Department of Law reported in 2000 ALT-5-468. It held as follows:
There are three categories of cases. The first category of cases are those where the depositor filed a consumer dispute case before the competent District Forum for refund of the deposit made by the depositor with the PRUDENTIAL CAPITAL MARKETS LIMITED (PCML for short) and on the District Forum allowing the application, the petitioner herein approached the State Commission which dismissed the appeal filed and whereupon the depositor approached District Forum under Section 27(1) of the Consumer Protection Act, 1986 by filing penalty petition. The second category of cases are those where the depositor filed a penalty petition before the District Forum for implementation of the order in consumer dispute case and where the petitioner did not approach the State Commission which is the appellate forum. The third category of cases are those where the orders of the appellate forum are challenged by the petitioner.
In the process, the question whether CLB can only entertain the complaint against PCML has arisen. While dealing with the said question the proceedings before CLB vis--vis the proceedings before Consumer Forum have also arisen.
20) In the instant case since the developer has clutched the jurisdiction of CLB, the question is whether the provisions of CLB oust the jurisdiction of Consumer Forum. The said question has been discussed in the above decision as follows:
The next aspect of the matter is whether the provisions of the Companies Act and the RBI Act impliedly ousts the jurisdiction of the Consumer Forums when the CLB is seized of the matter or passed an order at the instance of some of the depositors of NBFC. Hence, sub-sees. (4-D) and (5) of Section 10-E and Section 58-A(9) of the Companies Act and Sections 45-Q and 45-QA of the RBI Act require to be examined, which are as under:10-E-(4-D) : Every Bench shall be deemed to be a Civil Court for the purposes of Section 195 and (Chapter XXVI of the Code of Civil Procedure,1973) and every proceeding before the Bench shall be deemed to be a judicial proceeding within the meaning of Sections 193 and 228 of the Indian Penal Code and for the purpose of Section 196 of that code.(5) Without prejudice to the provisions of sub-sections (4-C) and (4-D), the Company Law Board shall in the exercise of its powers and the discharge of its functions under this Act, or any other law be guided by the principles of natural justice and shall act in its discretion. 58-A(9): Where a company has failed to repay any deposit or part thereof in accordance with the terms and conditions of such deposit, the Company Law Board may, if it is satisfied, either on its own motion or on the application of the depositor, that it is necessary so to do to safeguard the interests of the company, the depositors or in the public interest, direct, by order, the company to make repayment of such deposit or part the order: Provided that the Company Law Board may, before making any order under this sub-section, give a reasonable opportunity of being heard to the company and the other persons interested in the matter. Sections 45-Q and 45-QA of the RBI Act are as under: 45-Q: Chapter III-B to override other Laws: The provisions of this Chapter shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law. 45-QA. Power of Company Law Board to order repayment of deposit: (1) Every deposit accepted by a non-banking financial company, unless renewed, shall be repaid in accordance with the terms and conditions of such deposit. (2) Where a non-banking financial company has failed to repay any deposit or part thereof in accordance with the terms and conditions of such deposit, the Company Law Board constituted under Section 10-E of the Companies Act, 1956 (1 of 1956) may, if it is satisfied, either on its own motion or on an application of the depositor, that it is necessary so to do to safeguard the interests of the company, the depositors or in the public interest, direct, by order, the non-banking financial company to make repayment of such deposit or part thereof forthwith or within such time and subject to such conditions as may be specified in the order: Provided that the Company Law Board may, before making any order under this sub-section, give a reasonable opportunity of being heard to the non-banking financial company and the other persons interested in the matter.
21) The provisions of Reserve Bank of India Act, vis--vis., the CLB also came up for discussion. The very same logic could as well be applied to the case on hand. In view of the fact that their Lordships at Para 51 of the above decision opined:
The CLB is constituted by the Central Government and the said Board shall exercise and discourage powers and functions as may be conferred on it by or under the companies Act or any other law and shall also exercise and discharge such other powers and functions of the Central Government under the Companies Act or other law as may be conferred on it by the Central Government. Notwithstanding subsection (1A) of Section 10-E of the Companies Act, the Civil Courts exercised jurisdiction under sec.9 of the Code of the Civil Procedure, till sub-section (9) of Section 58-A was inserted by the Companies (Amendment ) Act, 1977 with effect from 24-12-1977 conferring powers on the CLB to entertain an application of the depositor for repayment of money. After 1977, till the enactment of Consumer Act in 1986, both the Civil Courts as well as the CLB entertained applications from the depositors for refund of deposits. After the Consumer Act, the Forums established under it started granting redressal to the depositors having regard to the broad definition service adumbrated in Sec.2(1) (O) of the Consumer Protection Act. Ultimately, to provide an additional speedy remedy, the Parliament enacted RBI ( Amendment) Act, 1997 inserting Sec.45-QA giving power to CLB constituted under Sec.10-E of the Companies Act which may, either on its own motion or on application of the depositors order NBFCs to make repayment of such deposits. This background should be kept in mind while examining the order of the CLB, Eastern Region Bench, Calcutta, dated 27-5-1998.
Their lordships also held at para-57 as follows:
Sub-section (5) of Sec.10-E of the Companies Act lays down that the CLB shall in the exercise of its powers and the discharge of its functions under the Companies Act or any other law be guided by the principles of natural justice. The proviso to sub-section (9) of Sec.58A categorically lays down that CLB may, before making any order under sub-sec. (9), give a reasonable opportunity of being heard to the Company and the other persons interested in the matter.
Likewise, the proviso to sub-section (2) of Sec.45-QA mandates that CLB may, before making any order under sub-section (2), give an opportunity of being heard to NBFC and the other persons interested in the matter., Elaborate reasoning is not required to infer that the other persons interested in the matter appearing in the proviso to subsection (9) of Sec.58-A of the Companies Act and the proviso to sub-section (2) of Sec.45-QA of the RBI Act also include the depositors and other creditors of NBFC. It also does not require any authority to say that any provision which adumbrates the principles of natural justice should be interpreted as a mandatory provision. Though the two provisions use the word may, the same should be interpreted as mandatory.
Obligation is on the part of the CLB to order notices to all the depositors in a matter like this. How a notice is sent or information is communicated about the cases filed before the CLB under Sec.45-QA (2) of the RBI Act or Sec.58-A (9) of the Companies Act is altogether different matter.
22) Coming to the present case, the developer did not make any attempt to place the case of the complainants before the CLB. There is no proof that notices were issued to the complainants while passing the order. It may be stated herein that all these proceedings have been taken only after the complainants have clutched the jurisdiction of this Commission. Even assuming that in one or two cases, the complainants are parties, it makes no difference. Therefore, the learned counsel for the complainants is justified in contending that in so far as complainants are concerned, the order passed by CLB is not binding on the proceedings before this Commission.
Their Lordships in the above case at Pare-59 pointed out as follows:
Further, as per the legal position, the proceedings before appropriate Bench of CLB should be initiated by the aggrieved party at the place of companys registered office. This is cumbersome procedure. Therefore, all the depositors cannot be expected to appear before the CLB, Calcutta, especially when there is no notice validly served on all the depositors. The judgments of the Supreme Court referred to above support the view that when the ordinary remedy provided under the alternative law is cumbersome, the consumer cannot be deprived of the remedy before the Consumer Forums.
At para 60, their Lordships asserted as follows:
The summary of the findings under point No.1 for consideration may now be given.
(i) A writ of prohibition cannot be granted unless want of jurisdiction is apparent and if want of jurisdiction is not apparent, the applicant must wait until the decision making body passes orders and seek a writ of certiorari.
(ii) A writ of prohibition ordinarily cannot be granted to stop execution or implementation of the decision; (iii) The grant of writ of prohibition is also governed by other principles which ordinarily govern the grant of extraordinary writs like delay and laches, availability of alternative remedy etc. (iv) The provisions of Sec.45-Q, 45-QA of the RBI Act and Sec.58-A(9) of the Companies Act, do not either expressly or impliedly bar the jurisdiction of the forums constituted under the Consumer Protection Act, from entertaining a consumer dispute case at the instance of the depositor claiming repayment of the deposit from a non-banking finance company. In view of Sec.3 of the Consumer Protection Act, remedy under the said Act is an additional remedy and the same cannot be taken away either by the RBI Act or by the Companies Act. (v) The order of the Company Law Board, Eastern Region Bench, Calcutta dated 27-5-1998 cannot be construed as either taking away the right of the depositors in these cases to approach the consumer forum or nullifying the orders passed by the District Forum/State Commission.
23) Equally the National Commission in Lloyds Finance Ltd. Vs. Ms. Napeena Singh reported in I (2006) CPJ 163 NC considering this aspect of the matter held:
It is the case of the complainants before us that they did not apply to the Company Law Board under Section 45QA. They were not served with any notice of any proceedings before the Company Law Board and they were not aware of any notice being published in any newspaper to which they subscribe to or is otherwise in circulation in the locality in which they reside. They say it is perversity of justice that Company Law Board situated in Mumbai could be approached by small depositors in the far flung corner of the country. The whole scheme as framed is floated and tilted in favour of NBFC. That is, however, not for us to consider. What the requirement of law is that a depositor may either approach the Company Law Board under Section 45QA or file a complaint under the Consumer Protection Act before the appropriate forum. A depositor cannot certainly choose both the remedies simultaneously and once he files an application under Section 45QA of the RBI Act before the Company Law Board, he cannot file a complaint in a Consumer Forum under the Consumer Protection Act.
It is not the case of the developer that complainants have invoked the jurisdiction of CLB, therefore we hold that this Commission has jurisdiction to adjudicate the matter.
24) The learned advocate for developer contended that in the order dt. 13.1.2011 of CLB it has considered the interests of investors, banks stakeholders, and the allottees. It held:
Having perused CA 24/2011 and the above mentioned documents and the fact that the petitioner, the existing directors of MPL, shareholders and the Hill County Owners association are supporting the application, and the prayer made in the application deserves to be granted since it is in the best interests of the company as also of all the stakeholders including banks, employees, investors and the aloottees in the Maytas Hill County Residential Project, and would serve the public interest, the following order is passed in supersession of the earlier order dt. 5.3.2009.
I permit the induction of IL&FAS (consisting of Infrastructure, Leasing & Financial Services Ltd. (IL&FS). IL&FS Financial Services Ltd. (IFIN) and IL&FS Engineering & Construction Company Ltd. (IECL) as the now promoter of MPL and permit reconstitution of the board of MPL as provided hereunder :
The IL&FS group shall invest Rs. 20 lakhs in equity share capital of the MPL whereupon its shareholding in MPL would become 80% The IL&FS group on induction as the strategic investor shall take over the management control of the MPL and reconstitute the board of directors of MPL as under :
There shall be four nominees of the IL&FS group as directors on the board of MPL including the Chairman The existing directors of MPL Mr. Rama Raju, Mr. D. Gopala Krishnam Raju and D. Venkata Satya Subba Raju shall resign as directors of MPL immediately on induction of IL&FS group as strategic investor in MPL.
Mr. Ved Jain, the nominee director appointed by the Union of India pursuant to the directions contained in the order dt. 5.4.2009 shall continue as director in MPL for a further period of 3 years.
The IL&FS group shall mobilize funds of 150 crores in MPL within a period of three months from today.
The IL&FS group shall complete the Maytas Hill County Residential Project phase-I within 18 months of its induction as promoter in MPL, and shall arrange the requires finances to complete the project.
It is not known whether the said order has been complied viz., raising of Rs. 150 crores etc. Though he contended that various steps were taken to complete the project on time, no evidence is placed to show the exact stage of the project. None of the directors of the company filed their affidavits to show the stage of construction, nor the fact that any of the projects were completed.
25) The contention of the developer is that the complainants are stakeholders. Simply by using such term, the complainants cannot be taken into its fold in order to bind the orders of CLB. At the cost of repetition, we may state that it is not known why the opposite parties did not try to implead these parties to the application filed before the CLB so that they could agitate their grievances including the recovery of amount.
Equally so with the bank.
26) A reading of the order passed by CLB shows that it was not aware of the cases pending before the Consumer Commission in Andhra Pradesh. Undoubtedly, the developer has with-held the information pertaining to these cases before the CLB. In the light of the above said decision, we are of the opinion that this Commission has jurisdiction. The orders passed by CLB have nothing to do with the cases on hand. The CLB was not appraised about the cases that were filed before this Commission. In view of the above decision, we are of the opinion that the orders of CLB would in no way prevent or prohibit us from passing appropriate orders as the case may be.
27) The learned counsel for the developer contended that any order directing cancellation of allotment or refund of amount would result in disbursement of the amount of the company, and therefore the complainants cannot seek refund of the amount paid by them. It is not known as to the exact amount that the developer had availed as finance from banks and other financial institutions. The developer except contending that the construction has been taken up and is in progress could not deny the statement of the complainants when they contended that no work was taken up. It could have sought for appointment of Commissioner or filed documents evidencing the construction activity.
28) Since the developer could not prove the stages of construction or that it would hand over possession within a reasonable period, and the period that was originally stipulated has already expired, and all through the complainants have been paying EMIs to the bank, we are of the opinion that it would be unjust that the complainants be directed to go on paying the amounts to the banks without there being any hope of getting the project completed.
29) The complainants by issuing notice to the developer cancelled the above said agreements and directed the developer to pay the consideration received so far, as no construction was taken up nor completed, and sought for refund of the amount paid by the bank to it with penalty @ Rs. 5/- per sft as per clause 7 (a to d) of the agreement. However, we do not see any justification in impleading the original owners of property, who have no subsisting interest in the property. They have parted their title in favour of developer. Therefore the claims against them do not sustain. The complaints are liable to be dismissed against them. Equally the complainant had issued notice to the bank alleging that the entire loan amount was released contrary to the tripartite agreement; wherein it had agreed to disburse stage wise. It was contrary to the agreement besides the guidelines under home loans scheme. It was also mentioned that since the developer had failed to complete the construction as per the terms of agreement of sale as well as tripartite agreement, the bank has to initiate the proceedings and recover the amount and return the loan amount recovered from them with no due certificate. They have enclosed the termination notice issued to the developer while sending notice to the bank. Neither of them had given any reply.
30) The principle of unjust enrichment can be applied herein as the developer has been enriched by receipt of a benefit, secondly, this enrichment is at the expense of the complainant, and thirdly, the retention of the enrichment is unjust and justifies restitution.
We may also quote herein the words of Lord Mansfiled C.J.
This kind of equitable action to recover back money which ought not in justice to be kept.. lies only for money which ex acquo et bono the defendant ought to refund .. It lies for money paid by mistake, or upon a consideration which happens to fail, or for money got through imposition (express or implied) or extortion, or oppression, or undue advantage taken of the plaintiffs situation, contrary to laws made for the protection of persons under those circumstances. In one word, the gist of this kind of action is, that the defendant, upon the circumstances of the case, is obliged by the ties of natural justice and equity to refund the money.
(emphasis supplied) Section 72 of the Indian Contract Act runs as follows :
A person to whom money has been paid, or anything delivered, by mistake or under coercion, must repay or return it. There must be some undue pecuniary inequality existing in the one party relative to the other which the law recognizes as requiring compensation upon equitable principles.
31) In some of the cases, sale deeds were executed in favour of the complainants by the developer conveying the title. Obviously, the complainants cannot have title as well as refund of the amount, since the very sale has been frustrated, in such a case, when the developer has executed the sale deed and there is no prospect of either constructing flats or delivering the property to the complainants, the Honble Supreme Court in somewhat similar case Vinod Kumar Thareja Vs. M/s. Alpha Construction reported in CPJ II (2011) CPJ -3 SC while giving directions to refund the amount also directed to re-convey the property to the builder. Therefore, we direct the complainants to execute re-conveyance deed on receipt of amount payable by the developer and the bank. The registration charges shall be borne by the developer. This is in conformity with the above said decision of the Honble Supreme Court.
32) We may also state herein that the orders of this Commission against the very same developer (vide C.C. 30/2009) directing to refund the amount with interest @ 12% p.a., has been upheld by the National Commission in F.A. No. 189/2010 while reducing the compensation from Rs. 5 lakhs to Rs. 1 lakh. The SLP moved by the developer before the Honble Supreme Court in Appeal (Civil) No. 26256/2010 was dismissed on 27.09.2010.
Therefore these matters are covered by the above decisions and there is no need for any distinction to be made between these cases. These contentions do not sustain.
33) It is an undisputed fact that agreement for purchase of apartment is between the complainant and the developer. It is also not in dispute as per the above said agreement the amount is to be paid as per the schedule which we have adverted at para-7 of this order. Recoursing the above agreement, a tripartite agreement was executed in between the complainant, developer and the bank. The complainants allege that contrary to the terms of the above said agreement the amount was disbursed. In fact it was duty bound to review the progress of construction before disbursing the amount as mentioned in the tripartite agreement. The bank cannot resile from the tripartite agreement and terms of the agreement by alleging that they (complainants) have consented to release the amount to the developer in one go. No security was taken from the builder before release.
34) We may refer herein some of the important terms of the tripartite agreement:
2) The bank shall make disbursement of the sanctioned loan by making payment to the developer directly on behalf of the borrower and payments made to the developer shall be deemed to be payments made to the borrower and borrower shall in each case be liable for the amount of the loan disbursed or his/her behalf to the developer, as though the same had been disbursed directly to him/her. It is further agreed by the borrower that the bank shall not be responsible or liable to ensure or ascertain the progress of the construction and mere demands by the borrower for disbursement would be sufficient for the bank to effect disbursement as aforesaid provided that all other sanction stipulations are complied by the borrower.
However, the Bank as its sole discretion, shall disburse the loan in suitable instalments, at the request of borrower, or in suitable instalments to be decided by the bank, with reference to need or progress of construction, which decision shall be final and binding on the borrower/developer. The borrower shall be responsible for follow with the bank to make disbursement on his/her behalf as per any agreement, payment schedule he/she may have with the developer. Not withstanding anything to the contrary contained herein, the bank may in its sole discretion refused to disburse the loan until:
(a) Borrowers has paid his/her own contribution in full to the developer (the cost of the dwelling unit less the loan) and the progress and need of the construction justifies the disbursement requested.
3) The developer further agrees to total subrogation of borrowers right to receive refund of all the monies, received by the developer from the bank on behalf of the borrower in favour of the Bank. In any event in which such refund becomes due and payable to the borrower under any agreement/arrangement executed/made between the developer and the borrower, the developer in particular agrees and undertakes not to pay any amount on any account or under any circumstances to the borrower by way of refund or otherwise without first receiving a written consent of the bank. The borrower and the developer also agrees that as soon as the first disbursement is made by the bank, the mortgage/charge in favour of the bank shall, without the necessity of any deed, document or writing, fasten on the said dwelling unit and the same shall continue (notwithstanding its allotment, completion and occupation) until the loan of the bank is fully repaid with interest and all other dues.
(5) If for any reason there is an increase in the cost of the dwelling unit such increase in the cost of the dwelling unit shall be paid/borne by the borrower without any reference to the bank bank and until such payment is made UTI bank shall have the right to suspend further disbursement of the sanctioned loan 7(a) Upon cancellation of the allotment of schedule property, made to the borrower for any reason, the developer shall immediately intimate about the same in writing to the Bank. Upon receipt of such intimation, The Bank shall notify the developer all amounts due to it from the borrower. In such an event, the developer shall forthwith pay the Bank all amounts received by it from the bank on behalf of the borrower within 60 days of receipt of such statement during which period, the developer shall pay interest to the Bank, at the rate of interest on such amount shall be the same as agreed between the Bank and borrower in the loan agreement.
7 (b) Further the developer hereby agrees that it shall also pay all the remaining amounts due and payable to the Bank from the borrower such as defaulted payments, additional interest, etc. after deducting reasonable expenses (as agreed by the developer, and the Bank) incurred by the developer from the sale proceeds of the property. Further any such sale by the developer can be effected only after obtaining a consent from the Bank.
9) That in the event of default in payment of any dues to the bank by the borrower the Bank may at its sole discretion enforce the security by sale of the land and dwelling unit for which the loan has been availed by the borrower and the developer shall not raise any objection/obstruction for the same and shall accept another purchaser for the house or flat in place of the borrower, however subject to the substitute purchaser complying with the necessary requirements of the developer in this respect. If there are any dues/ outstanding payable by the borrower to the developer the same shall be subordinate/secondary to that of the liability of the borrower to the Bank.
35) The complainant contends that contrary to the terms of agreement and also various guide lines for releasing loan amounts, the bank has released the entire amount in one go without considering the stages of construction to the detriments of their interests. The bank can directly pay the amount to the developer as agreed upon but not whole of the amount without even verifying the stages of construction and existence of property. It could not have released the amount without verifying the progress of construction jeopardising their claims. By referring to project programme guide lines where there was specific reference that the developer should be in business for not less than 5 years and the builder/developer has history of due completion of 3 projects and it should have completed at least 1,00,000 sft. of built up area, and that without satisfying the eligibility criterion the bank could not have sanctioned Advance Disbursement Facility (ADF for short). They contend that the developer was incorporated on 20-1-2005 and the amount was released without completion of 5 years to avail ADF contrary to stipulations.
36) The bank, despite the notices of cancellation of agreements etc. and even filing complaints before this Commission and proceedings before the CLB, did not try to recover the amount paid by it to the developer invoking the above clauses. The banker knew full well the amounts were diverted for some other purpose. It did not take steps to recover from the developer, obviously, it knew it would land up in litigation, where it may not be sure for recovery of the amount. It knew full well the complainants being salaried persons it was easy for them to recover.
37) Evidently the bank did not take any steps to recover the amount, only in the event of bank sustaining loss, this indemnity clause comes into play. The bank had taken a letter from the complainants wherein they had agreed to release the amount without waiting for construction to be made. This is contrary to the guidelines and tripartite agreement. It is not known why the bank had taken such a stance when the guidelines as well as their own agreements stipulate to release the amount stage wise. The fact remains that the bank released the amounts to the developer contrary to guidelines as well as tripartite agreement to non-existent apartments.
38) The bank having been a party to the tripartite agreement cannot direct the complainants to execute such a letter without the consent of the developer in this regard. This is contrary to the terms of the tripartite agreement . By taking such a consent from the complainants to release the entire amount, the bank is offending the terms of agreement. There cannot be any objection for the developer to take it. After all it will have the entire amount without corresponding burden to fulfil. It need not construct. Had developer been joined, the complainants could have insisted the developer to construct the property and only after satisfying itself as to the phases of construction, they would have asked the banker to release the amount accordingly. There would be no meaning in releasing the entire amount in one go, the bank having agreed to release the amount in a phased manner. Solely basing on the letter taken from the complainants, the bank cannot give a go bye to tripartite agreement and release the entire amount. This would cause unjust enrichment to the developer, and loss to the complainants. The terms of the agreement in between three parties were made in order to see that no party suffers from non-implementation of terms of the agreement. The bank cannot act at its own whims and fancies, and release the amount. It cannot defend that by virtue of letters of the complainants, it was entitled to release the amount in its entirety.
39) If the bank acts contrary to the agreement and guidelines the complainants are not liable to refund the amount paid to the developer. The bank can as well recover from the developer by recoursing the above clauses. The courts will not come to the rescue of the party which violates the terms and convey benefits to one party in preference to another. It intends to cause loss to a genuine borrower by unduly favouring a defaulting and unfair customer. All this amounts to unfair trade practice.
40) It is not as though the bank did not know that the developer has clutched the jurisdiction of the CLB. When the matter is pending with CLB, if really it intends to protect its own interest besides that of the complainants, in the light of dispute, it ought to have approached the CLB for recovery of the amounts. It did not even file the proceedings before the appropriate authority for recovery of the amount. Evidently the bank knew fully well that it could recover the amount from the complainants.
41) The banks and financial institutions promising to lend money or sanctioning loans and the borrower investing in the project thereon will be clothed by the principles of Promisorry Estoppel. The doctrine of promissory estoppel is an evolving doctrine, contours of which are not yet fully and finally demarcated. Being an equitable doctrine it should be kept elastic enough in the hands of the court to do complete justice between the parties. If the equity demands that the promissor is allowed to resile and the promisee is compensated appropriately that ought to be done. If, however, equity demands that the promissor should be precluded in the light of things done by the promisee on the faith of representation from resiling and that he should be held fast to his representation that should be done. It is a matter holding scales even between the parties to do justice between them. This is the equity implicit in the doctrine vide State of H.P. Vs. Ganesh Wood Products reported in 1995 (6) SCC 363.
42) It is legally open to the bank to take a decision in good faith in the exercise of its bonafide discretion as to whether it was safe to make advances of public funds to any particular party and arrive at a decision after examining the relevant facts and circumstances.
43) However, in the present case the complainants by issuing notice put an end to the contract as the developer disabled itself from performing its obligations. The bank did not act in good faith nor it had exercised bonafide discretion while releasing the funds. Recourse can be had to a decision in Nannapaneni Venkata Rao Co-operative Sugars Ltd. Vs. State Bank of India reported in AIR 2003 AP 515 (DB) it was held :
Refusal on the part of the respondent bank to pay interest on the ground that opening of such account and crediting of the interest is not in accordance with the guidelines of RBI is not tenable as the respondent is solely responsible for suppressing the fact while entering into the contract.
44) This Commission can take judicial cognizance of the fact that various banks have financed the builder obviously in view of the reputation the developer was having by then, and the bank contrary to the terms of the agreement as well as guidelines disbursed the amounts keeping the interests of the complainants in jeopardy. The banks are choosing certain clauses and contending that the very complainants have given authorization to them to release the amount and therefore they have released, forgetting the fact that the very financing of the project was contrary to the scheme issued in this regard. Evidently, the bank as well as the developer benefitted from these transactions. The developer has taken the amount without constructing any of the flats, and equally the bank has been collecting the amounts from the complainants towards EMI. It is a case of double jeopardy. Necessarily all this amounts to unfair trade practise as well as deficiency in service on the part of developer as well as the bank. Necessarily the complainants have to be compensated. Since terms of the agreement enable the bank to collect from the developer it can as well recover the same. The bank by violating its own rules cannot take advantage and recover the same from the complainants. This suppression of rules at the time when so called authorization taken from the complainants amounts to unfair trade practise. This cannot be allowed to happen.
45) The bank has undoubtedly violated the terms of the tripartite agreement, and released the amount even without bothering to verify as to the stage and nature of construction. In other words, the bank financed to a non-existent project or incomplete project, duping its own customers. Now the complainants would be un-necessarily hard pressed, to pay the amounts towards EMI without there being any hope of getting the apartments as the developer is under winding up proceedings. The bank cannot take advantage of its own indiscretion. This is unjust and unethical. If the bank releases the amounts contrary to tripartite agreement it has to suffer for the consequential losses. Whatever loss caused thereby it could as well approach appropriate forum for recovery of the amount from the developer, to which it has released the amount in one go. The bank under the terms entitled to recover from the developer to which it had paid the amounts. It cannot turn round and claim against the complainants. It is not under original stipulation that the bank had to pay the entire amount to the developer. The developer also agreed to refund the amount if there are cancellations of the agreements or failure to fulfil its commitments. The agreement that was arrived at earlier was fair and no party would benefit from the lapses or mistakes of the other. Therefore, the complainant are not liable to pay the EMIs.
46) The bank has to collect the loan amount plus whatever interest and other legally permissible charges from the developer and credit it to the complainants loan account. It shall not collect further EMIs nor entitled to any more amount except the amount, if any, remained unpaid by the complainant towards loan granted to him. The bank has no authority to complain to CIBIL. In fact if there is a provision, the CIBIL has to enter the name of the bank, as one of the violators of guidelines of the banks.
CC 64 of 2012 In the result the complaint is allowed in part directing Ops 1 to 6 to refund the amounts paid by the complainants with interest @ 12% p.a., from respective dates till the date of payment together with compensation of Rs. 1 lakh, and costs of Rs. 10,000/-. Further Ops 1 to 6 are directed to refund the amount disbursed by the bank (Op7) to it along with penal charges etc. levied by the bank if any, failing which the bank is entitled to collect, and credit the same to the loan account of the complainants. Time for compliance eight weeks.
On compliance of aforementioned directions the complainant shall re-convey the same to the developer and the registration charges and stamp duty etc., shall be borne by the developer.
CC 73 of 2010 In the result the complaint is allowed in part directing Op No. 1 to refund the amounts paid by the complainant with interest @ 12% p.a., from respective dates till the date of payment together with compensation of Rs. 1 lakh, and costs of Rs. 10,000/-. Further Op No. 1 is directed to refund the amount disbursed by the bank (Op2) to it along with penal charges etc. levied by the bank if any, failing which the bank is entitled to collect, and credit the same to the loan account of the complainant. Time for compliance eight weeks.
On compliance of aforementioned directions the complainant shall re-convey the same to the developer and the registration charges and stamp duty etc., shall be borne by the developer.
CC 79 of 2010 In the result the complaint is allowed in part directing Op No. 1 to refund the amounts paid by the complainant with interest @ 12% p.a., from respective dates till the date of payment together with compensation of Rs. 1 lakh, and costs of Rs. 10,000/-. Further Op No. 1 is directed to refund the amount disbursed by the bank (Op2) to it along with penal charges etc. levied by the bank if any, failing which the bank is entitled to collect, and credit the same to the loan account of the complainant. Time for compliance eight weeks.
On compliance of aforementioned directions the complainant shall re-convey the same to the developer and the registration charges and stamp duty etc., shall be borne by the developer.
1) _______________________________ PRESIDING MEMBER
2) ________________________________ MEMBER APPENDIX OF EVIDENCE WITNESSES EXAMINED FOR COMPLAINANTS OPPOSITE PARTIES None None CC 64 OF 2012 DOCUMENTS MARKED FOR COMPLAINANTS:
Ex. A1 Agreement for sale dt. 6.12.2006 Ex. A2 Tripartite agreement dt. 11.1.2007 Ex. A3 Agreement for construction dt. 31.7.2008 Ex. A4 Legal notice got issued by complainant to Ops dt. 12.5.2010.
Ex. A5 Postal receipts and acknowledgements.
Ex. A6 Home loan agreement dt. 11.1.2007 Ex. A7 Statement of account of complainant issued by OP bank.
Ex. A8 Certificate of incorporation consequent upon change of name issued by Asst. Registrar of Companies.
Ex. A9 Form-32.
DOCUMENTS MARKED FOR OPPOSITE PARTIES :
Ex. B1 CLB order dt. 5.3.2009 Ex. B2 CLB order dt. 13.1.2011 Ex. B3 Form-32 Ex. B4 Form-32 Ex B5 to B14 series of letters addressed by MPL to its customers about the progress of construction.
Ex. B15 Colour photograph showing the status of flats.
Ex. B16 Letter issued by Executive Officer, Village Panchayat furnishing the Rental value at Bachupally for the years 2008 to 2013.
Ex B17 Board Resolution dt. 1.11.2011 authorizing certain persons to deal with legal proceedings of the company Ex B18 Order of High Court in W.P. No. 9227 of 2010 & batch dt. 5.12.2012.
Ex. B19 Letters dt. 12.12.2012 addressed by MPL to its customers.
Ex. B20 Letters dt. 04.01.2013 addressed by MPL to its customers.
Ex. B21 Letters dt. 22.12.2012 addressed by MPL to its customers.
CC 73 OF 2010 DOCUMENTS MARKED FOR COMPLAINANTS:
Ex.A.1 Brochure Ex.A.2 Agreement of sale Ex.A.3 Tripartite Agreement Ex,.A.4 Sale Deed Ex.A.5 Agreement of Construction Ex.A.6 Tax invoice issued by the Ist Respondent to Complainant Ex.A.7 Invoice issue by the Ist Respondent to Complainant Ex.A.8 ledger account Ex.A.9 Statement of account issued by 2nd respondent Ex.A.10 Acknowledgement cum Receipt Ex.A.11 Acknowledgement cum Receipt Ex.A.12 letter issued by 1st respondent to Complainant Ex.A.13 letter issued by 1st respondent to Complainant Ex.A.14 letter issued by 1st respondent to Complainant Ex.A.15 legal notice issued by complainant ExA.16 Reply letter from 1st respondent.
ExA.17 Form No.32 DOCUMENTS MARKED FOR OPPOSITE PARTIES :
Ex.B.1. letter to customers dated 25-02-2011 ExB.2 letter to customers dated 08-04-2011 with respect to progress of construction Ex.B.3 letter Hill county Home Owners, Ex.B.4 letter to customers dated 25-10-2011 with respect to progress of construction Ex.B.5 letter to customers dated 08-09-2011 with respect to progress of construction Ex.B.6 CLB Order dated 5-3-09 Ex.B.7 CLB Order dated 13-01-2011 Ex.B.8 Form No. 32 Ex.B.9 Letter to Hill County Home Owners, dt 28-07-2011 Ex.B10 Letter to customers with respect of progress of construction, dt. 29-12-2011 Ex.B.11 Letter to customers with respect to recent physical progrees of Hill county Ex.B.12 Colour photocopy pictorial progress of construction dated 30-04-2012 Ex.B.13 color photocopy of Apartment blocks at construction site Ex.B.14 Letter of authority with Board of Resolution CC 79 OF 2010 DOCUMENTS MARKED FOR COMPLAINANTS:
Ex.A.1 particulars of M.D. Ex.A.2 G.P.A. of the petitioner Ex.A.3 Sale Deeds, dated 5-7-08 Ex,.A.4 Agreement of Construction Ex.A.5 Legal Notice DOCUMENTS MARKED FOR OPPOSITE PARTIES :
Ex.B.1. letter to customers dated 25-02-2011 ExB.2 letter to customers dated 08-04-2011 with respect to progress of construction Ex.B.3 letter Hill county Home Owners, Ex.B.4 letter to customers dated 25-10-2011 with respect to progress of construction Ex.B.5 letter to customers dated 08-09-2011 with respect to progress of construction Ex.B.6 CLB Order dated 5-3-09 Ex.B.7 CLB Order dated 13-01-2011 Ex.B.8 Form No. 32 Ex.B.9. letter to customers dated 25-02-2011 (Ex.B.1== Ex.B.9) Ex.B.10 Letter to Hill County Home Owners, dt 28-07-2011 Ex.B11 Letter to customers with respect of progress of construction, dt. 29-12-2011 Ex.B.12 Letter to customers with respect to recent physical progrees of Hill county Ex.B.13 Colour photocopy pictorial progress of construction dated 30-04-2012 Ex.B.14 color photocopy of Apartment blocks at construction site Ex.B.15 Letter to customers with respect of construction of internal works in Apt. Blocks Ex.A.16 A copy of letter dated 20-07-2012 from Gram Panchayat, Bachupally.
Ex.B.17 A.P. High Court Order, dated 5-12-2012 Ex.B.18 letter to customers with respect to commencement of registration Ex.B.19 letter to customers with respect to complete formalities Ex.B.20 Proof of deliver 16 flats addressed to customers
1) _______________________________ PRESIDING MEMBER
2) ________________________________ MEMBER *pnr UP LOAD O.K.