State Consumer Disputes Redressal Commission
Mr. Olvy Albert Douza vs Mr. Girdharlal Mohanlal Gangani on 26 April, 2012
BEFORE THE GOA STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PANAJI- GOA Appeal No. 21 of 2011 1. Mr. Olvy Albert DSouza 2. Mrs. Minguelita Clementina DSouza Both represented by their Attorney Holder Mr. John F. Fernandes H. No. 165/1, Near Rosary Chapel Caranzalem, Dona Paula P.O. Goa 403004. . Appellants/Complainants v/s 1. Mr. Girdharlal Mohanlal Gangani Galaxy Building Near Mahalaxmi Mandir Panaji Goa. 2. Shri. Poma Pundolica Tari Alias Kamalakant P. Chodankar 3. Smt. Jayashree Kamalakant Chodankar Both resident of A/2 Balaji Co-op. Housing Society Ltd. Opp. Canara Bank Kalina, Mumbai 400029 ...Respondents/O.Ps Appeal No. 22 of 2011 Mr. Girdharlal Mohanlal Gangani Galaxy Building Near Mahalaxmi Mandir Panaji Goa. .Appellant V/s. 1. Mr. Olvy Albert DSouza 2. Mrs. Minguelita Clementina DSouza Both represented by their Attorney Holder Mr. John F. Fernandes H. No. 165/1, Near Rosary Chapel Caranzalem, Dona Paula P.O. Goa 403004. 4. Shri. Poma Pundolica Tari Alias Kamalakant P. Chodankar 5. Smt. Jayashree Kamalakant Chodankar Both resident of A/2 Balaji Co-op. Housing Society Ltd. Opp. Canara Bank Kalina, Mumbai 400029 ..Respondents Appellants/complainants represented by Adv. Shri. J. Vaz. Respondent/O.P. No. 1 represented by Adv. Shri. N. R. S. Bodke. Respondent Nos. 2 & 3 ex-parte. Coram: Shri Justice N.A. Britto, President Smt. Vidhya R. Gurav, Member Dated: 26/04/2012 ORDER
[Per Shri Justice N. A. Britto, President] These two appeals have been fled by the complainants and O.P. No. 1 respectively in CC. No. 99/2005 and are directed against order dated 14/06/2011 of the Lr. District Forum, North Goa.
2. Some facts are required to be stated to dispose off both the appeals and for that the parties to the appeals shall be referred to in the names as they appear in the cause title of the complaint.
3. The O.P. No. 1 is a Builder and shall herein after be referred to as such. The Complainants entered into an agreement with the Builder on 16/4/1998. By virtue of this agreement the Builder was to provide to the complainants a flat admeasuring 90 sq mtrs. in his building complex known as Jay-Kamal Complex which was being constructed in survey No. 111/4 of village Penha de France. The Complainants paid to the Builder a sum of Rs. 5.5 lakhs towards the purchase price and the Builder issued a receipt on the same day for the said amount and also executed an undertaking in favour of the complainants stating that the Builder would compensate the complainants in the sum of Rs. 5000/- per month in case the Builder failed to deliver the premises within the stipulated time. The agreement stipulated that the flat would be delivered to the Complainants within a period of 6 months. The agreement dated 16/04/1998 by virtue of clause 7 gave an option to the purchaser i.e to say the complainants that in case the Builder was unable to complete the construction and deliver possession within the said period of 6 months, the complainants could exercise the option to cancel the agreement and to demand immediate refund of all the monies paid to the Builder and in such an event, the Builder was to refund to the purchasers i.e the complainants the monies received without interest, within 60 days of the receipt of the notice in writing in that behalf from the purchaser; and in default of payment within the said period of 60 days the Builder was to pay interest at the rate of 24%. The said agreement was entered into by the complainants through their attorney one Shri. John F. Fernandes. The complainants sent a letter dated 2/4/2005 calling upon the Builder to inform the attorney, so as to inform his principals namely his sister and brother-in-law i.e the Complainants as to when he intended to give the possession. This letter was followed by letter dated 6/4/2005 and then by letter dated 9/6/2005. The complaint was filed thereafter on or about 30/04/2005.
4. The complaint was initially filed against the Builder only. Subsequently by application dated 24/10/05, the owners of the property were added as O.P. Nos. 2 & 3.
The Builder took several defences which have been dealt with by the Lr. District Forum in the Impugned Order and therefore we do not propose to repeat them herein except for the submissions made in the light of the said defences at the time of hearing of these appeals.
5. Written submissions were filed before the Lr. District Forum by the Builder/O.P. No. 1 on or about 8/11/06 and thereafter the file was lost/misplaced by the Lr. District Forum, North Goa. The file was reconstituted after serving a notice both to the complainants as well as the Builder/O.P. No. 1.
6. The complainants responded to the notice dated 6/1/10 while the Builder/O.P. No. 1 did not respond to the same. The file therefore was re-constructed after obtaining the permission of the then President of this Commission on 2/12/10.
7. By our order dated 30/1/12, the Lr.
President of the District Forum, North Goa was directed to hold an enquiry, administratively, and fix the responsibility for the missing file of the original CC. No. 99/05 and he has complied with our direction and has submitted his report. After the file was re-constructed, no further proceedings were held and apparently on the basis of the written submissions filed by the complainants and the Builder that the Impugned Order came to be passed by the Lr. District Forum, by which the Builder has now been directed to deliver possession of the suit flat to the complainants by executing a sale deed, etc. The complainants have also been awarded compensation and costs of Rs. 25,000/-.
8. We shall first deal, with the appeal of the Builder.
9. Shri. N. Bodke, Lr. Advocate appearing on behalf of the Builder, would submit that the amended complaint was not before the District Forum at the time of passing the Impugned Order. He next submits that the Complainants had failed to provide the Annexures of the written version, such as the occupancy certificate, application made by the complainants and or their attorney to the Electricity Department and as such the Impugned Order was passed by the Lr. District Forum in the absence of all documents filed by both the parties before the Lr. District Forum.
10. We are not inclined to accept the submissions made by the Lr. Advocate of the Builder.
We have verified and satisfied ourselves that the notice dated 6/1/2010 for re-construction of the file was served on both the parties i.e the complainants as well as Builder and though the complainants responded to the same the builder did not. Nothing had prevented the Builder from producing the documents which according to him were not produced by the complainants either before the Lr. District Forum or even for that matter before this Commission and therefore the Builder cannot now contend that the Impugned Order came to be passed without all the documents being there before the Lr. District Forum.
11. Shri. Bodke next has submitted that after re-construction of the file the parties were required to be given a notice to be heard in the matter and in the absence of such a hearing the Lr. District Forum violated the principle of natural justice by not providing an opportunity to be heard. We are unable to accept this submission. Firstly, Lr. Advocate has not been able to point out to any provision of the C.P. Act or the rules or the regulation framed thereafter which has been breached.
We find that both the parties namely the Complainants and the Builder had filed their written arguments and after going through such written arguments that the Lr. District Forum has decided the complaint and therefore we find that there is no violation of any principle of natural justice.
12. Next, Shri. Bodke submits that at the time of admission of the complaint the complainants had submitted that they would be interested only in refund of the money paid in terms of clause 7 of the agreement dated 16/4/1998 and the complaint was admitted on that count alone. Shri. Bodke concedes that the OPs were not present before the Forum at the time of admission but when questioned as to whether the Builder had obtained any copy of order, Lr. Counsel submits that no copy of such order was obtained.
It is also not the case of the Lr. Advocate that he had perused such an order passed by the Lr. District Forum at the time of admission. In the absence of any order, this submission can be considered to have been made in the air only because the file was found missing. We find no substance in the said submission and therefore we reject the same.
13. Then, Shri. Bodke submits that the Builder had filed an application for cross-examination of the complainants which was dismissed by the Lr. District Forum by order dated 8/5/06. Lr. Advocate submits that the Lr. District Forum ought to have granted the said application and ought to have allowed the complainant/s to be cross-examined.
Shri. Vaz, Lr. Adv.
on behalf of the complainants is quick to submit that the Builder did not challenge the said order nor has challenged the same in the appeal. We inclined to accept the submission of Shri. Vaz and reject the submission of Adv. Shri. Bodke as the said order dated 8/5/06 was not challenged by the Builder at the appropriate time nor the same has been challenged by raising a ground of appeal and providing a copy of the same.
14. Next, Shri. Bodke submits that the possession of the flat in question was handed over to the complainants and according to the Lr. Advocate this can be gathered from fact that the complainants had obtained occupancy certificate on 3/4/2003 ( a copy of which is at page 35) of the file of the Lr. District Forum. Lr. Adv. Bodke has also not been able to point out to any date on which possessions of the flat was handed over with reference to the written version. Lr.
District Forum has held that the Builder has failed to prove that he handed possession of the flat to the complainants.
If the flat was handed over to the complainants, the Builder would have reacted immediately to the letters written to him dated 2/4/05, 6/4/05 and 9/6/05. The fact that the Builder did not react to the said letters nor stated the date on which the possession was handed over shows that the possession was not in fact handed over to the complainants. Moreover, in terms of clause 6 of the agreement the Builder was required by notice in writing to intimate the completion of the suit flat to the purchaser. It is not the case of the Builder that he had given such a notice in writing. It is therefore obvious that the Builder has taken a false plea that he has handed over possession to the complainants. That he had obtained occupancy certificate on 3/4/2003 is not at all sufficient to prove that the possession of the suit flat was handed over to the complainants.
15. We therefore find there is no merit in the appeal filed by the Builder and the same is liable to be dismissed.
16. We now proceed to decide the appeal filed by the complainants.
17. The short point raised by Shri. Vaz is that the Lr. District Forum ought to have awarded compensation to the complainants as agreed upon by virtue of the said undertaking by which the Builder had promised to pay to the complainants a sum of Rs. 5000/- per month on failure to deliver the possession within the stipulated period of 6 months. The plea of the Builder that the said undertaking was executed by coercion, Lr. Advocate submits, has been rightly rejected by the Lr. District Forum.
18. Shri. Bodke submits that the complainants have not explained as to why another undertaking was executed by the Builder providing for the said compensation of Rs. 5000/- per month. Explanation could come from the Builder as well, and the Builder has also not given any explanation why he had executed a separate undertaking. The Builder has not disputed the execution of the agreement and the payment receipt which were executed on the same day as the undertaking. It cannot be believed that two documents were executed by the Builder out of free will and the third out of coercion. In case the said undertaking was executed without free consent or coercion, the Builder would have immediately reverted to the complainants that it was so and informed that he was not bound by it. The Builders silence to the three letters referred to herein above, written to him of behalf of the complainants clearly shows that the said undertaking was executed by the Builder out of his own free will.
19. The Lr. District Forum has awarded the complainants compensation of Rs. 25,000/- including costs. Compensation included must be the compensation that the complainants were entitled to by virtue of the said undertaking though no reference has been made to it by the Lr. District Forum. Shri. Bodke has also not been able to throw any light on the entitlement of the complainants for the said sum of Rs. 5000/- per month though Shri. Vaz, Lr. Advocate on behalf of the complainants has insisted that the complainants would be entitled to the same because the Builder had agreed to pay the same.
20. We find from the application dated 10/4/12 filed by the complainants that the complainants reside in Bahrain and whenever they come down, for want of accommodation they are compelled to stay with their relatives or at hotels at a considerable cost.
21. The Indian Contract Act, 1872 applies to all. That is the ratio laid down by the Apex Court in Marine Container Services Pvt. Ltd. vs. GoGo Garments ( AIR 1999 SC 80). Section 73 of the Contract Act deals with compensation for loss or damage caused by breach of contract, and, Section 74 deals with compensation for breach of contract where penalty is stipulated for. We do not propose to reproduce both the Sections in extenso. A Division Bench of Bombay High Court in Board of Trustees of Port vs. Pioneer Engineer (2006 (5) Bom. C.R. 628) stated as follows:
A reading of these two judgments lead to an inevitable conclusion that according to the Supreme Court Section 74 of the Contract Act has obliterated the distinction between the stipulations providing liquidated damages and stipulations in the nature of penalty, so far as payment of compensation is concerned. Reasonable compensation is the principle to be followed. The above observations in Maula Buxs case are applicable to both the stipulations. Therefore, even if it is accepted that we are concerned here with stipulation naming amount to be paid in case of breach and not stipulation by way of penalty, the principle of reasonable compensation will still be applicable to it. The measure and requirement of proof of damages will vary according to type of contracts. Where the loss in terms of money can be determined, the party claiming compensation must prove the loss suffered by him.
22. Nearer home, in Ghaziabad Development Authority vs. Balabir Singh (2004 (5) SCC 65), the Apex Court has held that:
The word compensation is of a very wide connotation.
It may constitute actual loss or expected loss and may extend to compensation for physical, mental or even emotional suffering, insult or injury or loss. The provisions of the Consumer Protection Act enable a consumer to claim and empower the Commission to redress any injustice done. The Commission or the Forum is entitled to award not only value of goods or services but also to compensate a consumer for injustice suffered by him. The Commission/Forum must determine that such sufferance is due to mala fide or capricious or oppressive act. It can then determine amount for which the authority is liable to compensate the consumer for his sufferance due to misfeasance in public office by the officers.
Such compensation is for vindicating the strength of law.
23. The complainants could have easily let out the flat on rent and secured the amount stipulated in the undertaking by way of rent as they are generally residing in Bahrain.
The complainants had sought in terms of prayer c of the complaint, the said sum of Rs. 5000/- per month from 16/10/98 untill handing over possession to the complainant. The Lr. District Forum without even adverting to the said undertaking has awarded to the complainants a sum of Rs. 25,000/- to include costs as well which in our view is grossly inadequate. If the compensation was to be worked out on the basis of the undertaking, at the time of filing of the complaint, it would have worked out to over Rs. 4.2 lakhs. In our view a sum of Rs. 2 lakhs would be a reasonably compensation to be awarded to the complainant in terms of prayer c of the complaint with pending and future interest at the rate of 9% from the date of the complaint untill payment.
The complainants would be entitled to Rs. 5000/- as cost of the complaint and another sum of Rs. 10,000/- as cost of both the appeals to be paid by the Builder. The order of the Lr. District Forum awarding compensation and cost of Rs. 25,000/- would stand accordingly modified. No other relief is sought for by the complainants in their appeal.
24. In view of the above discussion F.A. No. 22/11 is hereby dismissed. F.A. No. 21/11 is hereby allowed on the above terms.
Applications filed by the complainants dated 10/4/12 is dismissed with liberty to file the same before the Lr. District Forum in execution proceedings which may be filed against the Builder and other parties.
(Smt. Vidhya R. Gurav] (Justice Shri. N.A. Britto) Member President