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Praveen Kumar & Others v/s Sharath Chida & Others


Company & Directors' Information:- PRAVEEN INDIA LTD . [Active] CIN = L21029WB1983PLC036326

Company & Directors' Information:- PRAVEEN & COMPANY PRIVATE LIMITED [Strike Off] CIN = U99999DL1999PTC098397

    FA Nos. 221 of 2015, 22 of 2016 Against CC No. 412 of 2012

    Decided On, 04 April 2017

    At, Telangana State Consumer Disputes Redressal Commission Hyderabad

    By, THE HONOURABLE MR. JUSTICE B.N. RAO NALLA
    By, PRESIDENT & THE HONOURABLE MR. PATIL VITHAL RAO
    By, JUDICIAL MEMBER

    For the Appearing Parties: P.V. Markandeyulu, N. Mohan Krishna, Sri Srinivas Karra, Advocate.



Judgment Text

Oral Order: (B.N. Rao Nalla, President)

1) These appeals are proposed to be disposed of by a common order in view of the appeals arising out of same order of the forum below.

2) For the sake of convenience, the parties are referred to as arrayed in the complaint.

3) The case of the complainants, in brief, is that the Ops promising to provide facilities and amenities as contained in the brochure and as per work order placed by the complainant agreed to sell the flat bearing No.304 on 2nd floor admeasuring 1090 sft with undivided share 30 sq. yards, out of 600 sq. yards in the semi-finished building apartment known as 'M/s Sai Paradise' situated at Lahari Estates in Sy.No.155 on plot No.25 & 26 in Block No.163 Bachupally village, Pragathi Nagar Gram Panchayat, Qutbullapur mandal, Ranga Reddy district.

4) It was represented by OP No.3 that the subject flat belongs to OP No.1 land owner who would also participate in the construction activity in a joint-venture and arranged for negotiations of price and other terms and conditions on 29.01.2011 wherein after deliberations and negotiation, the OP No.1 agreed to sell the said flat for a total consideration of Rs.18,50,000/- including the cost for completion of the flat at Rs.7,28,000/-. Accordingly, complainants paid an amount of Rs.1,00,000/- and entered into an agreement of sale on 20.04.2011 on the assurance that external and internal works would be completed within a period of one month or by 20.07.2011 with further hope that the rent of Rs.6500/- per month could be saved.

5) The complainants obtained loan of Rs.14,50,000/- with EMI of Rs.13,992/- from the ICICI bank and got released the same in favour of OP No.1, upon which, the OP No.1 executed a sale deed dated 27.06.2011 registered as document No.6001/2011 for which complainants paid Rs.84,150/- towards registration charges and Rs.10,000/- towards incidental expenses and the physical possession of the flat was delivered to the complainant. Prior to release of loan amount, the field Officer of the bank visited the site and after due satisfaction released the loan amount.

6) In spite of receipt of entire sale consideration, the Ops failed to complete the flat and provide the facilities and amenities as promised. On repeated requests to refund the amount of Rs.4,00,000/- out of Rs.7,28,000/-, the OP No.1 repaid the sum of Rs.2,61,850/-. In fact, complainants paid their amount of contribution by borrowing from friends @ 2% p.m. and thereby paying interest of Rs.8000/- p.m. Complainants are continuing to pay the rent @ Rs.6500/- p.m. and paid interest of Rs.1,65,414-40 on the loan amount on account of failure to complete the flat. Instead of fixing teakwood frame and shutters for main door, fixed teakwood frame and flush doors. The works pertain to toilets, main drainage and electrical fitting are not attended to.

7) On failure to complete the construction, complainants got issued notice on 04.05.2012 to which a reply dated 04.06.2012 was issued stating that the remaining work is to be completed by Ops 2 and 3. In fact, OP No.1 signed the work order dated 27.04.2011 agreeing to make the flat inhabitable for use with all amenities and facilities. That non-completion of the facilities and amenities as promised amounts to deficiency in service and unfair trade practice on the part of the Ops. Hence the complaint with a prayer to direct the Ops to pay jointly and severally a sum of Rs.1,65,414/- being interest component on loan, together with interest @ 24% p.a.; to replace the flush doors of the main door with teakwood shutters; to replace the sub-standard window frames of all windows with standard teakwood frames and to affix teakwood shutters for all the windows; to complete the remaining work pertaining to toilets, main drainage connection and electrical fitting as per specifications mentioned in the brochure and agreement of sale dt.20.04.2011; OR IN THE ALTERNATE, to direct the Ops to complete the external works worth Rs.4,66,500/-; to install the lift, standby generator and fire safety staircase; furnish occupancy certificate from the GHMC; grant compensation of Rs.6,00,000/- towards mental agony; award punitive damages of Rs.2,00,000/-.

8) Opposite party No.1 filed its written version contending that the complainants are not the consumers for rendering service and providing facilities and amenities as per brochure. He admitted approaching of the complainants and the settlement of price of the flat at Rs.18,50,000/- but contends that as the bank asked to pay the margin money of Rs.4,00,000/-, the complainants were short of funds and hence asked the OP No.1 to extend cooperation. Having regard to the request, OP No.1 gave cheque bearing No.284339 on 13.06.2011 from his construction company M/s Suprada Constructions through his associate Sri A.Siva Sankara Rao and said Siva Sankara Rao transferred the sum of Rs.3,00,000/- through cheque No.210463 to the account of Sharath Chida, which he paid to the flat owner. In fact, the complainants were paid Rs.88,250/- in cash and Rs.1,93,000/- through cheque bearing No.044466 drawn on ICICI bank dated 08.07.2011. The amount to be paid on completion of work was taken back by the complainants and it is lying with them.

9) The complainants ought to have occupied the flat when the marble flooring was completed to avoid payment of rent. It is for the complainants to pay the interest on loan from the date of disbursement for which, the Ops are not responsible. In fact, the complainants did not allow to carry-on the works as they got the marble flooring and woodwork done. In fact, the works are almost complete, hence, there is no deficiency in service on the part of Ops. There arose no cause of action. Hence, prayed to dismiss the complaint by ordering the complainants to pay the balance amount of Rs.6,21,250/-.

10) The Opposite parties 2 and 3 filed their written version stating that there is no privity of contract and therefore, they are not necessary parties to the complaint. The OP No.3 is in the real estate business for the last more than two decades. They agreed to develop the plot No.25 and 26 and accordingly approached the land owners and entered into Development Agreement-cum-General Power of Attorney on 07.09.2007. At that point of time, OP No.1 expressed his desire to enter into a partnership with OP No.3 and accordingly a partnership deed was entered into on 10.12.2007. In pursuance of the agreement, the Ops have constructed two blocks in the entire 1200 sq. yards as Block-A and B in the apartment 'Sai Paradise'.

11) During the course of construction of the apartments, the OP No.1 had expressed his inability to make further investment in the entire project and opted for bifurcation of the works into two separate blocks. Accordingly, the OP No.3, OP No.1 and one K.V.Ramanaiah, land owner of Plot Nos.23 and 24 have decided in the meeting held on 10.10.2010 that Block-B of the building shall have to be completed in all aspects by OP No.1 and Block-A of the building shall be completed by OP No.3 as per the specifications mentioned in the brochure. After verification of accounts, it was decided that the OP No.1 shall pay Rs.3,95,858/- to the OP No.3 as against which, OP No.1 paid only Rs.2,00,000/- and the balance is yet to be paid. For the balance amount, OP No.1 agreed to complete the balance finishing work in the flats fell to his share in Block-A of the complex.

12) Insofar as the flat sold to complainants is concerned, the OP No.2 has completed the works as provided in the specifications and the Ops 2 and 3 are not responsible for any additional promises by the OP No.1 to the complainants. The Ops No.1 and 3 have entered into a Deed of dissolution of partnership on 24.03.2011 and the firm was reconstituted with V.V. Ramana as partner. Thus, the Ops 2 and 3 are no way concerned with the agreement of sale entered into by the OP No.1 with the complainants and the receipt of monies thereof. These Opposite parties completed the construction of the apartment as per the specifications mentioned in the brochure.

13) Till date, the OP No.1 failed to discharge his outstanding dues to the firm. Since OP No.1 undertook to complete further works in the flats fell to his share, there is no deficiency in service on the part of the Ops 2 and 3. Without discharging the dues liable and payable by the OP No.1, mischievously trying to drag the Ops 2 and 3 into litigation. Hence, prayed to dismiss the complaint against these opposite parties with costs.

14) During the course of enquiry before the District Forum, in order to prove their case, the Complainant No.1 filed his evidence affidavit as PW1 and that of one Civil Engineer B.Shiv Kumar as PW2 and Exs.A1 to A17. On behalf of the Opposite parties, OP No.1 filed his evidence affidavit as RW1 and the documents Ex.B1 to Ex.B9 and one V.Kutumba Rao filed his evidence affidavit on behalf of the Ops 2 and 3 and the documents Ex.B10 to B14.

15) The District Forum after considering the material available on record, allowed the complaint bearing CC No.412/2012 by orders dated 16.10.2015 by directing the Ops 1 to 3 jointly and severally to install Generator back-up for lifts, motor and common lighting as per the specifications in the brochure; to provide occupancy certificate to the complainants from GHMC; to pay the complainants Rs.4,66,500/- with interest @ 9% p.a. from 28.06.2011 till realization; to pay Rs.2,73,000/- towards rents for two years and nine months; to pay Rs.1,50,000/- towards punitive damages; to pay Rs.3,00,000/- towards compensation and Rs.2,000/- towards costs disallowing the claim of Rs.1,65,414/- towards reimbursement of interest component on the loan obtained from ICICI bank granting time of 30 days. It was further ordered, on failure to comply within the stipulated time, to pay interest @ 9% p.a. on the amount awarded towards rents, punitive damages and compensation and costs @ 9% p.a. from 01.12.2015 till realization.

FA NO.221/2015 :

16) Aggrieved by the said orders dated 16.10.2015, the Appellant/Opposite party No.1 preferred the above appeal contending that the order of forum below (a) failed to see that originally the complaint was filed alleging deficiency in service on the part of OP No.1 in non-completion of the works as per the work order dated 27.04.2012; (b) failed to see that as per the order dated 29.1.2013 the OP No.1 completed the works in flat by 25.02.2013 and to that effect filed memo dt.04.03.2013; (c) erred in holding to pay Rs.4,66,500/- with interest @ 9% p.a. from 28.06.2011 as the works are carried-out; (d) erred in not accepting the fact that the complainants are due a sum of Rs.6,21,250/- towards balance sale consideration; (e) erred in awarding the rent of Rs.2,73,000/- in view of the fact that the complainants occupied the flat and got the wood work done; (f) erred in accepting the evidence of Civil Engineer in declaring the material to be sub-standard, which is not authorized by law. Hence, prayed to allow the appeal and side aside the orders dated 16.10.2015 of the forum below.

FA NO.22/2016 :

17) Aggrieved by the said orders dated 16.10.2015 made in CC 412/2012, the Appellants/Opposite parties No.2 and 3 preferred the above appeal contending that the order of forum below (a) failed to see, originally the complaint was filed alleging deficiency in service on the part of OP No.1 in not completing the works as per the work order dated 27.04.2012; (b) failed to see that there is no contract between the Ops 2 and 3 nor they promised to render any service and the alleged agreement of sale dated 20.04.2011 is with OP No.1; (c) failed to see that complaint is not maintainable against the appellants as there is no service promised or rendered by them; (d) failed to see that there is no evidence on record as to the involvement of the appellants in the sale transaction; (e) failed to see that as per orders dated 29.01.2013, the OP No.1 got completed the works and filed report; (f) failed to see that the appellants are not responsible for any additional promises made by OP No.1; (g) failed to see that the flat Nos.203, 204 and 403 fell to the share of OP No.1 and were left in semi-finished state as OP No.1 failed to make payment of amount as promised; (h) failed to see that agreement of sale entered by OP No.1 is not binding on the appellants so also in view of minutes of meeting held on 10.10.2010; (i) failed to see that the inspection by Sri B.Shivaram is without any notice or intimation; (j) erred in awarding rents and ordering refund of Rs.4,66,500/- towards non-completion of balance work; (k) erred in awarding Rs.1,50,000/- towards punitive damages as also Rs.3,00,000/- towards compensation.

18) The point that arises for consideration is whether the impugned orders as passed by the District Forum suffer from any error or irregularity or whether they are liable to be set aside, modified or interfered with, in any manner? To what relief ?

19) There is no dispute that the complainants purchased the flat in question from the OP No.1 for a sale consideration of Rs.18,50,000/-. It is also not in dispute that the complainants paid the amount of Rs.14,10,000/- through bank, Rs.4,00,000/- towards their own contribution. The only dispute is that though the major part of sale consideration is paid by the complainants, the OP No.1 failed to complete the construction of the semi-finished flat and deliver the possession for years together. However, we may state that during the pending proceedings before the forum below, the subject flat was delivered to the complainants by completing all the left-over works.

20) Though the learned forum below passed a detailed order in length as to the entitlement and grant of various reliefs to the complainants, it failed to justify in awarding refund of Rs.4,66,500/- together with interest @ 9% p.a. from 28.067.2011. We may state further that when the forum below had awarded rents for two years nine months, the grant of punitive damages and compensation may not arise. It is clear admission on the part of the complainants that the OP No.1 had repaid Rs.2,61,850/- as against the amount of Rs.7,28,000/- towards the work order under Ex.A5. Though the site is stated to have been inspected by the PW2, a qualified engineer, no certificate is filed to that extent. Even no reasons are assigned to the sub-standardness in the quality of material used by the Opposite parties in construction of the subject flat. Except contending that the forum below had passed well considered orders, it is not made clear by the Complainants whether they have occupied the flat in question or not and whether the balance works are carried-out by the opposite parties as of now.

21) Though it is contended by the Opposite parties 2 and 3 that they are not liable in view of no privity of contract, we may state that they are vicariously liable for prov

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iding amenities and facilities in lieu of the Development Agreement-cum-General Power of Attorney. As discussed by the forum below in its order, the Opposite parties failed to discharge their liability. Hence, no credence is given to their contentions. 22) Though we concur with the detailed orders passed by the forum below, admittedly, the complainants are due the balance of Rs.2,61,850/- which they received from the opposite parties and for the balance works, if any, the same would suffice. Hence, awarding of Rs.4,66,500/- is not justified in any manner. From the memo filed before the forum below on 04.03.2013 on behalf of the OP No.1, it is clear that the subject flat is completed and the complainants were asked to take delivery of the same, which the complainants have not disputed. No further evidence is brought on record to contradict the same. Hence, we are inclined to interfere with the orders of the forum below insofar as awarding the relief No.3, 5 and 6 are concerned and accordingly set aside the same by confirming the rest of the aspects. Accordingly, we allow the appeals in part and modify the orders dated 16.10.2015 of the forum below in the following manner. 23) In the result, we allow both the appeals in part and modify the orders dated 16.10.2015 of the forum below passed in C.C.No.412/2012 and set aside the direction to pay Rs.4,66,500/- with interest @ 9% p.a. from 28.06.2011 till realization; direction to pay Rs.1,50,000/- towards punitive damages and awarding the compensation of Rs.3,00,000/- and confirm the rest of the orders. The parties to bear their own costs in these appeals. Time for compliance : four weeks.
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