BEFORE THE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD.



F.A. No. 775/2006 against C.D. 1/2004, Dist. Forum, Ranga Reddy



Between:



K. Muthyala Swamy

S/o. K. Mallaiah

Age: 41 years, Service

R/o. 6-41/2, Venture No. 1

SBH Colony, L.B. Nagar

Hyderabad. *** Appellant/

Complainant

And

1) M/s. Vijay Bharat Builders (P) Ltd.

24-62/2, Opp. Ramchandra Theatre Gate

Vishnupuri, Malkajigiri

Hyderabad-500 047. *** Respondent/

O.P. No. 1

2) The Branch Manager

Syndicate Bank

Golconda Branch

Hyderabad. *** Respondent/

O.P. No. 2.





F.A. No. 776/2006 against C.D. 9/2004, Dist. Forum, Ranga Reddy



Between:



J. Gabrial, S/o. J. Samual

Age: 52 years, Service

H.No. 41-18, Papi Reddy Nagar

Jagadgirigutta, Hyderabad. *** Appellant/

Complainant

And



1) M/s. Vijay Bharat Builders (P) Ltd.

24-62/2, Opp. Ramchandra Theatre Gate

Vishnupuri, Malkajigiri

Hyderabad-500 047. *** Respondent/

O.P. No. 1

2) The Branch Manager

Syndicate Bank

Golconda Branch

Hyderabad. *** Respondent/

O.P. No. 2.



F.A. No. 787/2006 against C.D. 5/2004, Dist. Forum, Ranga Reddy



Between:

CH. Mallesh, S/o. CH. Komaraiah

Age: 36 years, Service

R/o. 11-1-889/4/A

Afzal Sagar, Komatikunta

Nampally, Hyderabad. *** Appellant/

Complainant

And

1) M/s. Vijay Bharat Builders (P) Ltd.

24-62/2, Opp. Ramchandra Theatre Gate

Vishnupuri, Malkajigiri

Hyderabad-500 047. *** Respondent/

O.P. No. 1

2) The Branch Manager

Syndicate Bank

Golconda Branch

Hyderabad. *** Respondent/

O.P. No. 2.



F.A. No. 778/2006 against C.D. 10/2004, Dist. Forum, Ranga Reddy



Between:

G. Srinivas, S/o. Late G. Balaiah

Age: 38 years, Service

R/o. 1-6-173/4

Musheerabad, Hyderabad. *** Appellant/

Complainant

And

1) M/s. Vijay Bharat Builders (P) Ltd.

24-62/2, Opp. Ramchandra Theatre Gate

Vishnupuri, Malkajigiri

Hyderabad-500 047. *** Respondent/

O.P. No. 1

2) The Branch Manager

Syndicate Bank

Golconda Branch

Hyderabad. *** Respondent/

O.P. No. 2.

Counsel for the Appellants: M/s. N. Rama Rao

Counsel for the Respondents: M/s. V. Venkata Ramana (R1)

M/s. Deepak Bhattacharjee (R2)



HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT.

SMT. M. SHREESHA, MEMBER

&

SRI K. SATYANAND, MEMBER


WEDNESDAY, THIS THE FIFTEENTH DAY OF JULY TWO THOUSAND NINE



ORAL ORDER: (Per Hon’ble Sri Justice D. Appa Rao, President)

***

1) These appeals are preferred by the unsuccessful complainants against the common order of the Dist. Forum dismissing the complaints. Since these appeals arise against the common order, it is convenient to dispose off these appeals equally by a common order:







2) The case of the complainants in brief is that they have purchased semi-finished flats from R1 M/s. Vijaya Bharat Builders (P) Ltd., on the finance arranged by R2 bank. R1 had obtained their signatures on blank papers stating that they would look after the entire housing loan transaction. They being the government employees could not spend time for processing the loan etc., and in good faith subscribed their signatures believing that the bank would release the funds after conducting periodical inspection of the construction. As per the agreement the bank has to release the funds. On receipt of sale consideration from the bank, R1 executed the sale deed in their favour. R1 agreed to finish the semi-finished flats by providing plastering, window panels and doors by taking extra amount from the housing loan within three months. However, R1 could not complete the flats and on that when they questioned, R1 informed that it did not receive any amount from the bank, and as such it could not complete within the stipulated period of 3 months. On that they requested the bank to furnish the details of housing loan account in order to verify the version of R1. It refused to give details. On the other hand the bank demanded them to repay the loan amount with interest. However, on their insistence, the bank has furnished the housing loan accounts wherein it showed that the entire housing loan was already released. On that they got issued legal notice to R1 calling upon him to return the entire amount with interest and other charges. R1 and R2 gave reply with false allegations. The bank had informed that the amount was released to R1 and to some others, to whom they were authorized to pay. Since the amount was un-authorizedly released to some other third party due to which they had sustained loss, they sought recovery of the amount paid to third party together with compensation and costs.









3) R1 resisted the case. While admitting that it entered into an agreement for sale of semi-finished flats to the complainants, it denied that it had promised to arrange loan and in the process obtained signatures on blank papers. Only after submission of the documents, as per requirement of the bank it took the signatures of the complainants. It alleged that on receipt of consideration it had executed the sale deeds. It has completed the construction. It has received the amount to the extent of sale consideration of semi-finished flat. It did not collude with the bank. There was no deficiency in service on its part, and therefore it was not liable to pay any amount. It prayed for dismissal of the complaint with costs.





4) R2 bank denied each and every allegation made by the complainants. It admitted that the complainants had executed housing loan agreement and the same was sanctioned for purchase of residential flats constructed by R1. Loan amount had to be repaid with interest @ 11.25% p.a. The interest is compounded quarterly from the date of loan till realization. In the light of specific instructions given by the complainants to release the amounts in favour of R1 it released directly to the owner and its suppliers or any person designated by them. The complainants had instructed the bank to release the amounts to M/s. Viz Constructions, suppliers of the material and basing on such instructions it had released the amounts. The complainant had obtained completion certificate from R1 wherein it was categorically mentioned that the flats were ready for occupation. The allegation that without competition of construction, balance instalments were released in favour of R1 has no basis. To the notice issued by the complainants they gave reply mentioning that the amounts were released on the specific instructions given by the complainants as well as by the builder. The entire loan amount was released to the nominees of the complainant. There was no deficiency in service on their part. Once the



complainants had given mandate for release of amounts under their signatures it is binding on the complainants. The relief sought for refund of the amount, paid to a third party is not valid under law. The complainants are not entitled to any compensation or costs. Therefore, it prayed for dismissal of the complaint with costs.



5) The complainants filed their affidavit evidence and got the sale deed, legal notice, reply notice etc. marked as Exs. A1 to A7 (C.D. No. 1/2004), Exs. A1 to A8 (C.D. 5/2004), Exs. A1 to A8 (C.D. 9/2004) and Exs.A1 to A7 (C.D. 10/2004) while the respondents filed Exs. B1 to B9 (C.D. 1/2004), Exs. B1 to B11 (C.D. 5/2004), Exs. B1 to B11 (C.D. 9/2004) and Exs. B1 to B10 (C.D. 10/2004).



6) The Dist. Forum after considering the evidence placed on record opined that the complainants themselves executed the documents authorizing the bank to pay the amount to M/s. Viz Constructions which had supplied the material and therefore the allegation that the builder and the bank were in hand and glove and misappropriated the amount is not true. At any rate, if the complainants felt that excess amount was released by the bank to a third party, they could as well initiate civil proceedings for recovery of the amount consequently the complaints were dismissed.



7) Aggrieved by the said order, the complainants preferred these appeals contending that the Dist. Forum did not appreciate the facts in correct perspective. It ought to have seen that the bank itself did not mention that it had paid the amount to M/s. Viz Constructions basing on the letters issued by them. It ought not to have released the amounts when the builder himself admitted that the flats were not fully completed and fit for occupation. The respondents had obtained their signatures on blank papers and misused them. Therefore they ought not to have been relied. In fact Exs. B2 and B5 still contain blanks and they should not have been relied for payment of amount to a third party. Therefore, they prayed that the appeals be allowed.



8) The point that arises for consideration is whether the complainants are entitled to refund of amount paid by the bank to a third party viz., M/s. Viz Constructions?



9) It is an undisputed fact that the complainants have purchased semi-finished flats from R1 M/s. Vijay Bharat Builders (P) Ltd. on execution of house loan agreements Ex. B1 in favour of the bank. R1 having received the sale consideration not only executed the sale deeds in favour of the complainants under Ex. A1 but also development agreements under Ex. A7 for construction of remaining part of the flats.



10) R1 the builder directed the bank to pay certain amounts for the construction carried out by a third party viz., M/s. Viz Constructions on its behalf pursuant to the letters executed by the very complainants in favour of the bank. The bank had paid the amounts to M/s. Viz Constructions as per the said letters evidenced under acknowledgements issued by M/s. Viz Constructions in favour of it.



11) The complainants now allege that they never agreed for such a course. Certain signatures were obtained on blank papers wherein these letters were fabricated and therefore the bank was liable to refund the amount paid to M/s. Viz Constructions. The complainants pleaded ignorance as to the amounts that were paid under the house construction agreement to R1 and others. Evidently, it has executed the sale deeds in respect of semi-finished flats as agreed upon having received part of sale consideration. The bank from whom the complainants sought refund of the amount had categorically stated that the complainants after completion of the flats obtained completion certificate from R1. The criteria for releasing of last instalment was submission of completion certificate and the complainants had filed the said certificates by themselves. The complainants cannot turn round and complain







that the bank did not follow the instructions. The complainants specifically instructed to remit the amount to M/s. Viz Constructions. The bank had filed the documents evidencing the authorization issued by the complainants to the bank to pay the amount to M/s. Viz Constructions, which in turn acknowledged receipt of the same. The amount was paid accordingly. At no time did they protest that their signatures were taken on blank papers. They could have asked either R1 or R2 as to the reason why their signatures are being taken on blank documents. It is not as if they did not know the amount borrowed by them under house loan agreement. The amounts were made a mention in the agreement. They knew full well as to the consideration that was passed under the Sale Deeds. Therefore, when construction was taken place and when they authorized and amounts were paid by virtue of their authorization to a third party M/s. Viz Constructions they have no right to say that they were fabricated and therefore they were entitled for refund. The complainants by harping on stray sentence mentioned by the bank in their reply to the notice alleging that they have “paid the amount to some other person” now contend that it was all fabricated. The documents filed by the bank would undoubtedly show that various agreements were entered into by the complainants in favour of R1 as well as M/s. Viz Constructions directing the bank to pay the amount besides the amount paid to the builder. Having executed the documents authorizing the bank to pay to a certain person, they cannot complain that their signatures were taken on blank papers. If really they had subscribed their signatures on blank papers they should have suspected some foul play. They ought to have issued notice or complained to the police. The conduct of the complainants in keeping quite all through would show that they were aware of these transactions underneath these letters, they have positively mentioned to pay the amounts and signed. They indicate that the complainants are coming with false version. The Dist. Forum appreciated the facts in correct perspective. We do not see any merits in the appeals.







12) In the result the appeal are dismissed with costs computed at Rs. 5,000/- one set.



1) _______________________________

PRESIDENT







2) ________________________________

MEMBER







3) _________________________________

MEMBER

Dt. 15. 07. 2009.