DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KOZHIKODE
PRESENT : Sri. P.C. PAULACHEN, M.Com, LLB : PRESIDENT
Smt. PRIYA.S, BAL, LLB, MBA (HRM) : MEMBER
Sri.V. BALAKRISHNAN, M Tech, MBA, LL.B, FIE: MEMBER
Monday the 30th day of January, 2023
C.C. 379/2012
Complainant
Narayana Kumar. M. K.,
28/3383, Jai Anjaneya,
Palazhi road, Pottammal,
Kuthiravattom P.O.,
Kozhikode – 16.
(By Adv. Sri. M. C. Ratnakaran & V. K. Anand Kumar)
Opposite Parties
- Managing Director,
Calicut Landmark builders & Developers (India) Pvt Ltd.,
CD Tower, Mini bypass,
Kozhikode – 4.
- Manager,
State Bank of India,
Kozhikode main branch,
Thavott place, Kannur road,
Kozhikode – 1.
(OP1 by Adv. Sri. Shyam Padman)
(OP2 by Adv. Sri. M. V. Sajeevan)
ORDER
By Sri. P.C. PAULACHEN – PRESIDENT.
This is a complaint filed under Section 12 of the Consumer Protection Act, 1986.
2. The case of the complainant, in brief, is as follows:
The complainant booked a flat on 06/04/2010 in the project launched by the first opposite party christened as “Land Mark Nesteem –I” within the local limits of Kozhikode Municipal Corporation. He paid an advance of Rs. 1,00,000/-. The price of the unit admeasuring 728 square feet was fixed as Rs. 17,09,625/-. Besides this, the complainant was required to pay a further sum of Rs. 1,25,000/- for the parking space. Thus the complainant had to pay a total amount of Rs. 18,34,625/- including the cost of Rs. 1.7382% of undivided share of immovable property. It was agreed that the flat offered would be ready and delivered by April/May 2011, at the most. It was assured by the first opposite party that in case of delay in delivery of possession, the first opposite party would pay an interest at the bank rate for the delayed period on the amount received from the complainant. The complainant made payment of Rs. 2,66,925/- on 10/04/2010. A tripartite agreement between the complainant, builder and land owner was executed on 12/04/2010.
3. The complainant opted for a housing loan of Rs. 16,53,000/- from the second opposite party which was facilitated by the first opposite party. It was agreed to release the housing loan in instalments in accordance with the progress of construction. Though the first opposite party has received Rs. 17,42,891/-, the progress of the work was very slow. The opposite parties colluded each other and the released the loan amount to the first opposite party. He approached the Banking Ombudsman. But his complaint was closed as per the reply furnished by the bank and he was advised to approach the appropriate forum for redressal of the grievance. The second opposite party made the payments without any verification as to whether the time schedule was adhered by the first opposite party. The construction is not completed and the occupancy certificate is not obtained so far. There is gross deficiency of service on the part of the opposite parties. Hence the complainant claims a total compensation of Rs. 9,77,000/- from the opposite parties besides litigation expenses and interest.
4. Separate written versions were filed by the opposite parties wherein they have denied all the allegations and the claims made against them in the complaint.
5. According to the first opposite party, they had entered in to an agreement with the complainant on 12/04/2010 and in pursuance of the same, a tripartite agreement had been entered in to between the first opposite party, the second opposite party and the complainant. The second opposite party disbursed the loan amount only as per the stipulation in the agreement after conducting proper enquiry and inspection. The first opposite party took steps to complete the construction as per the schedule fixed and on completion of the same, submitted completion report in the Kozhikode Corporation. The delay in allotting the number was on the part of the Corporation and the first opposite party is in no way responsible or liable for the delay in issuing completion report and allotting assessment numbers.
6. The complainant owes an amount of Rs. 5,35,039.59/- to the first opposite party. The statement showing the balance amount due was furnished to the complainant on 20/12/2012, but he failed to make payment. There was no intention to cheat or defraud the complainant. The Corporation authorities allotted assessment number to the apartment on 16/07/2013 and the tax was paid on 19/07/2013. There was no deficiency of service on their part. With the above contentions, the first opposite party prays for dismissal of the complaint.
7. The second opposite party has contended that they are not liable or responsible for the delay in completing the construction or handling over of the apartment or execution of the sale deed. The instalments were released to the builder as per the stipulation in the tripartite agreement. The Banking Ombudsman rejected the petition prima facie for the reason that the same is not maintainable. The cheques were issued to the builder as per the direction or oral instruction of the complainant. There was no deficiency of service on the part of the bank while granting the loan or disbursing the loan amount to the builder. The delay in getting registration is solely on the part of the builder. No loss or injury was caused to the complainant due to any act of the bank. The relief sought for is not allowable. It is, therefore, prayed to dismiss the complaint with costs.
8. The points that arise for determination in this complaint are;
(1). Whether there was any deficiency of service on the part of the opposite parties, as alleged?
(2) Whether the claim for compensation is allowable? If so, what is the quantum?
(3). Reliefs and costs.
9. Evidence in this case was recorded by our learned predecessors – in – office which consists of the oral evidence of PW1 and Exts A1 to A14 on the side of the complainant and RW1 and Exts B1 to B16 on the side of the opposite parties.
10. We heard both sides. Brief argument notes were also filed.
11. Points 1 and 2 : These points can be considered together for the sake of convenience. The complainant has approached this Commission seeking a total compensation of Rs. 9,77,000/- alleging delay in the construction and delivery of possession of the flat by the first opposite party. The grievance on the complainant against the second opposite party bank is that the loan amount was released to the first opposite party without any verification as to the compliance of the time schedule/stage.
12. In order to substantiate his case, the complainant got himself examined as PW1, who has filed proof affidavit and deposed in terms of the averments in the complaint and in support of the claim. The Managing Director of the first opposite party tendered evidence as RW1 in support of the averments in the written version.
13. The argument of the complainant is that the first opposite party has failed to handover possession of the flat after completing the work within the specified time and in fact there was a delay of 26 months in this regard and thereby the complainant has sustained huge monetary loss and mental torture and inconvenience. As far as the second opposite party is concerned, the argument of the complainant is that the bank released payments without any verification as to whether the time schedule/stage is adhered by the first opposite party. On the other hand, the argument of the first opposite party is that they have diligently put all their effort in to the timely completion of the project and the delay was on the part of the Municipal Corporation in allotting the building number. It is also the argument of the first opposite party that the complainant is a defaulter in payment and no other complaints were there for any of the occupants except the complainant. It was pointed out that a sum of Rs. 78,000/- was paid to the complainant as full and final settlement as compensation for the delay in the registration of the sale deed. The arguments of the second opposite party is that the payments were made to the builder as per the agreement and that PW1 has admitted while in the box that there was no default or deficiency with respect to the loan and the bank has honestly discharged their duties.
14. There are some admitted facts in this case. That the complainant booked a flat in the project “Land Mark Nesteem -I” launched by the first opposite party within the local limits of Kozhikode Municipal Corporation is admitted. He booked the flat by paying an advance amount of Rs. 1,00,000/- as per Ext A1 receipt. The unit was measuring 728 square feet and the price was fixed as Rs. 17, 09,625/-. A sum of Rs. 1,25,000/- had to be paid towards parking space. Thus the total amount comes to Rs. 18,34,625/- including cost of Rs. 1.7382% of undivided share of immovable property. Further payment of Rs. 2,66,925/- was made by the complainant on 10/04/2010 as per Ext A2 receipt and on 12/04/2010 Ext A4 tripartite agreement was executed between the complainant, the builder and the land owner. The complainant had opted for a housing loan of Rs. 16,53,000/- from the second opposite party which was facilitated by the first opposite party. The housing loan was agreed to be released in instalments in accordance with the progress of the construction as per Ext A5 tripartite agreement dated 19/05/2010. It was agreed that the possession of the flat would be handed over in May 2011. But the delivery of possession was delayed by 26 months. The possession of the flat was delivered to the complainant only in September 2013 during the pendency of the present complaint. There is no serious dispute on the above aspects.
15. The contention of the first opposite party is that the delivery of possession of the flat was delayed due to reasons beyond their control. The specific case is that the delay occurred only due to the reason that occupancy certificate was delayed from the Corporation authorities. This has been reiterated by RW1 while in the box. In this context, it may be noted that it is the duty of the first opposite party to obtain the occupancy certificate and deliver possession of the flat in time. The complainant has nothing to do in the matter. It is the contractual as well as legal obligation of the first opposite party to obtain the occupancy certificate. Ext A9 is the reply received under the Right to Information Act from Kozhikode Municipal Corporation. Ext A9 shows that the first opposite party applied for occupancy certificate only on 11/05/2012. Ext A10 the reply under the Right to Information Act shows that the occupancy certificate was not issued as there was deviation from the sanctioned plan. Thus it was the first opposite party alone who has contributed to the delay. The complainant had no role in the matter. The first opposite party owes the duty to apply and obtain the occupancy certificate and deliver possession of the flat in time. As already stated, there is inordinate delay of 26 months in handing over possession. The contention of the first opposite party that the delay was due to reasons beyond their control cannot be accepted. There was gross deficiency in service on the part of the first opposite party in this regard, for which, the complainant is to be compensated adequately.
16. The allegation against the second opposite party bank is that they released the payments to the first opposite party without verifying as to whether the time schedule is complied with by the first opposite party. The contention of the second opposite party is that they had released the loan instalments in tune with the tripartite agreement only after necessary inspection and being satisfied about the stage of construction. The complainant had approached the Banking Ombudsman in this regard. As per Ext. A7 letter dated 12/09/2011 the banking ombudsman expressed their inability to interfere in the matter and the complaint was closed with liberty to the complainant to approach any other forum for redressal of his grievance. However, while in the box, PW1 has admitted in the cross- examination that there was no latches or deficiency on the part of the bank in the matter of the loan and the bank dealt with the matter in an honest manner. Thus PW1 has ruled out any deficiency of service on the part of the bank authorities. So there is no scope for any grievance for the complainant against the second opposite party bank and no relief can be granted against the bank.
17. But as far as the first opposite party is concerned, as we have already stated, there was inordinate delay of 26 months in delivering possession of the flat and this constitutes gross deficiency in service. In spite of having received huge amount, the construction could not be completed in time and delivery of possession of the flat was delayed by 26 months. The complainant is entitled to get just and reasonable compensation. Clause 20 of Ext A4 agreement provides that if there is a delay in delivery of the apartment, the builder will pay the allottee liquidated damages at the rate of Rs. 2 per square feet per month for the period of delay towards compensation and the said compensation will be adjusted at the time of handing over of the apartment. It appears that such a term is wholly one sided, unfair and unreasonable. If that clause is applied, the complainant will get only Rs. 4,526/- per month (728 Square feet x 2 = Rs 1,456/-). Even the bank loan availed by the complainant from the second opposite party is at the rate of 10 ¾ % interest per annum. In Wg.Cdr. Arifur Rahman Khan and Aleya Sultana Vs DLF Southern Homes Pvt Ltd - 2020 (16) SCC 512, the Hon’ble Apex Court as held as follows :
“ Jurisdiction of Consumer Forum to award just and reasonable compensation as an incident of its power to direct the removal of a deficiency in service is not constrained by the terms of a rate which is prescribed in an unfair bargain”.
Further it was held that ;
“Flat purchasers who obtained possession or executed Deeds of conveyance have not lost their right to make a claim for compensation for the delayed handing over of the flats.”
So the above clause in Ext A4 does not bar the complainant herein to get just and reasonable compensation.
18. According to PW1 he had paid rent of Rs. 1,69,000/- from May 2011 till September 2013 and he is entitled to get reimbursement of the same. But there is absolutely no evidence in support of the claim. No rent deed or receipt is produced. Similarly, PW1 has a case that he lost his salary for four months as he had to remain in the native place due to the delay in the delivery of the flat. This claim is also not supported by any evidence.
19. However, PW1 has given evidence that he had to pay interest of Rs. 1,78,749/- to the second opposite party bank for the delayed period of 26 months. The evidence of PW1 in this regard stands unchallenged in the cross-examination. Considering the entire facts and circumstances, we are of the view that payment of a compensation of Rs. 1,78, 749/- in lieu of interest paid by the complainant to the second opposite party for the delayed period of 26 months will be just and reasonable in this case. But at the same time, it may be noted that the complainant had already received a compensation of Rs. 78,000/- from the first opposite party as per Ext A12 Sammathapathram. The receipt of the same is admitted by PW1 while in the box. So that the amount has to be taken in to consideration and deducted from Rs. 1,78,749/-. Thus deducting the above amount, the damages in lieu of interest will be Rs. 1,00,749/-. Apart from this, it goes without saying that the complainant was put to gross mental agony and hardship due to the delay, for which, he is entitled to be compensated. Considering the entire facts and circumstances, we are of the view that a sum of Rs. 25,000/- will be reasonable compensation in this case for the mental agony and hardship suffered. Thus the total compensation the complainant is entitled to get works out to Rs. 1,25,749/-. The complainant is also entitled to get Rs. 5000/- as cost of the proceedings.
20. Point No.3: In the light of the finding on the above points, the complaint is disposed of as follows;
a) CC 379/2012 is allowed in part.
b) The first opposite party is hereby directed to pay a sum of Rs. 1,25,749/- (Rupees one lakh twenty five thousand seven hundred and forty nine only) as compensation to the complainant.
c) The first opposite party is directed to pay a sum of Rs. 5,000/- (Rupees five thousand only) as cost of proceedings to the complainant.
d) The payment as aforestated shall be made within 30 days of the receipt of copy of this order, failing which, the amount of Rs. 1,25,749/- shall carry an interest of 6% p.a from the date of this order till actual payment.
e) The second opposite party is exonerated.
Pronounced in open Commission on this, the 30th day of January, 2023.
Date of Filing: 07/09/2012.
Sd/-
PRESIDENT
Sd/- MEMBER
Sd/-
MEMBER
APPENDIX
Exhibits for the Complainant :
Ext. A1 – Copy of the receipt dated 06/04/2010.
Ext. A2 - Copy of the receipt dated 10/04/2010.
Ext. A3 - Complainant’s Pass book .
Ext. A4 – Copy of the tripartite agreement.
Ext. A5 – Copy of the tripartite agreement.
Ext. A6 – Reply letter dated 28/07/2011.
Ext. A7 – Order dated 12/09/2011.
Ext. A8 – Cheques / copies of the pay orders.
Ext. A9 – Copy of the RTI application and reply letter dated 27/07/2012.
Ext. A10 – Copy of the RTI application and reply letter dated 27/08/2012.
Ext. A11 – Letter dated 08/10/2012.
Ext. A12 – Consent letter dated 12/01/2013.
Ext. A13 - Form 8 and connected documents.
Ext. A14 - Form 8 and connected documents.
Exhibits for the Opposite Party
Ext. B1 – Bank account statement.
Ext. B2 –Memorandum of Deposit of Title Deeds.
Ext. B3 – Copy of the deed.
Ext. B4 – Copy of the bills.
Ext. B5 – Loan sanction agreement.
Ext. B6 – Agreement for Term Loan.
Ext. B7 – Tripartite agreement.
Ext. B8 – Information given to the complainant by the opposite party.
Ext. B9 – Letter dated 20/05/2010.
Ext. B10 – Letter dated 06/09/2010.
Ext. B11 – Letter dated 11/09/2010.
Ext. B12 – Letter dated 14/07/2010.
Ext. B13 – Letter dated 06/01/2011.
Ext. B14 – Letter dated 07/05/2011.
Ext. B15 – Letter dated 03/11/2010.
Ext. B16 - Acknowledgement receipt dated 04/09/2013.
Witnesses for the Complainant
PW1 – Narayana Kumar. M. K (Complainant)
Witnesses for the opposite parties
RW1 – Arun Kumar.
Sd/-
PRESIDENT
Sd/-
MEMBER
Sd/-
MEMBER
Forwarded/By Order
Assistant Registrar
