BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 07^TH DAY OF JUNE 2023

ORDER

SMT.M.SHOBHA, PRESIDENT

1. The complaint has been filed under Section 35 of C.P.Act (hereinafter referred as an Act) against the OP for the following reliefs against the OP:-

1. Refund the sum of Rs.8,50,000/- advance booking amount along with 24% interest from the date of payment till realization.
2. Refund the sum of Rs.20,75,644/- along with 24% interest from the date of payment till realization which is paid as EMI to the bank.
3. Refund the sum of Rs.24,23,787/- balance home loan to be paid to bank along with 24% interest from the date of payment till realization.
4. A sum of Rs.2,50,000/- to each complainant for default, unfair trade practice and deficiency of service.
5. A sum of Rs.2,00,000/- to each complainant for inflicting mental agony.
6. A sum of Rs.2,00,000/- towards compensation and damages, and
7. Any other relief/s as this Hon’ble Forum deems fit.  

2. The case set up by the complainant in brief is as under:-
3. It is the case of the complainant that he has executed a GPA in favour of his friend Sri.Damodar Reddy B to conduct the proceedings on his behalf. The OP1 is a registered partnership firm. The OP2 to 6 are the partners of the firm by name M/s Vensapala Builders and OP2 to 6 being the partners of the said firm own a amalgamated site numbers 1753, 1765 and 1766 measuring to an extent of 8750 sq. feet in the residential layout called the aircraft employees co-operative limited situated Singasandra village, Bangalore south taluk.
4. The OP2 to 6 desirous of developing the said land entered into joint development agreement with the developer company and executed the power of attorney with OP7. The company known as M/s Sri.Manjunatha Sway developers and infrastructure pvt. Ltd., represented by OP8 and 9 as an authorized signatory of company and OP2 to 6 have executed power of attorney to develop the land into residential building known as SMD BEVRELY HILLS.
5. It is the further case of the complainant that OP8 and 9 were well acquainted with the complainant to establish the aforesaid real estate company. Both were working in Bosch company, Bangalore and the complainant was their colleague. OP8 and 9 have approached the complainant for buying an apartment unit in their project. The complainant considering their long relationship experience and reputation and to support their persuasion in establishing a real estate company having a trust in them has agreed and came forward to book the apartment units in the project SMD BEVRELY HILLS for total consideration of Rs.37,50,000/- and he has paid an initial booking amount of Rs.8,50,000/- through cheque and buy way of NEFT in four installments.  The advance amount have been received and acknowledged by Op8 and 9 and they have executed an agreement of sale on 16.09.2013 for unit No.301 L1, measuring super built up area of 1068 sq. feet on the third floor of apartment building with undivided 248 sq feet of land since the complainant had pledged the original sale agreement with ICICI bank he has produced the copy of the sale agreement.
6. It is further case of the complainant that based on the agreement of sale the complainant has availed housing loan of Rs.30 lakhs out of the said loan amount a sum of Rs.28,12,000/- is disbursed to the builder and the remaining loan amount of Rs.1,88,000/- will be released during the registration of the apartment in it under the loan account No.LBBNG00002048052 on 10.12.2013 and paying EMI of Rs.27,334.90 ps., p.m., since from January 2014.  The OP8 and 9 have agreed to deliver the possession of the apartment unit on or before two years from the date of agreement but to the shock and surprise of the complainant even after many years of delay there was no sign of starting the project.  The progress of the work has almost stopped and it is dismally slow. Even though the complainant had made several visits and enquiry with the Ops and project site, the OP8 and 9 have not attended the project work seriously due to their own problem and limitation.  Finally they started to give evasive and misleading replies and also false assurances of handing over the apartment unit within two years. 
7. It is further case of the complainant that when the OP8 and 9 have failed to complete the project and the OP8 and 9 through email dated 13.12.2019 have agreed to repay the booking amount and also the loan amount availed by the complainant. But to the shock of the complainant they have not even deposited a single rupee to the account of the complainant till date.  In addition to this the OP8 and 9 have sold the flat in favour of OP10 without informing to the complainant and they have executed a registered sale deed in his favour on 16.11.2016.  When the same was brought to the notice of the OP8 and 9 they made the assurance of making the refund and compensation before the end of July 2017.  On their assurance and considering their financial crisis the complainant has been with hold his further legal action against OP8 and 9 for many days.  The OP8 and 9 have promised to repay the amount by the end of November 2019 along with interest. The complainant is paying the EMI to the bank for the loan amount disbursed to the OP7 till today, even though he is not at all in possession of the flat which was booked by the complainant.  It is therefore an abuse of contractual understanding between the parties for having wrongful gain by the OP8 and 9.
8. The further grievance of the complainant that the OP1 to 6 in collusion with OP8 and 9 have cheated the complainant by taking the advance amount and selling the flat in favour of the Op10. All the land owners and builders had a dishonest intention from the outset by deceiving the complainant fraudulently or dishonestly the OP8, 9 and 10 are indulging in illegal activity and by taking advantage of the innocence of the complainant in collusion with each other have executed the sale deed in favour of OP10. The complainant without having any other option has got issued legal notice on 16.11.2020. Some of the Ops have not received the legal notice and the legal notice was returned.  Some of the Ops have received the legal notice have neither responded nor refunded the amount due to the complainant.  Under these circumstances, refusing to return the booking amount, loan amount collected from the complainant is against to rules and equity and also amounts to deficiency of services which is promised by the OP. hence the complainant is entitle to recover the amount paid by him and the Ops are liable to return the same. Hence this complaint. 
9. In response to the notice, OP1 to 3, 7 to 9  and 10 appeared and filed their version.
10. It is the case of the OP2 that the complaint is not maintainable and this authority cannot act the civil jurisdiction in entertaining the nature of the reliefs sought by the complainant.
11. The OP2 has admitted that OP1 is the partnership firm and OP2 to 6 are his partners the OP1 and its partners having the ownership to the sites and OP1 to 6 have executed the JDA with OP7 and the GPA.
12. It is further the case of OP2 that the litigation between the owners and the developers is pending before the competent civil court. He has further stated that he is not aware of the apartment booked by the complainant and his relationship with OP8 and 9 and the sale agreement entered between on 16.09.2013 for unit No.301 L1.  It is further case of the OP2 that the OP2 to 6 have constituted the OP1 partnership and by amalgamating the site have executed JDA on 10.12.2012 and a GPA in the name of OP7 to 9. Subsequent to the execution of JDA the supplementary agreement have been entered on 26.07.2013 and 10.12.2013 wherein the OP7 to 9 have been authorized to sell their builder share of flats by imposing conditions subsequently MOU dated 19.06.2016 and one more supplemental agreement dated 10.06.2016 were entered between them.  However OP7 to 9 did not comply the conditions imposed in those documents. But tried to sell the flat and for which OP1 to 6 have filed OS No.7177/2016 against the OP7 to 9 in alienating any of the flats. However the OP7 to 9 have illegally alienated majority of the flats and litigations filed in this regard is pending consideration.
13. The Op2 had taken the contention that he is not at all aware of the allegations made by the complainant in paras 5 to 18. It is further case of the OP2 that the complaint is not maintainable against OP1 to 6 as they never entered into any agreement of sale nor caused any losses to the complainant.  The complaint be confined only against OP7 to 10 and not against OP1 to 6. Hence prayed for dismissal of the complaint.
14. OP7 to 9 have filed their version denied all the allegations made in the complaint. It is the case of the OP7 to 9 that the complaint is not maintainable and liable to be dismissed. The complaint file by the GPA holder of the complainant who has no knowledge with regard to the intention of the parties who had entered into the agreement as such the complaint itself is not maintainable. The complaint filed against OP7 is not maintainable since the said company had striked out by the ministry of corporate affairs, Government of India way back in the year 2017-18 itself.  The complaint made against OP7 as a party to the proceedings which is nothing but filing a case against dead person. Hence the complaint deserves to be dismissed.
15. It is further case of OP7 to 9 that it is false to say that the complainant has paid a sum of Rs.8,50,000/- in favour of OP7 as initial booking but as per the recital in the sale agreement it has been shown that a sum of Rs.7,50,000/- has been paid to OP7. There is no recital with respect to 24% interest to be paid by the party who has breached the agreement. The complainant has not approached this court with clean hands and it has been filed with an intention to make a wrongful gain.  The complainant if there is a breach of contract the aggrieved party has to seek specific performance of the contract as such the first relief with respect to refund of the amount does not arise.
16. It is further case of the OP7 that as per the para 5 of the agreement the purchaser will be at liberty to enforce specific performance of the agreement by institution of legal proceedings or their option may sue the builder for recovery of the amount paid with interest.  Hence the complainant has to file a suit for recovery of the amount before the competent civil court.  The complainant only with an intention to overcome the court fees and with an intention to overcome the law of limitation has filed this complaint alleging deficiency in service and unfair trade practice only with an intention to present this complaint before this commission which is not at all maintainable.
17. It is further case of the OP7 that they have never induced nor requested the complainant to avail financial assistance from the bank as such ay amount which has been paid by the complainant by way of EMI is no way concerned with these Ops.  The relief itself seeking for the amount of Rs.24,23,787- along with interest @ 24% which he has not paid to the bank as such the relief is premature one, more over these Ops have neither requested nor directed the complainant to take the home loan as it is prerogative of the complainant who wishes to apply for loan. It is further case of the OP7 that since the complainant was not interested to purchase that apartment, he has cancelled the said apartment in the year 2016 itself as per his own admissions as he is suffering from economic crisis and difficulty to pay EMI and on the very same year he has sought for refund of the amount. Hence the complaint is barred by limitation and is liable to be dismissed.  The complainant has failed to file this complaint within the limitation period. Hence the complaint is not maintainable. The OP7 to 9 have denied all the other allegations made in the complaint and prays for dismissal of the complaint.
18. OP10 has filed his version stating that the complaint is not maintainable and it is frivolous and barred by limitation and liable to be dismissed in limine. This OP is neither a necessary nor a proper party and hence the complaint is liable to dismissed against him.  This OP has purchased the apartment bearing o.301 L1 in the residential building known as SMD BEVRELY HILLS, having built up area of 1068 sq. feet under a registered sale deed dated 16.11.2016 executed by OP1 and others.  He is unaware of the allegations made in the complaint along with alleged agreement of sale entered between the complainant and other Ops.  This OP is a bonafide purchaser for a valuable consideration without notice. Since from the date of purchase he is in actual physical possession of property by paying BBMP taxes.
19. OP10 further stated that he is not at all aware of any of the allegations made in the complaint. The present complaint appears that it is a public interest litigation and this commission has no jurisdiction to dispose of this complaint. The complainant is not entitled for the relief claimed in this complaint. Hence prayed for dismissal of the complaint.

20. The complainant has filed his affidavit evidence and relies on A1 to 13 documents.  Affidavit evidence of OP3 has been filed and OP relies on Ex.R1 to R3 documents marked.  OP1 and 2, 4 to 6 OP7 to 10 have not adduced any evidence.  OP7 to 9 have filed gazette notification. 
21. Heard the arguments of complainant and OP3. The complainant and OP3 and OP7 to 9 have filed their written arguments. Perused the documents.

22. The following points arise for our consideration as are:-

1. Whether the complainant proves deficiency of service on the part of OPs?
2. Whether the complainant is entitled to relief mentioned in the complaint?
3. What order?

23. Our answers to the above points are as under:

Point No.1:  Affirmative

Point No.2: Affirmative in part

Point No.3: As per final orders

REASONS

24. Point No.1 AND 2: These two points are inter related and hence they have taken for common discussion.  We have perused the allegations made in the complaint, version, affidavit evidence and written arguments and documents filed by both the parties.
25. It is undisputed fact that the OP 1 is a registered partnership firm and OP2 to 6 are the partners. The firm owned an amalgamated site No.1753, 1765 and 1766 measuring 8750 sq. feet and residential layout called the Aircraft Employees Co-operative society ltd., situated at Singasandra, Bangalore South Taluk. The OP2 to 6 in order to develop the land entered into a JDA with the developer company OP7 namely M/s Sri Manjunatha swamy developers and infrastructures pvt. Ltd., represented by OP8 and 9 as an authorized signatory of the company and OP2 to 6 have executed the power of attorney to develop the land into residential building by name SMD BEVRELY HILLS.
26. In support of his contention the complainant has produced the GPA dated 20.06.2020 entered between the OP1 in favour of OP7 represented by OP8 and 9.
27. The complainant has entered into sale agreement dated 16.09.2013 with OP for purchase of the flat unit No.301 L1 measuring super built up area of 1068 sq. feet on the third floor of the apartment with undivided share of 248 sq. feet, and he has produced the copy of the sale agreement as document No.2.  the complainant has agreed to purchase the flat for a total consideration of Rs.37,50,000/- in the project SMD BEVRELY HILLS and made an initial booking amount of Rs.8,50,000/-.  The complainant has produced the copy of the receipts issued by OP7 as document No.3 and also the copy of the ICICI bank statement as document No.4.
28. The complainant has availed the housing loan of Rs.30,00,000/- on 16.09.2013 and out of the loan amount a sum of Rs.28,12,000/- was disbursed to the builder with a condition that the remaining loan amount of Rs.1,88,000/- will be released during the registration of the apartment unit under the loan account No.LBBNG00002048052 on 10.12.2013 and paying EMI of Rs.27,334.90ps., p.m., since from January 2014.  He has also relied on the copy of the loan letter as document No.4 and document No.6 is the copy of the email communications.
29. As per the agreement the OP8 and 9 have agreed to deliver the possession of the apartment unit on or before two years from the date of agreement. But the OP8 and 9 have not at all completed the project and there was no progress of the work and they have almost stopped the work inspite of repeated request the OP8 and 9 have given evasive reply. When the OP8 and 9 have not at all properly responded to the complainant he has expressed his intention to cancel the booking of the plot.  During this period the OP8 and 9 have sold the flat in favour of OP10 under the registered sale deed dated 16.11.2016.  When the same was brought to the notice of OP8 and 9, they have made assurance to the complainant that they will refund the advance amount with compensation before the end of July 2017.  The OP8 and 9 have not at all refunded the amount. The complainant has also relied on the sale deed executed by the OP8 and 9 in favour of OP10 as document No.8.  After that the complainant has got issued notice to Ops as document No.9 on 23.10.2020. The legal notice was served on some of the Ops and some of the Ops have not received the legal notice and it was returned. The Ops have received Rs.8,50,000/- initial booking amount from the complainant on the date of entering into sale agreement dated 16.09.2013 itself. The complainant has also availed the housing loan of rs.30,00,000/- and out of that Rs.28,12,000/- was paid to the builder with a condition that the remaining loan amount will be released at the time of registration of the apartment unit and the loan amount was disbursed to the builder on 10.12.2013. The complainant is paying the EMI of Rs.27,334.90 ps., from January 2014. Even though the OP8 and 9 have received the substantial amount from the complainant have neither completed the project within two years from the date of sale agreement dated 16.09.2013. the Ops have played fraud on the complainant and they have got registered the plot which was booked by the complainant by paying substantial amount in favour of the OP10 under registered sale deed dated 16.07.2020. After that all the Ops have kept quite and they have neither refunded the amount nor offered the complainant any flat for the amount received by them.  The Ops are keeping the amount of the complainant from 2013 till today without refunding the amount or without deliver the possession of the flat which are available in the project.
30. Even though the OP3 and 7 to 9 and 10 have filed their objection the OP3 has filed his affidavit evidence and relied on Ex.R1 to R3. Ex.R1 is the JDA entered between the OP1 represented by OP2 to 6 in favour of OP7. Ex.R2 is the GPA executed by them in favour of OP7 to 9.  They have also produced the copy of the plaint in OS No.7177/2016 as Ex.R3.  The OP7 to 9 have also produced the copy of the notification issued by the registrar of companies, Ministry of corporate affairs, Bangalore for having struck out 2663 companies.  Wherein the OP7 was also one among them.  The complainant has also produced the copy of the chapter 18 of companies act 2013 sec 248.
31. It is clear from sec 248 of companies’ act that notwithstanding the undertakings referred to in the subsection the assets of the company shall be made available for the payment or discharge of all its liabilities and obligations even after the date of the order removing the name of the company from the registrar of companies. 
32. It is clear from the very admissions made by the OP1 to 6 and 7 to 9 that the complainant has entered into the sale agreement as document No.2 and they have received the initial deposit amount of Rs.8,50,000/- as per document No.3. The loan amount of Rs.28,12,000/- was released in favour of OP7 the developer with a condition that the remaining amount of Rs.1,88,000/- released at the time of registration.  Admittedly the complainant has availed the loan of Rs.30,00,000/- from the HSBC. 
33. The OP8 and 9 have agreed to deliver possession of the apartment on or before two years from the date of agreement i.e., 16.09.2013. They have neither completed the project nor refunded the amount in favour of the complainant even though they have received substantial amount from the complainant in the year 2013 itself.  In addition to this the OP8 and 9 representing OP7 have sold the flat booked by the complainant in favour of OP10 under the registered sale deed on 16.11.2016 as per document No.8. The flat is now in possession and enjoyment of OP10.
34. The complainant even after paying Rs.36,0,000/- after booking of the flat by raising housing loan and he is paying the EMI of Rs.27,,334.90 ps., p.m., from January 2014 the Ops have neither handed over possession of flat nor refunded the amount and thereby they have committed deficiency of service and unfair trade practice on their part.  In addition to this they have also cheated the complainant by selling the flat in favour of OP10 after receiving the entire sale consideration amount from the complainant.
35. The complainant has lost his money and also suffered mental agony from 2013 till today. Under these circumstances the complainant has clearly established the deficiency of service and unfair trade practice on the part of the OP1 to 10. Therefore, the OP1 to 10 are jointly and severally liable to refund the initial booking amount paid by the complainant of Rs.8,50,000/- with interest at 10% p.a., from the date payment till realization.  The complainant is also entitled for refund of Rs.20,75,644/- with interest at 10% p.a., from the date of payment till realization which is paid as EMI to the bank.  The complainant is also entitled for refund of a sum of Rs.24,23,787/- balance home loan to be paid to the bank with interest at the rate of 10% p.a., from the date of payment till realization. In addition to this the complainant is also entitled for compensation and also for deficiency of service and unfair trade practice by the Ops of Rs.4,00,000/- and litigation expenses of Rs.10,000/-. Therefore we answer point No.1 in affirmative and point No.2 partly in affirmative.
36. Point No.3:- In view the discussion referred above we proceed to pass the following;

O R D E R

1. The complaint is allowed in part.
2. OP1 to 10 are jointly and severally liable and directed to refund Rs.8,50,000/- with interest at 10% p.a., from the date payment till realization. 
3. The Ops are jointly and severally liable and directed to refund Rs.20,75,644/- with interest at 10% p.a., from the date of payment till realization which is paid as EMI to the bank. 
4. The Ops are jointly and severally liable and directed to refund Rs.24,23,787/- balance home loan to be paid to the bank with interest at the rate of 10% p.a., from the date of payment till realization.
5. The Ops are jointly and severally liable and directed to pay Rs.4,00,000/- towards compensation along with litigation expenses of Rs.10,000/- to the complainant.
6. The Ops1 to 10 shall comply this order within 60 days from this date, failing which the OP shall pay interest at 12% p.a. after expiry of 60 days on Rs.53,49,431/- till final payment.
7. Furnish the copy of this order and return the extra pleadings and documents to the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 07^th day of JUNE, 2023)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party3 – R.W.2;