IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, ALAPPUZHA
Wednesday the 03rdday of August 2022.
Filed on 27. 10. 2021
Present
- Sri.S.Santhosh Kumar BSc.,LL.B (President )
- Smt. P R Sholy, B.A., LLB (Member) In
CC/No.255/21
between
Complainant:- Opposite party:-
1. Sri. Rajagopalanachari M Sri.Sony Thomas,
S/o. Madhavanachari, S/o. Thomas,
Ampazhavelil, FAB Homes,
Oppo.Sivamoorthi Temple, Arattuvazhi, Kalappura Ward,
Pallippad Village, Neendoor, Aryad South Village,
KarthikapallyTaluk, Alappuzha. AmbalapuzhaTaluk, Alappuzha
2. Smt.Vishnukumari C, (Adv. P S Anaghan)
W/o. Rajagopalanachari,
-do-
(Adv. Jose Y James)
ORDER
SMT. SHOLY P R (MEMBER)
Complaint under section u/s 35 of the Consumer Protection Act 2019
1. Brief facts of Complaint’s case are as follows:-
Complaints are husband and wife who were Principal and Headmistress and retired from two different schools. The opposite party is a man known to the complainants during the last so many years and he was engaged in contract work of buildings, RO Plant and other works relating to buildings in complainants’ working schools.
2. After retirement the 1st complainant was engaged in taking tuition classes at his residence. Subsequently at the time of retirement of the 2nd complainant, both complainants took a decision to arrange a separate tuition facilities in a separate building for their retirement livelihood and for that they submitted a building plan at low cost construction with iron pipes and V boards to get licence fromHarippad municipality.
3. When the complainants contacted the opposite party for installing RO Plant in the proposed building the opposite party himself assured complainants that the construction of the two storied building as per the plan with branded high quality steel pipes and other quality materials within a period maximum of 120 days. The opposite party had given an estimate to the total cost of Rs.11,80,255/- (Eleven lakh Eighty thousand Two hundred and fifty-five only) in a plain paper without any authenticity of name, signature, seal or stipulations etc. Believing the words of the opposite party the complainants entrusted the entire building work as per plan to the opposite party. Due to the confidence and reliability to the opposite party the complainants never wanted a document in lawful manner. As the complainants and opposite party are in cordial relationship, oral agreement of the opposite party was accepted by the complainants and the work started on 16. 11. 2020.
4. As requested by the opposite party the complainants made the cash payments to the opposite party on different occasions such as, Rs.2/- lakhs (Rs.Two lakhs only) on 16. 11. 2020, Rs.3/- lakhs (Rs.Three lakhs only) on 07. 12. 2020, Rs.3/- lakhs (Rs.Three lakhs only) on 24.12.2020, Rs.2/- lakh (Rs.Two lakhs only) on 29. 1. 2021 and Rs.1/- lakhs (Rs.One lakhs only) on 10. 3. 2021. In total Rs.11/- lakhs paid by the complainants together to the opposite party directly in cash.
5. The opposite party did not complete the construction work as agreed by him in time. When contacted directly and over phone the opposite party in connection with the failure of finishing the construction work the opposite party requested some more amount to complete the work since the amount entrusted him were spent for his personal use. On enquiry the complainants got reliable information that the opposite party entrusted the complainants construction work to one Antony D Silva on labour contract basis. It was also learnt from the said subcontractor that the construction work of the complainants building was with substandard and rejected metal pipes and other inferior materials and there is no durability and strength in the construction. As per the calculation of labour contractor the actual expenditure incurred to the incomplete works (including labour and materials) will come about Rs.6,40,140/- (Rs.Six lakhs Forty thousand One hundered and forty only) and the construction work hardly reached up to the half-way stage.
6. Due to the incomplete stage of work the iron pipes, V boards and other materials used may fall into ruins or damaged due to rain and sunshine. The subcontract tor issued a detailed statement regarding the materials used and its expected costs including labour charge to the complainants for finishing the building. As per the said estimate nearly Rs.5/- lakhs has been collected from the complainants by the opposite party as excess amount.
7. As the opposite party declined to complete the construction work and the delay caused the 1st complainant filed a complaint before Sub Inspector of Police, Haripad on 22. 7. 2021 where the matter settled by executing a sammathapathram in favour of the complainants agreeing to complete the work on or before 24. 7. 2021 on payment of additional amount of Rs.4,14,000/- (Rs.Four lakhs fourteen thousand only). Even though the complainants are ready for paying the additional amount the opposite party not commenced the pending work. The complainants repeatedly contacted opposite party to commence the pending work, but not turned up. Due to the non-co-operation on the part of the opposite party the 1st complainant sent a registered letter to the opposite party on 02. 8. 2021 with regard to details regarding the work done by him, but not replied or cared to complete the work as promised. The act of the opposite party by not finishing complainants’ building in time after receiving entire amount as per oral agreement in advance amounts to deficiency in service on the part of the opposite party. Hence this complaint to return an amount of Rs.5 lakhs (Rs.Five lakhs only) with interest @ 12% p.a along with compensation for a sum of Rs.3/- lakhs (Rs.Three lakhs only) from the opposite party.
8. In response to the complaint the OP filed a detailed version as follows:-
The complaint is not maintainable either in law or facts. Opposite party has no personal liability and an unnecessary party to this proceedings. Complaint is bad for non-joineder of necessary parties.
9. The opposite party is engaged in the business of installation of commercial and domestic RO plants. The opposite party is not engaged in any time in the business of contract work of buildings or any other work relating to buildings. The opposite party has installed a RO plant at the Mancombu School where the 2nd complainant was working as Head Mistress, which led to the introduction of the opposite party to the 2nd complainant. Thus the complainants and the opposite party are in acquaintance from last so many years.
10. There is no oral or documentary agreement between the complainants and opposite party of the construction of the low cost building. Therefore, there is no violation of the terms of the agreement. The opposite party is not the contractor of construction of building and therefore the opposite party cannot be considered as a service provider. Therefore, there is no deficiency in service of unfair trade practice is not occurred on the party of opposite party.
11. As satisfied with the work of instalation of the above said RO plant at her school, the 2nd complainant and her husband frequently contacted the opposite party to install a domestic RO plant and a plant for purifying the well water in their property where they permanently resides and the above said required plants were installed by the opposite party for the complainants. And they are fully satisfied with the work and the functioning of the RO Plant put up by the opposite party
12. The complainants never contacted the opposite party for installing RO plant in the proposed building. And after a period of one and half years of the installation of the domestic RO plant and a plant for purifying the well water in the residential property of the complainants, the complainants contacted and requested the opposite party to install a commercial RO plant for them in their residential property. And as requested by the complainants, the opposite party visited the residence of the complainants for inspecting the feasibility of the installation of the commercial RO plant in their residential property. And when the opposite party visited their residence, they have made enquiries about the construction of building for the installation required equipment’s for the RO plant.
13. When the complainants enquired about the above said building, the opposite party told them about his low cost residential building and shown them its pictures. Fascinated by it, the complainants visited the residence of the opposite party, and they inspected the building and enquired him about the expenses and materials used for the construction and its durability. And satisfied with the residential building of the opposite party, the complainants changed their mind to construct a low cost building at their property situates far away from their residential property. And they requested him to introduce the person who has done the work of the low cost building of the opposite party. And as requested by the complainants and thereby the opposite party introduced the Anonty.D Silva who has constructed the low cost building of the opposite party. Antony D. Silva is also a resident of the nearby place of the opposite party. As per the advice of the opposite party, Antony D Silva, the contactor directly approached the complainants. The opposite party never assured anything with regard to the construction of the building.
14. Mr. Antony D Silva entered an oral agreement with the complainants to construct the building for an amount of Rs.1500/- (Rs.One thousand and Five hundred only) per square feet using the same material used for the construction of the residential building of the opposite party. It was also informed to the opposite party.
15. The complainants requested the opposite party to supervise the work of the building as he has an experience of the work of Mr. Antony D Silva who has constructed his low cost building. As insisted by the complainants, the opposite party agreed to supervise the work. And sometimes some amount also entrusted with the opposite party by the complainants. And all amount entrusted with the opposite party was given to the building contractor Antony D Silva. The opposite party never given any subcontract to Antony D Silva or entrusted him to construct the building of the complainants. All the material used for the buildings were purchased by the contractor Antony D Silva.
16. After the almost completion of the construction due to some financial problems, the work was stopped. There after the complainants requested the opposite party to raise certain amount for them. As the opposite party too was suffering from financial constraint, he was not willing to raise the amount as demanded by the complainants. Thereafter said Antony D Silva informed the complainants that he could not complete the work without paying the amount which is necessary for the completion of work.
17. After accepting the registered notice, the opposite party personally contacted the complainants and intimated the matter that the opposite party is not in good terms with Antony D Silva and he has nothing to do for the completion of the building. The opposite party told the complainants that if there is any complaint about the construction of the work and they could have contacted their contractor.
18. The opposite party and the Antony D Silva are not in good terms since the opposite party demanded the amount of Rs.30000/- (Rs. Thirty thousand only) and a blank cheque received from opposite party in connection with supply of construction material to the opposite party
19. The complainants are also in inimical terms with the opposite party due to the sole reason that the opposite party is not willing to raise funds for the complainants for the completion of the work.
20. Later on colluding with Antony D Silva a false complaint filed before SHO, Harippad Police Station on 24-7-2021. Then the opposite party called to the police station and he was forced to sign in a blank paper. After accepting the notice from the Commission the opposite party came to understand that the blank signed paper has converted into a sammathapathram. The opposite party happened to sign this blank stamp affixed paper due to the threat of police personals to take coercive steps against the opposite party and also threatened that the police will implead him in non bailable offences and put him behind the bars.
21. The above complaint is filed is only to extract money from the opposite party and take an undue gain. The complainants have not sustained any damages or any other injury due to any act or omission form the part of the opposite party and they did not sustain any mental agony, sufferings, loss of valuable time as alleged in the complaint. The complainants are not entitled to get any relief as prayed for in the complaint. There is no deficiency in service or unfair trade practice on the part of the opposite party. Hence the complaint is only to be dismissed with compensatory cost of the opposite party.
22. On the above pleadings the following points were raised for consideration:-
1. Whether the complaint is maintainable?
2. Whether the complainants are come under the definition of consumer?
3. Whether the complainant is entitled to realise an amount of Rs.5 lakhs along with interest from the opposite party as prayed for?
4. Whether the complainant is entitled to realize an amount of Rs.3 lakhs as compensation from the opposite party?
5. Reliefs and costs?
23. Evidence in this case consists of the oral evidence of PW1 and PW2 and Ext.A1 to A9 (A7 marked as subject to proof) and Ext.C1 and C1(a) series from the side of the complainant and oral evidence of RW1 on the side of opposite party.
24. In the meantime the complainants filed a petition for allowing them for completing the construction as IA .No. 170/2022 and the opposite party filed a petition to setaside the commission report as IA.No. 215/2022.
25. Point No.1 and 2:-
PW1 is the 2nd complainant in this case. She filed an affidavit in tune with the complaint and got marked Ext. A1 to A9 in which the marking of Ext.A7 the proposed estimate of the disputed building prepared by opposite party was objected by the counsel appearing for opposite party and the same was not proved further.
26. PW2 is the Advocate/Expert Commissioner in this case. He got marked Ext.C1 and C1(a) series photographs of 24 numbers. According to PW2 the completed work was estimated for Rs 6,55,916/- and the remaining materials kept in the spot estimated for Rs. 5,275/-. The estimate for completing the remainingwork is Rs. 4,69,084/-. He had ascertained the defects of the building constructed by the opposite party. The iron tubes are second grade and not of branded company and the defects of the same also shown in Ext.c1(a) photographs. There is possibility for effecting durability of the building due to the defect of the pipe. Now it will be exceeds 25% -30% of expenditure of the construction of the building.
27. RW1, is a contractor doing Civil, interior, welding works etc. He is having knowledge of low cost building construction. During 2020 the cost of low cost building of 1 sqft was approximately Rs.1,500/-. The guage of the iron pipe used is 16—18 and septic tank material is fibre rated @ Rs.7000 - 25,000/-. Cost of wiring per unit is Rs.250 and cost of plumbing per unit is Rs.400-500.20 guage iron pipes are to be used for furniture making. Electrical welding is used for building construction. It is not possible to weld 20 guageiron by electric welding, but used gas welding for the same.
28. The complainant’s case is that they had entrusted a low cost building construction to the opposite party as per Ext.A4 building permit and plan. It was alleged the complainants that there was an oral agreement between the PW1 and opposite party to complete the entire construction of the building within a maximum period of 120 days as per the estimate given in Ext.A7. Though the complainants alleged as stated above the opposite party objected the marking of the Ext.A7 since the same was prepared without any authenticity of name, signature, seal or stipulations and dates etc as averred in the complaint. It was not proved further with cogent evidence, hence Ext.A7 remains not proved. According to the complainants after retirement from government service from the posts of Principal and Headmistress both of them took a decision to arrange a separate tuition facilities in a separate building for their retirement livelihood. For that purpose they got Ext.A4 site approval and building permit from HaripadMunicipality for the construction of two storied building made up with iron pipes and V boards as a low cost construction. According to the complainants the work was started on 16/11/2020 and a total amount of Rs.11,00,000/- (Rupees Eleven lakh) paid by the complainant together to the opposite party directly in cash as per the demands and requests made by the opposite party. The complainants also contended that the opposite party did not complete the construction work as agreed by him and also demanded additional amount for completing the work and further on enquiry it was learnt that the said construction work was given to one Antony.D.Silva as Labour contract basis, and also realized that the actual expenditure incurred to the incomplete works would come about Rs. 6,40,140/-(rupees six lakh forty thousand one hundred and forty only) uptothe half way stage. PW2 also estimated the amount for completed works for Rs.6,55,916/-(rupees six lakh fifty five thousand nine hundred and sixteen only) and for the remaining work for completing the construction needs an amount of Rs.4,69,084/- (Rupees four lakh sixty nine thousand and eithyfour only). Alleging deficiency in service on the part of opposite party the complainants filed this complaint. It was contended by the opposite party in the version that the complaint is not maintainable. Eventhough there is no specific contention, in the discussion of this point as per the definition in the Consumer Protection Act, the complainants are not consumers since the transaction in this case ie, the construction of building is for their retirement livelihood by means of conducting a tuition centre. Here the construction of building is for commercial purpose as it involves the act of profit making and the institution is a commercial entity and therefore it has to be kept out of the purview of the definition of consumer under Sec.2(7) of the Consumer Protection Act,2019. At the time of argument also the learned counsel appearing for the opposite party vehemently contented that the complaint is not maintainable this Commission. Consumer is defined u/s 2(7) (ii) of the Consumer Protection Act, 2019 is as follows:-
“hires or avails of any service for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such service other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person, but does not include a person who avails of such service for any commercial purpose.
29. Per contra the learned counsel appearing for the complainants pointed out that the construction of the building is for conducting a tuition centre for earning the livelihood of the complainants. The word commercial is not defined in the Act. However there are umpteen number of judicial pronouncements. It was held by the Hon’ble Supreme Court in LilavatiKirtilal Mehta Medical Trust Vs. Unique Shanti Developers and Ors.( AIR 2020 SC 3580).
“ To summarize from the above discussion, though a straight- jacket formula cannot be adopted in every case, the following broad principles can be culled out for determining whether an activity or transaction is ‘for a commercial purpose’:
(i) The question of whether a transaction is for a commercial purpose would depend upon the facts and circumstances of each case. However, ordinarily, ‘commercial purpose’ is under stood to include manufacturing/ industrial activity or business – to – business transactions between commercial entities.
(ii) The purchase of the goods or service should have a close and direct nexus with a profit- generating activity.
(iii) The identity of the person making the purchase or the value of the transaction is not conclusive to the question of whether it is for a commercial purpose. It has to be seen whether the dominant intention or dominant purpose for the transaction was to facilitate some kind of profit generation for the purchaser and /or their beneficiary.
(iv) If it is found that the dominant purpose behind purchasing the good or service was for the personal use and consumption of the purchaser and /or their beneficiary, or is otherwise not linked to any commercial activity, the question of whether such a purchase was for the purpose of ‘generating livelihood by means of self-employment’ need not be looked into.”
30. Here in this case the disputed building was constructed for running a tuition centre by the complainants. They also admitted that they were retired government employees both had been drawing service pension having sufficient income for their livelihood. Hence the contention of making livelihood will not stand. Of course it is only for profit making activities . More over it is pertinent to not that the complainants admitted that at the time of retirement of 1st complainant, he was engaged in taking tuition classes at his resident, subsequently at the time of retirement of PW1, 2nd complainant, both were took a decision to arrange a separate tuition facilities in a separate building for more establishing the same.
31. Now the question to be considered whether the complainants who is doing business and having separate income source further establish it will come under the explanation livelihood. The law in this regard is well settled by various judicial pronouncement. It was held by the theHon’ble National Consumer Disputes Redressal Commission in Sanjay D. Ghodawat Vs. R.R.B Energy Ltd. ( IV 2010 CPJ 178(NC).
“ Under Section 2(1) (d) (i) any person who buys goods for consideration for commercial purpose is excluded from the ambit of consumer. Besides this, the services of opposite party were availed by the complainant for commercial purpose for augmentation of profit by increasing the efficiency and thereby the output of the Company with the help of the software. After lifting the veil, it is clear that the complainant has put in the forefront efficiency card though actually the whole exercise is increasing the profit. All this goes to show that the software in question is sale of goods by the opposite party to the complainant for commercial purpose on account of which the complainant would be excluded for being considered as consumer in terms of provisions of Section 2(1) (d) (i) of the Consumer Protection Act. The complainant in our opinion does not qualify to be a consumer in view of the provisions of Section 2 (1) (d) (i) of the Consumer Protection Act.”
32. It was held by the Hon’ble National Consumer Dispute Redressal Commission in GowharRiyaz Khan vs. Ansal Housing & Construction Ltd. and Ors.( MANU/CF/0275/2018).
“To put it differently, one while purchasing a commercial unit would be a consumer within the meaning of Section 2(1) (d) only if one is not having already business establishment. Booking of a shop for the purpose of expansion of business, as is the object in the given case, envisage existence of business establishment already, in which case one would not be covered within the exception clause of Section 2(1) (d) of the Act (Supra) and if that be the case, availing of service would tantamount to for commercial purpose and in such event complainant would not be a consumer.”
33. It was held by the Hon’ble National Consumer Disputes Redressal Commission in Prithipal Singh Arora and Ors Vs. Emaar MGF Land Limited. ( MANU/CF/0133/2018)
“ On bare reading of the above, it is clear that both the complainants are gainfully employed. Complainant No.1 is engaged in business of operation and maintenance of industrial equipments and at present he has 181 regular employees. Further , complainant No. 2 is stated to be a retired banker currently engaged as a financial advisor with respect to the investment in different portfolios. Thus, it is clear that both the complainant are gainfully employed and earning livelihood. Consequently, it cannot be said that they had booked the subject shops exclusively for the purpose of earning livelihood by way of self employment.”
34. It is evident that the both the complainant were employed and retired from service with pension benefits and monthly pension and earning livelihood and already having a business of tuition centre at their residence and the construction of the building mentioned in this complaint is only for augmenting their profit. In this circumstances as held by the decisions referred above complainants cannot take shelter under the explanation livelihood and self employment. In said circumstances in the light of the above discussion and as per the settled principles it can be safely concluded that the construction of building as per Ext.A4 was for commercial purpose for augmenting profit of the complainants and so they will not come under the definition of consumer and they cannot take shelter under explanation. These points are found accordingly.
35. Point No.3 and 4:-
Since point No. 1 and 2 were found against the complainants, these points does not arise for consideration. IA.No.170/2022 and IA.No.215/2022 are also discarded.
36. Point No.5:-
In the result complaint stands dismissed as not maintainable.
Dictated to the Confidential Assistant, transcribed by him corrected by me and pronounced in open Commission on this the 3rd day of August, 2022. Sd/-Smt.Sholy.P.R (Member)
Sd/-Sri.S.SanthoshKumar(President)
Appendix:-
Evidence of the complainant:-
PW1 - Smt.Vishnukumar C (2nd complainant)
PW2 - Sri. DileepRahman (Commissioner)
Ext.A1 - Original Sammathapathram dated 24/7/21
Ext.A2 - Copy of petition dated 22/7/21
Ext.A3 - Copy of notice with postal receipt and postalAckonwledgement card
Ext.A4 - Copy of Site Approval and Building permit and plan issued from Haripad
municipality
Ext A5 - Copy of order in PLP No.849/2021 of KarthikapallyTaluk Legal Services
Committee, Haripad
Ext A6 - Original copy of order in in PLP No.849/2021dated 24/11/21
Ext A7 - Copy of Estimate
Ext A8 - Copy of Land tax receipt dated 06/6/22
Ext A9 - Copy of Sale deed No.983/07
Ext A10 - Copy of Statement issued from Sub Treasury Harippad and Advocate’s Memo
Ext C1 &C1(a) series - Phototgraphs
Evidence of the opposite parties:-
RW1 - Sri.Sebastian Abraham (Contractor)
///True Copy ///
To
Complainant/Oppo.party/S.F.
By Order
Assistant Registrar
Typed by:-Br/-
Compared by:-
