Dr. V. Damodarudu Vs. Kesava Constructions, Rep. by K. Kesava Kumar and Another

Oral Order: (R. Lakshminarasimha Rao, Member)

1. The unsuccessful complainant has filed appeal contending that the District Forum failed to consider that the respondent had not filed any documents to show that the construction of flat is in progress and that the sole ground of dismissal of the complaint is inability of the appellant to state whether construction of flat is completed . It is contended that the District Forum failed to consider attitude of the respondent in the back drop of criminal case filed against them and that the appellant has been ready to pay balance sale consideration.

2. The case of the appellant is that he paid an amount of Rs.5 lakh as advance out of sale consideration of Rs.14 lakh for purchase of Flat No.402 at Sai Ganesh Towers in Hyderabad. On 22.12.2008 the respondents entered into agreement with the appellant wherein it is stated that the first respondent entered into agreement with V.Lalitha Kumari to purchase the flat and the first respondent would get sale deed executed by her in favour of the appellant. The contract between the 1^st respondent and Lalitha Kumari was expired on 20.07.2008. The appellant got issued notice to the respondents on 23.08.2010 requesting the first respondent to execute sale deed. It is contended that the respondents cheated the appellant.

3. The respondents resisted the claim on the premise that there is no priviity of contract between the appellant and them and that Lalitha Kumari is necessary party,. It is contended that the 1^st respondent is agreement holder of Lalitha Kumari and the sale deed was stated to be executed by Lalitha Kumari. It is contended that the appellant failed to pay balance sale consideration of Rs.9,00,000/- and without paying the amount, the appellant cannot seek for execution of sale deed. It is contended that the appellant is blackmailing the respondents to pay a sum of Twenty lakh. Rupees.

4. The appellant in support of his case, filed his affidavit and the documents, ExA1 to A7. On behalf of the respondents, the respondent no.2 has filed his affidavit. No documents were filed.

5. The District Forum dismissed the complaint on the premise that the appellant failed to pay balance sale consideration even after the respondents requested them to pay the amount and informed him the construction of flat was completed.

6. The point for consideration is whether the appellant is entitled to execution of sale deed?

7. The first respondent executed agreement in favour of the appellant on 22.12.2008 agreeing to sell Flat No.402 which was purchased under agreement of sale from its owner Lalitha Kumari, for consideration of Rs.14,00,000/- out of which the appellant paid a sum of Rs.5,00,000/- and the balance amount of Rs.9,00,000/- was agreed to be paid by the appellant in phased manner in accordance with stage wise construction. It appears the appellant did not respond to the demand for payment of balance sale consideration whereof the 1^st respondent got issued notice dated 11.04.2010 requesting the appellant to withdraw private complaint filed by the appellant and pay balance sale consideration. The appellant was informed that construction of the flat was completed. Relevant portion of the notice date 11.04.2010 reads as under:

“That our client had completed the entire construction of Flat No.402 according to the specifications mentioned in the agreement with great hope you honour the terms of the agreement in payment of the balance sale consideration and requested you to pay the balance sale consideration of Rs.9,00,000/-. But there is no any proper and positive response in paying the balance sale consideration to our client as agreed by you in the agreement dated 22.12.2008.

That to cover up all your lapses and failures you have filed a private complaint against our client for cheating and other charges by suppressing the above said material facts. Moreover you have dragged the father of our client Sri Neelakanteswar Reddy into this criminal complaint with malafide intention and to get the legal benefits.

That our client is ready to get the registration on your name on the condition to pay the balance sale consideration to our client.”

8. The appellant got issued reply on 2.05.2010 through his advocate stating that the 1^st respondent is not a registered firm and as per the terms of agreement, it had not completed construction of flat as also the first respondent did not hand over link documents to the appellant. The appellant sought for completion of construction of flat, execution of sale deed and in the alternative for refund of the amount along with interest thereon. Concluding portion of the reply reads as follows:

“Hence, it is hereby informed to you that please advise your client to complete the construction and obtain the agreement from the original owner that your client has no due to the original owner and her willingness to execute the regd sale deed to my client and show your clients bondafides to get execute the regd sale deed in favour of my client. Otherwise my client is ready to initiate legal proceedings against your client to get register the same or to recover the advance amount with interest at the rate of 24% from the date of execution till the realization and your client is liable to pay the entire legal expenses incurred by my client in this transaction including this notice charges worth Rs.2,000/-.”

9. The appellant got issued notice dated 23.08.2010 repeating the same demand as was made in reply dated 2.05.2010. It is stated in the notice that;

10. Our client got issued suitable reply stating that our client is ready and willing to perform his part of contract and that he is ready to pay the balance of sale consideration as per the terms of agreement.

“Hence, we are hereby demand you to register the Flat in our clients name through original owner with or to pay the advance amount of Rs.5,00,000/- with interest and also to pay Rs.20,00,000/- compensation as our client suffered physically and mentally within one week from the date of receipt of this notice, failing which our client will take necessary steps against you and our client will proceed against both of you in a consumer forum and then you will be held liable for all costs and consequences including this notice charges of Rs.1,000/-.”

11. The appellant filed private complaint stating that the respondent no.1 cheated him by receiving the amount of Rs.5,00,000/- from him for part of sale consideration of Flat No..402 and later the appellant came to know that the first respondent had no right as it failed to pay the consideration in time to the original owner of the flat. The appellant complained of cheating him by the respondent no.1. In the back drop of the compliant and his statement that he came to know that the respondent no.1 has no right to sell the flat, the appellant cannot be heard to say that he is entitled to claim for execution of sale deed. He filed complaint seeking for refund of the amount paid by him and interest thereon as also compensation.

12. The appellant had not denied that he verified the documents and visited the site where construction of the building was carried out. In the agreement it is specifically mentioned that Lalitha Kumari and not the respondent no.1 is the owner of the Flat No.402 and the respondent no.1 would get sale deed or the flat executed by Lalitha Kumari in the name of the appellant after the appellant paid the sale consideration. As such the appellant cannot blame the respondent no.1 for the ownership of Lalitha Kumari over the flat agreed to be sold to him.

13. The first respondent stated that the appellant forcibly got entered into agreement with it for purchase of the flat. The statement does not carry any credence. In the light of notice issued by the 1^st respondent, reply by the appellant and subsequently notice by the appellant, the facts emerge are that the first respondent entered into agreement of sale with Lalitha Kumari for purchase of incompletely constructed flat and agreed to sell the flat to the appellant. The appellant exhibited dual behavior by finding fault with the respondent no.1 for its not being registered and on the other hand seeking for execution of sale deed or refund of the amount. Both parties proceeded on wrong premises and attempted to find fault with one another.

14. The Honble National Commission in “GDA vs Alok Chandra Sharma” II(2010)CPJ 158 held that possession not delivered in time and development work nor completed amounts to deficiency in service on the part of the builder. In that case GDA was held liable to pay interest for belated delivery of possession of house. It was held

“In the instant case, it is on record that Petitioner/Authority had already started construction on the land in question before the stay order was passed and, therefore, Petitioner cannot now take the plea that there was delay because of this stay. For this reason, the order of the District Forum stating that the Petitioner was not liable to pay interest from 24.04.1991 to 16.12.1993 is erroneous. Further, both the District Forum and the State Commission on the basis of credible data have concluded that there were deficiencies in the house as well as lack of adequate civic facilities and in our revisional jurisdiction we see no reason to differ with this finding of facts by the fora below. We, therefore, agree that there was clear deficiency of service on the part of the Petitioner on both counts for which the Petitioner/Authority is liable to pay interest on the amount deposited by the Respondent from the date of deposit till the date of possession.”

15. The National Commission referred to the judgment of the Honble supreme Court in “Bangalore Development Authority vs Syndicate Bank” 2007(6) SCC 711 it was held:

“Where no time is stipulated for performance of the contract (that is for delivery), or where time is not the essence of the contract and the buyer does not issue a notice making time the essence by fixing a reasonable time for performance, if the buyer, instead of rescinding the contract on the ground of non-performance, accepts the belated performance in terms of the contract, there is no question of any breach or payment of damages under the general law governing contracts. However, if some statute steps in and creates any statutory obligations on the part of the development authority in the contractual field, the matter will be governed by the provisions of that statute”.

16. The respondent no.1 failed to collect the balance sale consideration and it failed to cancel the contract. In the circumstances, the appellant is entitled to refund of the amount with interest. The appellant consciously proceeded to seek for execution of sale deed attributing lack of title over the Flat No.402 to the first respondent. In the circumstances, the appellant is entitled to interest @9% from the date of filing of complaint. The appellant failed to show how the second respondent rendered deficient service.

17. In the result, the appeal is allowed setting aside the order of the District Forum. Consequently, the complaint is allowed. The first opposite party is directed to pay an amount of five lakh rupees with interest @ 9% p.a .from the date of filing co complaint till payment and costs of Rs.3,000/-. Time for compliance four weeks.