J.M. Malik, Presiding Member:
1. The present petition has been filed by Jeevan Bima Nagar Flat Owners Welfare Association. The members of the above said Welfare Association were the policy holders of the L.I.C. during October, 1993. The L.I.C., the opposite party in this case advertised in newspapers for the sale of single, double and three bedrooms residential flats construction in an area of 12.5 acres at Jeevan Bima Nagar Anna Nagar Western Extension, Madras. The salient features of the advertisement were these:
œ(i) 800 Flats (single, double and three bedrooms) with price ranging from 3.3 to 6.6 lakh.
(ii) The flats are located in 12.5 acres of land with well laid out roads and other amenities.
(iii) Provision being made for locating a community centre, Public Telephone, with S.T.D. facilities, milk booth, clinic-cum-pharmacy and other similar basic facilities within easy reach all within the complex.
(iv) Constructions supervised by a team of highly experienced and qualified Engineers of L.I.C.?
It was also mentioned that 40 flats were reserved for non-residents Indians and 40 more flats were reserved for the employees of the Tamilnadu Government and Tamilnadu Housing Board. The receipt of the application with earnest money deposit was from 8.11.1993 to 15.12.1993. In the brochure, it was stated that flats will have all the basic civil and social amenities. It was also stated that the flats were likely to be ready for the allotment and occupation in about three months time. The allottees were to mobilize the full purchase price of the flats ranging from Rs. 3.3 lakh to Rs. 6.5 lakh within a period of six months from the date of allotment. They were also to mobilize additional amount ranging from Rs. 40,000 to Rs. 80,000 as stamp duty.
Various defaults/deficiencies
2. It is alleged that LIC defaulted from the beginning as per Clause V(9) in page 9 of the brochure issued, the LIC should have sold and handed over the possession of all the 800 flats before 30.4.1994. The draw for the flats were made only on the first week of February, 1994. The first sale deed in favour of the allottees was executed only on 15.9.1994 by LIC. The possession was handed over to the allottees during third week of September, 1994 onwards. Consequently, those allottees who had paid the full purchase price between March, 1994 and September, 1994 suffered a huge financial loss due to failure of LIC to adhere the time schedule issued in the brochure.
3. The allottees were shocked to know that the underground water available in the entire complex of 12.5 acres was unfit for any domestic use. The allottees had to arrange for potable water and were forced to purchase water through private tankers for their daily needs thereby incurring huge monthly expenditure.
4. The entire complex of 12.5 acres had wild plants and bushes grown in the common areas and open space reserved in the complex which were heaven for wild creatures, dangerous creatures such as poisonous reptiles, rodents, scorpions. The LIC did not clear the jungle and rubbish surrounding the complex till 8.3.1995. Rs. 12 lakh were allotted for greening the complex. The wild plants and bushes were cleared only in March, 1995. The waste construction material rubbish were not removed. Open space of 12.5 acres earmarked for playground, park and other recreation facilities were not provided. The association had also spent around Rs. 20,000 for levelling three space reserved. Due to lack of approach roads, the allottees faced problems to enter or go out from the complex. Due to total lack of basic amenities, social amenities and lack of approach roads, 240 flats remained unsold. The LIC was forced to advertise for the second time during April, 1995 for the sale of flats. At the time of filing of this complaint, 64 flats were yet to be sold.
5. Again, it was found that construction of the blocks and flats was substandard, defective, deficient in several ways and bad for habitation. In all the above said 800 flats regarding the doors substandard metal frame were used. The metal doors flats were found to be corroded and even at the nascent stage of occupation, the door frames fixed in the toilet and bathrooms were fully corroded and damaged and the surrounding plaster started to peel off and doors could not be closed. The metal doors frame was made up of cheap 18 SWG metal sheets instead of a thicker priority. Some of the allottees changed the doors. Due to the use of sub-standard, thin and poor quality of doorframe, there was no scope for strengthening the doorframe except its total replacement. They have posed threat to the security system and some theft had taken place by tampering front door. LIC used Teewood for hand railers in stair case and balcony and wooden frames for windows and ventilators.
6. There were structural defects in all the 50 blocks. Deep and long cracks were found in beams and other structure of the blocks both inside and outside of the flats. Every passing day, the cracks become wider. It is evident that the stale cement sea sand and saline water was used for construction in all the 50 blocks. It also transpired that the iron rods were rusted in the columns and beams and this could be the only reason for cracks appearing all over the building. Few allottees have repaired the said defect. Again, the plaster in the walls both inside and outside started to wither off resulting in seepage of water into the flats. After the lapse of one year it gives look of an old construction.
7. In all the 800 flats, the grills used in windows are very flimsy and thin. The same can be easily bent or removed by any intruder. The grills are in the range of 2.5 to 3.5 mm, whereas its thickness should not be less than 6 mm.
8. The Main Circuit Breakers used in the flats are all of low quality and defective.
9. Furthermore, in all the 50 blocks of the complex, the overhead tanks are for water distribution, were all constructed with substandard bricks instead of RCC. The tanks are leaking and are damaging the structure of the third floor. Due to the cracks which have appeared in the overhead tanks of block Nos. 42, 43 and 47, the residents are scared. The tanks made of brick work can collapse any time.
10. In blocks 1 to 13 and in several other blocks, the RC kurb wall for the staircase have been deliberately omitted. In Sector 3, blocks 14 to 26, three bed rooms flats, the contractor engaged by LIC ran away in the middle without completing the job, at few places sewage lines are yet to be completed. The sewage canal flowing in the centre of the complex between blocks 12, 13 and 14, 15 should have been diverted before the allotment of the flats. The entrance ways for blocks 14 and 15 have not yet been provided and the residents of the blocks face immense difficulties. The sewage canal should have been properly closed with covered slab till such time it was diverted. Consequently, it has become a breeding grounds for mosquitoes causing diseases like Malaria.
11. Again insufficient headrooms were provided in several blocks for the first floor which is the potential danger to the residents permanently. Again headrooms were given in the second and third floor but the first floor had been denied this important facility. Moreover, some of the first floor headrooms are less than the standard height. It is contended that this defect has to be rectified as early as possible in block Nos. 38, 39, 40, 44, 45, 46, 47, 48, (Sector-1) 29 to 33 (Sector-2) and 16 to 36 (Sector-3).
12. The terracotta tiles laid down on the head roofs are badly situated resulting in seepage of water inside the flats, since there is no proper waterproofing.
13. The General Engineering tactics is to provide a bore well for 8 to 10 flats. The LIC should have provided two bore wells for a block of 16 flats. There are only 22 bore wells for the entire 50 blocks. They should have provided atleast 28 more bore wells. Since the funds earmarked for digging of 28 bore wells are not utilized, therefore, the same be refunded to the petitioner association. A sewage Nullah is flowing from north to south of eastern side of the colony. The bore wells for blocks 8, 9 and 10, 24, 25, 26, 27, 28, 29 and 30 and 44, 45, 46, 47 and 48 have been dug up very closed to the sewage nullah without bearing in mind that the contamination effect to the bore well water. Due to the toxic contents and contamination of underground water, GI Pipes used in bore wells were already corroded and flow of water stopped in several bore wells. Consequently, 12 out of 22 bore wells, the GI Pipes have been replaced by the petitioner. The petitioner association with PBC pipes incurred Rs. 2500 in the material and labour cost for each bore well. While replacing the corroded GI Pipes, it was found out that in block Nos. 34, 6, 7, 8, 9 and 10 instead of 120 feet for which payment was made, only 60 feet deep bore well were found to have been dug up.
14. Again, the floor tiles are of substandard quality and therefore give the shabby appearance. At many places, they have developed holes and cracks. As a matter of fact, few residents have to change their floor tiles at their own costs. In its letter dated 28.10.1995, the LIC assured to give spare motor but the same was not provided.
15. No proper ducting was provided for underground electric cables.
16. Office-cum-shopping complex constructed for the purpose of several social amenities like milk booth, telephone with STD facilities, clinic-cum-pharmacy, etc. is not yet handed over to the association. The said complex was constructed within the project costs which had already been paid by the residents. The office of the association had been functioning in the first floor northern side of the said complex.
17. As per the approved plans of the MMDA and the advertisement of the bonanza offer, the LIC should have provided with a community centre and primary nursery school for the common enzyme of the residents. There is population of about 5,000 people in respect of above said 800 flats. Consequently, the primary school is a necessity.
18. Another important amenity i.e. vehicle parking is not provided by LIC in the entire complex.
19. During the rainy season, the entire complex was flooded due to complete lack of store water drainage inside the complex.
Representations and Writ Petitions
20. On 19.11.1994, a number of flat owners gave a representation. Thereafter, several members individually and collectively represented their grievances at the site office to the opposite party Nos. 3 and 4. The delegation of the flat owners met opposite party No. 4 to air their grievances at the time of inaugural meeting of the Jivan Bima Nagar Flat on 19.2.1995. All these things were brought to the notice of high officials of LIC and they were assured that their grievances would be attended to on priority basis. The following demands were made to the OPs for early redressal on priority basis, rectification of structural defects, handing over the ownership and possession of the office complex building to the Association, steps for solving the water problem, construction of compound walls, removal of wild plants and bushes, developing other infrastructure facility, removal of garbage, strengthening of the Security, to rectify the structural defects in the over headtanks and to stop the water seepage in the over headtanks.
21. A meeting was held on 15.3.1995. There was a move to sell the office cum shopping complex. The office bearers objected that it was a common property of the 800 flats owners and demanded to hand over the same. The flat owners were told that neither the regional office nor the zonal office have power to decide the matter and the corporate office alone could ultimately decide the issue.
22. Again, due to the continuous use of contaminated and toxic ground water, the children faced several health hazards. LIC was asked to provide metro water. However, request was made that as an interim arrangement, 1,00,000 litres of metro water daily be provided to the complex as offered by the MMWSSB. A writ petition was filed before Honble High Court at Madras but it also did not produce the desired result. After long persuasion, the opposite party agreed to deposit the sum of Rs. 14.2 lakh to the MMWSSB and an understanding was reached between the LIC and the Association to withdraw the writ petition. The writ petition was withdrawn after the deposit of the said amount. The opposite party be asked to pay compensation in the sum of Rs. 50,000 per month.
23. Without getting the completion certificate, some of the flat owners were put in possession of the flats. The opposite parties refused to hand over the fund to the Association but that was not paid to the petitioner. That fund was meant for water system, electrical system, sewerage system and also to remove the garbage and to improve the hygiene and environment of the colonies. Only 10 workers were engaged spending an amount of Rs. 15,000 per month. Association is spending its money from their own for maintaining a number of services. Association is starved of funds ever since its formation due to low rates of occupation of flats. The Association has done a lot of developmental works. The LIC failed to provide Gates at the entrance which has resulted in increasing incidence of theft and pilferage of properties. The Association made a representation to the OPs on 28.10.1995.
24. When the OPs failed to execute the project, the Association was forced to file another writ petition in the Honble High Court at Madras during November, 1995 for direction to the LIC to complete the project as per the approved project of the MMDA and also to fulfil all the promises made in the bonanza offer of the advertisement. Even though, the amount of Rs. 20.5 lakh from the project cost was deposited to the Ambattur Municipality long back towards development charges including formation of approach roads, drains, etc. It is strange to know that the LIC failed to pursue the matter. The petitioner sent letter to the Commissioner Director and the Secretary to the Municipality Administration demanding the authorities to lay all the approach roads to the complex, to construct the main storm water drainage, to divert the open sewage flowing in the main road between Blocks 12, 13, 14 and 15 and close the sewage of canal, providing street lights in the approach roads and construction of public toilets.
25. The complainant has learnt that the OPs have paid a huge amount to the Architect for the project namely Chitale and Son. When the Association approached it, he stated that there was no mistake in the drawing issued for their staircase and headrooms. Since, there was no response so it forced them to resort to frequent demonstrations and agitations which were widely reported in the Press. The Association formed a team of qualified Engineers who were the members of the Association to assess the defects. Legal notice was sent.
Reliefs sought
26. Ultimately, this complaint was filed with the following prayers:
(1) to dismantle and replace all the substandard, defective, and corroded metal door frames with standard, good quality door frames in all the 800 flats. If the demand is not met the opposite parties may kindly be directed to pay damages and compensation of Rs. 2,950 per doorframe and a sum of Rs. 26,550 per Type I flat, Rs. 23,600 per Type II Flat and Rs. 17,700 per Type III Flat totalling 800 flats;
(2) to direct the opposite parties to replace all the door shutters of the bath rooms and toilets in all the 800 flats failing which to pay a compensation of Rs. 2,050 per door shutter and payment of Rs. 6,150 per Type I and II flats; Rs. 4,100 per Type III flats;
(3) to dismantle and replace all the existing substandard and flimsy window grills in all the 800 flats with standard 6 mm. Grills. If the demand is not met the opposite parties may kindly be directed to pay damages and compensation of Rs. 6852 per Type I Flat, Rs. 5,010 per Type II Flat and Rs. 4,044 per Type III Flat totalling 800 flats;
(4) to replace the defective low quality Main Circuit Breakers in all the 800 flats failing which the LIC should pay Rs. 900 each to all 800 flat owners as damages and compensation;
(5) to dismantle and replace in all the 800 flats the existing inferior quality mosaic tiles and relaying with good quality mosaic tiles including neat polishing. If the demand is not met the LIC should pay damages and compensation of Rs. 24,390 per Type I, Rs. 19,863 per Type-II and Rs. 15,420 per Type-III flat totaling 800 flats;
(6) to dismantle and replace in all the 800 flats the existing inferior quality skirting tiles/plaster skirting and relaying with good quality tiles including neat finishing etc. Otherwise the opposite parties be directed to pay damages and compensation of Rs. 5,884 per Type I, Rs. 4,667 per Type II and Rs. 3,700 per Type-Ill totalling 800 flats;
(7) to complete the office-cum-shopping complex in all respects and hand over the ownership and possession of the whole complex to the Association to the common welfare of all the 800 flats;
(8) to hand over Rs. 12 lakh to the Association allocated in the project cost for greening the complex;
(9) to dismantle all the existing brick masonry wall of overhead tanks and reconstruct the same with RCC tanks providing with water proofing cement plasters in all the 50 blocks, failing which damages and compen-sation of Rs. 25,000 to each of the blocks totalling 50 blocks.
(10) to pay a cost of Rs. 2,500 each for the existing 22 borewells for replacing corroded and failed GI Pipes with standard quality PVC pipes in the bore wells suction lines;
(11) to construct Kerb Wall for staircase step-sides to prevent flow of water from top floor to the lower floors during washing which was constructed for 36 blocks but not. constructed for 14 blocks; failing which damages and compensation of Rs. 2,000 for each block totaling 14 blocks;
(12) to supply and fix M.S. Grills for staircase landing portion in second and third floors which was provided for 13 blocks (Sector-I) and not provided for remaining 37 blocks (Sector-II, III and IV) failing which damages and compensation a sum of Rs. 3,500 for each block totaling 37 blocks;
(13) to dismantle and replace the existing terrace door frames (substandard metal door frames) with good quality wooden door frames and shutters for 50 blocks; failing which pay a sum of Rs. 5,000 as damages and compensation for each block totalling 50 blocks;
(14) to dismantle the existing badly laid terracotta tiles on sloped roofs and relaying it with good quality tiles to arrest the seepage of rain water inside the flats; failing which damages and compensation of Rs. 18,290 per block in Type-I for 13 blocks; Rs. 14,840 per block in Type-II for 24 blocks, and Rs. 11,870 per block in Type III for 13 blocks;
(15) to pay a sum of Rs. 28,000 per block for all the 50 blocks as damages and compensation for the structural defects such as cracks in staircase, waist slabs, columns and beams and plastering in walls caused by the use of saline water, stale cement, sea sand, etc. for construction resulting in the deterioration of concrete and corrosion of reinforcement bars;
(16) to pay damages and compensation for providing head rooms which are of inadequate height in staircase leading to the first floor, a sum of Rs. 50,000 per block for 24 blocks.
(17) to pay the cost of 28 bore wells including electrical cable connections where the same do not exist but the provision was made in the project cost a sum of Rs. 60,000 each for 28 bore wells;
(18) to construct saucer cup type drainage system on both sides of the roads inside the complex and provide cable ducts for running underground cables failing which pay damages and compensation to the tune of Rs. 1,75,000;
(19) to repay the cost of erecting five entrance gates in the complex amounting to Rs. 10,000 per gate;
(20) to provide proper entrance way for Blocks 14 and 15; failing which damages and compensation of Rs. 10,000 for each block;
(21) to pay compensation for not providing the required width of 7.2 metres approach to Blocks 1, 2, 3 and for shifting the compound wall to get the required width, a sum of Rs. 1,50,000;
(22) to direct the LIC to provide vehicle parking as per MMDA Rule and specifications in the unused area of 55 Grounds and 1164 sq. ft. of lands, failing which a compensation of Rs. 40 lakh for 800 flats;
(23) to pay the cost of water purchased for drinking and domestic use by the flat owners from September, 1994 till date and also for future expenditure upto December, 1996 as an average sum of Rs. 50,000 per month.
(24) to direct the LIC to take proper steps for the completion of all approach roads, roadside drains and street lights and developing the open space reserves for play ground, park and other recreational facilities;
(25) to direct the LIC to pay a sum of Rs. 50,000 per flat owner as compensation for physical hardships and mental agony undergone; and
(26) to award the costs, of this Petition to the petitioner Association.
The petitioner has contested this revision petition.
Defence
27. The OPs have enumerated the following defences. The brochure provides that:
œ... after taking possession of your flat, you should become members of the Flat Owners Association to take up the responsibility for internal maintenance of Jeevan Bima Nagar including roads, sewerage, water supply, street lighting and security and develop the colony into a prestigious project of fine dwelling unit and make your living a pleasant one.?
The water supply was to be provided by the Madras Metro Water and Sewerage Board (MS and SB) and was to be drawn from the Kilpauk Water Works of the said water supply and sewerage board. The OPs paid Rs. 21 lakh to the Ambattur Municipality for development charges and for laying the peripheral roads adjacent to the colony. As provided in the conditions in the sale of the said flats, the scheme therefore provides in para Nos. 4 and 5 that those concrete roads were to be laid as approved by MMDA plan. The said work was likely to start shortly. There are 48 street lights. The LIC has sunk 23 bore wells which are in operation.
28. So far as metro water is concerned, application was moved to metro water authorities. Application was moved as they were likely to be completed by the end of 1996. About sewerage a pumping station energised and maintained by the Madras Metro Water and Sewerage Board and LIC has already paid the bills to the said board. Electricity was also provided.
29. The flats were put up for sale and allotted and sold on œAs is where is? basis and the applicants may inspect and satisfied for themselves regarding the flats before submitting the applications for allotment. It was also stipulated that:
œOnce possession of the flat allotted and sold, is taken over by the allottee-purchaser, Life Insurance Corporation of India will not be responsible for any breakages, damage to glasses/fixtures and fittings unless the same is pointed out in writing at the time of taking over possession.?
30. Again all the flats were sold on œAs is where is? basis after giving the basic amenities including bore wells. Rs. 14.2 lakh were deposited with the Madras Metro Water supply and Sewerage Board for drinking supply. Inside the colonies, concrete road have been made. Necessary deposits were reported to Municipal. Authorities. Three roads have been completed and black-topped, street lights have been provided. Construction of compound wall around have been provided. Sewerage lines have been laid. There has been a binding contract and the complainant have been estopped from contending against the terms of sale. The writ petition filed by the petitioner is still pending wherein they have demanded community centre, public telephone booth with STD facility, milk booth, clinic-cum-pharmacy. All the other allegations have been denied. The allottees of the possession of the flats being aware of the severe water problems which affects the entire Metropolitan town of Chennai (Madras). The provisions of the potable drinking water are the responsibility of the Civic Municipal Authorities. The LIC got the water tested by the MMWSSB which was found not to contain any toxic substance and the concentration of the ground water in respect of PH valve, magnesium, calcium, sulphate, fluoride were contained to be in normal limits. The individual agencies have approved the water to be fit and suitable for human consumption. It is, however, admitted that there was some delay on the part of the MMWSSB in providing the water supply because of acute scarcity of the drinking water in the proximity of Chennai. Neither in the brochure nor in the advertisement published in the Hindu dated 7.11.1993, no commitment was made that the shopping complex having a community centre, public telephone booth with STD facility, milk booth, clinic-cum-pharmacy will be handed over to the Association. It is explained that the construction of the shopping complex has been completed and the premises therein will be sold by inviting quotations through advertisement in the newspapers. It is alleged that flat owners association have illegally occupied the same and have encroached upon the property of the corporation. The electricity consumption charges for the complex till the date of filing written statement were being paid by the Corporation to avoid disconnection of essential amenities. When the LIC wanted to sell the office-cum-shopping complex, the association sent its offer but subsequently they came out with this new defence. It is denied that the OPs have promised to construct primary school. The possession of Community Centre was not to be handed over to the association. Community Centre was to be constructed in the second phase but housing team has not yet handed over the entire land purchased as there was litigation pending in respect of the portion in a land housing radial building. The plots were constructed as per the plan.
31. It is further averred that a topography of the project site is such that the eastern and northern parts of the complex are lowlying areas having existing storm water drains setup by the local civil authorities having a gravitational slope. The road has been constructed keeping the required gradient for natural gravitational flow to the existing civic drains. However, water logging in the area has been denied.
32. The titles in respect of 709 flats have been transferred and possession handed over to the concerned allotees. The petitioner is bad for non-joinder of municipal authorities. The owners have accepted the flats without demur.
Evidence
33. There are reports of five local Commissioners. Those deserve to be discussed and effort will be made to winnow truth from falsehood. These Local Commissioners were appointed by this Commission and parties themselves from time-to-time.
The first report was made by Mr. R. Ambalavanan. The same is dated 6.3.2003.
The Local Commissioner framed three questions in terms of the reference made by the Commission which read as under:
1. Whether there has been any structural defect at the time of construction of this building/flats resulting in cracks in the building?
2. Whether the construction was carried out in accordance with specifications, if any?
3. Whether the common facilities have been provided within the complex as per terms of brochure or any other material published by the LIC of India while, inviting applications for sale of flats?
The Local Commissioner pointed out the following deficiency.
1. Absence of a community centre.
2. Cracks in a large number of RCC components.
3. Extensive dampness on walls.
4. Peeled off plastering on walls.
5. Corroded light gauge steel doorframes.
6. Absence of side drains on the internal roads.
7. Corroded G.I. water lines.
The Commissioner further opined the approximate cost of the carrying out the above three phase of work will be around Rs. 1 lakh and required time will be about two months.
Second Report
34. The second report is by Er. C. Shanmugam, Chief General Manager, (Tech) Retd. He was appointed by Chief Commissioner, LIC of India and gave his report on July 25, 2005. He stated that his report is based on the terms of reference made by National Commission. He found that the construction was good but found the following deficiencies in the said colony. He contended that some landscaping, lawns, etc. may be provided by LIC along with development of community hall and their proposed Phase II construction. 15 tanks should be repaired immediately on war footing basis. The contention of Welfare Association is correct to the effect that the LIC may either construct Kerb walls for the remaining 14 block or consider their claim of Rs. 2000 per block. The Local Commissioner further submitted that he had seen some of the Gl water lines taken below the terracotta tiles which had led to leakage on the RCC slab. He did not see any seepage. He found some of cracks in some of the beams and columns after 11-12 years of construction despite the fact that the good quality materials were used in the project. He further opined that in coastal area like Chennai, periodical maintenance played an important role in maintenance of the building/structure. The Local Commissioner felt that immediate action may be taken to rectify the defects in flat Nos. 8, 16, 17 and 49. Necessary entry gates for all the blocks were provided by the LIC as per approved plans of municipality. Hence, no additional gates are required as demanded by the welfare association. The compound wall was constructed by the association. Necessary directions were given to dismantle the compound constructed by the association and restore the earlier compound wall. The buildings are getting Metro Waters and the open space area stands transferred to Ambathur Municipality. No other deficiency was pointed but by this Local Commissioner.
Third Report
35. Third Local Commissioners report is dated 26.6.2006. Thiru C. Subramanian, B.Sc., B.L., Registrar, SCDRC was appointed by this Commission. The Local Commissioner found extensive cracks developed from the earth to the terrace, staircases, portico and all the RCC pillars. He also found extensive dampness with regard to quality of water. The findings of the first Commissioner were found to be absolutely true. The water cannot be used even for washing purpose. With regard to the condition of steel frames, allegation was true but that is absolutely due to non-maintenance by the flat owners/tenants who occupied the fiats for which the LIC cannot be blamed. The allegation regarding sunken flooring was true. The Local Commissioner found many leakages in the water pipelines. That was due to non-maintenance of the pipes well by the flat owners for which the opposite party cannot be blamed. This could have happened due to efflux of time and wear and tear. There was no community centre. However, telephone booth and milk booth were available. The colony was provided with Metro Water. The Commissioner made the following observations:
œDuring the course of inspection, the opposite parties L/C authorities have stated that with reference to the directions of the Honble National Commission, they themselves had arranged to rectify all the defects pointed out by the Commissioner particularly with reference to Block Nos. 8, 16, 17 and 49.?
œIt is seen that out of the said four Blocks, in Block Nos. 8 and 49, the work executed by LIC is not at all satisfactory to us as mere improper patch work here and there alone has been carried out leaving major problems of cracks in the pillars and beams and walls, portico have not at all been attended to as per the Commissioners report. The contention is same with regard to development of cracks and peeling off of plastering and bulging of walls. Of course, the work done by the opposite party with regard to Block Nos. 16 and 17 is somewhat better when compared to Block Nos. 8, 49.?
œThe Registrar, State Consumer Disputes Redressal Commission submits that it is very obvious that the opposite parties do not care to the findings of the Commissioner appointed by the Honble National Consumer Disputes Redressal Commission to attend to the rectification of the defects, namely, the development of cracks in the main pillars and beams of all the blocks. Just as an eyewash, they have carried out some repairs to the aforesaid blocks, namely 8, 16, 17 and 49 and in that too, they have not attended the main fault to the development of cracks in the R. C. C. pillars and beams. On physical verification, it reveals that the deficiencies alleged by the complainants are absolutely justifiable and that the main defects pointed out by the Commissioner has definitely to be attended by the opposite parties, as otherwise adequate compensation as deemed fit by the Honble National Consumer Disputes Redresssal Commission has to be provided by the opposite parties to the complainants, so as to execute the extensive damages caused due to the improper materials, such as usage of thing gauge of steel rods, improper mixture of concrete mortar, usage of saline water, lack of supervision, etc.?
Fourth Report
36. There is another report of Shri B.V. Sharma, Joint Registrar of this Commission dated 9.2.2007. His conclusion is as under:
œThe undersigned, while carrying out the inspection along with the representative of both sides, found that the opposite side has not attended the rectification of defects viz. development of cracks in the main pillars and beams of all the blocks as pointed out by the Commissioner appointed by the National Commission. On physical verification, it is noticed that the conditions of the flats is very poor and the deficiencies alleged by the Complainants are true and justified. The main defects, as pointed by the Commissioner have definitely to be repaired by the opposite party. The flats, which have not been repaired so far, are required to be repaired immediately to keep them safe and inhabitable.
Fifth Report
37. Another report is by Thiru R. Sampath, Senior Civil Judge/Registrar, SCDRC, Chennai is dated 11.2.2011. He visited the spot in presence of both the parties. The following points are noteworthy. He took the photographs, visited 7 flats and made the following report:
œSeveral cracks developed in the RCC beams and columns in the non-renovated first five flats. Corroded steel rods in beams and columns are exposed in these flats. The flats are in worst condition, which require repairs immediately.?
Other evidence
38. There are objections to the report of Local Commissioner, interrogatories, site plans and record. Both the parties have produced Compact Disc (CD) filed by both the parties. The parties have also placed on record various photographs. The CD filed by complainant supports their case and CD filed by respondent reveals that most of the construction was good and there was unauthorised construction as well. The parties have sworn affidavits to buttress their case.
39. We have heard the learned Counsel for the parties and gone through their written synopses.
Submissions
40. Learned Counsel for the complainant admitted that there was unauthorised construction which was necessary for the construction otherwise the whole building would have collapsed. He admitted that they have not taken permission from any authority to raise the unauthorized construction. Learned Counsel has invited our attention to the Tamilnadu Society Registration Act, 1975. Learned Counsel for the complainant opined that the petitioner have become absolute owner of the land and they can raise the construction without seeking permission from any authority.
41. We do not agree with him in this context. The LIC will have the overall charge of the land and property in dispute. Such like arguments do not whittle down the authority of L.I.C. as such.
42. The learned Counsel for the complainant had recounted the above said deficiencies. Those hardly need reiteration. It was also argued that possession was delayed by five months. The complainants are from lower midle class and they were in rented premises earlier. They were desperate to have their own roof over their heads so that they have a shelter. Since, the complainants had no other choice but to move in these flats, several of them had to incur heavy cost and for repairing the flats in many respects. What surprises the Commission most is that every now and then it is stated that the flat owners have repaired the flats of their own accord, but the most crucial evidence in the bills of any kind did not see the light of day. The position does not begin to jell. These deficiencies were brought to the notice of the Regional Manager and the Chief Engineer of LIC during the inaugural session in 1995 itself. They acknowledged the deficiency and promised to do the necessary repairs but nothing was done. All these facts are supported by CD. The plea of the respondents/OPs is that the complainants took possession of the premises on œAs is where is? condition. It is contended that this plea is wholly untenable. This plea does not behove a public sector organization like LIC. There can be no estoppel against the provisions of consumer protection act. It is contended that building Engineering Wing of School of Planning and Architecture or Civil Engineering Wing of IIT, the building complex in question may be inspected and the estimated cost of removing the deficiencies may be worked out so that either LIC or any other building construction company is able to carry out the repairs under their NT or School of Planning and Architecture supervision. It is further prayed that in the alternative, the costs of such repairs may be given to the complainants so that they would carry out the repairs themselves.
43. It was argued that at this stage, the case cannot be dismissed for non-rejoinder of necessary parties. He has invited our attention towards Savita Garg v. National Heart Institute, IV (2004) CPJ 40 (SC)=VI (2004) SLT 385=2004 (8) SCC 56, 69:
œTherefore, as a result of our above discussion we are of the opinion that summary dismissal of the original petition by the Commission on the question of non-joinder of necessary parties was not proper. In case, the complainant fails to substantiate the allegations, then the complaint will fail. But not on the ground of non-joinder of necessary party.?
44. He also invited our attention towards another authority reported in Nizams Institute of Medical Sciences v. Prasanth S. Dhananka and Others, II (2009) CPJ 61 (SC)=III (2010) SLT 734=(2009) 6 SCC 1, wherein in para No. 70 at page 34, it was held that:
œ70. This Court in J. J. Merchant (Dr.) v. Shrinath Chaturvedi while dealing with the argument that the matter should be relegated to the civil Court observed” (SCC p. 640, para 7)
7. In the present case, there is inordinate delay of about nine years in disposal of complaint. However, if this contention raised by the learned Counsel for the appellants is accepted, apart from the fact that it would be unjust, the whole purpose and object of enacting the Consumer Protection Act, 1986 (hereinafter referred to as the Act) would be frustrated. One of the main objects of the Act is to provide speedy and simple redressal to consumer disputes and for that a quasi-judicial machinery is sought to be set up at the District, State and Central level. These quasi-judicial bodies are required to observe the principles of natural justice and have been empowered to give relief of a specific nature and to award, wherever appropriate, compensation to consumers. Penalties for non-compliance with the orders given by the quasi-judicial bodies have also been provided. The object and purpose of enacting the Act is to render simple, inexpensive and speedy remedy to the consumers with complaints against defective goods and deficient services and the benevolent piece of legislation intended to protect a large body of consumers from exploitation would be defeated. Prior to the Act, consumers were required to approach the civil Court for securing justice for the wrong done to them and it is a known fact that decision in a suit takes years. Under the Act, consumers are provided with an alternative, efficacious and speedy remedy. As such, the Consumer Forum is an alternative forum established under the Act to discharge the functions of a civil Court. Therefore, delay in disposal of the complaint would not be a ground for rejecting the complaint and directing the complainant to approach the civil Court.?
45. Learned Counsel for the petitioner also cited another authority reported in Union of India and Others v. Dr. M. Ismail Faruqui and Others, (1994) 1 SCC 265, wherein in para 12, it was held:
œ12. It was next contended that such complicated questions of facts cannot be decided in summary proceedings. In our view, this submission also requires to be rejected because under the Act, for summary or speedy trial, exhaustive procedure in conformity with the principles of natural justice is provided. Therefore, merely because it is mentioned that Commission or Forum is required to have summary trial would hardly be a ground for directing the consumer to approach the Civil Court. For trial to be just and reasonable long drawn delayed procedure, giving ample opportunity to the litigant to harass the aggrieved other side, is not necessary. It should be kept in mind that Legislature has provided alternative, efficacious, simple, inexpensive and speedy remedy to the consumers and that should not be curtailed on such ground. It would also be totally wrong assumption that because summary trial is provided, justice cannot be done when some questions of facts are required to be dealt with or decided. The Act provides sufficient safeguards. For this purpose, we would refer to the procedure prescribed under the Act for disposal of the complaint.?
46. The Learned Counsel has also referred to Para 154 in Malay Kumar Ganguly v. Dr. Sukumar Mukherjee and Others, III (2009) CPJ 17 (SC)=VI (2009) SLT 164=(2009) 9 SCC 221.
47. Learned Counsel for the petitioner also referred to another authority reported in Narne Construction (P) Ltd. v. Union of India, II (2012) CPJ 4 (SC)=III (2012) SLT 669=(2012) 5 SCC 359, wherein at page 363, it was held:
œ6. ... When the contractor or builder undertakes to erect a house or flat then it is inherent in it that he shall perform his obligation as agreed to. A flat with a leaking roof, or cracking wall or substandard floor is denial of service. Similarly when a statutory authority undertakes to develop land and frame housing scheme, it, while performing statutory duty renders service to the society in general and individual in particular.?
œ8. Having regard to the nature of the transaction between the appellant Company and its customers which involved much more than a simple transfer of a piece of immovable property it is clear that the same constituted service within the meaning of the Act. It was not a case where the appellant Company was selling the given property with all advantages and/or disadvantages on as is where is basis, as was the position in U.T. Chandigarh Admin v. Amarjeet Singh. It is a case where a clear-cut assurance was made to the purchasers as to the nature and the extent of development that would be carried out by the appellant company as a part of the package under which sale of fully developed plots with assured facilities was to be made in favour of the purchasers for valuable consideration. To the extent the transfer of the site with developments in the manner and to the extent indicated earlier was a part of the transaction, the appellant-company had indeed undertaken to provide a service. Any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers like the respondents.?
(Emphasis supplied)
48. Learned Counsel for the complainant argued with vehemence that as is where is basis was specified in the brochure issued by the opposite party, LIC.
Learned Counsel for the complainants vehemently argued that in the sale deed these covenants did not find any place. He argued that the complainants are bound by the terms and conditions of the sale deed. After the execution of the sale deed, the brochure and other covenants pale into insignificance.
49. Instead of touching the heart of the problem, the learned Counsel for the complainant just skirted it. It must be pointed out that the first omission committed by the complainant is that it did not file the sale deed along with complaint. It should have been filed along with the complaint. However, the sale deed dated 15.12.1995 and 18.10.2011 were handed over by the complainants in the course of arguments. It was pointed out that the clear picture will not emerge until or unless the sale deed was filed. The sale deed was taken on record with the permission granted to the opposite parties to advance additional arguments on sale deed.
50. We have perused the sale deed. The sale deed clearly, equivocally and specifically mentions:
œWhereas the Vendor executed a Sale Agreement dated 14th January, 2008 with the purchase in respect of the above allotment and the purchaser has agreed to abide by all the terms, conditions, rules and procedures contained in the Brochure and Sale Agreement and also the covenants, conditions and restrictions, expressed or implied, hereinafter contained.?
51. It clearly means that all the terms and conditions, rules and procedures contained in the brochure were also applicable. The plots were handed over to the flat owners on œas is where is basis?. Consequently, it does not lie in the mouth of the complainant to complain about the same. The flats were given to flat owners on very cheap rates. It is also mentioned here that in the complaint or in the written arguments themselves, the complainant relies upon the brochure every now and then. Even the 1st Local Commissioner framed the first issue based on brochure. It cannot be heard about saying that brochure should not be considered. This piece of evidence towers about the rest. Is the complainant a consumer?
52. The brochure unequivocally mentions as under:
œ1. The Flats put up for sale will be allotted and sold on as is where basis and the applicants may inspect and satisfy for themselves regarding the flats before submitting the applications for allotment.
7. Once possession of the Flat allotted and sold, is taken over by the allottee-purchaser, Life insurance Corporation of India will not be responsible for any breakages, damage to glasses/fixtures and fittings unless the same is pointed out in writing at the time of taking over possession.
9. The responsibility for internal maintenance of the colony including roads, sewerage, water supply and street lighting shall also be of the individual purchaser or of Consortium/Association or Society to be formed by the allottees. However, to provide the allottee purchasers, sufficient time to form their association, LIC shall maintain internal roads, sewerage water supply, etc. till 30.4.1994.?
53. It may be recalled that the first sale deed was executed on 15.9.1994. Possession was given in March, 1994 to third week of September, 1994. No objection was raised at the time of taking of possession. The subsequent proceedings are afterthoughts.
54. In First appeal No. 15 of 1993 titled as S. Gupta v. Life Insurance Corporation of India, the National Commission vide its order dated 19.7.1995 was pleased to hold:
œThe brochure which was issued by L.I.C. had a clause specifying that the houses put up for sale will be allotted and sold on as is where is basis. It was further provided in the brochure that before submitting the application for allotment the applicants can inspect and satisfy themselves regarding the houses. The applicant must have satisfied himself before submitting the application for allotment. After allotment he took possession of the house on 6th June, 1992. It is not the case of the complainant that he noticed the alleged defects after he had taken the possession. According to him the alleged defects exist in the construction of the house. Thus those defects must be existing before his taking the possession. After taking possession of the house he is estopped from complaining about the alleged defects in the house.?
55. The second omission committed by the complainant is that it did not produce any bills to show that they have repaired the flats or have done anything new. It was argued that most of the people have already done the needful. It is unfortunate that the amount spent by them or the bills or the vouchers did not see the light of the day. In absence of cogent and plausible evidence, it cannot be said that how much amount was spent by them. The complainant has not bolstered the case with documentary evidence. The production of bills would have added steel to the complainants case. The evidence to the effect as how much money was spent by the association is the crucial evidence, main pillar, foundation on which the case of complainant rests. It would have become too easy to pass the order in favour of the complainant.
56. It is good if you file a case in respect of so many flat owners. The law permits it. However, such like cases entail a lot of time as this case pertains to the year 1996 and is being decided in the year 2013. Individual cases would have taken short time. Moreover, in the instant case, we are not aware which of the flats require what kind of repairs. The case of the complainant is confusing. Each of the flat does not have the same problem or deficiency. The reports of Local Commissioner except few flats discuss the flats generally. The Local Commissioners do not state anything about unauthorized construction. The Commission cannot wink at such serious lapses. No list of each flat with deficiency or deficiencies was tagged with the complainant. Do all the flat owners deserve same kind of compensation? During the arguments, it was brought to the notice of learned Counsel for the complainant to file a list of those persons who were still interested with their separate grievances but the needful was not done. It is clear that some of the flat owners are happy