V.B. Gupta, Presiding Member:
1. Complaint Cases (Nos. 113 and 114 of 2010) were filed by complainants-Sri Koduru Subba Reddy and Sri Burla Ravindra Reddy, respectively against builder M/s. Sai Arvind Property Developers (Builders) as well as land-owners Sri Mamidi Janardhan Reddy and Smt. Mamidi Parasanna, respectively on the allegations that complainants invested about Rs. 35 lakh each, towards purchase of independent houses costing Rs. 80 lakh each. However, their dreams were shattered due to incompetence of the builder as well as land owners, since there was deficiency on their part, in completing the houses. Accordingly, complainants filed complaints before Andhra Pradesh State Consumer Disputes Redressal Commission, Hyderabad (for short as State Commission).
2. The complaints were resisted by the builder as well as land owners.
3. State Commission,vide impugned order dated 11.11.2011, partly allowed the complaints, and following order was passed:
œC.C. No. 113/2010
In the result this complaint is allowed in part directing opposite party No. 3 to refund the amount of Rs. 34,20,000 paid by the complainant together with the interest at 9% p.a. from 8.10.2009 together with compensation of Rs. 10,000 and costs of Rs. 5,000. Case against opposite party Nos. 1 and 2 is dismissal as we do not see any deficiency in service on their behalf as opposite parties are land owners and the complainant did not establish by way of documentary evidence that they have received payments with respect to H. No. 297.
C.C. No. 114/2010
For the same reasons as stated in C.C. No. 114/2010, this complaint is allowed in part directing opposite party No. 3 to refund the amount of Rs. 35,00,000 paid by the complainant together with the interest at 9% p.a. from 8.10.2009 together with compensation of Rs. 10,000 and costs of Rs. 5,000. Case against opposite parties 1 and 2 is dismissed as we do not see any deficiency in service on their behalf as opposite parties are land owners and the complainant did not establish by way of any documentary evidence that they have received payments with respect to H. No. 296.?
4. Aggrieved by the impugned order, builders filed (First Appeal Nos. 530 and 531 of 2011), while complainants filed (First Appeal Nos. 23 and 24 of 2012) for enhancement.
5. Along with their appeals, complainants filed applications for condonation of delay.
6. Since, there is delay of about 25 days in filing of the appeals, for the reasons mentioned in the applications, delay stands condoned.
7. It has been contended by learned Counsel for the builder that complaints are not maintainable since complainants themselves have defaulted in making the payments. Therefore, they derailed the entire project of the builder. The construction of the houses booked by the complainants and the developments of the entire work, were inter linked with regular payments, as per agreed schedule of the payment between the parties. Both complainants committed default at the very initial stage in respect of the agreement.
8. In sptie thereof, the builder continued with further stages of construction in the belief that complainants would make good their default. However, in order to over come their own defaults, complainants filed the complaints before the State Commission.
9. It is further contended that State Commission completely ignored the fact that it were the complainants, who are defaulters. Thus, there has been no deficiency on the part of builder.
10. On the other hand, learned Counsel for complainants has contended that builder has failed to complete the constructions as per schedule. No complete amenities as per agreement executed between the parties were provided.
11. Other contention is that State Commission ought to have granted interest from the dates of respective payments, that is, with effect from 25.2.2008, 13.3.2008, 4.5.2008, 13.5.2008 and 12.6.2008, instead from 8.10.2009. Moreover, State Commission ought to have granted interest @ 18% p.a., instead of 9% p.a. since complainants arranged the funds from private sources.
12. Lastly, it is contended that only meagre compensation of Rs. 10,000 has been granted. As per agreement, construction was to be completed by 13.2.2009 and if there has been delay in handing over the possession of the houses, then builder had to compensate the complainants @ Rs. 10,000 per month.
13. The points which arise for consideration are, as to whether there has been any deficiency in service on the part of the builder and if so, to what relief the complainants are entitled.
14. Case of complainants is that, after having received major portion of the amount, builder has failed to complete the construction within the specified period. Moreover, due to deficient act on the part of the builder, complainants have been deprived of their houses before the scheduled date.
15. Builder in its written statement admits that construction work had to temporarily stopped and he is ready to perform his part of the share. Specific averments to the effect have been made in Para 14 of the written statement, which state:
œ14. The opposite party further states that due to depletion in market and Telangana Agitation, the real estate business has fallen drastically. So the opposite party No. 3 explained the situation to all the members including the Complainant and temporarily stopped the work and are waiting for the restoration of the circumstances. If the performance of a promise becomes impossible for any reason which the promisor could not prevent, after the contract is made, the contract becomes void when the act becomes impossible. At this juncture also the opposite party No. 3 is ready to perform their part of the share on a moral ground and requested all the members for the accumulation of money along with restoration of favourable situation?.
16. Thus, as per builder own case, there is a delay on his part to complete the construction of the houses.
17. Further, Clause 4 of the third agreement of sale-cum-construction, Ex. A-7 executed between the parties, reads as under:
œThe Builders ought to have completed the construction of the said house and delivered possession of the same on or before 13th February, 2009, with a grace time of three months beyond the said stipulated period of completion. In the event of delay, on the part of the Builders in constructing and delivering the possession of the houses, the Builders shall be liable to pay to the Vendee an amount of Rs. 10,000 (Rupees ten thousand only) per month as rent. Any such amount to be payable shall be adjusted at the time for handing over possession of the House?.
18. There is nothing on record to show that even till the filing of the complaints, builder had completed the work of electrification, water supply and sanitary.
19. State Commission in its impugned order observed:
œIt is an admitted fact that the builder stopped the work due to economic crises and non receipt of payments from the purchasers, it is also to be considered that the complainant has paid Rs. 34.20 lakh way back in 2008 itself but the builder did not progress with the construction. Even Ex. A9, valuation report, by a chartered engineer states that the construction cost is only Rs. 22,42,000. It is an admitted fact that the complainant paid an amount of Rs. 34,20,000 by 12.6.2008 for House No. 297 and till the date of filing of the complaint i.e. 1.11.2010 as per the complainants affidavit, the opposite parties did not develop the layout and did not complete construction of the said house. Therefore, we are of the considered view that there is deficiency in service on behalf of the opposite party No. 3 builder in receiving payments by 12.6.2008 itself and not adhering to terms of the agreement with respect to delivery of the possession of the said house and therefore we are of the considered view that Clause 12 of Ex. A7 agreement dated 8.10.2009, reads as follows:
12. The VENDEE, at any time during this Agreement and prior to registration reserves his right to withdraw and cancel this agreement, whereupon all the money received by the Builders shall be repaid within one month thereof.?
20. Since, deficiency in this case on the part of builder is writ large as builder himself has admitted that construction work had to be stopped and as such possession could not be handed over to the complainants within time, we do not find any infirmity and illegality in the impugned order of the State Commission.
21. Consequently, (Appeals Nos. 530 and 531 of 2011) filed on behalf of the builder, are not maintainable and the same are hereby dismissed.
22. Now coming to (Appeal Nos. 23 and 24 of 2012), filed on behalf of the complainants, we find nothing wrong with regard to interest as awarded @ 9% p.a. by the State Commission. We do not find any reason to enhance the interest rate to 18% p.a.
23. However, we hold that builder is liable to pay interest on the amount paid by the complainants from the dates of respective payments, that is, 25.2.2008, 13.3.2008, 4.5.2008, 13.5.2008 and 12.6.2008 instead from 8.10.2009.
24. As far as amount of compensation is concerned, in view of Clause 4 of the Agreement of Sale-cum-Construction Ex. A7, we are of the view that complainants are entitled to compensation of Rs. 50,000 each, instead of Rs. 10,000, as awarded by the State Commission.
25. With above modifications (Appeal Nos. 23 and 24 of 2012) filed on behalf of the complainants stand allowed.
Final Order:
(i) Appeal Nos. 530 and 531 of 2011, filed on behalf of the builder, stand dismissed.
(ii) Appeal Nos. 23 and 24 of 2012, filed on behalf of the complainants are partly allowed. No order as to costs.
Appeals dismissed.