A.P. Rajiv Swagruha Corporation Limited vs V. Narahari Rao

M. Shreesha, J

Challenge in this Revision Petition under Section 21(b) of the Consumer Protection Act, 1986 (in short "the Act") is to the order dated 14.03.2016 in FA No. 694 of 2014 against CC No. 22 of 2014 passed by the Telangana State Consumer Disputes Redressal Commission, Hyderabad (for short "the State Commission"). By the impugned order the State Commission has concurred with the findings of the District Consumer Disputes Redressal Forum, Ranga Reddy (for short "the District Forum").

The brief facts as stated in the Complaint are that the Complainant in response to the advertisement for allotment of flats under Rajiv Swagruha, Rajiv Gruhakalpa, Phase-II applied for a double bed room flat by paying an amount of Rs. 15,000/-. Thereafter he paid amount of three instalments in the month of April, 2007 and subsequently paid the entire amount of Rs. 10,30,000/- to the Opposite Party. It was averred that the Complainant was informed that the area of the double bed-room was increased to 696.42 sq. ft. and an additional amount of Rs. 1.90 lakhs was demanded to be paid on or before 20.11.2009. Once again the same was informed to the Complainant vide letter dated 20.10.2009 that the cost of the flat was to be 12.20 lakhs and an extra amount of Rs. 1.9 lakhs was demanded along with Rs. 75,000/- towards car parking (covered) and Rs. 20,000/- for car parking (uncovered) to be paid on or before 20.11.2009 failing which penal interest @ 18% p.a. would be charged. It was pleaded that the said increase in the price of the flat was illegal and arbitrary as the initial cost was fixed at Rs. 10.30 lakhs and the Opposite Party had suddenly increased the cost. It was averred that the Complainant visited the site and found that no civil amenities such as lifts, electrical wiring, pipes for water for water supply and drainage pipes were provided.

A news item was published in Telugu "Eenadu" dated 30.10.2009 that several employees were absconding from Opposite Party Corporation and they had committed fraudulent activities. As the Complainant was not in a position to pay the extra amount of Rs. 1.90 lakhs he sought refund of the amount already paid. It was pleaded that the Opposite Party had refunded Rs. 9.08 lakhs vide cheque dated 27.04.2010 deducting an amount of Rs. 1.22 lakhs which is 10% of the estimated cost of Rs. 12.20 lakhs. It was pleaded that the Complainant had taken a bank loan to pay the cost of the flat and is a senior citizen aged 80 years and, therefore, such a forfeiture was unfair. The Complainant addressed several letters dated 09.05.2010, 23.05.2010, 01.09.2010, 09.02.2012, 02.03.2013 and 18.083.2013 requesting the Opposite Party to pay the balance amount along with interest @ 10% p.a. to which the Opposite Party issued a replay on 04.02.2013 rejecting the said request.

The Complainant also got issued a legal notice dated 10.04.2013 demanding the Opposite Party to pay amount of Rs. 5,26,104/- as on 18.03.2013 for which there was no response. Hence the Complainant filed the Complaint seeking the following reliefs:-

(i) To declare that there is a deficiency in the service of the opposite party in refusing to refund the balance amount of Rs.1,22,000/- to the complainant;

(ii) to consequently direct the opposite party to pay an amount of Rs.5,26,970/- to the complainant towards non-refunding an amount of Rs.1,22,000/- which was deducted by the opposite party at the time of refunding an amount of Rs.9.08 lakhs from the total amount of Rs.10.30 lakhs paid by the complainant together with interest from 28.7.2008 till 26.12.2013;

(iii) to direct the opposite party to pay interest @ 24% per annum on the claim amount of Rs.5,26,970/- from the date of filing the present consumer complaint till the date of realization;

(iv) to award cost;

(v) any other reliefs

Opposite Party though filed vakalatnama but did not file their Written Version. District Forum based on the evidence adduced allowed the Complaint directing the Opposite Party to refund Rs. 1,22,000/- along with interest @ 12% p.a. from 27.04.2010 till the date of realization and also to pay interest @ 6% p.a. on Rs. 10,30,000/- from payment of last instalment i.e. 29.01.2009 till its repayment i.e. 27.04.2010 i.e. for 15 months. Rs. 10,000/- were awarded towards costs.

Aggrieved by the said order, the Opposite Party preferred First Appeal bearing No. 694 of 2014 before the State Commission. The State Commission while concurring with the finding of the District Forum observed as follows:-

"18. Even perusal of Ex.A2 and A3 demand notices demanding the applicant to pay the balance cost of the flat on or before 20.11.2009, it is not mentioned whether the project is completed or not or at least what is the stage of progress of the project. The counsel argued upon placing reliance on Ex.B1 and Ex.B2 documents. A careful reading of the same would show that the Appellant is entitled to deduct 10% of the revised cost from those allottees of 2BHK withdrawing after having paid total tentative cost. It does not disclose as to the authority under which these proceedings are issued and the powers vested with such authority to pass an order to that effect. Even otherwise, it is not the case of the Authority Board that the refund is sought against the completion of project or else by a willful defaulter. In the case on hand, the Respondent made request for refund of amount in response to Ex. A3 demand. As can be seen from Ex.A3 there is a marginal increase of area from 685.5 sft to 696.42 sft in case of double bedroom allottees, which should be around 10.92 sft. For a space of 10.92 sft, a demand of Rs.1.90 lakhs extra is made by the Appellant that too in the month of September, 2009 without making it clear the progress and stage of the construction of the project.

The bunch of correspondence made by the Respondent would clearly disclose that except drawing pillars at the site, there was no progress in the project even after lapse of considerable period of time. Hence, the contention of the learned counsel that the refund is made as per the refund policy is not justifiable. The facts and circumstances differ from case to case. In the case on hand, the Respondent made total payment of the cost of the flat, hence, fastening the liability to pay the difference amount does not arise. At the most, the Appellants are entitled to demand the amount in respect of marginal area of 10.92 sft, which they increased to the double bedroom flat allottees. Instead, in an arbitrary manner, they made demand of Rs.1.90 lakhs without informing the circumstances for increase of amount in such a manner and what are the circumstances that necessitated them to increase the cost. It is also not placed as to how the Chairman & Managing Director is empowered to take such a unilateral decision.

From the perusal of evidence on record, there are no bonafides in the contention of the learned counsel for the Appellant to accept that the refund is made as per the refund policy. The very refund policy is not in accordance with any procedure. Nothing is placed on record to support the decision taken by the Chairman & Managing Director as regards the refund policy empowering to take such a decision. A perusal of orders passed in RP No.417/2013 and 418/2013 of the Hon'ble National Commission would go to show that the matter pertains to insurance claim wherein the claimant had accepted the amount in full and final settlement and the Hon'ble Commission rightly termed the order of State Commission to be not sustainable. But in the facts and circumstances of the case on hand, it is not a dispute relating to insurance claim, but it is the whole amount paid by the applicant towards double bedroom flat much before inception of the project. As against the terms and conditions of the application, the Appellant deducted 10% of the amount of the total cost, that too, taking into consideration the increased cost of Rs.12,20,000/- as against the construction cost of Rs.10.30 lakhs. Admittedly, the Respondent has not agreed to the increased cost. In such a circumstance, the Appellant has no right or authority to deduct the amount for the increased cost. As discussed supra, the very refund policy is not supported by any Authority empowering the Chairman & Managing Director to take such a decision unilaterally without there being any sufficient cause and reason, in which circumstance, this Commission would term the same as illegal and arbitrary."

Learned Counsel appearing for the Revision Petitioner contended that this matter is squarely covered by the judgement dated 21.05.2014 of the National Commission passed in RP bearing No. 417 and 418 of 2013 dealing with the same Corporation. He further contended that the State Commission has wrongly observed that the present dispute does not concern with insurance claim and that even in this case there was no plea of coercion for accepting the full and final settlement.

None appeared for the Respondent/Complainant despite the receipt of the notice. The matter was called twice but still there was no representation. The brief point for consideration is whether the Complainant had accepted the cheque of Rs. 1.90 lakhs paid to him vide cheque dated 27.04.2010 after deducting an amount of Rs. 1.22 lakhs in full and final satisfaction or whether there was any pleading in the Complaint regarding coercion. It is observed from the record that there is no specific pleading in the Complaint that the cheque was accepted under misconception, fraud or coercion. For better understanding of the case the receipt issued by the Respondent/Complainant herein is reproduced:-

"HAND RECEIPT

Name of work: Construction of 900 flats 685. 50 sft.

(Double Bed Rooms) and 240 flats

of 464 sft. (Single bed Rooms)

Chandanagar Project.

Name of Allottee : V.N. Narahari Rao

Type of Flat : Application No.855 Lot No.251

EMD Amount : Rs.15000.00

Installment (4) Amount : 1015000

Paid

Total Amount : 1030000.00

(Less) administrative

Charge (-) : 122000.00

Net payable by cheque : Rs.908000.00

Received from the General Manager (P) APRSCL, Chandanagar Division Rs.908000/- (Rupees nine lakhs and eighty thousand only) towards refund of (4) installment amount due to my request for refund. I accept this refund that this is the full and final settlement of my claim.

Signature:

Name: V. Narahari Rao

Passed and pay by Cheque Rs.9,08,000/- (Rupees Nine lakhs and eight thousand only in favour of Sri V. Narahari Rao.

PAID VIDE

Cheque No.977441 Date 27/4/2010

Rs.9,08,000.00

GENERAL MANAGER (PROJECTS)

CHANDANAGAR DIVISION,

APRSC LTD. R.R. DIST."

From the afore-noted receipt it is clear that the refund amount was accepted by the Complainant in full and final satisfaction on 27.04.2010 on his own request for refund and admittedly the Complainant had addressed the next letter to the Opposite Party seeking refund of the amount which has been forfeited on 09.05.2010 and thereafter got issued a legal notice on 18.03.2013. State Commission has wrongly observed that the judgement dated 21.05.2014 of this Commission passed in RP bearing No. 417 and 418 of 2013 is not applicable to this case for the reason that it relates to insurance whereas the fact of the matter is that the said decision relates to similar set of facts against the same Opposite Party who is the Petitioner herein.

Keeping in view the ratio laid down by this Commission in RP No. 417-418 of 2013, we are of the considered view that in the absence of any pleading in the Complaint regarding the acceptance of the amount under coercion, this Revision Petition is allowed and the orders of both the Fora below are set aside. Complaint is dismissed.