ARMY WELFARE HOUSING ORGANISATION vs Maj.General V.K. Singh

OUT of the above two appeals, First Appeal No.125 of 2009 came to be filed first by the complainant Major General V.K. Singh (Retd.) but at the initial stage of admission hearing, this came to be withdrawn by the appellant with liberty to revive the same in case the respondent (opposite party), the Army Welfare Housing Organization (AWHO) seeks to assail the order dated 20.01.2009 passed by the State Commission, Delhi (State Commission for short). Later on, when the order of the State Commission came to be impugned by the opposite party through its cross appeal no.366 of 2009, the earlier appeal no.125 of 2009 filed by the complainant was allowed to be revived and both the appeals were admitted vide our order dated 04.01.2010 and have now been taken up for final hearing together. For the sake of convenience of reference, we have referred to the parties as per their nomenclature in the First Appeal No.366 of 2009 in the present common order disposing of both the appeals. Accordingly, the opposite party, i.e, the Army Welfare Housing Organization, has been referred to as appellant and the complainant Major General V.K. Singh (Retd.) as respondent.

THE main dispute between the parties is regarding the covered area of the flat constructed by the appellants and purchased by the respondent. According to the respondent, the covered area is 1269 sq.ft. whereas the appellants have shown the total super area, i.e., the covered area, as 1412 sq.ft. Vide its order dated 21.09.2007 passed by the State Commission in the complaint filed by the respondent seeking refund of the proportionate cost of the covered area and compensation, the State Commission gave the following directions:- i) That the matter shall be referred to a technical expert committee for their opinion as to the covered area with regard to the balcony as well as the carpet area and if they agree to the view of the complainant the OP shall pay compensation of Rs.50,000/-.

ii) As per the claim of the complainant and in view of the shortfall of the area, the OP shall refund the excess amount proportionately in accordance with the report of the technical committee.

In compliance of the aforesaid order of the State Commission, the Technical Committee came to be appointed and submitted its report dated 15.12.2007. After considering the report of the Technical Committee and the submissions made by the two parties in the matter and also seeking clarifications from the representative of the HUDA, the State Commission vide its impugned order dated 20.01.2009 retained its earlier direction of payment of compensation of Rs.50,000/- by the appellants to the respondent and in addition also awarded a further compensation of Rs.25,000/- over and above Rs.50,000/- already awarded. This order has been challenged by both the parties through their respective appeals before us. The operative part of the impugned order is reproduced below:-

Since the OP is a Housing Society and has built thousands of flats for Ex-Army Officers, the order for refunding the proportionate cost of covered area which is not assessable because of there being no criteria for assessing the cost in such a manner, we have awarded a compensation of Rs.50,000/- to the complainant. In our view additional compensation for such discrepancies, if any, which is difficult to be ascertained and solved because of the facility of a flat or the area of a flat is to be taken as a whole for the purpose of living, we deem that for creating such a confusion amongst the flat owners, who are Ex-Army Officers and for whose welfare the OP had undertaken the construction activities, an additional compensation of Rs.25,000/-, over and above Rs.50,000/- already awarded to the complainant, shall meet the ends of justice.

COMPLAINT stands disposed of in aforesaid terms. Payment shall be made within one month from the date of receipt of a copy of this Order. 4. While the respondent has prayed for modification of the impugned order by praying for upholding the initial order of compensation passed by the State Commission for payment of Rs.50,000/- as compensation and a further direction to the AWHO to pay to the respondent the proportionate cost of the shortfall in the covered area of the flat amounting to Rs.1,13,685/- along with interest @ 13% compounded from 1999 onwards. On the other hand, the appellants have prayed for setting aside the entire order of payment, i.e., initial compensation of Rs.50,000/- (as per order dated 21.09.2007 and confirmed by the impugned order) and the additional compensation of Rs.25,000/- directed to be paid by the appellants to the respondent over and above the initial compensation. 5. We have heard the learned counsel for the appellants and the respondent who has appeared in person. The facts of the case relevant for decision of these appeals, even though given in detail in the two orders of the State Commission, may be reiterated as follows. The appellant, i.e., the Army Welfare Housing Organization, is a society registered under the Societies Registration Act, 1860 and is a welfare Organization involved in promoting residential units all over India for serving, retired army personnel and their widows, on self-financing basis on no profit no loss basis. In 1990, the respondent, who was a serving army officer at that time, registered his name with the appellant Organization for a house at Gurgaon. In May 1997, the appellant booked an economy type apartment for the respondent for which the payment was made in installments by the respondent to the appellant Organization as per the requisition made by the appellant. The respondent was allotted a B-Type apartment with a covered area of 1442 sq.ft. along with car parking space. The respondent, however, wrote a letter to the appellant Organization on 26.09.2001 pointing out certain defects in the apartment and also requesting for providing to him details such as carpet area, wall area, plinth area and super area etc. He sent another letter on 30.10.2001 requesting for further details in respect of rooms, balconies, lifts, staircases etc. The information sought by the respondent was provided by the appellant Organization vide its letter dated 26.12.2001. Besides this, respondent was also informed vide appellants letter dated 16.11.2001 that the room sizes of the dwelling units have been provided in the plans given in the technical brochure already provided to the respondent at the time of the booking of the dwelling unit by the respondent. The specifications of the dwelling units were also provided in the technical brochure. The respondent took over the possession of the flat allotted to him on 21.12.2002 and after the calculation of the final cost, an amount of Rs.1,52,829/- after deducting Rs.10,000/- as society charges has been refunded to the respondent by the appellant Organization since the actual cost of the flat turned out to be less than the amount earlier recovered from the respondent in installments. The possession certificate indicates the super area of the flat in question as 1412 sq.ft.

THE appellant Organization would assail the impugned order on the ground that the pricing of the dwelling units allotted by the appellant Organization is not done on per sq. ft. basis but on as is where is basis as indicated to all the allottees including the respondent. It is also the contention of the learned for the appellant that dwelling units constructed and allotted by the appellant Organization are on self-financing basis and the revised cost of the flats is also indicated to the allottees from time to time. It is submitted on behalf of the appellant that even though at the time of the registration of the flat, the appellant had indicated a plinth area of an economy B-Type unit as 1442 sq.ft. but it was clearly mentioned in Note no.2 on page 7 of the technical brochure that the plinth area includes share of common areas like lobby, staircase, lift etc. and the actual plinth area may differ due to architectural requirements. It is also submitted that well before the actual physical possession of the flat in question was taken over by the respondent, he had been provided with all the details in respect of the dimensions and the area of the flat allotted to him and the same is not in dispute. THE appellant Organization has finally charged the respondent for the flat consisting of 1417.90 sq.ft. area only and the respondent was also informed that the revised rates will be applicable from 01.01.2002 and that existing rates of recoveries were applicable till 31.12.2001 and the respondent had the choice to withdraw at the existing rates till 31.12.2001. However, the respondent chose to continue with the scheme and took over the physical possession of the flat. THE details of the super area were duly provided by the appellant Organization to the respondent. THE Technical Committee report dated 15.12.2007 appointed in compliance to the order dated 21.09.2007 of the State Commission has also confirmed that the total area of flat including the balconies area was 1417.90 sq.ft and was strictly as per the drawings sanctioned by HUDA. In view of these facts which are placed on record and were available for consideration before the State Commission, the impugned order of the State Commission awarding compensation of Rs.75,000/- on the basis of the shortfall alleged by the respondent is not based on the facts and hence cannot be sustained in the eye of law. We have given our thoughtful consideration to the submissions made by the parties before us and also perused the record produced by the parties. The point which arises for our consideration in the present case is as to whether or not the appellant Organization has allotted and handed over a Type B flat to the respondent having built up area as per the allotment order dated 10.08.2001 issued by the appellant Organization to the respondent in pursuance of the earlier registration/booking of the dwelling unit done by the respondent with the appellant Organization and the technical brochure issued by the appellant Organization which contains the details of the dwelling units offered by the Organization to different prospective allottees. It has to be noted that the allotment and the pricing of the dwelling units is done by the appellant Organization not in terms of per sq. ft. but as a complete unit of a particular category. However, it is also not in dispute that while registering the dwelling unit in favour of the respondent, it was indicated in the technical brochure that the plinth area of the Economy B-Type unit which came to be allotted to the respondent, is 1442 sq.ft. Nonetheless, it cannot be ignored that the technical brochure specifically defines the plinth area and further indicates that the actual plinth area may differ due to architectural requirements. Accordingly, the area of the flat which was declared to be 1442 sq.ft. initially came down to 1410 sq.ft. details of which were duly furnished to the respondent vide letter dated 26.12.2001 by the appellant Organization and the same is not in dispute. It is further noted by us from this letter that before issuance of this letter, the respondent had personally visited the appellants office and had discussion with the Managing Director of the appellant Organization during the course of which he was provided with different clarifications and analysis carried out by the appellant Organization in this regard. It is further noted by us that when a consumer complaint came to be filed by the respondent before the State Commission, the Technical Committee which came to be appointed also confirmed that the actual area of the unit allotted to the respondent is 1417.90 sq.ft. In the circumstances, it is established beyond doubt that the appellant Organization handed over possession of the flat allotted to the respondent strictly in accordance with the scheme under which the respondent registered his name with the Organization and also handed over the possession thereof in terms of the technical brochure provided to the respondent at the time of the registration. We have not come across any confusion or lack of clarity created by the appellant organization in this regard in the minds of the prospective beneficiaries who were serving or retired army personnel. If there was any doubt or reservation in this regard, the same was duly clarified and explained by the appellant Organization well before the respondent took over the possession of the flat in question. This being the undisputed factual position, it is not understood as to how the State Commission could proceed to assume deficiency on the part of the appellant Organization in respect of the area of the flat allotted by the appellant Organization to the respondent and then to award compensation of Rs.75,000/- on that account through its impugned order. In our considered opinion, the State Commission committed grave mistake and erred in proceeding on the assumption that the registration of the dwelling unit by the respondent with the appellant Organization was on per sq.ft. basis thereby reaching the conclusion reflected in the impugned order. Besides the fact that the appellant is a registered society and welfare Organization involved in promoting residential units all over the country for serving/retired army personnel, the State Commission failed to appreciate that the schemes implemented by the appellant Organization including the one under which the respondent came to register his flat, were on self-financing and on no profit no loss basis. The registration done by the appellant origination was on a lump sum cost basis per unit details and dimensions of which in various categories were well documented and declared right from the beginning through various information brochures including the technical brochure (supra). The Organization at the apex level is managed by different service officers and functions under the overall supervision and control of the Ministry of Defence. It goes without saying that its accounts are subject to audit as per the procedures laid down. Not only this, the Organization itself committed to refund to its allottees such sums of money as were found surplus upon closure of the housing project. In the present case, admittedly the respondent has also received refund after finalization of the costing. In spite of such clarity in respect of the entire procedure of registration, allotment and costing, the State Commission erred in concluding that there is a case for awarding compensation on the basis of the calculation of the covered area.

AS stated above, we have also observed that the appellant Organization has provided all the information sought for additionally by the respondent well before the possession was taken over by him. We, therefore, conclude that the Type-B Economy flat actually allotted to the respondent and the possession of which was taken over by him strictly conformed to the specifications for which he had paid the money under the self-financing scheme. Any doubts in this regard have been duly set at rest by the Technical Committee appointed on the direction of the State Commission. Even if the representative of HUDA who was summoned by the State Commission deposed that while sanctioning the plan, the balcony area is not shown as covered area, the State Commission had rightly held that it cannot be taken to mean that the appellant Organization has to exclude the balcony area while showing the super area. We entirely agree with the learned counsel for the appellants that it is the total cost of the flat including the covered area and other amenities like community centre, parks, parking area etc. which is required to be taken into consideration rather than separate costs for different portions/segments of the totality of the unit. The State Commission obviously erred while passing the impugned orders in this regard.

KEEPING these facts and aspects in view, the conclusions drawn by the State Commission and its impugned order based thereon were wrong and hence the impugned orders are liable to be set aside. Accordingly, the impugned orders dated 21.09.2007 and 20.01.2009 of the State Commission are hereby set aside and the appeal No. 366 of 2009 filed by the appellant Organization is allowed. As a result, the appeal No.125 of 2009 filed by the respondent Major General V.K. Singh (Retd.) is hereby dismissed. In the facts and circumstances of this case, we consider it appropriate to leave the parties to bear their own costs.