M/S. Shl Ventures vs P. Venkata Satya Prasad Rao

This revision petition has been filed by the petitioner M/s. SHL Ventures against the order dated 23.02.2018 of the State Consumer Disputes Redressal Commission, Telangana, (in short 'the State Commission') passed in FA No.282 of 2016.

Brief facts relevant for deciding the present revision petition are that the respondent/complainant booked a flat with the opposite party/petitioner by paying Rs.8,00,000/- as the booking amount. Later on he requested for cancellation and refund of the amount. As the opposite party did not respond, the respondent filed a consumer complaint bearing No.72/2014 before the District Consumer Disputes Redressal Commission, Ranga Reddy (in short 'the District Forum') and the District Forum vide its order dated 22.04.2015 allowed the refund of Rs.8,00,000/- with interest @ 9% p.a. from 03.01.2014.

Aggrieved with the order of the District Forum, the petitioner herein/ opposite party preferred an appeal before the State Commission and the State Commission dismissed the appeal vide its order dated 23.02.2018 and confirmed the order of the District Forum. Hence, the present revision petition.

Heard the learned counsel for the petitioner as well as learned counsel for the caveator/respondent. Learned counsel for the petitioner states that the complainant was not a consumer as no allotment was made in favour of the complainant. He further stated that the booking amount was Rs.21,62,700/-, however, the complainant only deposited Rs.8,00,000/- and had promised to deposit the remaining amount within a short period. The complainant did not deposit any amount and later on filed consumer complaint for refund of the paid amount. It was argued that only the booking of a flat is not a concluded contract between the parties and the remedy of the complainant does not lie before a consumer forum, rather it lies before a civil court. To support his arguments, learned counsel referred to paragraph 31 of the following judgment of the Hon'ble Supreme Court, wherein the following has been observed:-

Morgan Stanley Mutual Fund Vs. Kartick Das, (1994) 4 SCC 225. It has been held that:-

"31. Therefore, it is after allotment, rights may arise as per the contract (Article of Association of Company). But certainly not before allotment. At that stage, he is only a prospective investor (sic in) future goods. The issue was yet to open on 27-4-1993. There is no purchase of goods for a consideration nor again could he be called the hirer of the services of the company for a consideration. In order to satisfy the requirement of above definition of consumer, it is clear that there must be a transaction of buying goods for consideration under Section 2(1)(d)(i) of the said Act. The definition contemplates the pre-existence of a completed transaction of a sale and purchase. If regard is had to the definition of complaint under the Act, it will be clear that no prospective investor could fall under the Act."

The learned counsel further stated that the complainant has not gone ahead with the agreement and therefore, the opposite party is entitled for deduction of earnest money, which would be more than Rs.8,00,000/-. Thus, nothing is required to be paid to the complainant.

On the other hand learned counsel for the respondent/complainant stated that no builder-buyer agreement was signed between the parties. Hence, no question of deduction of earnest money arises because there is no concluded contract between the parties. As per the provisions of the Consumer Protection Act, 1986, a consumer complaint can be filed even if only part payment has been made against consideration for goods or services. Thus, it does not matter whether allotment was made by the opposite party/petitioner or not. So far as the complainant has paid certain amounts to the opposite party and the contract is not concluded, the complainant is entitled for the refund of the same. The District Forum has allowed only a very reasonable rate of interest 9% p.a. whereas this Commission has been awarding 12% p.a. interest on the amount of refund. But for resolution of the dispute the complainant has not gone into appeal against the order of the State Commission. The order of the District Forum is very reasonable and the issue of 'consumer' is being raised unnecessarily by the petitioner just to delay the payment. Both the fora below have given concurrent finding and the scope under the revision petition is quite limited. The facts cannot be reassessed by this Commission in revision petition and accordingly the revision petition needs to be dismissed.

I have carefully considered the arguments advanced by the learned counsel for the parties and have examined the material on record. First of all, it is seen that the judgment of Hon'ble Supreme Court in Morgan Stanley Mutual Fund Vs. Kartick Das (supra) relates to purchase of shares, which is a movable property, whereas the present case is relating to immovable property. Secondly, there was no payment made in that case, whereas, in the present case payment of Rs.8,00,000/- has been made for the booking of the flat. Therefore, in my view the judgment of Morgan Stanley Mutual Fund Vs. Kartick Das (supra) does not apply to the facts and circumstances of the present case.

So far as the argument of the petitioner relating to part payment of booking amount is concerned, it seems that the complainant as well as opposite party both are at fault. If the booking amount was Rs.21,62,700/-, the opposite party should not have accepted the payment of Rs.8,00,000/- only. It is clear that on this ground the petitioner/opposite party cannot put blame on the complainant. Now the fact remains that the complainant has paid Rs.8,00,000/- to the opposite party for booking of the flat. The complainant has asked for refund. It is clearly a consumer dispute. The complainant would be deemed to be a consumer. From this angle, I don't think that any interference is required in the orders of the fora below.

Learned counsel for the petitioner could not explain as to why petitioner does not want to refund the amount of Rs.8,00,000/-, which was paid by the complainant. Secondly, there is no builder-buyer agreement signed, therefore, no question of deduction of earnest money can arise without any agreement. Thus, I do not see any illegality in the order of the District Forum and the order of the State Commission in the matter. Coming to the question of interest, I agree with the learned counsel for the respondent. This Commission has been generally ordering refund with interest ranging from 9%p.a. to 14% p.a. depending on the facts and circumstances of each case and therefore, 9% p.a. is not unreasonably high interest, which has been ordered by the State Commission, therefore, on this account I do not find any material irregularity done by the District Forum. Moreover, both the fora below have given concurrent finding and the scope under the revision petition is very limited as held by the Hon'ble Supreme Court in the following case:-

Lourdes Society Snehanjali Girls Hostel and Ors. Vs. H&R Johnson (India) Ltd. and others, (2016) 8 Supreme Court Cases 286, wherein, the Hon'ble Supreme Court has held the following:

"23. The National Commission has to exercise the jurisdiction vested in it only if the State Commission or the District Forum has either failed to exercise their jurisdiction or exercised when the same was not vested in them or exceeded their jurisdiction by acting illegally or with material irregularity. In the instant case, the National Commission has certainly exceeded its jurisdiction by setting aside the concurrent finding of fact recorded in the order passed by the State Commission which is based upon valid and cogent reasons."

Based on the above discussion, I do not find any illegality material irregularity or jurisdictional error in the order dated 23.02.2018 of the State Commission which calls for any interference from this Commission. Accordingly, the RP No.1547 of 2018 is dismissed.