Ramkishore Baldawa vs R. Sudhakar Rao And Ors.

THIS appeal has been filed by appellant against order dated 17.12.2012 passed by State Commission in Complaint No. 119 of 2010 - Dr. R. Sudhakar Rao & Anr. Vs. M/s. Sri Venkatesh Constructions & Ors.; by which complaint was partly allowed.

Brief facts of the case are that complainant No. 1/Respondent No. 1 entered into contract for purchase of flat No. 201 at door No. 3 -6 -527 in Highness Residency, Road No. 7, Himayatnagar, Hyderabad, admeasuring 1976 sq fts. @ Rs. 2,800/ - per sq. ft. in the name of his son - Sri Ranga Veera Nanda Kishore. It was further submitted that opposite party No. 1 -partnerhsip firm entered into contract of construction with land owner - Smt. Nikkath Parveen and five others. Complainant No. 1 paid Rs. 50,116/ - on 24.6.2006 as advance against total sale consideration of Rs. 55,32,800/ -. It was further submitted that cost of other amenities was Rs. 5.00 lakh. Time for completion of construction work was two years as per the Development Agreement between opposite party No. 1 and owner of land but construction was delayed. Complainant No. 1 repeatedly insisted opposite party No. 1 to complete construction and hand over the possession of property. It was further submitted that complainant No. 1 paid Rs. 40,50,116/ - by April, 2008 and by that time even 50% construction work was not completed and construction work was stopped. In such circumstances, complainant completed remaining pending work by spending Rs. 10 lakhs. It was further submitted that opposite party No. 2 demanded enhanced rate of Rs. 3,300/ - per sq. ft. instead of Rs. 2,800/ - but complainant No. 1 refused to pay. As Sale Deed was not executed, opposite party No. 2 to 4 under coercion obtained two cheques of Rs. 5.00 lakh each from complainant No. 1 drawn on self, whereas these cheques were encashed by opposite party No. 4. It was further submitted that again two cheques of total Rs. 6,85,000/ - were obtained by opposite party No. 3 from complainant No. 1 with promise that cheques will be returned soon after the Sale Deed is registered but cheques were not returned. Opposite party No. 2 further demanded Rs. 20.00 lakhs which were paid and sale deed was got executed in favour of his son/complainant No. 2 after obtaining loan from bank. It was further submitted that quality of construction was very poor. Opposite party No. 2 collected Rs. 1,47,044/ - as service tax which was not payable. Opposite party reduced common area as well allotted less area in undivided land and complainant claimed refund of Rs. 7,14,000/ - towards common area and Rs. 8,99,600/ - towards short fall of land. Alleging deficiency on the part of opposite party, complainant No. 1 filed complaint before District Forum. Opposite party resisted complaint and denied that complainant No. 1 has purchased property but submitted that his son has purchased the property and got registered Sale Deed executed in his favour, so complainant has no locus standi to file complaint. Opposite party denied receipt of any amount encashed. Opposite party also denied receipt of Rs. 50,116/ - for entering into agreement and denied contents of para 3(c) of the complaint. It was further submitted that complaint was barred by limitation. Complainant No. 1 has not given any details of expenditure incurred by him and as per Sale Deed, complete finished flat was handed over to the purchaser so there was no question of completing work by spending Rs. 10.00 lakhs. It was further denied that opposite party obtained two cheques of Rs. 5.00 lakh from the complainant drawn as self and got it encashed. It was further submitted that complainant No. 1 obtained loan of Rs. 6,85,000/ - from opposite party No. 2 and for refund gave two cheques of aforesaid amount which were dishonoured and opposite party No. 2 has filed complaint u/s 138 of The Negotiable Instruments Act. It was denied that quality of construction was poor. Allegation regarding collection of service tax, reduction of common area and undivided portion of land was denied and prayed for dismissal of complaint.

DURING the course of proceedings, complainant No. 2 was impleaded as complainant vide order dated 15.11.2011. Opposite party filed application that complaint was time barred which was dismissed by Learned State Commission against which revision petition filed by opposite party was dismissed as becoming infructuous vide order dated 5.2.2013 as Learned State Commission had finally decided complaint. Heard Learned Counsel for the parties finally at admission stage and perused the record.

LEARNED Counsel for appellant submitted that complaint filed by complainant No. 1 was not maintainable and after impleading complainant No. 2 as a party, complaint was barred by limitation, even then, Learned State committed error in allowing complaint. It was, further, argued that in spite of claiming Rs. 10.00 lakhs for unfinished work, State Commission allowed Rs. 13,30,608/ - without any clause in the Sale Deed, hence, appeal be allowed and impugned order be set aside. On the other hand, Learned Counsel for respondent submitted that Learned State Commission rightly allowed complaint as per clause in Agreement to Sale and as complainant No. 1 was also ''consumer'', hence, appeal be dismissed.

IT is admitted case that complainant No. 1 filed complaint against opposite party in which it was mentioned that he entered into contract for purchase of flat in the name of his son - Sri Ranga Veera Nanda Kishore. Admittedly, there is no document on record to depict that any agreement was executed between complainant No. 1 and opposite parties. On the other hand, Agreement to Sale and Sale Deed were executed between complainant No. 2 and opposite parties. Merely because some payments have been made by complainant No. 1 on behalf of complainant No. 2 to the opposite party for purchase of flat, complainant No. 1 cannot be treated as ''consumer'' under the Consumer Protection Act, 1986 on the ground that complainant No. 1 is also user of flat alongwith complainant No. 2. Merely because there was some correspondence between opposite party and complainant No. 1 on behalf of complainant No. 2, complainant No. 1 does not fall within the purview of ''consumer'' and he had no locus standi to file the complaint. Learned State commission has committed error in observing complainant No. 1 as ''consumer'' and holding locus standi to file complaint. Learned Counsel for appellant submitted that on account of benami transaction by complainant No. 1 in the name of complainant No. 2, complaint was not maintainable whereas Learned Counsel for respondent submitted that new plea cannot be taken before this Commission as this plea was not taken before State Commission.

PERUSAL of complaint clearly reveals that complainant No. 1 purchased flat in the name of complainant No. 2 and made some payments and some payments were made by complainant No. 2 after obtaining loan from the bank. Perusal of complaint makes it clear that complainant No. 1 purchased property in the name of complainant No. 2 which is clearly benami transaction. As per Section 3 of The Benami Transactions (Prohibition) Act, 1988, no person shall enter into benami transaction but exception has been made and a person can purchase property in the name of his wife or unmarried daughter. In the case in hand, property has been purchased in the name of major son which is clearly benami transaction which is punishable u/s 3(3) of The Benami Transactions (Prohibition) Act, 1988. Merely because, no specific plea has been taken in the written statement by opposite party, the opposite party cannot be restrained from taking this plea before this appellate Commission as legal pleas can be raised at any stage of the matter.

HON ''ble Apex Court in : (2014) 5 SCC 660 - Vasu P. Shetty Vs. Hotel Vandana Palace and Others; held that arguments, based on admitted facts on record, can be examined by Supreme Court on merits even though same were neither raised in High Court nor in SLP. In the light of aforesaid judgment, plea of benami transaction can be looked into by this Commission at appellate stage. Admittedly, sale deed was executed on 17.6.2009 between complainant No. 2 and opposite party and complaint was filed by complainant No. 1 on 27.12.2010 and complainant No. 2 moved application for impleadment on 17.8.2011 which was allowed by Learned State Commission vide order dated 15.11.2011. Thus, it becomes clear that application for impleadment by complainant No. 2 was filed after two years & two months from the date of execution of sale deed. If complaint filed by complainant No. 1 is held to be not maintainable as observed earlier, complaint can be treated from the side of complainant No. 2 only from the date of order of impleadment i.e. 15.11.2011 or at the earliest from the date of application i.e. 17.8.2011. Thus, it becomes clear that complaint was filed after two years & two months from the date of execution of sale deed and in such circumstances, complaint was barred by limitation. Admittedly, complainant has not moved any application u/s 24 -A for condonation of delay in filing complaint. Learned State Commission, while deciding limitation issue observed as under - "As stated above, originally the complainant No. 1 filed the complaint on 27.12.2010. Ex. A11 Agreement of Sale is dated 17.6.2009. The original complaint is therefore filed well within the limitation as provided under Section 24 -A of the Consumer Protection Act. All pleas have been taken in the original complaint and the same pleas have been adopted by the complainant No. 2 also, after he was impleaded as complainant No. 2 as per the orders dated 15.11.2011. In CCIA.1745/2011 which was filed on 17.8.2011. No new plea has been taken after the complainant No. 2 came on record. Under these circumstances, we are of the view that the complaint is not barred by limitation", and treated complaint in limitation. Merely because, pleas taken by complainant No. 1 have been adopted by complainant No. 2, it cannot be treated that complainant No. 2 filed complaint on 27.12.2010 which was filed by complainant No. 1 without any locus standi and in such circumstances, complaint was barred by limitation. Learned Counsel for respondent placed reliance on : (2000) I SCC 586 - Lata Construction and Others Vs. Dr. Rameshchandra Ramniklal Shah; in which it was held that as rights under the first agreement had not been given and appellant was constantly under an obligation to provide a flat to the respondents and deliver possession thereof, cause of action has to be treated as continuing cause of action and claim was not beyond limitation. Aforesaid case is not applicable to the case in hand because in the case in hand, sale deed between complainant No. 2 and opposite party had already been executed on 17.6.2009 and possession had already been taken by complainant No. 2, then, there was no question of continuing cause of action till filing application of impleadment by complainant No. 2 and complaint was barred by limitation as application for impleadment of complainant No. 2, who was purchaser of flat, was filed on 17.8.2011 i.e. after two years & two months of execution of sale deed. Thus, it becomes clear that complaint filed by complainant No. 1 was without locus standi and application for impleadment was filed after two years & two months of accrual of cause of action, complaint was barred by limitation and Learned State Commission has committed error in treating complaint within limitation.

COMPLAINANT in his complaint alleged deficiency on number of counts but Learned State Commission observed deficiency only in not refunding amount spent on finishing the flat and in charging service tax and rest of the prayers were dis -allowed. Complainant has not filed any cross appeal and in such circumstances, it can be assumed that complainant unnecessarily exaggerated his claim. In the complaint, complainant claimed Rs. 10.00 lakhs towards cost for unfinished items incurred by complainant whereas Learned State Commission allowed Rs. 13,30,608/ - on the ground of furnishing bills though few bills related to period subsequent to sale deed. There was no occasion for the State Commission to grant more amount than the prayed amount towards cost incurred for unfinished items and prima -facie Learned State Commission committed error in allowing claim of Rs. 13,30,608/ - towards expenses incurred for completing unfinished work.

COMPLAINANT in his complaint mentioned that complainant agreed to purchase flat for Rs. 55,32,800/ - and other amenities for Rs. 5.00 lakh which has been denied by the opposite party. On the contrary, Agreement to Sale executed between the parties is for Rs. 34,00,116/ - and same amount has been shown in Sale Deed executed after seven months. Thus, it becomes clear that complainant has either wrongly mentioned sale consideration of Rs. 60,32,800/ - in the complaint or has wrongly mentioned sale consideration amount in Agreement of Sale as well as Sale Deed for evading stamp duty and registration charges and in such circumstances, complainant is not entitled to any relief. Learned Counsel for respondent has drawn my attention towards clause 4 of the Agreement to Sale in which it was mentioned that as purchaser at his cost did flooring including polishing, colouring and other works, which was obligation of the developer so developer was to deduct amount of aforesaid cost from the balance sale consideration and on this basis, Learned State Commission rightly allowed claim of Rs. 13,30,608/ -. Admittedly, this clause does not specify expenses incurred in flooring, etc. Not only this, this clause does not find place in Sale Deed dated 17.6.2009 and in the absence of aforesaid clause in Sale Deed, complainant was not entitled to claim cost incurred in flooring, etc. from the opposite party. Agreement to Sale losses any significance after execution of Sale Deed and only terms & conditions of Sale Deed can be enforced by the parties and Agreement to Sale cannot be looked into. Learned State Commission only on the basis of site plan attached with Sale Deed observed that semi -finished flat was sold but in the Sale Deed itself it has nowhere been mentioned that flat was semi -finished. Not only this, even in the Agreement to Sale, it has been mentioned that purchaser at his cost did flooring including polishing etc. which connote that at the time of Agreement to Sale, flat had already been completed in every respect and it was not semi -finished and in such circumstances, only on the basis of semi -finished shown in the site plan attached with Sale Deed, complainant is not entitled to get Rs. 13,30,608/ - as awarded by Learned State Commission. Learned Counsel for appellant submitted that Learned State Commission has committed error in allowing refund of service tax of Rs. 1,47,044/ -. Learned State Commission after referring Circular rightly observed that opposite party was not entitled to recover Rs. 1,47,044/ - as service tax from the complainant and was entitled to refund but as complaint is barred by limitation, complainant is not entitled to get refund of Rs. 1,47,044/ - as observed by State Commission and impugned order is liable to set aside.

CONSEQUENTLY , FA No. 71 of 2013 - Ramkishore Baldawa Vs. Dr. R Sudhakar Rao & Anr.; filed by appellant is allowed and order dated 17.12.2012 passed by Learned State Commission in Complaint No. 119 of 2010 - Dr. R. Sudhakar Rao & Anr. Vs. M/s. Sri Venkatesh Constructions & Ors.; is set aside.

PARTIES to bear their own costs.