Samuel Dorman vs Superior Builders

This first appeal has been filed by the appellant Samuel Dorman challenging the order dated 14th August 2015 passed by the Maharashtra State Consumer Disputes Redressal Commission Mumbai (in short "the State Commission") in consumer complaint No. CC/03 /183.

The Complainant had booked a residential flat no.404 in Friends Co-op. Housing Society building with OP1 in or about the month of July 1995. The total consideration of the flat as agreed by OP1 was Rs.7,59,225/- against which complainant made the payment of Rs.8,00,000/- i.e. excess amount of Rs.40,775/- to the OP1. However, despite making payment of entire amount of consideration, complainant was not given possession of the said flat as assured to be given in January 1998. Complainant from time to time, made enquiries with OP1 about the construction of the flat however, OP1 kept on giving false promises that he will complete the construction of the building and hand over possession of the flat. It is further contended that in or about the first week of March 2003, complainant came to know that the opponent no.1 has entered into an agreement with the opponent no.2 for the construction of the incomplete work of the said building. Therefore, complainant issued a legal notice dated 17.03.2003 to the OP1 calling upon to hand over vacant and peaceful possession of the flat no.404 forthwith and to refund excess amount of Rs.40,775/- paid over and above the price of Rs.7,59,225/- and further Rs.10,000/- per month for each and every month's delay from January 1998 but no positive response was made. Therefore the complainant filed the consumer complaint before State Commission seeking alternate directions to the OP1 i.e.,

(i) To hand over vacant and peaceful possession of the flat no.404. In addition, OP1 be directed to pay to the complainant a sum of Rs.40,775/- towards refund of excess amount along with interest @24% p.a. Or

(ii) In alternative, Refund an amount of Rs.8 lacs along with interest @24% p.a. from the date of payments till its realization.

(iii) OP1 be directed to pay a sum of Rs.6,60,000/- to the complainant for the delay in handing over the flat @Rs.10,000/- per month from January 1998 till possession of the flat, a sum of Rs.5 lacs as compensation towards mental torture and Rs.1 lac towards costs of the complaint.

The complaint was resisted by the respondent No.1/opposite party No.1 by filing the written statement stating that they have received only Rs.5 lakhs and allegation that Rs.3 lakhs were given in cash by the complainant is not correct. It was also mentioned that the total consideration of the flat was Rs.12,65,375/- instead of Rs.7,59,225 as alleged by the complainant. The opposite party No.1 stated that complainant did not pay the remaining amount by way of installments and therefore there was no question of handing over the possession to the complainant. Accordingly it was requested to dismiss the complaint.

The State Commission, however, partly allowed the complaint and directed the opposite party No.1 to refund Rs.5 lakhs along with interest at the rate 12% per annum from the date of filing of the complaint till actual payment along with a compensation of Rs. 20,000 and cost of litigation as Rs.5,000/-. If the order was not complied within 30 days, the rate of interest will be 15% till realization.

Aggrieved by the order of the State Commission, the complainant has filed the present appeal.

Heard the learned counsel for the parties and perused the record. The learned counsel for the appellant stated that there was no reason why the State Commission should not have admitted the receipt given by the opposite party for Rs.3 lakhs in cash. In fact, the receipt is signed by a partner of the opposite party No. 1and there is seal of the opposite party No1. The opposite party has wrongly denied the receipt of Rs.3 lakh in cash. Moreover, the State Commission has not considered the request of the complainant to grant possession of the flat which was the main prayer of the complainant in the complaint. When the complainant has paid the total consideration, why should the complainant accept the refund? As there has been rise in the price of the flat, the opposite party does not want to sell the flat at the old price and therefore the opposite party is not interested in selling flat to the complainant.

Learned counsel for the appellant stated that the State Commission, Mumbai, ought to have allowed the prayer of the complainant in respect of the possession of the flat; there is sufficient evidence on record to pass such order in favour of the complainant as the agreement entered between the parties is still existing, subsisting and not at all cancelled by any competent authority at any point of time.

Learned counsel for the appellant stated that the State Commission, Mumbai, failed to appreciate the fact that the OP No.1 has received Rs.3,00,000/- cash from the appellant which was not considered by the State Commission and mechanically passed the impugned order without going into the merit of the case and conveniently ignored the provisions of the MOFA in respect of handing over the possession of the booked flat. From the record, it is crystal clear that the opposite parties have contravened the provisions of Maharasthra Ownership of Flats Act, 1963. Therefore, the opp. Parties are not entitled to take benefit of the same.

Learned counsel for the appellant further stated that the State Commission, did not consider handing over the possession of the flat booked by the complainant and has given unnecessary importance to the documents filed by the opposite parties which are also not genuine. When there was clear-cut evidence against the opposite parties of their committing unfair trade practice and deficiency in service and thereby contravening the provisions of MOFA by taking undue advantage of the rise in prices of the flats which should not have been allowed by the State Commission, and the flat booked by the complainant ought to have been handed over to the complainant as per the agreement for sale.

On the other hand, the learned counsel for respondent No.1/ opposite party No.1 stated that the complainant did not pay the remaining amount of the consideration for the flat and meanwhile the cost of the flat also increased to about Rs.17 lakhs and the complainant did not pay any further amount except Rs.5 lakhs, therefore possession could not be given to the complainant. In these circumstances, the State Commission has passed a right order for refund of the amount given by the complainant. The complainant has forged the receipt for Rs.3 lakhs in cash and the State Commission has rightly rejected that receipt. It was requested to dismiss the appeal having no merits.

The learned counsel for respondent No.2/ opposite party No.2 has stated that the work of the building has been given to respondent No.2 now and they are not concerned with the dispute between the respondent No.1 and the complainant.

I have carefully considered the arguments advanced by the learned counsel for the parties and examined record. The State Commission has observed the following in respect of the receipt for Rs.3 lakhs allegedly given in cash and on the aspect of agreement between the parties:-

"As to Issue No.3:

It is the contention of the complainant that the total consideration of the flat as agreed upon with the opponent no.1 is Rs.7,59,225/-. As against the total amount of consideration, complainant has claimed to have paid total sum of Rs.8 lacs as detailed below:-

(i) Rs.4 Lacs through receipt no.559 dated 16/07/1995 [by cheque]

(ii) Rs.1 lac through receipt no.606 dated 10/01/1996 [by cheuqe]

(iii) Rs.3 lacs [by cash]

However, opponent no.1 has admitted to have received only Rs.5 lacs, but has denied to have received Rs.3 lacs in cash. From the perusal of said receipt of Rs.3 lacs, it reveals that it is in hand written and is without any date. Though there is a stamp of the opponent no.1, the name of the signatory is not mentioned. Therefore, this receipt of Rs.3 lacs as produced by the complainant is doubtful and therefore the same cannot be accepted. According to the complainant, total consideration of the flat as mentioned above Rs.7,59,225/- to be paid by the complainant to the opponent no.1. As per the contention of the complainant, possession of the flat was agreed to be handed over by opponent no.1 on or before January 1998 as stated in Clause No.11. In fact, the complainant has placed agreement on record executed with the said Friends Co-operative Housing Society and said society is not party to the complaint. There is no agreement produced on record as executed between the complainant and opponent no.1. Even if, there is no agreement, opponent no.1 had further agreed to hand over the possession of the flat by last week of June 2004 subject to verifying and ascertaining the position of payment of consideration as revealed from roznama dated 12/3/2004 in the delay proceedings i.e MA./03/2165. However, as the complainant failed to make balance payment of the consideration of the said flat, he cannot be said to be entitled for the possession of the said flat. In fact, as revealed from the evidence filed by the opponent no.1[1(c)] that the construction of the building is yet incomplete and for completion of the incomplete work, society has already entered in to an agreement with the opponent no.2. Therefore, question of making balance payment by the complainant to the opponent no.1 does not arise. In view of this position, the complainant cannot be said as entitled for the possession. However, it has become clear that amount of Rs.5 lacs is paid to the opponent no.1 and complainant has not been given possession. Therefore, the complainant is entitled to get refund of Rs.5 lacs with reasonable interest from the opponent no.1. Hence, we have given our findings as partly affirmative."

It is surprising to see that the complainant has not made the cooperative housing society as a party in the complaint case even though the main agreement is with the society. The State Commission has recorded that there is no agreement between the respondent No.1 and the complainant as nothing has been filed by the complainant either before the State Commission or before this commission. The appellant has not mentioned in the appeal that the appellant is ready to take the possession on the increased price of the flat. Clearly, if the price of the flat was Rs.12,65,375 which increased to Rs.17,20,075 and the complainant is not ready to pay even the original price of Rs.12,65,375, then, there can be no question of handing over possession to the complainant. Had cooperative society been a party in the case, the issue of cost could have been clarified by the society. In respect of the receipt for Rs.3 lakhs given in cash, the State Commission has correctly observed that the receipt does not bear any date and it is not in the format on which other receipts were issued to complainant. Had this amount been given by cheque or draft, the same could have been verified from other documents, however, it is not possible to verify any transaction of Rs.3 lakhs given in cash in the summary proceeding under the Consumer Protection Act 1986. If the complainant wants to pursue this matter, liberty can be granted to the complainant to approach the civil court where proper evidence can be adduced by both the parties and the matter could be decided by the civil court in respect of the payment of Rs.3 lakhs in cash.

Based on the above discussion, I do not find any infirmity in the order dated 14th August 2015 of the State Commission so far as it relates to the refund of Rs.5 lakhs to the complainant. However, it is seen that the State Commission has allowed interest at the rate 12% per annum from the date of filing of the complaint and not from the date of payment to the opposite party. When the amount paid by the complainant is being refunded, the complainant is entitled to interest from the date of respective deposits with the opposite party. In the present case, the amount of Rs.4 lakh was paid on 16th July 1995 and the amount of Rs.1 lakh has been paid on 10th January1996, therefore the interest should be paid from these dates and not from the date of filing of the complaint. Accordingly, the order of the State Commission dated 14th August 2015 stands modified to this effect only. The order of the State Commission as modified by this order be complied by the responded No.1/ opposite party No.1 within a period of 45 days from the date of receipt of this order, failing which 15% per annum interest Shall be chargeable instead of 12% per annum from the date of this order till actual payment. Liberty is also granted to the complainant to approach the civil court for recovery of Rs.3 lakhs that has been allegedly paid by the complainant to the respondent No.1/ opposite party No.1 in cash. The appeal is accordingly disposed of.