judgment

C.K. Thakker, J. —

1.The present appeals are filed against an order passed by the State Consumer Disputes Redressal Commission, Madras (State Commission for short) on July 24, 1995 in Original Petition Nos. 143-149 of 1995 and confirmed by the National Consumer Disputes Redressal Commission, New Delhi (National Commission for short) on February 25, 2002 in First Appeal Nos. 500-506 of 1995.

2.Shortly stated the facts are that the Tamil Nadu Housing Board (hereinafter referred to as the Board) was constituted under the Tamil Nadu Housing Board Act, 1961 (Act 17 of 1961). The primary object of creation of the Housing Board was to acquire land in the neighbourhood areas of developed cities at a reasonable price and to construct tenements, houses and flats thereon for providing residential accommodation to needy people of different income groups and categories. In the year 1982, vast piece of land admeasuring about 28 acres of Thiruvamiyer, Chennai was acquired by the State of Tamil Nadu under the Land Acquisition Act, 1894 for a public purpose, viz. for the development of the area known as South Madras Neighbourhood Scheme. On February 27, 1991 the Board approved a proposal to construct seven different types of flats. It proposed to construct 102 flats under its High Income Group Scheme (HIG Scheme for short). In order to assess demand from public, an advertisement was issued by the Board on March 21, 1991 inviting applications for registration under the title ‘Avail a chance of owning your own flat’ in Thiruvanmiyur Extension, Madras. Seven types of flats were mentioned in the said advertisement along with plinth area, tentative price, initial deposit, monthly instalment, repayment period, amount of deposit for registration, etc. It was stated that pursuant to the said advertisement applications were made by interested persons. There was overwhelming demand and several persons applied. The record reflects that finally instead of seven types of flats, fifteen types of flats were constructed under HIG Scheme. The Board issued letters on August 13, 1993 to the applicants asking them whether they were willing to purchase flats. Necessary details of the type, design, plinth area, tentative selling price and other particulars were supplied. Draw was conducted on October 15, 1993 and provisional allotment letters were issued on October 19, 1993. Tentative cost was specified in the letter which was to be paid within a period of 21 days. Final allotment order was made on August 9, 1994 wherein final cost of the flat was mentioned. An agreement was entered into between the Housing Board and allottees on August 22, 1994. In the said agreement, it was mentioned that it was agreed between the parties that the ultimate cost of the total construction of the flat was subject to the outcome in the award of compensation in land acquisition proceedings pending adjudication and the final amount will be fixed on that basis which will be paid by the members. Thereafter possession of flats was given to all allottees. The members were then asked to pay additional amount. The respondent-Sea Shore Apartments Owners Welfare Association [Association for short] felt that the demand made and amount recovered by the Housing Board was neither legal nor proper. It could not have demanded more amount. The amount which was fixed earlier was already paid and the members of the Association were not treated fairly. It, therefore, made representation on December 26, 1994 against the additional amount. In the said representation, the Association asked the Board to give reasons for enhancement of price of flats as also for reduction of period of payment of instalments from 15 years to 13 years. The Board, however, did not reply to the said letter. Even subsequent letter was not responded. Seven complaints were, therefore, filed by the allottees before the State Commission on May 26, 1995 under Section 12 of the Consumer Protection Act, 1986 (hereinafter referred