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HARYANA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, CHANDIGARH
Hon’ble Mr. Justice S.S. Sandhawalia, President;
S. Kulwant Singh, Member
ESTATE OFFICER, HUDA—Appellant
versus
MADAN MOHAN GANDHI & OTHERS—Respondents
F.A. Nos. 118, 133 to 136/93—Decided on 17.6.1993
CONSUMER PROTECTION ACT - JURISDICTION - SECTION 2(1)(D) - ALLOTMENT OF PLOTS BY HUDA - WHETHER A CONSUMER DISPUTE - YES
Fact of the Case:
The Haryana Urban Development Authority (HUDA) auctioned plots in a colony it developed in Hisar. The complainants, who were successful bidders, paid the required amounts and were issued allotment letters. However, they were not given possession of the plots despite the passage of nearly five years. They filed consumer complaints against HUDA, claiming interest on the deposited amount and other reliefs.
Finding of the Court:
The District Forum held that HUDA was providing services to the public by developing and allotting plots, and that the complainants were consumers within the meaning of the Consumer Protection Act. It directed HUDA to pay interest at 10% on the deposited amount till the offer or delivery of actual possession of the site.
Issues: 1. Whether the complainants were consumers within the meaning of the Consumer Protection Act? 2. Whether HUDA was deficient in providing services to the complainants? 3. Whether the complainants were entitled to interest on the deposited amount?
Ratio Decidendi: 1. The court held that HUDA was a corporate body primarily engaged in serving the public in the matter of providing housing or ancillary commercial sites by acquisition of land, the development thereof, including the allotment of plots and houses to the public. It was in the pursuance of this identical activity that the police lines area was sought to be developed and allotted out to consumers by the HUDA. 2. The court held that the allotment of plots by HUDA was a hiring of services and a deficiency therein which is clearly within the pale of the consumer jurisdiction. It cannot even remotely be looked at as a mere out right sale and purchase of immovable property alone. 3. The court held that the complainants were entitled to interest on the deposited amount as compensation for the patent deficiency in services undertaken by HUDA.
Final Decision: The court dismissed the appeals filed by HUDA and allowed the cross-appeals filed by the complainants. It modified the rate of interest to 18% per annum.
Mr. Justice S.S. Sandhawalia, President—First Appeals No. 118 and 133 to 136 of 1993 being cross appeals arise from the virtually identical orders of the District Forum, Hisar. Learned Counsel for the parties are agreed that the issues of fact and law are common and this judgment will consequently govern all of them.
2. The representative matrix of facts may be noticed from First Appeal No. 118 of 1993 H.U.D.A. of Hisar v. Mr. Madan Mohan Gandhi & Others’, with relevance to the case of the consumer/Complainant. The Haryana Urban Development Authority had admittedly developed a colony in the police lines area at Hisar. An auction was held for the allotment of plots therein and Dr. Om Parkash one of the successful bidder made the payment of Rs. 12,800/- being 10% of the price and thereafter within the specified period deposited Rs. 19,200/- being 15% of the said price. An allotment letter dated the 20th of May, 1988 was issued in his favour and according to its terms and conditions he was required to deposit the balance amount in six half yearly installments alongwith interest at 10%. It was his case that subsequently he had made payment of all the installments due and had secured a no due certificate from the HUDA on the 13th of December, 1991.
3. The primal grievance of the consumer was that the terms of allotment announced at the spot were categoric that the possession of the plot could be given within one year and relying thereon he had made the successful bid. Not only that the basic reliance was on Clause No. 5 of the terms and conditions admittedly recorded between the parties. This reads as under :
“The possession of the site will be delivered on payment of 25% sale price (10% on the spot of bid) the purchaser shall enjoy the right of possession so long as he continues paying instalments of the price on due date and abide by other terms and conditions of allotment.”
4. Despite the above, to the great anguish of the consumer-complainant, he had been unable to secure possession despite the passage of nearly five years thereafter. It was pleaded that the HUD A was itself charging 10% interest on the balance amount payable for installments, but there was no reciprocating provision for payment of interest despite the patent contravention of the primal term of the delivery of possession within a year.
5. On notice being issued the HUDA took up preliminary jurisdictional objections that the Complainant did not come within the definition of a consumer and also raised objections to the pecuniary jurisdiction of the District Forum. On merits the basic reliance was on condition No. 6 of the allotment letter that the possession of the site would be offered to the allottee on the completion of the development works in the area. It was consequently pleaded that the offer of possession will only be given after the completion of the development works and the implicit premise was that such development had not yet been started. The claim for interest and other reliefs was controverted.
6. The District Forum noticed that on behalf of the HUDA a clear admission was made that no development in the area had taken place and their learned Counsel Mr. Yadav could give no time frame when the same would be done because a piquant situation has arisen, since the police Department is adamant in not vacating the area and delivered possession thereof either to the HUDA or to the allottees. It was the stand that this has created an unusual situation, the solution of which was not in sight The District Forum consequently observed that it was a case of negligence of the highest magnitude where without any development and demarcation of the plots these were auctioned and huge amounts were collected from the allottees to whom possession was being unduly delayed, if not virtually denied. Consequently, the relief was granted in the terms of a direction to pay 10% interest on the deposited amount till the offer or delivery of actual possession of the site.
7. M
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