Back
NATIONAL CONSUMER DISPUTES
REDRESSAL COMMISSION, NEW DELHI
Honble Mr. Justice V. Balakrishna Eradi, President;
Mr. Y. Krishan & Mr. Justice B.S. Yadav, Members
M.M. SINGH & ORS.—Complainants
versus
CHARANJIT KOCHHAR, PROPRIETOR, M/S. CHARANJIT
KOCHHAR ENGINEERS AND CONTRACTORS & ANR.—Opp. Parties
Original Petition No. 226 of 1993—Decided on 6.1.1995
Counsel for the Parties :
For the Complainants :Mr. R.P. Dave, Advocate.
For the Opp. Parties :Mr. V.S. Juneja, Advocate.
A builder is liable for the loss occasioned to the complainants by the negligence or deficiency in the rendering of service in relation to house construction.
Headnote:
CONSUMER PROTECTION - HOUSING - DELAY IN CONSTRUCTION - REFUND OF MONEY - INTEREST - DAMAGES - JURISDICTION - ASSIGNABILITY OF AGREEMENT - LIABILITY OF BUILDER AND NEW DEVELOPER - CONSUMER PROTECTION ACT, 1986, SECTIONS 2(1)(g), 2(1)(r), 12, 14, 15.
Fact of the Case:
Complainants entered into agreements with Opposite Party No. 1 for the purchase of flats in a residential complex to be constructed by December 1992. The agreements provided for interest at 15% per annum on amounts deposited if possession was not handed over by December 1992, unless the delay was caused by "natural calamities." There was also a clause specifically providing that there would be no escalation in the price of booked flats. Opposite Party No. 1 had undertaken that development and construction of the proposed flats were to be undertaken by M/s. Charanjit Kochhar and not by any other organization or builder. However, construction of the flats had not even commenced on the site up to the date of the filing of the complaint in July 1993. Vide letters dated June 10, 1993, Opposite Party No. 2 had communicated with some of the complainants that Opposite Party No. 2 had "taken over" the Charanjit Tower Project in which the complainants had booked flats. The complainants alleged that Opposite Party No. 2 was not a party to the agreements entered into by the complainants with Opposite Party No. 1 and that the agreements were not assignable in any manner whatsoever.
Finding of the Court:
The Commission held that both Opposite Parties were liable for the loss occasioned to the complainants by the negligence or deficiency in the rendering of service in relation to house construction. The Commission ordered that the Opposite Party Nos. 1 & 2 shall jointly and severally pay to each of the complainants the amount paid by them, along with interest at the rate of 15% per annum calculated from the dates of payment of installments/sums up to the date of payment. The complainants were also awarded Rs. 10,000/- as costs.
Issues: 1. Whether the Commission has jurisdiction to entertain the complaint where the value of the alleged claims is below Rs. 20 lakhs? 2. Whether the agreements entered into between the complainants and Opposite Party No. 1 are assignable? 3. Whether Opposite Party No. 2 is liable to the complainants for the loss occasioned to them by the negligence or deficiency in the rendering of service in relation to house construction?
Ratio Decidendi: 1. The Commission held that it has jurisdiction to entertain the complaint even though the value of the alleged claims is below Rs. 20 lakhs, as the complaint pertains to deficiency in service by Opposite Party No. 1 who had undertaken to complete construction of the flats by December 1992. 2. The Commission held that the agreements entered into between the complainants and Opposite Party No. 1 are not assignable, as there is no evidence of any agreement or transaction between the answering Opposite Party and the complainants giving rise to a contractual relationship. 3. The Commission held that Opposite Party No. 2 is liable to the complainants for the loss occasioned to them by the negligence or deficiency in the rendering of service in relation to house construction, as Opposite Party No. 2 had taken over the Charanjit Tower Complex and had committed to take over the commitments made to all flat buyers as per the flat buyer agreement entered into between them.
Final Decision: The Commission ordered that the Opposite Party Nos. 1 & 2 shall jointly and severally pay to each of the complainants the amount paid by them, along with interest at the rate of 15% per annum calculated from the dates of payment of installments/sums up to the date of payment. The complainants were also awarded Rs. 10,000/- as costs.
Mr. Justice B.S. Yadav, Member — This complaint has been filed against Charanjit Kochhar, Proprietor, M/s. Charanjit Kochhar Engineers and Contractors, who is Opposite Party No. 1 and M/s. Technology Parks Ltd., who is Opposite Party No. 2. According to the allegations in the complaint, the complainants are a group of 19 individuals, 17 of whom are working for M/s. Maruti Udyog Ltd. (for short MUL). In July, 1989 Opposite Party No. 1 issued a public advertisement inter alia in the Hindustan Times advertising a residential complex of flats proposed to be constructed under the banner of "Charanjit Tower" (hereinafter referred to as the Proposed Flats). The Proposed Plats were to be situated on Plot No. 26 in Vaishali Township, Ghaziabad, Uttar Pradesh. In response to the said advertisement, each of the complainants entered into an agreement with Opposite Party No. 1 for the purchase of one flat each of the Proposed Flats in August, 1989. These agreements were in a standard form, the terms of which are identical. The salient points of the agreements are the following:
(i) There were proposed to be 4 sizes of flats in the complex. These were flats of area 736 sq.ft., 922 sq.ft., 982 sq.ft and 1380 sq.ft..
(ii) Under Clause 8 of the agreements, the flats were proposed to be completed by December, 1992.
(iii) Under Clause 12 of the terms and conditions of allotment, the Builders bound themselves liable to pay interest at the rate of 15% per annum on the amounts deposited by them if possession was not handed over to the complainants by December, 1992 in accordance with the agreements unless the delay was caused by "natural calamities".
(iv) There was included in the said agreement a clause which specifically provided that there would be no escalation in the price of booked flats.
Opposite Party No. 1 had undertaken under the terms of the said agreements that development and construction of the proposed flats were to be undertaken by M/s. Charanjit Kochhar and not by any other organisation or builder.
2. Further, vide Clause 6 of the Terms of Allotment of the land at Vaishali by the Ghaziabad Development Authority to Opposite Party No. 1, the latter were under obligation to complete construction upon the allotted land within a period of-3 years from the date of taking possession of the land. Opposite Party No. 1 had taken the possession of the land in 1989. However, construction of the flats has not even commenced on the site up to the date of the filing of the complaint which was filed on 26th July, 1993. Vide letters dated June 10, 1993 Opposite Party No. 2 had communicated with some of the complainants that Opposite Party No. 2 had "taken over" the Charanjit Tower Project in which the complainants had booked flats.
3. According to the Complainants, Opposite Party No. 2 was not a party to the agreements entered into by the complainants with Opposite Party No. 1 and till the time letters were received from Opposite Party No. 2 by individual complainants, the complainants had have no dealings with that party and did not know who the said Opposite Party was. Further the agreements that were entered into between the complainants with Opposite Party No. 1 were not assignable in any manner whatsoever. Opposite Party No. 2 which is a public concern and is an associated Company of Skipper Group of Companies. On June 23, 1993 an advertisement appeared in the Hindustan Times, New Delhi edition, offering for sale of apartments at a total cost of Rs. 90,000/- only. The proposed apartments were called "Park Apartments" and the developers were "Technology Parks Ltd. — a project of Charanjit Tower" and the apartments were to be situated in Vaishali Township, Ghaziabad, U.P. In the brochure issued in respect of the Park Apartments, the address of the site office for park Apartments was given as Plot No. 26, Vaishali, Ghaziabad, that is the same address as that of Charanjit Towers in which the complainants had booked their flats. Upon receiving t
