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TAMIL NADU STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, CHENNAI
Hon’ble Thiru Justice A. Raman, President &
Tmt. R. Vanaroja, Member
VERARAGHAVAN—Appellant
versus
K. BACHAMMAL—Respondent
A.P. No. 326 of 2003—Decided on 3.3.2004
Counsels for the Parties :
For the Appellant :Mr. R. Subramanian, Advocate.
For the Respondent:Mr. V. Subramanian, Advocate.
The court established that the failure to commence construction as agreed constituted a deficiency in service under the Consumer Protection Act, 1986, and affirmed the complainant's status as a consumer.
Headnote:
Construction Agreement - Delay in Construction - Rental Compensation - Consumer Protection Act, 1986 - Section 2(1)(o) - Section 2(1)(g) - Section 2(1)(r) - Section 2(1)(u) - Section 2(1)(d) - Section 2(1)(o) - Section 2(1)(r) - Section 2(1)(g) - Section 2(1)(d) - Section 2(1)(u)
Fact of the Case:
The complainant and the opposite party entered into a construction agreement for developing the complainant's property into flats. The construction was not started even after 3 years, and the opposite party failed to make regular rental compensation payments. The complainant issued a notice and cancelled the agreement, leading to the complaint.
Finding of the Court:
The court found that the opposite party failed to commence the construction as agreed, and the reasons provided for the delay were not acceptable. The court dismissed the appeal and confirmed the lower forum's order.
Issues: Delay in construction, failure to make regular rental compensation payments, cancellation of the agreement, and the applicability of the Consumer Protection Act, 1986.
Ratio Decidendi: The court held that the opposite party's failure to commence construction as agreed constituted a deficiency in service. The court also determined that the complainant was a consumer under the Consumer Protection Act, 1986, and the decisions relied upon by the opposite party did not apply to the facts of this case.
Final Decision: The appeal was dismissed with costs, confirming the order of the lower forum.
Thiru Justice A. Raman, President—The complainant and the opposite party entered into a construction agreement to develop the complainant’s property into flats. The complainant paid a sum of Rs. 25,000/- at the time of the agreement. The construction should have been completed within 15 months from the date of starting of the construction. A general power was given to the opposite party to take all necessary steps towards construction. Even after 3 years, the construction work has not been started. The opposite party agreed to pay rental compensation of Rs. 3,000/- per month commencing from June, 1998. But the opposite party failed to make payment regularly, but was paying only once in 3 months or 8 months. As against 43 months payment, the opposite party had only paid 6 payments. As a result, the complainant was put to much mental hardship and financial strain. The complainant would have enjoyed a rental income of Rs. 2 lakhs if the opposite party handed over the flats within two months of commencement of the construction. The complainant issued a notice and cancelled the agreement. The opposite party failed to hand over the documents pertaining to the property. Hence, the complaint.
2. The opposite party contended that the complainant’s remedy is to move Civil Court for specific performance. There was no agreement to hand over the building within 15 months from the date of entering into the agreement. The opposite party could commence the project only if the permission is accorded by the CMDA authorities. The opposite party was regularly in payment of rental compensation. On account of the act of State, he was prevented from the commencement of the construction. Hence, the opposite party contended that there is no deficiency in service.
3. The lower Forum directed the opposite party to pay a sum of Rs. 37,000/- and return all the documents pertaining to the scheduled property and to remove the hoardings and watchman shed and to pay a rent of Rs. 1,000/- from the date of cancellation of agreement till removal of the hoardings, watchman and watchman’s shed.
4. Aggrieved by the same, the opposite party has filed this appeal.
5. The facts are not in dispute. The complainant and the opposite parties have entered into an agreement on 9.12.1998. The opposite party has agreed that the construction will be completed in 15 months from the date of commencement and he would obtain for necessary sanction for construction of residential apartment at his cost and the owner will not be liable to contribute any amount required for obtaining sanction for the construction of apartment and the owner will sign all papers and affidavits and the other party is entitled to put up buildings, flats and other structures at his will in the Schedule A property and according to the technical specification in Schedule B property and that he is permitted to negotiate terms to sell the land described in the schedule A property to various third party purchasers and the owner would sign all the papers and the sale agreements. While this agreement has been executed on 9.12.1998, no steps were taken thereafter and, therefore, on 10.12.2002 the complainant sent notice to the opposite party pointing out the omissions. The opposite party sent a reply under Ex. A4 admitting the agreement and also admitting he agreed to complete the construction within 15 months from the date of commencement of construction and that the approval papers are pending before the CMDA authorities and that he has paid a sum of Rs. 1,17,000/- towards rental compensation for 36 months till 29.6.2001. To this, a rejoinder was sent by the complainant and she cancelled the general power of attorney as well. The opposite party namely the appellant herein has thus failed to develop the property and put up flats as agreed by him. The contention that he agreed to complete the construction within 15 months from the date of commencement of the construction alone cannot be accepted at all. That woul
