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2010(1) CPR 237 (NC)
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION,
NEW DELHI
Ashok Bhan, President and B.K. Taimni, Member
Jagdish Gurnani —Appellant
versus
Lucknow Development Authority —Respondent
First Appeal No. 283 of 2005
Decided on 19.1.2010
For the Appellant:Mr. Jagdish Gurnani, in person and Mr. S.K. Effendi, Advocate.
For the Respondent:Mr. Vinay Garg and Ms. Jyoti Sharma, Advocates.
IMPORTANT POINT
Price cannot become a matter of Consumer disputes and parties shall be governed by terms of contract.
Headnote:Consumer Protection Act, 1986—Section 12 and 17—Deficiency in service—Flat was allotted to complainant in 1989 at estimated cost price at Rs. 3,80,000—Possession of flat was given in 2001 and complainant had paid Rs. 1,94,000 in instalments by cost of flat was revised to Rs. 6,84,895—Consumer complaint—Determination of final price would not come within ambit of Consumer Protection Act—Brochur as well allotment letter stipulated estimated cost at Rs. 3,80,000—Complainant however could have been granted relief by way of grant of interest for delay in delivery of possession of flat but as a fact have taken possession in 200/- complainant had not even paid the balance of 50% amount of original estimated cost till 2007—Appellant in such circumstances could not be found to be entitled to any relief. (Paras 6, 11 and 12)
Result: Appeal dismissed.
B.K. Taimni, Member—Appellant was the complainant before the State Commission, where he had filed a complaint alleging deficiency in service on the part of the respondent Lucknow Development Authority (LDA).
2. Undisputed facts of the case are that the appellant complainant in response to an advertisement, deposited Rs.18,000 on 24.09.89 as registration money applying for a flat with covered area 750 sq. ft in the Premayan category which was later on shifted to Vatayan category of the same scheme. In the brochure the estimated sale price of the apartment was indicated at Rs.3,80,000. It was the contention of the Respondent, LDA, that due to some problem with the labour and the respondent, letter of allotment could be issued on 10.01.91 in which again the estimated price was given Rs.3,80,000 against which the complainant paid Rs.1,94,000 in 10 instalments. But the possession of the flat was not given despite a provision in the brochure, that after payment of 40% of the amount, the possession shall be given. Finally, vide letter dated 10.9.01, the respondent LDA demanded the balance amount placing the revised cost of flat at Rs.6,84,895. It is not in dispute that the appellant was put in possession of the flat on 4.4.01 allegedly, full of defects and discrepancies and use of substandard material in the construction. It is in these circumstances, a complaint was filed before the State Commission with the following prayer:
“(i) to pass an order directing the opposite party not to charge the price in excess of the bargaining price of Rs.3,80,000; for the flat;
(ii) to pass order directing the opposite party to pay interest @24% on the deposits made by the complainant;
(iii) to pass order for awarding compensation of Rs.3,00,000;
(iv) to pass order for awarding cost of Rs.11,000.”
3. The matter was contested by the respondent before the State Commission and the State Commission after hearing the parties and perusal of material on record, disposed off the complaint in following terms:
“Without being exhausting, it is appropriate in the circumstances to take into consideration the following factors while showing the estimated sale price in the brochure while ultimately fixing the final costing.
1. Escalation cannot be arbitrary or erratic;
2. Specific terms and conditions with regard to the escalation of the cost of house; flat be mentioned in the brochure and in this connection the mandate contained in KDA v. Sheela Devi (Supra) be strictly adhered to.
3. While floating the scheme and mentioning in the brochure about the escalated sale price, reasonable factors which determine the cost be thoroughly considered and taken into account and every effort in normal circumstances be made not to increase the cost more than 10% of the estimated sale price shown in the brochure particularly in the schemes touching the lower income group or middle income group as in the event of increase in the final cost by more than 10%, it adversely affects the purchase of these two groups which frustrates the objectives of the developmental bodies;
4. Final costing of construction is to be confined in ordinarily cause whose out off date should be the completion of the construction of the house/flat.
5. Development Authorities are not traders and they cannot be permitted to enter into restrictive trade practice as defined under section 2 (nnn) of the Act;
6. The increase must be rational based on materials and since the allotment matters are subject to judicial scrutiny, the direction of escalation must be based on objective satisfaction and not on subjective satisfaction;
7. Increase of the cost only on the ground of delayed delivery of possession will not be justifying unless disabling factors of handing over the delayed possession has been caused by the allottee or the delay in delivering the possession was beyond the control of the Development Authority;
8. The plea that the possession had to be delivered delayed on account
