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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Dr. B.C. Gupta, Presiding Member and Dr. S.M. Kantikar, Member
Sheo Prakash Gupta and Anr. —Appellants
versus
Kanpur Development Authority —Respondent
First Appeal No.374 of 2015
(Against the Order dated 26/03/2015 in Complaint No.25/2007 of the State Commission Uttar Pradesh)
Decided on 12.6.2017
Counsel for the Parties:
For the Appellants:Mr. T.V.S. Raghavendra Sreyas, Advocate with Ms. Gayatri Gulati, Advocate
For the Respondent:Mr. Ritesh Agrawal, Advocate with Mr. Sohil Rishabh, Advocate
IMPORTANT POINT
Builder-Buyer agreement is a unconscionable contracts.
Headnote:Consumer Protection Act, 1986—Sections 17, 19 and 21—Real estate—Builder-Buyer agreement—Cancellation of allotment of plot—Refund of money without interest—Complaint dismissed by State Commission—Complainants are consumers of KDA/OP—Auction process never concluded due to faults of KDA/OP—Overall it was deficiency in service from KDA who retained complainants’ huge amount for more that 423 days and refunded the same to complainants without interest—Complainants have accepted refund of principal amount under protest because interest was neither paid nor offered at the time of refund—These are unconscionable contracts—Builder exercise his right to charge penalty or interest at 18-24% on delayed payment of installments—In interest of natural justice consumers at large deserve to receive same interest from opposite parties in cases of fault or deficiency—Complainants are entitled for interest as per the rate of post office saving account on their deposit of total amount—Simple interest @ 5% will be just and proper in instant case. (Paras 9 to 14)
Result: Appeal allowed.
Dr. S.M. Kantikar, Member—This first appeal has been filed under Section 19 of the Consumer Protection Act, 1986 against the order dated 26.3.2015 passed in complaint case No. 25 of 2007 by U. P. State Consumer Disputes Redressal Commission, Lucknow (in short, ‘the State Commission’) whereby the State Commission dismissed the complaint.
2. The brief facts relevant for the disposal of the appeal are, that in response to the advertisement issued by OP in 2005 for the sale of plots by auction, the complainants applied for a plot with a condition precedent to deposit Rs. 11 lakh, as registration fees. The complainants were successful bidders and a plot was allotted to them vide letter dated 20.8.2005. They were informed that remaining ¾ of the premium was to be paid in four quarterly installments alongwith 15% interest. The complainants made total payment of Rs. 1,53,62,528/-. Before handing over the possession of the plot due to temporary injunction from Civil Court, Kanpur, the OP cancelled the orders of allotments. The complainants thereafter filed Writ Petition No. 27893 of 2006 before Allahabad High Court wherein the High Court by order dated 23.5.2006 directed the OP/authority to decide the refund application filed by complainants. Accordingly, the OP refunded their entire deposited amount of Rs.1,53,62,528/- vide cheque dated 28.10.2006 as per rules but no interest on the deposited amount was paid. Being aggrieved by the non-payment of interest, the appellants/complainants filed a consumer complaint before Uttar Pradesh State Commission, Lucknow and claimed Rs.32,49,174/- as interest amount which accrued on the principal amount alongwith Rs.10 lakhs as damages and Rs.25,000/- as cost of litigation.
3. In the initial round of litigation, after admission of the complaint, the OP was served on 21.12.2006 but no one appeared on behalf of OP. Therefore, the State Commission proceeded ex parte and allowed the complaint vide order date 14.10.2011. The same order was challenged by the OP before this Commission (NCDRC) through appeal No. 42 of 2012. It was dismissed. Being aggrieved, the OP approached Hon’ble Supreme Court by way of an appeal and vide order dated 24.8.2012, the Hon’ble Supreme Court remanded back the matter to this Commission to decide the matter on merits and also about the issue whether the OP was served by State Commission or not. On 10.09.2014, this Commission (NCDRC) remanded back the matter to the State Commission for fresh adjudication.
4. Thereafter, the OPs filed written statement and took preliminary objections that the auction purchasers are not consumers, which has already been settled by various decisions of NCDRC. Therefore, the complainants were not consumers. The OPs submitted that before giving possession of the plot to the complainant, the Civil Court of Kanpur issued temporary injunction for the sale of plot in question. It was immediately conveyed by the OP to the auction purchasers/complainants. Therefore, on the same ground, the orders of allotment were cancelled by the OP/authority. In compliance of the order dated 23.5.2006 of Hon’ble High Court, the OP refunded the entire deposit amount of Rs.1,53,62,528/- on 28.10.2006, as per their rules.
5. The State Commission vide its impugned order on 26.3.2015 dismissed the complaint. Hence, aggrieved by the said impugned order, the complainant filed this instant appeal.
6. We have heard the learned counsel for the parties. Learned counsel for the appellants/complainants submitted that complainants’ huge money was lying with OPs for 423 days, which the OPs have utilized for their purpose. Thus, the complainants deserve to get interest on the said amount, which was deposited by the complainants. As the OP/authority was aware that the delivery of possession of the plot was not possible, under such circumstances, the OP would have refunded the deposited amount immediately.
7. Learned counsel for the complainants further submitted that the complainants a
