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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Dr. B.C. Gupta, Presiding Member and Dr. S.M. Kantikar, Member
M. Vittal Rao (Died) Rep. By Lrs. —Appellant
versus
M/s. Brindavan Builders Pvt. Ltd. —Respondent
First Appeal No.531 of 2003
(Against the Order dated null in Complaint No. of the State Commission Andhra Pradesh)
Decided on 1.9.2017
Counsel for the Parties:
For the Appellant:Mr. K. Maruthi Rao, Advocate
For the Respondent:Mr. C. Balaji, Advocate
IMPORTANT POINT
Development Agreement is not a joint venture and complainant is to be treated as consumer of service provider.
Headnote:Consumer Protection Act, 1986—Sections 15, 17, 19 and 21—Real estate—Development Agreement—Respondent/OP provided them flats after a delay of 2 years and that also for much reduced area—In addition, respondent/OP used building material of inferior quality and did not leave required spaces for vehicles as per agreement—Agreement between parties in such cases was not a joint venture and complainants were to be treated to be consumers of opposite party which was service provider—Both parties acknowledged that construction of proposed residential apartments at site could not be undertaken due to dispute arising out of their title—Builder had not intentionally or voluntarily refrained from proceeding with construction and there was no deficiency on their part on this count—Demand of complainants for grant of 3600 sq. ft. of built-up area to them is not justified and there is no deficiency in service on part of OP Builder on this ground as well—Complainants also failed to show before State Commission that there was an agreement to use teak wood doors and windows—Appeal dismissed. (Paras 12, 14 to 17)
Result: Appeal dismissed.
Dr. B.C. Gupta, Presiding Member—This appeal has been filed under section 19 read with section 21(a)(ii) of the Consumer Protection Act, 1986 against the impugned order dated 22.10.2002 passed by the Andhra Pradesh State Consumer Disputes Redressal Commission (hereinafter referred to as ‘the State Commission’) in Original Petition No. OP/10/97, vide which the said petition filed by the present appellants against the respondent/opposite party (OP)/builder was ordered to be dismissed.
2. Briefly stated, the facts of the case are that the three complainants M. Vittal Rao, M. Dasarath and M. Badrinath, who are real brothers, stated in their consumer complaint OP/10/1997 that they were owners of an open land measuring 640 sq. yards at Raja Dharam Karan Estate, Ameerpet, Hyderabad, upon which, a building bearing old municipal No. 239 and new No. MCH-7-1-60 had been constructed. The said property was their ancestral property, divided in equal shares among them. The complainant entered into a ‘Development Agreement’ with the respondent/OP/builder M/s. Brindivan Builders on 03.02.1991, as per which, the said builder agreed to construct a multi-storeyed building on the said premises and to provide 1200 sq. ft. built-up area to each of the complainants in the shape of three flats and retain the balance area of 6400 sq. ft. The said flats were to be provided within 8 months of the date of sanction of the municipal plan. It is alleged in the consumer complaint that the respondent/OP did not follow the terms and conditions stated in the agreement. The respondent/OP provided them flats on 17.03.1996, i.e., after a delay of 2 years and that also for much reduced area from 1200 sq. ft. In addition, the respondent/OP used building material of inferior quality and did not leave required spaces for vehicles as per the agreement. The complainants sent legal notice to the respondent/OP on 10.07.1995, demanding compensation and also for rectification for insufficient services rendered by them. Since there was no response from the OP, the complainants filed the consumer complaint in question, seeking compensation on various items including shortfall in the area of flats provided to them. In total, the complainants demanded a sum of Rs. 19,41,000/- from the respondent/OP builder as compensation.
3. The complaint was resisted by the OP builder by filing a written statement before the State Commission in which they stated that the complainants were not consumers as defined in the Act, as they had entered into a development agreement with the OP Builder. The complaint was, therefore, not maintainable before the State Commission. The OP Builder further stated that the delay in handing over the possession occurred due to proceedings pending in the courts. The development agreement was signed with them by 5 persons which included two wives of late Miryala Danaiah and 3 sons of the said person who are the present complainants. They claimed that they were the only legal heirs and absolute owners of the scheduled property. However, there were other legal heirs to the property of late Miryala Danaiah to whom the Builder had to pay various sums from time to time. The complainants had, therefore, concealed facts about the legal heirs from the OP Builder and hence, caused loss of time and loss of money to the Developer. The OP Builder further stated that the possession of the property in question was to be handed over by the complainants to the OP builder on the date of agreement itself, i.e., 03.02.1991, but the said possession was handed over after a delay of 7 months. The OP further stated that as per the schedule, the area of the property was to be 640 sq. yds. However, the complainants themselves mentioned in their counter reply submitted to the First Additional Judge Citi Civil Court and also in the legal notice issued to the developer dated 24.01.1994 that the area of the land was only 560 sq. yd. In fact, the complainants had encroached upon some lan
