ORDER

J.M. Malik, Presiding Member - The present petition has been filed by Jeevan Bima Nagar Flat Owners Welfare Association. The members of the above said Welfare Association were the policy holders of the L.I.C. during October, 1993. The L.I.C., the opposite party in this case advertised in newspapers for the sale of single, double and three bedrooms residential flats construction in an area of 12.5 acres at Jeevan Bima Nagar Anna Nagar Western Extension, Madras. The salient features of the advertisement were these:

"(i) 800 Flats (single, double and three bedrooms) with price ranging from 3.3 to 6.6 lakh.

(ii) The flats are located in 12.5 acres of land with well laid out roads and other amenities.

(iii) Provision being made for locating a community centre, Public Telephone, with S.T.D. facilities, milk booth, clinic-cum-pharmacy and other similar basic facilities within easy reach all within the complex.

(iv) Constructions supervised by a team of highly experienced and qualified Engineers of L.I.C."

It was also mentioned that 40 flats were reserved for non-residents Indians and 40 more flats were reserved for the employees of the Tamilnadu Government and Tamilnadu Housing Board. The receipt of the application with earnest money deposit was from 8.11.1993 to 15.12.1993. In the brochure, it was stated that flats will have all the basic civil and social amenities. It was also stated that the flats were likely to be ready for the allotment and occupation in about three months time. The allottees were to mobilize the full purchase price of the flats ranging from Rs. 3.3 lakh to Rs. 6.5 lakh within a period of six months from the date of allotment. They were also to mobilize additional amount ranging from Rs. 40,000 to Rs. 80,000 as stamp duty.

Various defaults/deficiencies

2. It is alleged that LIC defaulted from the beginning as per Clause V(9) in page 9 of the brochure issued, the LIC should have sold and handed over the possession of all the 800 flats before 30.4.1994. The draw for the flats were made only on the first week of February, 1994. The first sale deed in favour of the allottees was executed only on 15.9.1994 by LIC. The possession was handed over to the allottees during third week of September, 1994 onwards. Consequently, those allottees who had paid the full purchase price between March, 1994 and September, 1994 suffered a huge financial loss due to failure of LIC to adhere the time schedule issued in the brochure.

3. The allottees were shocked to know that the underground water available in the entire complex of 12.5 acres was unfit for any domestic use. The allottees had to arrange for potable water and were forced to purchase water through private tankers for their daily needs thereby incurring huge monthly expenditure.

4. The entire complex of 12.5 acres had wild plants and bushes grown in the common areas and open space reserved in the complex which were heaven for wild creatures, dangerous creatures such as poisonous reptiles, rodents, scorpions. The LIC did not clear the jungle and rubbish surrounding the complex till 8.3.1995. Rs. 12 lakh were allotted for greening the complex. The wild plants and bushes were cleared only in March, 1995. The waste construction material rubbish were not removed. Open space of 12.5 acres earmarked for playground, park and other recreation facilities were not provided. The association had also spent around Rs. 20,000 for levelling three space reserved. Due to lack of approach roads, the allottees faced problems to enter or go out from the complex. Due to total lack of basic amenities, social amenities and lack of approach roads, 240 flats remained unsold. The LIC was forced to advertise for the second time during April, 1995 for the sale of flats. At the time of filing of this complaint, 64 flats were yet to be sold.

5. Again, it was found that construction of the blocks and flats was substandard, defective, deficient in several ways and bad for habitation. In all the above said 800