A construction agreement failure coupled with dishonoured refund cheques constitutes a deficiency in service under the Consumer Protection Act, 1986, entitling the consumer to a refund with interest and compensation, regardless of pending proceedings under the Negotiable Instruments Act.

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Order :

HON’BLE SMT. MEENA RAMANATHAN - PRESIDING OFFICER,

MEMBER (NON-JUDICIAL)

1. This is a complaint filed by the complainant U/s.17(1) (a) (i) of the Consumer Protection Act, 1986 praying this Commission to direct the Opposite Party:

(i) to pay the amount of Rs.14,27,600/- together with interest at the rate of 18% per annum.

(ii) to award Rs.5,00,000/- as compensation towards mental agony suffered by the complainant.

(iii) to award damages of Rs.39,35,000/- towards loss of accommodation in the locality of the project.

(iv) to award costs and

(v) to grant any other relief or reliefs as this Commission may deem fit and proper in the circumstances of the case.

2. (a) The brief facts of the case: The complainant submits that the opposite party is represented by their Managing Director, Sri Chennamaneni Srinivas Rao and that they are the absolute owners and possessor of land admeasuring Ac.21.06 gts in Sy.No.’s 168, 169, 170, 171, 172, 198 and 199, situated at Venkatapur, H/o Korremula Village, Ghatkesar Mandal, Ranga Reddy District. It was proposed that the opposite party would construct a huge residential complex over the said land by obtaining permission and approvals from the concerned department. It was also represented by the opposite party that they have vast experience in construction of multi-storied residential and commercial apartments.

(b) Basing on the advertisement, the complainant evinced interest to purchase one flat in the 4th or 5th floor (North East Corner), with a super built up area of 1600 sq. ft., including common area and balcony in the residential complex by name “Avalon Courts”. It was included under undivided share of land, admeasuring 50 sq. yards. The purchase was for a total sale consideration of Rs.16,65,000/-. Basing on the offer and acceptance, the complainant paid an advance of Rs.8,30,000/- on different dates and agreed to pay remaining balance at the time of execution of registration of sale deed. The opposite party acknowledged the receipt of the said amount and executed a Memorandum of Understanding (MOU) cum Agreement of Sale on 26.10.2013. After receipt of the advance amount and execution of MOU, the opposite party has delayed the construction and informed the complainant that the delay was due to grant of building permission from concerned authorities. Thereafter, both parties entered into a fresh agreement of sale by taking back the original MOU and this agreement of sale was entered on 22.01.2016.

(c) In terms of the said agreement of sale, the opposite party agreed to convey the flat in Block No.19, in 2nd floor, admeasuring 1387 sq. feet along with undivided share of land admeasuring 40 sq. yards. As there is difference with respect to plinth area to be conveyed with respect to MOU, dated 26.10.2013 and agreement of sale dated 22.01.2016, the opposite party informed the complainant that cost of the flat comes to Rs.12,39,000/-. Therefore, after adjusting the amount paid by the complainant he was to pay the balance of Rs.4,09,000/-, at the time of registration. Despite entering into a fresh agreement of sale, the opposite party failed to commence construction. As there is no construction activity going on, the complainant informed the opposite party that he is going to initiate legal action, however, on their request that they would return the advance amount along with interest at 18% per annum from 17.10.2013, the complainant was asked not to initiate legal proceedings.

(c) The opposite party issued four cheques for a