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2009(2) Supreme 650
SUPREME COURT OF INDIA
R.V. Raveendran and Markandey Katju, JJ.
U.T. Chandigarh Administration & Anr. — Appellants
versus
Amarjeet Singh & Ors. — Respondents
Civil Appeal No. 1994 of 2006 and Civil Appeal No. 1995 of 2006, CA No. 1633/2009 @ SLP [C] No.25250/2007; CA No. 1634/2009 @ SLP [C] No.4518 of 2008, CA No. 1635/2009 @ SLP [C] No.4519 of 2008, CA No. 1636/2009 @ SLP [C] No.4520 of 2008, CA No. 1637/2009 @ SLP [C] No.4523 of 2008, CA No. 1638/2009 @ SLP [C] No.4525 of 2008, CA No. 1639/2009 @ SLP [C] No.6362 of 2008, CA No. 1640/2009 @ SLP [C] No. 6363 of 2008, CA No. 1641/2009 @ SLP [C] No.6364 of 2008, CA No. 1642/2009 @ SLP [C] No.6365 of 2008, CA No. 1643/2009 @ SLP [C] No.6366 of 2008, CA No. 1644/2009 @ SLP [C] No.6367 of 2008, CA No. 1645/2009 @ SLP [C] No.6368 of 2008, CA No. 1646/2009 @ SLP [C] No.6369 of 2008, CA No. 1647/2009 @ SLP [C] No. 6372 of 2008, CA No. 1648/2009 @ SLP [C] No.6373 of 2008, CA No. 1649/2009 @ SLP [C] No.6374 of 2008, CA No. 1650/2009 @ SLP [C] No.6375 of 2008, CA No. 1651/2009 @ SLP [C] No.6376 of 2008, CA No. 1652/2009 @ SLP [C] No.6377 of 2008, CA No. 1653/2009 @ SLP [C] No.6378 of 2008, CA No. 1654/2009 @ SLP [C] No.6379 of 2008, CA No. 1655/2009 @ SLP [C] No.6380 of 2008, CA No. 1656/2009 @ SLP [C] No.6381 of 2008, CA No. 1657/2009 @ SLP [C] No.6382 of 2008, CA No. 1658/2009 @ SLP [C] No.6383 of 2008, CA No. 1659/2009 @ SLP [C] No.6384 of 2008, CA No. 1660/2009 @ SLP [C] No.6385 of 2008, CA No. 1661/2009 @ SLP [C] No.15831 of 2008, and CA No. 1662/2009 @ SLP [C] No.15859 of 2008.
With
CA Nos.1674-1686/2009 [@ SLP(C) Nos.3271 to 3283 of 2008].
Decided on : 17-03-2009
(1994)1 SCC 243; (2004)5 SCC 65 – Distinguished.
(b) Consumer Protection Act, 1986 – Section 2 – In case of public auction of existing sites (as contrasted from sites to be ‘formed’), the purchaser/lessee is not a consumer – The owner is not a ‘trader’ or ‘service provider’ and the grievance does not relate to any matter in regard to which a complaint can be filed – Therefore, any grievance by the purchaser/lessee will not give rise to a complaint – Fora under the Act will not have jurisdiction to entertain or decide any complaint by the auction purchaser/lessee against the owner holding the auction of sites. (Para 14)
(c) Development Act – Sections 5 and 6 – No obligation is cast on the Authority to provide amenities to plots sold/leased by public auction. (Para 16)
(d) Leasehold Rules, 1973 – Rule 12(2) – Lessee/successful bidder cannot seek rescheduling of the instalments of premium or postponement of accrual of the interest payable as per rules. (Para 18)
(2006) 4 SCC 109 – Relied upon.
AIR 2001 P&H 309; CWP No. 13695 of 2001 – Referred.
(e) Leasehold Rules, 1973 – Rule 12(3A) – Interest – Equated installment includes interest only upto the dates stipulated as due dates – When the installments are not paid on the due dates, the lessees become liable to pay penal interest – If interest is payable, the claim therefor becomes more stronger when there is no assurance of providing any amenities etc. (Paras 19 and 20)
C.A. No. 605/2009 – Relied upon.
(f) Development Act – Section 7 – Providing amenities is not linked to auction of plots on lease basis and the premium paid is not for providing any amenity. (Para 24)
Facts of the case :
1. The Estate Officer, Union Territory Chandigarh Administration issued an advertisement notifying the auction of 74 residential sites and 71 commercial sites in different sectors of Chandigarh, on leasehold basis subject to the General Terms and Conditions regarding auction.
2. Respondents 1 to 4 were the successful bidders in regard to plot No.173 in Sector No.39C & D at the auction held on 18.12.1996. The lease premium bid offered by them was Rs.20,45,000. The acceptance of the bid cum confirmation of the lease of the plot was communicated to respondents 1 to 4 by letter dated 19.5.1997 enclosing therewith a letter offering possession of the leased site. The said letter of allotment acknowledged the receipt of Rs.511,250 towards 25% of the premium and permitted the respondents to pay the balance 75% of the premium with 10% interest thereon in 3 equated instalments of Rs.6,16,736/- on 18.12.1997, 18.12.1998 and 18.12.1999. It also required the respondents to pay annual ground rent of Rs.51125/- during the first 33 years of lease.
3. The respondents filed a complaint before the Consumer Disputes Redressal Commission, Union Territory, Chandigarh (‘UT Commission’) under the Consumer Protection Act, 1986 in the year 1999 alleging that in addition to the initial payment of Rs.511250/- towards the lease premium, they had paid Rs.616,736/- plus Rs.51,125/- on 9.1.1998, Rs.168,000/- on 4.3.1999 and Rs.200,000/- on 12.5.1999. They alleged that the appellant did not provide any amenities in regard to the site, and as a result they had suffered huge losses. They contended that until the basic amenities were provided, the appellants were not legally entitled to claim the balance of premium or the annual rent.
6. The U.T. Commission allowed the complaint by the respondents, alongwith other similar complaints, by a common order dated 31.3.2003
7. Appellants filed an appeal before the National Commission which allowed the appeal in part and modified and restricted the reliefs granted by the U.T. Commission.
Finding of the Court:
The National Commission proceeded on wrong premises.
Result : Appeal allowed.
JUDGMENT
R.V. Raveendran, J. —
Leave granted in the special leave petitions. These appeals are filed by Union Territory of Chandigarh (for short ‘UT Chandigarh’). C.A. Nos.1994 of 2006 and 1995 of 2006 are filed against a common order dated 21.2.2005 passed by the National Consumer Disputes Redressal Commission (“National Commission” for short). Other appeals are filed against the common order dated 21.2.2007 passed by the National Commission following the earlier order dated 21.2.2005. By these orders, the lease premium instalments have been rescheduled and certain reliefs have been granted in regard to interest, to the lessees - respondents (who had secured leasehold interest in sites belonging to UT Chandigarh in public auctions held by it).
FACTS OF THE CASE
2. As the facts are similar, we will refer to the facts of only one case (CA No.1994/2006 arising from FA No.499/2003 on the file of the National Commission). The Estate Officer, Union Territory Chandigarh Administration issued an advertisement notifying the auction of 74 residential sites and 71 commercial sites in different sectors of Chandigarh, on leasehold basis subject to the General Terms and Conditions regarding auction. The relevant terms were :-
(i) The auction was for grant of a lease of sites for 99 years. The auction was governed by the provisions of the Capital of Punjab (Development & Regulation) Act, 1952 (‘Development Act’ for short) and Chandigarh Leasehold Sites & Building Rules, 1973 (‘Leasehold Rules’ for short).
(ii) In addition to the premium for lease (to be offered by bids), the lessee had to pay annual rent at the rate of 2.5% of the premium for the first 33 years, liable to be raised to 3.375% of the premium for the next 33 years and 5% of the premium for the remaining 33 years;
(iii) 25% of the bid amount had to be paid by demand draft or cash at the fall of the hammer. The remaining 75% premium could be paid either in a lump sum with 30 days of the auction without any interest, or at the option of the lessee, in three equated annual instalments along with interest at 10% per annum, the first instalment becoming due on the expiry of one year from the date of auction.
(iv) If the instalments of the lease of premium or the ground rent were not paid on the due dates, interest at the rate of 24% per annum should be paid from the due date to date of payment.
(v) The successful bidder should complete the construction of the building on the plot within three years from the date of auction in accordance with the Punjab Capital (Development & Regulation) Building Rules, 1952 (‘Building Rules’ for short)
(vi) The government would not be responsible for leveling of uneven sites.
(vii) In the event of default, breach or non compliance of any of the terms and conditions of lease, the lease was liable to be cancelled and the site/building resumed and the amount paid to government towards premium/rent forfeited either wholly or in part.
(viii) The lessee was liable to pay all taxes and fees as may be levied by the Chandigarh Administration in respect of the site and the building to be constructed thereon.
3. Respondents 1 to 4 were the successful bidders in regard to plot No.173 in Sector No.39C & D at the auction held on 18.12.1996. The lease premium bid offered by them was Rs.20,45,000. The acceptance of the bid cum confirmation of the lease of the plot was communicated to respondents 1 to 4 by letter dated 19.5.1997 (for short ‘letter of allotment’) enclosing therewith a letter offering possession of the leased site. The said letter of allotment acknowledged the receipt of Rs.511,250 towards 25% of the premium and permitted the respondents to pay the balance 75% of the premium with 10% interest thereon in 3 equated instalments of Rs.6,16,736/- on 18.12.1997, 18.12.1998 and 18.12.1999. It also required the respondents to pay annual ground rent of Rs.51125/- during the first 33 years of lease. The letter of allotment set out and reiterated the terms and
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