KRISHNA D SINGH Vs. PAVAN T PUNJABI

JUDGEMENT

(1.) BOTH these appeals are cross appeals arising against the one and same order of the District Forum Thane being dated 7-8-99. The appellant in the first appeal is original complainant and respondent original O. P. where as the position is reverse in the second appeal, that is to say, O. P. is appellant and complainant is respondent. We are proceeding to dispose of these appeals at the stage of their admission itself on perusal of the material available in the appeal paper book and on hearing the learned Advocates for both the parties, with a common judgment. At the outset it needs to be stated that the complainant has filed the appeal being not satisfied with the quantum of compensation and other monitory benefits awarded by the District Forum where as the O. P. has filed the appeal with grievance that the monitory part of the award of the District forum is exorbitant. Few relevant facts-The party hereinafter are referred to as Flat purchaser and Builder i. e. to say appellant in the first appeal is referred to as "flat purchaser" and respondent as "builder". The flat purchaser filed the complaint against the Builder alleging deficiency on the part of the Builder. There are various deficiencies alleged including demand of more amount than agreed, not handing over possession etc. Main grievance of the flat purchaser pertains to non delivery of the possession of the flat. In the complaint the flat purchaser claimed possession of the flat as also compensation against the Builder. It is noticed that the Builder appeared in response to the show cause notice issued by the District Forum and fact that there was a deal between the flat purchaser and the Builder, whereby the flat purchaser had agreed to purchase a flat and the Builder having agreed to sell the same for consideration as also schedule of payment and delivery schedule etc. , all these facts which are otherwise documented are not in dispute. According to the complainant agreed consideration was Rs. 3,43,977/- and which he paid from time to the Builder and payment of entire consideration was completed in the year 1996. The Builder was to hand over the possession of the flat to the flat purchaser by September, 1994. As the possession was not given, that the purchaser approached the district Forum. The Builder appeared in response to the show cause notice and opposed the claim, inter alia raising several points on several accounts. However, the fact remains that the Builder did not deny the fact of non delivery of possession of flat as also receipt of consideration except that some amount which the complainant claimed to have paid in cash for which no receipts was issued by the Builder. The Builder put up plea, he having sold the flat earmarked for the flat purchaser/complainant to one Mr. Sunil Khanna in September, 1997 and reliance was placed to the alleged M. O. U. executed between the Builder and the said Mr. Sunil Khanna. The District Forum which probed the rival contention of the parties and plea put forth herein above, proceeded to award in the first instance ordering the Builders to hand over possession of the flat agreed to be sold to the flat purchaser. In the alternative the District Forum ordered the Builder to pay to the flat purchaser a sum of Rs. 7,00,000/- as compensation, worked out and rounded up by calculating interest at 18% p. a. on the amount of consideration paid by the flat purchaser Rs. 1,00,000/- for mental agony, Rs. 5,000/-as cost and interest etc. As stated the said award has been challenged by both the parties. Across, the learned Advocate for flat purchaser submitted that the transaction dates back to the year 1993-94 and it is nearly now 10 years that this appeal is being taken up for hearing. On behalf of flat purchaser it is asserted that the District Forum has passed the award in the year 1999 and compensation of Rs. 7,00,000/- as awarded was not fair, since by then the marked value of the flat of the size which the flat purchaser had agreed to purchase had gone much higher and if the flat purchaser wanted to have equivalent the flat acquired, it will require much more amount. This is bone of contention as far as flat purchaser is concerned. On behalf of the Builder, it was submitted that the complaint filed was not maintainable as it exceeded pecuniary limit of District Forum. Reference is made to the operative Clause 2 of the order where the District Forum has proceeded to award compensation of Rs. 7,00,000/- when, at the relevant time its pecuniary limit of jurisdiction was upto Rs. 5 lakhs. We have considered the submissions made across and also material placed before us. By and large we find the order of the District Forum impugned in this appeal which is elaborate running into as many as 25 pages as fair and to some extent reasonable except on the aspect which we propose to thrash out in the judgment herein. The fact that possession was not made over by the Builder to the flat purchaser despite receipt of consideration was noted by the District Forum and on basis thereof has rightly held Builders being deficient in rendering services to the flat purchaser. The fact that the Builder has received the consideration to the extent as claimed by the complainant is also not in dispute. That being so, non delivery of possession despite receipt of agreed consideration and thereafter withholding the same by the Builder without delivery of possession will certainly constitute deficiency in service within the meaning of section 2 (l) (g) of Consumer Protection Act, 1986, and the findings rendered by the District Forum to that extent have to be upheld. Now the question comes about precise relief to the granted and whether those granted by the District Forum are reasonable in the fact situation in the matter as obtained herein. As far as grant of possession is concerned, as done by the District Forum, we are of the view that same is just, fair and reasonable which is legitimate entitlement of the complainant/flat purchaser, so we are upholding the award to that extent. For failure and or non delivery of the possession of flat, the District forum has awarded a sum of Rs. 7,00,000/ -. We do not find the requisite data having been made available by the complainant which would have facilitated the District Forum or for that matter to us to assess the compensation. We make reference to the recent judgement of Supreme Court in the case of (Charan Singh v. Healing Touch Hospital and others), reported in the 2001 (1) (S. C.)323 : 2000 (7) S. C. C. 688, in which the Supreme Court has held that the consumer Fora functioning under Consumer Protection Act, 1986, have to settle the claims for damages and compensation by applying well settled principles of law. The said judgment further lays down that principles of assessment of damages, compensation etc. as provided under section 73 of Indian Contract Act have to be applied. It postulates that the party claiming damages, compensation etc. have to furnish particulars duly substantiated by cogent and acceptable evidence. This is not the position in the case herein. Across the learned Advocate for complainant submitted that the market price of the flat in question when the District Forum disposed of the complaint should be taken as criteria. But even in that respect there is no material made available. However, all said and done, since deficiency against the O. Ps. /builders stands established, as provided under section 14 (l) (d) of Consumer Protection Act, 1986, the award of damages for the loss suffered as also compensation to the injury suffered, would require to be granted. Considering the conduct of the Builder/o. P. that he had proceeded to dispose of the flat earmarked for the complainant herein as is asserted, when there were contractual as well as statutory obligation hanging on him vis a vis flat purchaser/complainant, in our view it is a serious matter. Therefore, while assessing the compensation and damages, we think it appropriate to make reference to our judgment in Appeal Nos. 584/98, 592/98, 594/98 and 595/98 in the case of (M/s. Paranjpe Construction Co. v. Nilesh ram Marathe and others), decided on 20th June, 2001 reported in 2001 (3)All M. R. (Journal) 1, in which the parties to the dispute were flat purchaser and Builder and on surveying and reviewing the legal position as also judicial pronouncements on the point we have proceeded to pass award in favour of flat purchaser in the first instance, ordering the Builder to refund the amount received by him from the flat purchaser and pay interest at higher rate of interest than provided under section 8 of Flat Ownership Act, 1963. The award of compensation of higher rate of interest was taken as an element of compensating flat purchaser who had suffered at the hands of the Builder being deficient in services. Although in the said Paranjape's case (supra) we have awarded interest at the rate of 15% p. a. on the amount of consideration paid, considering the conduct of the Builder, in the case herein, which is gross, we think it appropriate that interest at the rate of 18% p. a. will be fair and reasonable on the amount of consideration which the flat purchaser/complainant had paid and such payment shall be from the dates of respective payments as will be indicated in the operative clause of the order. Further more, taking into consideration that this matter is dragging on since long and considering the conduct of the O. P. /builder, we are also ordering payment of Rs. 1,00,000/- as compensation for mental agony suffered by the complainant. Order of cost of Rs. 5,000/- as awarded stands confirmed. Builder/o. P shall pay cost in the appeal to the complainant quantified to Rs. 3,000/ -. Further, before concluding, we thrash out one point put forth with vehemence by and on behalf of the Builder. The same is that the District forum which entertained the complainant and passed the Award impugned in these appeals, did not possess jurisdiction to do so. It is urged, by referring to the monetary claims made by the complainant/flat purchaser in his complaint, that the same exceeded the pecuniary limits of its jurisdiction, which is to its pecuniary jurisdiction and in fact the Forum has also awarded the same vide impugned order. It is however to be stated and which fact is not in dispute that agreed consideration of the fact in question is Rs. 3,43,977/ -. That being so, in view of the settled position of Law in this respect, the same is to be considered as the value of the claim in the complaint and as such determinable factor for the purpose of its pecuniary jurisdiction of any Forum. Further, the dispute is filed under Consumer Protection Act, 1986, in the Forum established and set up under the said Act, which is otherwise maintainable and as such entertainable, since, as provided under section 2 (l) (o) of the said Act, in the definition of 'housing Construction' is included and that deficiency in the case herein, as defined under section 2 (1) (g) of the said Act, as noticed above stands clearly established. We think it also necessary to elaborate this aspect viz. determination of issue of pecuniary jurisdiction, with details, as we came across cases wherein the District Forums in the State fall into error in accepting the plea as raised in this matter on behalf of O. P.-Builder and declining to entertain Consumer disputes on that plea, which eventually results in causing inconveniences and hardship to the consumers. We advert to the settled position of the law on the point. Prior to 2002 amendment to Consumer Protection Act, 1986, pecuniary limit it of jurisdiction of District Forum, under section 11 of the said Act was Rs. 5,00,000/ -. In this case, the subject matter of the dispute is the flat which the complainant has agreed to purchase from the O. P. , in respect of which the flat purchaser has alleged deficiency in service on the part of the Builder, and of which agreed consideration fixed is Rs. 3,43,977/ -. It would, therefore, be legitimate to value the claim in the complaint for the purpose of pecuniary jurisdiction of the Forum for Rs. 3,43,977/ -. The complainant has claimed interest at 18% p. a. on the said amount as also compensation and has quantified the same, which has exceeded pecuniary limit of the District Forum. The Forum has granted reliefs to the complainant/flat purchaser on the basis of such quantification. It is to be stated that the jurisdiction of Forum has to be determined on the basis of the value of the subject matter of the dispute and not by the result of the decree or award. For the purpose of valuation of a dispute, reliefs claimed have to be considered in the context of averments in the complaint/suit. The rule is that a suit shall be instituted in the Court of lowest grade competent to try the suit and Court/forum can pass a decree for an amount in excess of its pecuniary jurisdiction, which excessiveness in the result of such benefits arising on the basis of valuation of the subject matter. That being so, we reiterate, jurisdiction shall be determined by the valuation in complaint and not by the result of the decree. Usefully we may refer to the recent decisions of the National Commission lending support to our above view. The decisions in question are (1) (Vijay Shankarv. Mandeep Singh, National Commission and others), reported in 2003 (II) C. P. J. 170 (June 03 Issue) and (2) (Shahbad Co-operative Sugar Mills v. National Insurance Co. Ltd. and others), reported in 2003 C. T. J. Page 453 (N. C.) (June 2003 issue) taking the same view as we have done. In the first case, (supra) the complainant claimed further loss and in the second case (supra) the complainant claimed interest as is the case in hand. ORDER appeal No. 1789/99 stands allowed with modification as under-1. Order of the District Forum for handing over possession of flat as per first operative clause of the order stands confirmed.

(2.) O. PS. are jointly and severally ordered and directed to pay interest@ 18% p. a. on sum of Rs. 3,43,977/- with effect from the dates of various payments as indicated herein below till realisation- <FRM>JUDGEMENT_551_BCR1_2004Html1.htm</FRM>

(3.) O. P. /builder shall jointly and severally refund a sum of Rs. 26,700/- to the complainant recovered towards Stamp duty.