TaxTMI 
TaxTMI 
2007 (5) TMI 565
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.... 17.7.1982 for allotment of 250 flats/houses under the said scheme, that is, 15 'HIG' Houses, 110 'MIG' units and 125 'LIG' units. BDA registered the request for allotment of 15 HIG Houses, vide confirmation letter dated 20.8.1984. This appeal relates to delay in delivery of 11 HIG houses at R.M.V. Extension, Bangalore. 4. BDA had initially fixed the tentative price of a HIG house as Rs.2,85,000/-. The price was revised to Rs.4.75 lakhs per unit (Rs.5.5 lakhs in respect of corner units). By letter dated 22.08.1985, BDA informed the respondent about the revision of price of HIG Houses from Rs.2.85 lakhs to 4.75 lakhs per unit. BDA also indicated the total amount due in respect of 15 HIG Houses and required the Respondent to pay the said amount in installments as shown in the Annexure thereto. BDA also informed the Respondent that the units would be ready for occupation in December, 1986. As respondent did not pay the installments, BDA sent a letter dated 20.10.1986 demanding payment. By letter dated 27.5.1987, BDA informed Respondent that 15 Houses (including three corner houses) had been allotted to Respondent on 16.1.1987 and furnished the numbers of the houses allotted. 5. ....
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....ate varying from 16.5% to 24.25% P.A. compounded quarterly); c) Payment of Rs. 16.5 lakhs as reimbursement of the rent paid by the Respondent for 11 houses at the rate of Rs.3,000/- per house per month from 01.01.1987 to 31.12.1994 (Note : Though for 96 months the amount works out Rs.31,68,000/-, claim was restricted to Rs.16.5 lakhs which is the rent for 11 houses for 50 months); d) Payment of Rs.25,00,000/- as compensation for mental agony and harassment; e) Payment of future interest at 19.5% P.A. on Rs. 53,00,000/- plus Rs.33,000/- per month by way of reimbursement of the rent, from 01.01.1995 till delivery of possession 8. BDA resisted the claim both on the question of maintainability, as also merits. In brief, the contentions were : a) It was not a service provider nor a seller of goods and the respondent was not a 'consumer' and therefore the complaint under the Act was not maintainable. b) The contract did not stipulate any period for completion and delivery. Being a building contract, time was not the essence of the contract. The project related to construction of 558 HIG Houses. 490 houses were completed during 1989. The contractor - M/s. Khoday Engineer....
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....m the expiry of two years after the deposit of last installment of Rs.53 lakhs up to date of handing over the possession. The said order is challenged in this appeal. The principles 10. Where a Development Authority forms layouts and allots plots/flats (or houses) by inviting applications, the following general principles regulate the granting of relief to a consumer (applicant for allotment) who complains of delay in delivery or non-delivery and seeks redressal under the Consumer Protection Act, 1986 ('Act' for short) - [vide : Lucknow Development Authority vs. M. K. Gupta - 1994 (1) SCC 243, Ghaziabad Development Authority vs. Balbir Singh - 2004 (5) SCC 65, and Haryana Development Authority vs. Darsh Kumar - 2005 (9) SCC 449, as also Ghaziabad Development Authority vs. Union of India - 2000 (6) SCC 113]: (a) Where the development authority having received the full price, does not deliver possession of the allotted plot/flat/house within the time stipulated or within a reasonable time, or where the allotment is cancelled or possession is refused without any justifiable cause, the allottee is entitled for refund of the amount paid, with reasonable interest thereon from th....
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....etermination of price on completion of the project (that is acquisition proceedings and development activities), the Development Authority will be entitled to revise or increase the price. But where the allotment is at a fixed price, and a higher price or extra payments are illegally or unjustifiably demanded and collected, the allottee will be entitled to refund of such excess with such interest, as may be determined with reference to the facts of the case. (g) Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment and mental agony, in addition to appropriate direction for execution and delivery of title deed. (h) Where the allotment relates to a flat/house and construction is incomplete or not in accordance with the agreed specifications, when it is delivered, the allottee will be entitled to compensation equivalent to the cost of completing the building or rectifying the defects. (i) The quantum of compensation to be awarded, if it is to be awarded, will depend on the facts of each case, nature of harassment, the period of harassment and the nature of arb....
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....s. There is no basis for the finding that BDA had agreed to deliver the houses by December, 1986 or the finding that no reason was shown for the delay in delivery. The allotment of 15 HIG Houses identified by House numbers was only by resolution dated 16.1.1987 and communicated to Respondent on 27.5.1987. The payment was only on 15.5.1989. Delivery could not, therefore, obviously be by the end of December, 1986. If reasonable period for construction is to be reckoned as two years (as assumed by the Commission), then the question of delay would arise only after 15.5.1991. The Commission also assumed that mere delay automatically meant deficiency in service and in all such cases, the allottee will be entitled to interest at 18% per annum from the date of payment till date of delivery by relying on its decision in HUDA vs. Darsh Kumar. The decision of the Commission in HUDA vs. Darsh Kumar was held to be unsustainable by this Court, on appeal in HUDA vs. Darsh Kumar [2005 (9) SCC 449]. This Court held that there cannot be uniform award of interest at 18% per annum in all cases and that in cases of complaints of deficiency in service by a development authority relating to allotment of ....
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....ot produce any document to show that it paid Rs.3,000/- per month per house for similar houses between 1991 and 1997. Nor did it produce any evidence to show that Rs.3000/- was the prevailing rent for similar houses. It is not the case of the Respondent that documentary evidence for payment of rent was not available. Where documentary evidence was available, but not produced, obviously a mere statement in the affidavit cannot be the basis for award of damages. 16. The more serious issue is whether the facts and circumstances warrant a finding of negligence and deficiency in service on the part of BDA necessitating award of compensation. The brochure relating to the BDA scheme did not mention any specific date for delivery of possession of the houses. No agreement was entered into between the parties stipulating any time for performance or delivery of houses. The only document on which reliance is placed by the respondent is a letter dated 22.8.1985 wherein BDA makes a reference to the expected date of completion of construction while intimating the revised cost of the HIG houses on account of escalation etc. The said letter stated that the total cost of 15 HIG houses would be Rs....
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....ously in view of the manifold increase in the value of the Houses. For the first time, by notice dated 11.7.1994, it purported to make the time the essence, but demanded delivery within an unreasonable period of one month and filed the complaint on 4.2.1995. Thus, it cannot be said that the Respondent made time the essence of contract, in a manner recognized in law. We also find that the development authority was constructing these houses under a self- financing scheme on 'No-Profit No-Loss basis' by using the installments/amounts paid by the allottees. The houses were delivered in 1997 at a price agreed in 1986. By 1997, the value had gone up many times (more than 10 times according to BDA). The Respondent had the benefit of such rise in value. The respondent also failed to prove any negligence on the part of BDA. In this factual background, we find it difficult to hold that there was 'deficiency in service' on the part of BDA entitling the respondent for any compensation by way of interest or otherwise. Consequently, the respondent is not entitled to any compensation. 18. We may also note that the respondent had also written letters dated 27.12.2005 and 25.1.2006 during the pe....