(Uday Umesh Lalit, S. Ravindra Bhat and Pamidighantam Sri Narasimha, JJ.)
Consumer Welfare Association and Others ____________ Appellant(s);
v.
Secretary, Mulund Radheyshyam CHS Ltd. and Another ______________________________________________ Respondent(s).
Civil Appeal No. 2670 of 2022 (Arising out of SLP (C) No(s). 12212/2020), decided on April 1, 2022
The Order of the court was delivered by
Order
1. Leave granted.
2. This appeal challenges the judgment and order dated 14-02-2020 passed by the National Consumers Disputes Redressal Commission, (‘the National Commission’ for short) New Delhi in Revision Petition No. 998/2018.
3. The instant proceedings arise out of Complaint No. 162 of 2010 filed by the appellants before the Consumer Disputes Redressal Forum {‘the Consumer Forum’, for short), Mumbai Suburban District, Mumbai submitting inter alia:
(a) Plot No. 11/D-5 was originally allotted by Mukund Radheyshyam Cooperative Housing Society (‘the Society’ for short) to Ms. Jean Marceline Fernandes who sold her interest in favour of Shakti Subhash Sawant, appellant No. 2 herein. Plot No. 11/D-6 was originally allotted by the Society to one Vijay Ramchandra Koyande who later sold his interest in favour of Shri Vidnyan S. Sawant, appellant No. 3 herein.
(b) Appropriate orders were thereafter passed by the Maharashtra Housing and Area Development Authority (‘MHADA’ for short) on 08.05.2009 accepting the transfers, whereafter the share certificates were transferred in the names of appellants 2 & 3 and entries in the records of the Society were made.
c) However, the construction work begun by the Society with respect to all the other plots was completed by the Society but the construction pertaining to said Plot Nos. 11/D-5 and 6 was abandoned without completion.
4. In the premises, the appellants sought following reliefs:—
“A. The Opponents be directed, jointly and severally, to reimburse each of the Complainants the amount of Rs. 39,000/- (Ex.C) paid to Opponents over and above the agreed price of Rs. 1,30,000/- paid for each construction on D-5 & D-6.
B. The Opponent be directed to pay to the Complainants 2 & 3, Rs. 1,59,000/- & Rs. 1,54,575/- respectively, being the cost of completing the construction on D-5 & D-6 as per MHADA approved plans (Ex.B) which the Opponents left incomplete (55% & 60% Ex.E).
C. The Opponents be directed to pay compensation of Rs. 10,000/- to each Complainant for the harassment, frustration, inconvenience, mental anxiety and loss incurred in failing to complete the construction and denying the Complainants possession since April 2006 for construction on D-5 and from April 2007 for D-6 (2 years (2 years from the date first instalments were made for respective constructions.”
5. In the written version filed by the Society, it was submitted inter alia that there was no privity between the Society and the appellants 2 and 3 and therefore no action under the Consumer Protection law could be maintained against the Society.
6. Paragraphs 5 & 6 of the written version were as under:
“5. As regards averment in para No. 4 of the complaint the Opponent denies in toto that the complainants were informed the construction of the house as Plot No. 11, D-5 and D-6 (as per MHADA approved plan) would cost Rs. 1,30,000/- i.e. Rs. 3250 per sq. mtr and that the possession on completion would be given on or before April 2006 and 2007 i.e. within 2 years from commencing from 1st installment payment and put the complaints in strict proof thereof. The society never received any application either for NOC or for transfer and the society has not passed any resolution for admitting the complainants as members. The complainants have been creating law and order problem in the society premises and therefore a report to Navghar Police Station has been made about harassment by the Complaint. (Hereto marked and annexed as Annexure WS 6 is the copy of the report made by Opposite Party No. 1). The real fact is that the agreed cost for the full construction was Rupees 1,95,000/- (Rs. One Lakhs Ninety Five Thousand Only) for each of the Core House.
6. With reference to averment made in Para No. 5 of the complaint, the Opponent draws kind attention to the contents of the Bank Statement and receipts at Exhibit B and Exhibit C of the complaint. Contents of the receipts are self explanatory. The Opponent No. 1 disputes about the payment schedule shown by complainants in para 5. The real fact is that the Opponents have received Rs. 2,50,000/- (Rs. Two Lakhs Fifty Thousand Only) from complainants for construction work of all the core Houses i.e. D-5 and D-6 where the payments were partly received as per the contract from complainants and the amount of Rs. 4,000/- (Rupees Four Thousand Only) for fixing of one common electric meter for D-5 and D-6 and the amount of Rs. 6000/- (Rupees Six Thousand only) on account of extra Labour Charges and Material Costs were paid by complainant to opponents/opposite parties. Thus the, present complaint filed by the complainant against these opponent/opposite parties making allegations that the opponents/opposite parties have received an amount of Rs. 3,38,000/- is totally false and baseless and is denied by opponent No. 1.”
7. Similar objections were raised on behalf of the builder/developer namely, M/s. S.S. Constructions.
8. The Consumer Forum vide its order dated 28.11.2014, accepted the submissions made by the Society/builder/developer and concluded that appellants 2 & 3 could not be said to be consumers and as such could not maintain any action before the Consumer Forum.
9. In the course of its order, following observations were made by the Consumer Forum:
“14. As mentioned above, disputed plot number 11/D-5 and 11/D-6 has been distributed to Jane Fernandez and Vijay Ramchandra Koyande, the members of opponent no. 1 and it is proved from the above mentioned documents that they only have made payments to opponent no. 2 for the construction work on the said plot from time to time. And have always remain the members of opponent no. 1. Even though Complainant have produced above said agreements. There is no evidence in the records to prove that the disputed plot was transferred to them they have become members of the opponent no. 1. Though complainants have paid some amount to the opponent no. 1, there is no evidence suggesting that opponent no. 1 has given membership to the complaints are issued share certificate to them. Considering all the facts, forum has come to a conclusion that complainants are not “consumer” of opponents. Hence, the answer to issue number 1 is reported as negative.
Explanation point number 2 & 3
15. Since complainant number 2 & 3 not consumer of the opponents there is no question of offering them service by opponents or providing inappropriate service. Complainants Alice the opponents of incomplete construction of the disputed plot and its inappropriate construction work, in order to prove that they produced the report given by the architect D. Santosh and associate on record. Thus it is the opinion of the forum that even if this is considered as an argument, since the complainants cannot become “consumer” of the opponents they are not eligible for the justice they have short for. Hence, the answer to issue no. 2 and 3 is being reported as negative and the final decision is as follows.
Final order
1. Report number 162/2010 is rejected.
2. Both the parties have to bear their expenses.
3. Free copy of this order shall be sent to both the parties.”
10. The appellants being aggrieved, preferred appeal being A/15/177 before the State Consumer Disputes Redressal Commission Commission (‘the State Commission’ for short). The State Commission affirmed the view taken by the District Forum and observed as under:
“In our view, therefore, it is essential for the complainants to prove their prima facie legal title before the competent Civil Court. Once they establish their such legal title, they shall be at liberty to claim right as consumers, if they are so advised, on the ground that they are members of the Co-operaive Housing Society mentioned as Mulund Radheshyam CHS Ltd. We however direct that respondent no. 1-Mulund Radheshyam CHS Ltd. Shall not create any third party interest in respect of plot nos. D-05 and D-06, until the complainants-Smt. Shakti S. Sawant and Shri Vidnyan S. Sawant approach the competent Civil Court and obtain necessary relief on the basis of prima facie case, which they want to plead in their favour on the basis of payments made to Ms. Jean Marceline Fernandes and Mr. Vijay Ramchandra Koyande respectively. We therefore dispose of this appeal with liberty to the complainants-Smt. Shakti S. Sawant and Shri Vidnyan S. Sawant to approach the competent Civil Court so that they can establish their legal title as against opponent no. 1- Mulund Radheshyam CHS Ltd. and as against their predecessor in title Ms. Jean Marceline Fernandes and Mr. Vijay Ramchandra Koyande respectively. We make it clear that we have not entertained this appeal as against dismissal of the complaint for the aforesaid reasons.”
11. The matter was then carried further by the appellants by filing a Revision Petition No. 998 of 2014 before the National Commission. The National Commission was of the view that the appellants 2 & 3 could not be said to be consumers and that the appellants would be well advised to knock the doors of a civil court to establish their legal rights to the plots in question.
12. Appearing for the appellants, Ms. Amita Singh Kalkal, learned Advocate invited our attention to orders dated 08.05.2009 in terms of which, transfers from the erstwhile members of the society in favour of appellants 2 and 3 were accepted and acknowledged by MHADA and to the fact that the share certificates were therefore transferred in the names of appellants 2 & 3. She also relied upon the averments in the Complaint that the funds to the tune of Rs. 1,69,000/- were made over in respect of Plot Nos. 11/D-5 & 6 for the purposes of construction.
13. Mr. Atul B. Dakha, learned Advocate appearing for the Society reiterated the submissions which found favour with the authorities and submitted that there was no privity with the Society. It was however, accepted that Jane Fernandez and Vijay Ramchandra Koyande were members of the Society. As regards letters dated 08.05.2009 issued by MHADA, Mr. Dhakha submitted that they were wrongly issued by MHADA and that the Society was forced to accept transfer of shares in the names of appellants 2 & 3.
14. Even going by the written version filed on behalf of the Society, some part of the payments were definitely received by the Society. When the shares were transferred from the erstwhile members in favour of appellants 2 & 3, after orders from the Competent Authority, namely, MHADA and appropriate entries in the record regarding transfer of shares in the names of appellants 2 & 3 were made, it was incorrect on part of the authorities to conclude that the appellants were not members of the Society and could not maintain any action under the Consumer Forum.
15. In the circumstances, we set aside the view taken by the authorities below and hold that the appellants are consumers and were entitled to maintain an action before the Consumer Forum and that there is privity between the appellants 2 & 3 and the Society.
16. However, no relief at this juncture can be granted in favour of the appellants as the matter was never dealt with on merits. While setting aside the orders passed by the National Commission and the State Commission, we, therefore restore the appeal before the State Commission with a direction to dispose of the matter on merits in light of the observations made in this order.
17. The parties are at liberty to place any material by way of additional evidence in accordance with law and the State Commission shall consider the matter purely on its own merits and see if the claim made by the appellants is to be accepted or not.
18. Since the action was initiated in way back in 2010, we direct the State Commission to dispose of the appeal as early as possible and preferably within six months. For facility, the parties shall appear before the State Commission on 22.04.2022.
19. With these observations, the appeal is allowed. No costs.
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