M/S. SRIJA CONSTRUCT... v. 1. SRI T. SRINIVAS, ...

Respondents/complainants Counsel for the Appellant M/s V.Srinivas Counsel for the Respondent M/s S.M.Deshmukh QUORUM: SRI R.LAKSHMINARASIMHA RAO, HON'BLE MEMBER

AND

SRI THOTA ASHOK KUMAR, HON'BLE MEMBER

MONDAY THE FIRST DAY OF JULY

TWO THOUSAND THIRTEEN

Oral Order (As per Sri R.Lakshminarasimha Rao, Hon'ble Member) ***

1. The opposite party is the appellant. The respondents filed complaint claiming an amount of `4,10,000/- towards loss of rent and a sum of`10,24,000/- as compensation for delay caused in construction of the building as also a sum of `20,000/- towards compensation for suffering mental tension.

2. The case of the respondents as seen from the complaint is that the respondent no.1 is the owner of house bearing number 1-68 in Plot No.38 admeasuring 280 sq.yards and the respondent no.2 is the owner of house bearing number 1-67 in plot number 37 situate at Kothapet village of Saroornagar Mandal, Ranga Reddy district . Smt.Vimala Devi is the owner of plot bearing number 36 adjacent to the plots of the respondents. The respondents and Vimala Devi entered into Development Agreement with the appellant for development of land and construction of building thereon within 18 months from the date of development agreement. In case of delay caused in completing construction of building, the appellant agreed to pay an amount of `4/- per sqft per month for total built up area including common area.

3. The respondents submit that during the course of construction of the building , they requested the appellant to do certain extra work and as demanded by the appellant they paid a sum of `1,00,000/-. The appellant refused to pay the amount for the period of delay caused in completion of the construction of the building and as such the respondents refused to execute sale deeds for the flats that fell to the share of the appellant and the appellant got issued notice dated 4.06.2009 demanding for payment of damages. The respondents issued reply .The appellant began to collect rent of the flats that fell to the share of the respondents. HUDA had taken land meaning 10" in width from the land of Vimala Devi for the purpose of widening of road as a result of which actual assessment is reduced from 319 sq.yards to 273 sq.yards. As such, the respondents claimed amount for deficit area.

4. The appellant remained exparte.

2

5. The respondent no.2 filed his affidavit and the documents, Exs.A1 to A12.

6. The District Forum allowed the complaint on the premise that the appellant caused delay in construction of the building in violation of the terms of the Development Agreement and the appellant illegally collected rent from the tenants of the flats that fell to the share of the respondents.

7. The opposite party has filed appeal contending that the respondents had taken possession of the flats that fell to their share and the appellant sold the flats that fell to its share. It is contended that the respondents have to pay the appellant 26.1% of the expenditure incurred by the appellant towards erection of electrical transformer, elevator etc. The respondents have to pay the amount for extra work carried out by the appellant. The appellant left the space on the four sides of the building keeping in view of bye laws of GHMC to ensure maximum benefit to the respondent no.1 and 2 and Vimala Devi . It is contended that the respondents have to pay proportionate charges in respect of maintenance of the building. It is contended that the respondents had filed O.P.No. 818 of 2010 seeking for injunction under Section 9 of Arbitration Act on the file of Special Judge for SC/ST cases -cum-Addl.District Judge, Ranga Reddy.

8. The learned counsel for the respondents has filed written submissions.

9. The points for consideration are:

i) Whether the complaint is maintainable in view of the respondents filing OPNo.818 of 2010 under the proceedings of Arbitration Act?

ii) Whether the appellant is liable to pay the amount sought for by the respondents?

iii) To what relief?

10. POINT NO.1: There is no dispute between the parties about the ownership of the respondents and Vimala Devi over the land and their entering into Development Agreement with the appellant on 26.10.2006 for development of the land and construction of building over it. The respondents claimed compensation on the premise that the appellant had not completed construction of the building within 18 months as per the terms of the agreement and they further claimed certain sum contending that the appellant collected rent in respect of the flats that fell to their share. The appellant who was proceeded exparte before the District Forum submitted that the respondents filed OPNo.828 of 2010 under provisions of Arbitration Act and as such the complaint is not maintainable.

11. As seen from the grounds of appeal, the respondents filed O.P.No. 828 of 2010 on the file of Special Judge for SC/ST cases -cum-Addl .District Judge, Ranga Reddy seeking for injunction under Section 9 of Arbitration Act. Hon'ble Supreme Court considered maintainability of complaint in the

3

circumstances where arbitration proceedings are not initiated prior to filing of complaint in 'National Seed Corporation vs Madusudan Reddy' 2012 (2) SCC 506. It was held :

" The remedy of arbitration is not the only remedy available to a grower. Rather, it is an option remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Protection Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the consumer Protection Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking section 8 of the Arbitration and conciliation Act, 1996 Act. Moreover, the plain language of section 3 of the Consumer Protection Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force."

12. In the case on hand, the respondents have already invoked proceedings under Arbitration Act by filing O.P.No. 828 of 2010 on the file of the Court of Special Judge for SC/ST-cum-Additional District Judge, Ranga Reddy. Thereafter, the respondents had chosen to file complaint before the District Forum. As the appellant did not participate in the proceedings, the District Forum has no opportunity to know about the pendency of the OP filed under Section 9 of the Arbitration Act. Had the respondents filed complaint before initiating arbitration proceedings, in view of law laid in National Seed Corporation (supra) they could file the complaint which, however, they had not done. As such the complaint is not maintainable and is liable to be returned. .

13. In the result, the appeal is disposed of setting aside the order of the District Forum. The respondents are at liberty to approach appropriate and competent court/Forum. In the event the respondents approach the court/forum, the period spent between the filing of the claim before the District Forum and the disposal of the matter today by us will be excluded under Section 14 of the Limitation Act, 1963 in the light of the decision of the Hon'ble Supreme Court in "Trai Foods Ltd vs National Insurance Company Ltd and others" reported in III (2012) CPJ 17".

MEMBER

MEMBER

4

Dt.01.07.2013 ..*

[HONABLE MRS. M.SHREESHA]

PRESIDING MEMBER

[HONABLE MR. S. BHUJANGA RAO]

MEMBER

5