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Important judgements passed by the Consumer Courts


Bihar State Housing Board penalised for unilaterally cancelling allotted house

National Consumer Disputes Redressal Commission , New Delhi
(First Appeal Nos. 294/93 & 330/95)

O R D E R

Dr. (Mrs.) R. Thamarajakshi, Member

The above two cross appeals are against the order dated 2-4-1993 of the State Consumer Disputes Redressal Commission, Bihar in case No. 52 of 1991.The Complainant, Shri Prio Ranjan Roy was allotted House No.3K 43 (with an area 0.077 acre) under the Low Income Group Housing (LIG) Scheme in Mohalla Bariyatu, Ranchi Town on 28-3-66 by an order of the Government of Bihar and an agreement was registered between the Complainant and the Government of Bihar on 1-8-66. Tentative price of the house was fixed at Rs. 14,000/- at that time. Thereafter, the District Development Officer, Ranchi wrote to the Executive Engineer, Housing Department, Ranchi directing him to hand over possession of the said house to the Complainant. In the meanwhile, the Complainant paid the first instalment of Rs. 3,000/- as stipulated and also subsequent instalments on several dates aggregating to Rs. 2,260/- but possession of the allotted house was not given to him and instead, it was allotted to one Smt. Ishwari Devi. On 2-2-1969, another order was issued allotting house no.3K 91 to the Complainant which according to him was in a most dilapidated condition and was not worthy of habitation and he, therefore, laid down certain conditions for taking this house in lieu of the originally allotted house No.3K 43. Though according to the Complainant almost all conditions were accepted by the Board, possession of house No.3K 91 also was not given to him. The Bihar State Housing Board which was constituted in 1972 after taking over all the assets and liabilities of the Housing Department of the State Government in respect of allotment of plots/houses took a decision to allot house No.3K 91 to Smt. Sumitra Devi, a Minister in the State Government. As a result, no house was given to the Complainant even though he satisfied all the preconditions. The Complainant alleged before the State Commission that because of this, he had been put to difficulty with regard to residential accommodation after his retirement in 1984, that he had paid Rs. 57,500.50 till the date of the complaint (7-10-91) as rent for hired accommodation and that the landlord of the house had filed an eviction suit in the Court of Munsif Magistrate, Ranchi and for increase in monthly rent amounting to Rs. 5,000/- per month. In view of these difficulties, the Complainant prayed before the State Commission the following reliefs: a compensation of Rs. 6,25,000/- for the harassment caused to him, a sum of Rs. 57,500/- paid by him as rent and refund of Rs. 5,300/- paid by him to the Housing Board along with interest @18%. In their version before the State Commission, the Board made the following points: (i) The State Government which had originally allotted the house in favour of the Complainant had not been made a party (ii) The dispute is not maintainable under theConsumer Protection Act as the Board is not carrying on any business of house properties and it is a statutory body constituted for making available plots and houses to people (iii) The matter of alternative allotment to be made in favour of the Complainant was still pending before the Board.

The State Commission took note of the fact that in the version of the Board, the facts as contended by the Complainant in his complaint which was duly supported by an affidavit filed by him have not been disputed and reference to various orders and letters have been said to be matters "on record." Since the Housing Board took over all the liabilities and assets from the Government, the Commission held that it was not necessary to implead the Government as a party. On the question of jurisdiction, the Commission relied on the findings of the National Commission in UP Avas Evam Vikas Parishad Vs Garima Shukla & others (1991) Consumer Cases 151 and held the Complaint is maintainable. Regarding the matter of alternative allotment, the State Commission pointed out that it gave a number of opportunities to the Board to finalise the pending matter, but the Board kept on postponing the matter time and again.

The Commission observed that the matter had been pending with the Board for about 27 years although the Board had ample opportunities to redress the genuine grievance of the Complainant. The State Commission concluded that the Housing Board had been negligent, even callous in the matter and there was deficiency of service. The Commission, therefore, directed that the Complainant be compensated within a period of three months of their order by (i) allotment and handing over possession of another house similar to 3K 43 (ii) payment by the Board of the rental paid by him after retirement (iii) refund of Rs. 5,260/- he had deposited to the Board on various dates for house no. 3K 43 along with interest @18% per annum from the date of deposit to the date of refund and (iv) payment of Rs. 50,000/- for the tribulations and anxieties due to the delay in making the accommodation available to him.

In their Appeal (FA No.294/93), the Board have stated that there are no 3K type houses available and that they had offered to the Complainant through their letter dated 5-2-93 an alternative allotment of house No.LS-1 in Harmu Housing Colony in Ranchi which according to the Board is the best possible alternative house available with them under LIG category at Ranchi. The Board have reiterated that they function on no loss no profit basis and there is no provision under their statute to award the rental amount and compensation for delay. According to the Board, the scheme of construction, allotment and possession of houses is such that there is bound to be delay on some account or the other and if on account of delay, the Board has to pay compensation, it would not only be difficult but absolutely impossi-ble for the Board to function and do its primary duty of construction of houses. In his version, the Respondent - Complainant has contended that the house LS-1 made available by the Board at Harmu Housing Colony is not at all similar to house No.3K 43 at Bariyatu for the following reasons: (i) It is situated by the side of Harmu Burning Ghat (ii) it is in a polluted atmosphere (iii) it is far away say 10 to 15 Kms. from Bariyatu (iv) it is not a three roomed house but has only two rooms (v) it contains less area of land and (vi) it is a half-portion of a twin house whereas the Bariyatu house is an independent house.

The Appellant - Board filed a rejoinder to this counter affidavit of the Respondent. However, the submissions are at variance with those before the State Commission as also in their Appeal. It is mentioned in the Rejoinder that the agreement registered with the Complainant on 1-8-66 for house 3K 43 was terminated by the Department and was allotted to Smt. Ishwari Devi with whom an agreement was also executed. The Board have put the blame on the Complainant that he did not make any complaint at that time and came with a belated petition before the Consumer Forum in 1991 and have pointed out that the Complainant could not get house 3K 91 allotted on 2-2-69 because he failed to complete all the formalities required under the terms and conditions of the allotment letter for getting the agreement executed and registered. It has been made out that the Complainant was at fault in pointing out the defects without taking possession of the house. This was, however, not the case of the Board before the State Commission. The State Commission's order has clearly pointed out that the possession of the house duly allotted in favour of Shri Roy in 1966 was not given to him in spite of the registration of the deed and in spite of Shri Roy fulfilling all the conditions enforced in the terms and conditions of the allotment. Similarly in respect of the second house which was allotted to him in lieu of the first one, the State Commission has observed that possession of the same was also not given to him even though specifically ordered to be done so after the house was made habitable.

As for the Cross Appeal filed by the Complainant (FA No.330/95), there is a delay in the same which has been explained by the Appellant - Complainant as due to the non-receipt of the certified copy of the judgment of the State Commission in time. A copy of the order was stated to have been received only on 3-9-93 along with the Memo of the FA No. 294/93 filed by the Board after which the Complainant preferred his appeal. In the circumstances, the delay is condoned. In his Appeal, the Complainant has prayed that (i) the rental should be awarded from the date of agreement i.e. 1966 and not just from the date of his retirement (ii) allotment order issued for house No.3K 91 in favour of Smt. Sumitra Devi, is illegal and liable to be set aside as she, as a Minister, admittedly does not belong to LIG and (iii) whatever, rent is finally passed as fair rent from March, 1991 after his appeal against a rent Court's decree obtained by the landlord for enhancement of rent from Rs. 200/- per month to Rs. 2,150/- per month be paid to him. Subsequent to this appeal, a synopsis and chrono- logy was filed by the Complainant wherein he has prayed that the house allotted to the Minister be cancelled and possession directed to be given to him failing which the Board be directed to pay as damages equal to the present day value of the house which amounts to Rs. eleven lakhs thirty five thousand, in addition to other reliefs.

We have heard counsel on both sides and carefully gone through the available records. The argument of the Board that since they are functioning on no loss no profit basis, it is difficult for them to pay compensation for such cases of delay which according to them are normal procedural delays in the scheme of their functioning, is just indefensible. That the public authorities rendering housing services under different enactments are covered under the jurisdiction of the Consumer Protection Act is settled, after the judgement of the Supreme Court on Lucknow Development Authority Vs. M.K. Gupta (1986-95 Consumer 278).

The original prayer of the Complainant before the State Commission was for compensation of Rs. 6.25 lakhs for harassment besides relief for rent paid by him and refund of money deposited by him with the Board. The State Commission ordered compensation in terms of allotment of a house similar to 3K 43 besides payment of rent and refund of deposits and compensation as detailed in their order. However, the Board has not been able to comply with this order. It now emerges that the Board is not having a house similar to 3K 43 or 3K 91. The alternative house offered by the Board LS-1 was not acceptable to the Complainant for reasons given by him. We are convinced that the Board has treated the Complainant in a most casual manner; the possession of the house duly allotted to the Complainant was not handed over to him but given to some other person, not once but twice. Having regard to the default and unjustifiable delay and harassment caused by the Board and in the light of facts and circumstances of the case, we are of the view that payment of a total compensation of Rs. 7.00 lakhs to the Complainant by the Board along with refund of Rs. 5,260/- deposited by him to the Board on various dates as per terms of allotment of house 3K 43 would meet the ends of justice. We, therefore, direct the Appellant-Board to pay the Respondent - Complainant within a period of three months of the date of the receipt of the copy of this order a sum of Rs. 7.00 lakhs as compensation and refund to the Complainant a sum of Rs. 5,260/- paid by him to the Board with interest @18% from the date of deposit to the date of refund. The Appellant - Board shall also pay Rs. 5000/- as costs to the Complainant. The order of the State Commission is accordingly modified and the Appeals are disposed of as above.

Sd/-................................. J 
(V.Balakrishna Eradi) President
Sd/-................................. J
(B.S.Yadav) Member
Sd/-................................. J
(S.S.Chadha) Member
Sd/-.................................. 
(Dr. (Smt.) R.Thamarajakshi) Member
Sd/-..................................
(S.P.Bagla) Member


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