Decided on October 28,2010

ABDUL REHMAN Respondents


- (1.) COMPLAINT filed under Section 17 of the Consumer Protection Act, 1986 .
(2.) THE case of the complainant is as follows: On 22.3.1997, the complainant approached the 1st opposite party, Abdul Rehman for the purpose of constructing a commercial building and thereby the complainant availed the service of the 1st opposite party for construction of a commercial building. An agreement for construction of the building was entered into between the complainant and the 1st opposite party on 22.3.1997. As per the terms of the said agreement, construction of the building was to be completed within a period of 12 months. Time was an essence of the said agreement. The plinth area of the said building was 12185 sq.ft. and that the 1st opposite party agreed to construct the said building at the rate of Rs. 287 per sq.ft. An advance amount of Rs. 5 lakh was paid to the 1st opposite party on 22.3.1997 and the balance amount was to be paid in instalments as the work progresses. The 1st opposite party did not complete construction of the building as agreed. Construction of the building could not be completed due to the negligence and deficiency of service on the part of the 1st opposite part.Thereafter at the request of the 1st opposite party, the 2nd opposite party, Ibrahim was also made a party to the agreement. The 2nd opposite party is the brother of the 1st opposite party. On additional/supplemental agreement was also executed between the complainant and the opposite parties 1 and 2. The said agreement was executed on 13.7.1998. In the modified agreement it was admitted that the construction could not be completed due to the fault of the 1st opposite party. The negligence on the part of the 1st opposite party has been admitted in the said modified agreement. As per the terms of the modified agreement, the 2nd opposite party was also made responsible for construction work along with the 1st opposite party. Time was made an essence of the said contract and the construction was to be completed by 11.7.1999. The 2nd opposite party was made responsible for the advance amount accepted by the 1st opposite party. The opposite parties commenced the construction work and they accepted a total of Rs. 15,66,542.50 by way of 12 instalments. They also acknowledged receipt of the said amount. But the opposite parties failed to complete the construction of the building on or before 11.7.1999. They could not even complete 25% of the construction work and that the opposite parties abandoned the work. The opposite parties have done the work in an unscientific manner. On examination of the work it could be understood that the work was done in an unscientific manner and the strength of the structure was weak. The opposite parties used poor quality materials for the construction work. Shortage of cement in mortar was also caused cracks, shrinkage etc. The floor and roof slabs are also seen leaking at several places. The value of construction so far done is estimated to be Rs. 7 lakh only. As the present structure is weak, further construction is possible only if the present structure is strengthened. The cost of strengthening the present structure would come to Rs. 3 lakh. The failure of the opposite parties to construct the building properly and to complete the construction within the agreed time amounts to deficiency of service and unfair trade practice on their part. The cost of building materials, labour charges, etc. have been escalated. The complainant will have to spend additional amount to complete the construction by incurring substantial amount. Therefore the complainant claimed refund of the excess amount of Rs. 8,66,542.50 collected by the opposite parties with interest at the rate of 18% per annum from 11.7.1999 till the date of realization. The complainant has also claimed Rs. 3 lakh for strengthening the existing structure with compensation of Rs. 2 lakh towards the escalation of cost of materials and labour charges. The complainant has also claimed Rs.2 lakh as compensation for deficiency in service and unfair trade practice adopted by opposite parties and Rs. 10,000 towards the cost of the proceedings.
(3.) OPPOSITE parties 1 and 2 entered appearance and filed a joint written version contending as follows: The joint written version was filed by the opposite parties through their power of attorney holder Yousuf Ali: The complaint is not maintainable either in law or on facts. The complainant is not a consumer. The disputes involved in the complaint are not covered by the provisions of the Consumer Protection Act. The allegations in the complaint required elaborate and voluminous evidence and the disputes cannot be adjudicated in a summary proceedings as contemplated in the Consumer Protection Act. The subject matter is purely of a civil nature. The allegation in the complaint is arising out of a civil contract stated to be entered into between the parties herein and consequent breach of contract. The complainant has to resort to civil remedy by approaching a competent Civil Court. The allegations in the complaint require intervention of engineeringexperts. As such this Hon'ble Commission cannot entertain the present complaint. The terms of the contract entered into between the parties do not confer a contract of service. There is no hiring of service and, therefore, question of deficiency of service does not arise at all. The maintainability of the complaint is a primary question to be considered in this case. The complainant entered into a contract based on a tender/bidding for construction of a multi -storeyed commercial complex having an area of around 14,000 sq.ft. The rates quoted had no bearing with the market rate /local rates and the complainant was making unlawful enrichment. There was laxity in making payments and no payments were made in time. Delay in construction was caused due to the delay inpayment by the complainant. The payments were made in piecemeal. Costs of materials were shooted up. The complainant and his engineers, architects and site engineers were present always. Work was carried out under their strict direction and supervision. The building was designed by the complainant. There were lot of defects in the design. Execution of work was delayed due to the defects in design and site conditions. Defects in design also caused additional extra works. There was variance in contract, design and execution. The 3 engineers who were assisting the complainant for execution of the work had never co -operated. The complainant's father was supervising the work. There was substantial change in design/ work after the agreement. Payments were made only after execution of work, that too inordinately delayed. No advance amount was lying in the hands of the opposite parties. More than Rs. 8,26,000 is due to the opposite parties for the work carried Out including extra works. Materials worth Rs. 72,000 was lying unused in the site at the time of stoppage of work. The opposite parties could not continue the work due to the delay in payments and also due to non co -operation of the complainant. There was change in the ratio of reinforced cement. The number and size of steel rods were increased. Proportion of reinforced cement was also changed. There are about 74 columns. Hence, there was substantial difference and consequent extra work. The area of the building was also increased. The area was water logged; substantial amount was spent for bailing out water. The complainant later found that there are no prospective buyers for the commercial complex and thereby the complainant was delaying payment on one pretext or another. The steep increase in price of materials and wages were not met with by the complainant. The payment for increased price was not honoured. In the circumstances, the opposite parties were compelled to stop the work with notice. Time was not the essence of the contract due to variance in design. Opposite parties were employed in the Middle East. They are not engaged in the construction business. Complainant and his father invited bids for carrying out construction of commercial complex. The 1st opposite party also submitted tender. The tender submitted by the 1st opposite party was accepted. After negotiations, finally the contract work was awarded to the 1st opposite party. Tender documents are with the complainant. The 1st opposite party had not executed many works as contractor. It is not true to say that the service was availed of. The agreement for construction of building was executed. Unilateral terms were agreed on the understanding that complainant will bear the cost of extra work or excessive work. There was understanding that payment will be made in advance. The site conditions were different from what was demonstrated. The approved plan, lay out and design were changed later, considering the site conditions. Complainant is deliberately suppressing these facts. The contract between the complainant and the opposite parties was a pure bidding contract, extension of time was permissible, new contract was entered into, the initial payment of Rs. 5 lakh used as mobilization advance. No amount was paid during the next 15 months. The non -completion/progress of work during the first year was totally on the negligence of complainant and his father. New contract was entered into altering/varying the terms. New contract was entered into only at the instance of the complainant as he wanted the 2nd opposite party also to be made responsible for completion of work. The agreement was drafted by the complainant and his father. The terms were framed unilaterally by the complainant, his father and advisors. Opposite parties were compelled to enter into the agreement. The recitals in the agreement were made by the complainant deliberately and intentionally to trap the opposite parties. The payment of money in lump sum was not honoured. The complainant ignored the demand of the opposite parties for payments. Only Rs. 15,59,000 was paid during the period as against the actual cost of work of Rs. 22,13,392 and extra work of Rs.1,71,000. The complainant is liable to pay an amount of Rs. 8,26,000 towards the cost of work with the cost of materials amounting to Rs. 72,000. Complainant has made unlawful gain and enrichment. Appointment of an expert engineer in the presence of opposite parties would reveal these facts. The opposite parties carry out the work as per design/changed design and strict supervision of the complainant, his engineers and designers. No single brick was laid without the concurrence and approval. The entire materials/men were under scrutiny by the complainant and his engineers. The observation that the structure was weak is absolutely false and denied. Everything was done scientifically as per design, specification and supervision of the complainant and his engineers. In any new construction, there could be little wetting on slabs and the same can be rectified at no cost by pouring grout. The complainant has not suffered any financial loss or mental agony. Completion of construction at the rate of Rs. 287 per sq.ft. is impossible. There is no deficiency of service or unfair trade practice as alleged. Delay in completion of work is not caused due to negligence of opposite parties. The complainant is not entitled to get any compensation from the opposite parties. On the other hand, the opposite parties are entitled to Rs. 8,98,000 from the complainant. Thus, the opposite parties prayed for dismissal of the complaint with cost of Rs. 10,000. During the pendency of the complaint in OP 140/2000, the 1st opposite party Abdul Rehman died and his legal representatives are impleaded as additional opposite parties 3 to 6 vide order in I.A. 628/02 dated 28.2.2004. But the additional opposite parties 3 to 6 remained absent throughout the proceedings.;

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