Order to arrest officers of builder for failing to hand over flat...

Order to arrest officers of builder for failing to hand over flat or make refunds upheld

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In a recent order passed by the National Consumer Disputes Redressal Commission New Delhi, in the case of Nitishree Infrastructure Ltd. v. Inderdeep Singh [Appeal Execution No. 28 of 2016, decided on 05.10.2016], the Commission upheld the order passed by the Punjab State Consumer Disputes Redressal Commission to arrest officers of a Construction company for failing to hand over flat or make refunds.

The facts of the case are that in Consumer Complaint No. 43/2014 filed by the complainants against the builder, it was alleged that the complainants had booked a flat with the builders, but despite deposit of a substantial sum of money with them as per the terms and conditions of the agreement, they were not able to hand over the possession of the flat, even after the lapse of grace period of three months. It was requested that the builders should be directed to refund an amount of Rs. 23,92,243/- as principal and Rs. 3,96,295/- as interest @ 24% per annum compounded quarterly upto 31.12.2013, alongwith some other amounts as liquidated damages and compensation. The said consumer complaint was decided by the State Commission vide order dated 23.04.2015, vide which, the complaint was partly allowed against the builders and they were directed to refund the sum of Rs. 23,92,243/- alongwith interest @ 12% per annum from the date of payment till realisation. They were also directed to pay Rs. 25,000/- as cost of litigation.

Thereafter, an execution application was filed before the State Commission, which has been decided vide impugned order dated 27.07.2016, in which it was stated that the proclamation was duly published against P.C Mishra, Director and Bimal Garg, General Manager of the builder Company, under Section 82 Cr.P.C., in spite of which they did not remain present. They were accordingly declared as “Proclaimed Offenders”. Accordingly, the notice regarding these persons, having been declared “Proclaimed Offenders”, was directed to be published in “The Tribune” newspaper on the deposit of the publication charges. It was further directed that the file may accordingly be put up after the arrest of those two persons, so as to take proceedings against them under Section 27 of the Consumer Protection Act, 1986.

It is pertinent to point out that on behalf of the builders, a miscellaneous application was earlier before the State Commission stating that they should be allowed to settle the entire amount awarded against them by way of allotment of flat, equivalent to the value of the amount awarded, or they should be allowed to pay the decree amount in monthly instalments of Rs. 50,000/- each, till payment of the entire amount. However, this miscellaneous application was ordered to be dismissed by the State Commission since the offer so made in the application was not acceptable to the complainants.

The National Commission, on appeal, held that it was clear from the facts of the case that in case the builders wanted to make an alternative offer, they could have challenged the order dated 23.04.2015, passed by the State Commission, but they chose not to do so. Since the order dated 23.04.2015 has already become final, the miscellaneous application could not have been allowed.

In respect of the execution application, the National Commission noted that the State Commission stated that in spite of the proclamation published against the Director and General Manager of the builder Company under Section 82 Cr. P.C, they did not remain present and hence, were declared as Proclaimed Offenders. The said persons could not offer any satisfactory explanation as to why they did not present themselves before the State Commission. It was held by the National Commission that under the Consumer Protection Act, the compliance of the order passed by the consumer fora is made by following procedure under Section 25 or Section 27 of the said Act and it is not for the Judgement Debtor to choose, which manner of execution is to be followed. It was the duty of the Judgment Debtor, therefore, to put in appearance before the State Commission and state their viewpoint before them. In view of these reasons, the National Consumer Disputes Redressal Commission dismissed the appeal and upheld the order passed by the State Commission.

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