Case: Chief Administrator Huda  Vs. Shakuntla Devi

He also submitted that cogent material was placed before the State Commission to prove the escalation in the cost of construction between 1989 and 2000.10. The avowed object of the Consumer Protection Act, 1986 is to provide for better protection of the interest of consumers. The statement of the objects and reasons, inter alia, provides for a speedy and simple redressal to consumer disputes. The quasi judicial bodies at the District, State and Central levels were empowered to give relief to the consumers and award, wherever appropriate, compensation to consumers.11. Section 14 (1) (d) of the Act which is relevant for the adjudication of the dispute in this case is as follows:"14. Finding of the District Forum.-(1) If, after the proceeding conducted under section 13, the District Forum is satisfied that the goods complained against suffer from any of the defects specified in the complaint or that any of the allegations contained in the complaint about the services are proved, it shall issue an order to the opposite party directing him to do one or more of the following things, namely:.......(d)to pay such amount as may be awarded by it as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party."12. The sine qua non for entitlement of compensation is proof of loss or injury suffered by the consumer due to the negligence of the opposite party. Once the said conditions are satisfied, the Consumer Forum would have to decide the quantum of compensation to which the consumer is entitled. There cannot be any dispute that the computation of compensation has to be fair, reasonable and commensurate to the loss or injury. There is a duty cast on the Consumer Forum to take into account all relevant factors for arriving at the compensation to be paid.13. In Charan Singh v. Healing Touch Hospital and Others, reported in (2000) 7 SCC 668 , this Court held as follows:"12. ..... Indeed, calculation of damages depends on the facts and circumstances of each case. No hard and fast rule can be laid down for universal application. While awarding compensation, a Consumer Forum has to take into account all relevant factors and assess compensation on the basis of accepted legal principles, on moderation. It is for the Consumer Forum to grant compensation to the extent it finds it reasonable, fair and proper in the facts and circumstances of a given case according to the established judicial standards where the claimant is able to establish his charge."In Ghaziabad Development Authority v. Balbir Singh, reported in 2004(3) R.C.R (Civil) 658 : (2004) 4 SCC 65, this Court was considering the compensation to be awarded to the consumers in cases of deficiency of service by Development Authorities like the Appellant herein and Ghaziabad Development Authority. Considering a situation similar to the one that arises in the instant case, it was held as follows:"9.That compensation cannot be uniform and can best be illustrated by considering cases where possession is being directed to be delivered and cases where only monies are directed to be returned. In cases where possession is being directed to be delivered the compensation for harassment will necessarily have to be less because in a way that party is being compensated by increase in the value of the property he is getting.*** *** ***11.Further, in cases where the Commission/Forum has directed delivery of possession, the party has to a certain extent already got a benefit. The cost of the land/flat would have gone up in the meantime. Of course, even in cases, where delivery of possession has been directed there could be compensation for the harassment/ loss. But such compensation has to be worked out after looking into the facts of each case and after determining what is the amount of harassment/loss which has been caused to the consumer."14. It is undisputed that the Appellant handed over the plot to the Respondent only in the year 2000 instead of 1989. The Respondent had paid Rs. 1,22,400/- towards the cost of the plot at the rates prevailing in the year of allotment i.e. 1986. There is no dispute that the Respondent was paid Rs. 1,28,188/- towards interest awarded by the State Commission. There is also no dispute about the fact that the Respondent did not commence construction till 2006. The State Commission while awarding the compensation of Rs. 15 lakhs towards escalation in the cost of construction commented on the conduct of the Respondent in delaying the construction only with a view to claim higher compensation.15. The point that falls for our consideration in this case is whether the State Commission was justified in awarding Rs. 15 lakhs towards the escalation in the cost of construction as compensation. We are of the view that the Respondent is not entitled to such compensation awarded by the State Commission and confirmed by the National Commission. The Respondent suffered an injury due to the delay in handing over the possession as there was definitely escalation in the cost of construction. At the same time the Respondent has surely benefited by the increase in the cost of plot between 1989 to 2000. In our opinion, the order of the State Commission is vitiated for non application of mind to a vital and relevant factor and hence, suffers from the vice of unreasonableness. The State Commission criticized the conduct of the Respondent in intentionally delaying the construction for 6 years but still proceeded to award compensation. In the facts and circumstances of this case, we are of the opinion that award of interest would have been sufficient to compensate the Respondent for the loss suffered by him due to the delay in handing over the possession of the plot. The compensation of Rs. 15 lakhs awarded by the State Commission is excessive. As we have not reversed the impugned order on any other ground, it is not necessary for us to delve into other points that were urged by the Respondent.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]14. It is undisputed that the Appellant handed over the plot to the Respondent only in the year 2000 instead of 1989. The Respondent had paid Rs. 1,22,400/towards the cost of the plot at the rates prevailing in the year of allotment i.e. 1986. There is no dispute that the Respondent was paid Rs. 1,28,188/towards interest awarded by the State Commission. There is also no dispute about the fact that the Respondent did not commence construction till 2006. The State Commission while awarding the compensation of Rs. 15 lakhs towards escalation in the cost of construction commented on the conduct of the Respondent in delaying the construction only with a view to claim higher compensation.15.The point that falls for our consideration in this case is whether the State Commission was justified in awarding Rs. 15 lakhs towards the escalation in the cost of construction as compensation.We are of the view that the Respondent is not entitled to such compensation awarded by the State Commission and confirmed by the National Commission. The Respondent suffered an injury due to the delay in handing over the possession as there was definitely escalation in the cost of construction. At the same time the Respondent has surely benefited by the increase in the cost of plot between 1989 to 2000. In our opinion, the order of the State Commission is vitiated for non application of mind to a vital and relevant factor and hence, suffers from the vice of unreasonableness. The State Commission criticized the conduct of the Respondent in intentionally delaying the construction for 6 years but still proceeded to award compensation. In the facts and circumstances of this case, we are of the opinion that award of interest would have been sufficient to compensate the Respondent for the loss suffered by him due to the delay in handing over the possession of the plot. The compensation of Rs. 15 lakhs awarded by the State Commission is excessive. As we have not reversed the impugned order on any other ground, it is not necessary for us to delve into other points that were urged by the Respondent.